In an unexpected move –and an unexpected show of unanimity from competitors – three of the country’s startup wireless carriers have pulled out from an industry association because it favours big cellphone companies.
Wind Mobile, Mobilicity and Public Mobile said Wednesday they have left the Canadian Wireless Telecommunications Association (CWTA) because of “long-standing, mounting frustration with the CWTA’s consistent bias in favour of Rogers, Bell and Telus on a wide variety of issues,” the trio said in a news release.
The allegation was immediately denied by the CWTA.
“When we were first approached by the CWTA, we were promised clear and fair representation on issues of true industry alignment,” said Simon Lockie, Wind’s chief regulatory officer, said in a news release “But despite making our objections and concerns abundantly clear on numerous occasions, the CWTA has repeatedly failed to honour this promise, leaving us no alternative but to withdraw.”
Bob Boron, Public Mobile’s general counsel and senior vice-president for legal affairs, said in the release that “rather than being a true industry association which represents the views of all players regardless of size, the CWTA has instead largely been an advocate for Rogers, Telus and Bell, and often directly contrary to the interests of new entrant wireless carriers.”
“We have spent the better part of three years repeatedly voicing our opposition to the CWTA on a wide range of matters to the point of issuing a press release in January 2011 that publically expressed our dissent on the CWTA’s position on wireless consumer protection,” Gary Wong, director of legal affairs for Mobilicity, said in a statement. “There seems to be a blatant disregard of the new entrants in favour of acting in the best interests of the Big Three carriers and it is unacceptable.”
WIRELESS SUBSCRIBERS 2012
Rogers Communications 9.4 million
Bell Mobility 7.5 million
Telus Corp. 7.5 million
Wind Mobile 510,000
Mobilicity, Public Mobile Unavailable
(Wind is part of a publicly traded company. Mobilicity and Public Mobile are privately-held companies and haven’t released subscriber numbers)
The departure is a blow to former New Brunswick premier Bernard Lord, who became CEO of the association in 2008.
The CWTA is the wireless industry’s lobbying group in Ottawa. It includes SaskTel and Manitoba Telecom Services (MTS). Two new carriers who haven’t left the association are Videotron and Eastlink.
However, like any association, its biggest and smallest members have widely different goals.
This is especially the case where Bell, Rogers and Telus have been vigorously fighting attempts by the startups to eat into their large market share. No one expected the big three to easily give up in the face of new competitors encouraged by Ottawa in the 2008 spectrum auction, and they haven’t.
For example, although Industry Canada obliged the incumbents to provide space on their towers for antennas from the startups, the terms have to be negotiated. Startups have complained for years that incumbents have been dragging their feet.
For telecom consultant Iain Grant of SeaBoard Group, the move by Wind, Mobilicity and Public Mobile wasn’t unexpected.
“Surprised it took them so long,” he said in an interview. The fact that the three have been in the association since 2009 is a “great testmiony to Bernard Lord’s ability to put oil on turbulent waters. But I guess straws broke the camel’s back.”
“The fact that it was dominated by incumbents was wlel-known when they first joined, but Bernard has done an excellent job of trying to smooth over the dufferences. But the differences are irreconcilable.”
In the end, Grant says, it will mean the three startups will have a stronger voice in Ottawa because they won’t be diluted “by lowest common denominator thinking.”
In an inteview Boron said there was no last straw that made the three startups decide it was time to go. Rather, it was a combination of things over the years. For example, he said, recently Lord wrote an online column for the association with viewpoints Public Mobile opposes — such as supporting the right of big carriers to offer three-year contracts, defending the roaming charges subscribers have to pay and claiming carriers are effectively using their spectrum.
The startups have urged Ottawa to block big carriers from offering three-year contracts, complain of the roaming deals they’re pressured to enter into with incumbents and allege the big carriers are hoarding spectrum.
“On issues that were important to the incuments the CWTA was very vocal and proactive,” Boron said, “and on issues that were important to the new entrant competitors thy have been at best silent, if not contrarty to those interests.”
In a news release issued within minutes of the announcement from the startups the CWTA said their withdrawal “is an unfortunate and surprising announcement.”
“These carriers have been valued members of CWTA and have fully participated on the CWTA board of directors and CWTA committees since joining the association and continued to do so up until the announcement this morning. CWTA rejects the accusation that the association represents the interests of only certain members. CWTA has always and will continue to work on behalf of all of its members.
“While any industry association that represents a large and diverse membership in an intensely competitive sector will have some disagreements amongst its members on certain issues, CWTA is a catalyst for numerous initiatives that bring many benefits to Canadians,” it said including a cell phone recycling program.
“The many contributions of Wind, Mobilicity and Public Mobile will certainly be missed.,” the association statement said.