Thursday, October 23, 2008

Canada's Wireless World Gets Weirder.

The weird world of wireless in Canada continues to make waves. Hat Tip to Blogger who quotes a Canadian Press story that Shaw Communications has just announced it will not enter the wireless market and will not be in the cell phone business.

Shaw just spent $190m buying a chunk of the new wireless spectrum to enable it to carry cell phones and multimedia signals. I wonder what they will do with the new spectrum asset now. Obviously sell it to someone…but whom?

This is not a good first step on the federal government strategy to reduce wireless service pricing in Canada by increasing competition by having more providers.

Quebecor Media, a sub of cable company Videotron, announces in the Globe and Mail today that it is investing $800m to launch a wireless network in the next 18 months. They picked up 178 new spectrum licenses for over $550m in July. Quebecor is planning to put ads on smart phones in Quebec and projecting to hold 30% of the Quebec market by 2015.

Earlier this week Bell was in the news with complaints from independent cell phone franchisees over commission issues and has teamed up with Telus to jointly invest in the next generation wireless network but has withdrawn efforts to put fibre-optic cable into homes in Ontario. How will this add to competitiveness’ in the wireless marketplace in Canada and better price deals for consumers?

The market meltdown and the continuing nationalization of the world’s financial systems add to the uncertainty for everyone. It is tough to plan for everyone in these strange days. It is interesting to see two cable companies betting on diametrically opposite directions on new wireless investment.