Canada adds seventh wireless carrier

Published: May 19th, 2010

Canada’s newest wireless carrier is trying to set itself apart from the other start-ups now entering service by targeting the nation’s large Asian community.

Mobilicity, the brand name of parent Data & Audio-visual Enterprises (DAVE) Wireless, began signing up customers on the weekend in Toronto and its surrounding suburbs, promising to extend its HSPA+ network later this year to Vancouver, Calgary, Edmonton and Ottawa, the nation’s capital.

For $20 a month on top of any of its no-contract plans, subscribers can take one of two unlimited voice calling packages: One to China, Hong Kong, South Korea, Japan, Singapore and Vietnam, and the other to India, Pakistan and Bangladesh.

“The two largest ethnic groups in the Greater Toronto area are Asian and South Asians,” company president David Dobbin explained. “Eighteen per cent of the GTA are East Asia and 16 per cent from South Asia. They’re huge communities and they’re completely underserved.”

DAVE Wireless, headed by Toronto businessman and satellite radio network owner John Bitove, paid CDN$243 million in Canada’s 2008 AWS spectrum auction for licences covering many of the country’s biggest cities. It’s also funded by New York’s Quadrangle Capital Partners.Unlike Wind Mobile, which is backed by Egypt’s Orascom Telecom Holdings S.A.E., Mobilicity isn’t trying to build a national network. Instead it’s focusing on urban dwellers who aren’t looking for the coast-to-coast coverage offered by incumbent carriers.

The Canadian government set aside spectrum for new entrants in the 2008 to encourage competition because three incumbents — Bell Canada, Rogers Communications and Telus Corp. — hold about 95 per cent of the wireless market.

An estimated 70 per cent of Canadians are wireless subscribers, leaving 30 per cent of the market — roughly 7 million people — up for grabs.

Mobilicity, Wind Mobile and Public Mobile are three of the four pure-play new entrants. Public Mobile, which spent $52 million on what many thought was less desirable PCS spectrum in the auction, is expected to shortly launch service aimed at so-called working class Canadians in Toronto and Montreal.

Mobilicity is trying to keep costs under control by outsourcing almost everything it can. Ericsson Canada, for example, is not only building the carrier’s network but is also managing it.

Mobilicity, which becomes the country’s seventh carrier, started by opening 35 stores in the Toronto area, which will be supplanted by some 200 sales outlets in computer stores and other retail locations.