By Greg O’Brien
TORONTO – As a newcomer to the wireless game, Mobilicity executive chairman John Bitove offered his “different perspective” to the Canadian Telecom Summit on Tuesday.
During his luncheon keynote, the entrepreneur, who also launched XM Satellite Radio in Canada, among other businesses, noted he paid $243 million for his wireless spectrum the same week Lehman Brothers collapsed in 2008 – and then proceeded to hunt for capital for a wireless build, right in the middle of the economic downturn. “You want to talk about some sleepless nights,” said Bitove.
Saying “consumers have more choice now and lower prices” since the launch of Mobilicity in 2010, Bitove says the company is running as hard as it can, adding tons of new customers, using all of its available spectrum – and that he intends to fully participate in the 700 MHz spectrum auction when it happens (likely in early 2013).
Much has changed since the last spectrum auction in 2008, he added, pointing to how the company (once named Dave Wireless) had figured data would comprise about 10% of network traffic. Instead, data is 90% of his network traffic. “Did we ever get that wrong,” Bitove (pictured) said. “The market is no longer a carrier’s market. It is a consumer market.”
He came with four main ideas to appeal for change:
1. Regulate roaming. Canada needs International roaming rates that are standardized and aligned with the rest of the world. “We could learn a thing or two from Europe,” he said. “In 2007, Europe implemented standardized caps on consumer roaming rates… An incoming call is capped at 11 Eurocents – the equivalent of 14 cents a minute in Canada. And if you think that’s good, next month the cap will be reduced to 8 Euro cents… Who wins? Consumers… It is time to step up to the plate and regulate roaming.”
2. We need to build our own application developing gold rush in Canada to find the next Instagram or Rovio, here, funding the search for new apps the way we fund the search for oil and gas. “In an effort to better serve Canadian wireless consumers, inspire entrepreneurialism on a global stage and give back to the community, in ways we have never explored, I would like to propose the introduction of Canadian app flow-through shares,” said Bitove. “Investing through flow-through shares has proven quite successful in the oil and gas, mining and other natural resource sectors. The flow-through share program provides tax incentives to investors who acquire FTSs by allowing deductions for expenses and investment tax credits for individuals.”
3. Our flawed regulatory structure, where Industry Canada hands out the spectrum and the CRTC handles regulation and other matters, must be replaced. “I think those of us in the industry would all like to see the federal government combine spectrum management and wireless regulation into one body,” Bitove said. “I don’t care whom they choose to empower, but having the owner of the property not accountable to the manager of the property will always lead to problems. It’s like a Canadian bank being managed by a hedge fund.”
4. The industry must consolidate how it builds and runs wireless networks in rural areas so that one robust network can support all companies which want to use it. “Consolidating resources, eliminating redundancy and improving efficiencies – it all makes good business sense. That’s why I believe that to ensure the success of the federal government’s mandate to lower wireless pricing for all Canadians – and not just those in urban markets – we need to pool our resources on rural tower builds to best service the needs of Canadians. We need a national digital strategy on building out wireless towers… in rural areas that any carrier can utilize.”
Photo courtesy Pinpoint National Photography.
