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New Wireless Carriers Struggle to Compete with the ‘Big 3’, iPhone 5 and LTE

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With the launch of the iPhone 5 and the vast superiority of LTE networks from coast to coast being installed by Rogers, Bell, and Telus, it appears the situation remains bleak for new wireless entrants to make a dent in the wireless market.

According to the Financial Post, analysts estimate Rogers has signed up 40,000 customers since the launch of the iPhone 5. This number is what WIND Mobile would typically sign up–in a three-month fiscal quarter.

Like fellow new entrants Mobilicity, Public Mobile and Videotron, Wind is hampered in part because it has never been able to sell Apple’s wunder-phone, which remains the most potent single sales driver for any mobile operator the world over.

The new wireless entrants run their networks on a different frequency that does not support the iPhone, a major disadvantage when it comes to marketing the latest smartphones to customers, which the incumbents are able to do with ease:

Some expect Rogers, Bell and Telus, which together hold 91% of the wireless market, to step up advertising of the superior standard. “The incumbents can show off their LTE networks with the iPhone 5,” Canaccord’s Mr. Ghose said.

[…]

“We believe that the lack of an iPhone offering from new entrants has curtailed their market share,” said Canaccord’s Mr. Ghose.

Even though the iPhone 5 fever is exciting for the ‘Big 3’, it is expensive up front as costs to subsidize handsets affect profit margins for fiscal quarters surrounding launches, and do not drive growth. However, these costs are recuperated over the long term when customers sign onto three year contracts coupled with higher-priced voice and data plans.

As much as we’d love to see the new wireless entrants succeed in Canada, it doesn’t look like they’ll make a big enough dent to hurt Rogers, Telus or Bell, as they dominate more than 90-percent of the wireless market. It’s for reasons like this WIND Mobile’s financial backer regretted entering the “protected” Canadian market.

What do you think? Do the new wireless entrants stand a chance in Canada?

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  • Matthew

    As long as they stick around I’ll keep enjoying my $29 unlimited everything plan.

  • crosseyed_mofo

    videotron didnt do wind any favours by completely cutting them out of quebec

  • Randy Ritraj

    With an iPhone?

  • Jill

    As my 3yr imprisonment with Rogers is coming to an end this December, and hearing the unsurprising news that the iPhone 5 is not AWS supported, I will have to settle with another phone (to my iPhone now). I may look into a windows mobile or even a BB, as I dislike the Android OS.

    I think in the Canadian wireless market, the choice you have is the plan, then the phone. Where as in most parts of the world, it is the phone, then the plan. I don’t ever want to be in a contract, and I don’t want to be paying a high phone bill each month for limited service, as I am now.

    I really had hoped the iPhone 5 would have been AWS. I’ve grown very used to using an iPhone.

  • nick

    hes probably using a BB android or windows7 phone since the iphone isnt offered from the new entrants

  • crosseyed_mofo

    if canadian AWS telcos follow in the footsteps of tmobile, iphone should be fully compatible

  • wuju

    no chance until they get the iPhone wonder. I would switch to Wind instantly if they support iPhone.

  • I agree. The day that either WIND supports the iPhone or Apple manufactures an iPhone that supports the AWS frequency I will switch. I’d even switch if WIND didn’t have an LTE speed data network, their costs are so much more reasonable.

    I lived in Europe for 3 years and we are being robbed by the wireless companies in Canada. I was excited to see WIND come to Canada and thought it was going to be the answer to our problems.

  • Jon

    Can you explain that in a little more detail? I keep reading conflicting statements. Thanks!

  • crosseyed_mofo

    tmobile is upgrading their lte networks that will operate on frequencies compatible with the iphone

    thats not to say tmobile will be selling iphones, but its no secret how agressive they have been trying to attract at&t users with unlocked units to make a switch

    http://support.t-mobile.com/docs/DOC-4781

  • crosseyed_mofo

    i replied, but my reply was moderated for some reason o_0

  • Jill

    The best way to explain it is this:

    Tmobile, in a way, is the WIND/mobilicity in the US. 3G data band has a large frequecy range, which AWS falls under 1700/2100.

    Tmobile upgraded their network to also cover the 4G data band for AWS (4G is LTE, for simplicity sake). So Tmobile covers 3G AWS and 4G AWS.

    Where as WIND/mobilicity only cover 3G AWS.

    I was explained this way. I hope this is accurate.

  • Jon

    My question is (and what I don’t understand): Does Wind own spectrum that they can run 4g/LTE on, that one of the new iPhones can also do 4g/LTE over? And if so, are they in a position to do that, or would it cut off existing service (eg 3g) at that frequency?

  • Jon

    Did you swear? haha. Maybe try again? thx!

  • crosseyed_mofo

    ah its there now 😀

  • cUn1t

    Not entirely accurate. You are not able to use Wind’s 3G network with an iPhone. Wind has a roaming agreement with Rogers though which would allow you to get Edge on the iPhone.

  • JML

    It would be great if it supported the frequencies in which Wind and Mobilicity operate. It would truly be a world phone at that pojnt, like the Galaxy Nexus!! If those companies were to merge, it could perhaps effectively deal with their biggest problem-network reliability.

  • JMCD23

    They’re making gradual progress and do support some higher end phones (S III on AWS) but the options are too limited to attract the high paying customers that are on other networks. Unless the CRTC has Canadian consumers in mind rather than the big 3, I doubt things will change too much. I’m currently overseas paying $20/mo for unlimited data, 200min, 200sms and every feature is included. The CRTC is half the reason why Canadians pay such absurd rates.

  • Evil Telus.Rogers&Bell

    We need to support these new underdog wireless carrries as we’re all paying for the monopoly of the big 3. They overcharge us through overbilling and there isn’t much we can do since they own the market. That’s great way to see change and better offers for all of us.

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