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Shaw’s Freedom Mobile to Bring Competition to Rogers, Telus and Bell in 2017: Analysts

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Shaw’s Freedom Mobile is expected to put pressure on growth rates of wireless incumbents Rogers, Telus and Bell in 2017, predicts analysts.

In late 2015, Shaw announced it would be acquiring WIND Mobile in a $1.6 billion deal. The latter rebranded as Freedom Mobile back in November, announcing its LTE network in Toronto and Vancouver. The problem? Its new LTE network based on AWS Band 3 only supports limited smartphones for now, with the iPhone not being one of them (yet).

However, despite Freedom Mobile’s slow start to its LTE network, analysts believe Shaw will ramp up competition towards the end of 2017 and negatively affect growth rates of incumbents.

Scotia Capital Inc.’s Jeff Fan explained in his year-end report, “We believe Freedom has always been held back by its network quality from being truly competitive with the incumbents, a dark cloud that should progressively dissipate over the year,” reports The Globe and Mail.

Maher Yaghi, Desjardins Securities Inc. analyst, said Freedom Mobile could threaten revenues of Rogers, Telus and Bell, noting “We forecast that growth will slow in 2018 on increased wireless competition from Shaw.”

Shaw is set on expanding their LTE network in its urban centres of BC, Alberta and Ontario near the end of 2017, which by then the company should be able to offer more compatible handsets and an improved network experience. Existing users have been critical of Freedom Mobile’s spotty 3G network.

Last month, Freedom Mobile launched free Wi-Fi for customers, leveraging Shaw’s existing free Wi-Fi network for Internet customers, a perk only available until March 31, 2017, in what appeared to be a temporary solution to fill in gaps in their existing wireless network.

Calgary-based Shaw is also expected to ramp up its television offerings against rival Telus in Western Canada, as it will launch new set-top boxes based on Comcast’s X1 IPTV platform.

Rogers announced in December it would also adopt X1, and ditch its own in-house IPTV solution, at the cost of a $525 million write down, a move seen to keep up with rival Bell and its Fibe TV offering.

Despite TV cord-cutters, Fan believes upcoming network improvements and better TV products should “help curb overall subscriber losses and lead to growth in average revenue per account [ARPA] in 2017.”

In regards to the CRTC, chairman Jean-Pierre Blais will see his five-year term end in June of this year, and Fan believes Justin Trudeau’s Liberal government could appoint one of their own candidates into the position, which will “be a positive relief for the industry.” The analyst continued to say “Mr. Blais was viewed by many as very pro-consumer, with a populist agenda, usually at the expense of the incumbents.”

Blais was in particular critical of Rogers and Shaw for shutting down their streaming service shomi, after a short two year endeavour, noting “I have to wonder if they are too used to receiving rents from subscribers every month in a protected ecosystem, rather than rolling up their sleeves in order to build a business without regulatory intervention and protection.”

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  • Jason Chu

    I just don’t believe that the low prices Freedom Mobile currently offers will be maintained for the future. Maybe the first few years you can have a low monthly cell phone plan but I bet they will find a way to increase it going forward. Freedom Mobile’s drawback is always been the bad coverage. If they start sinking $$$ into towers and all the customer will be paying for it.
    Every year my Shaw TV, internet and phone bill keeps going up. Cut my basic TV package out? Oh my telephone portion goes up another $15. Shaw is in it to make $$$. My friend works at Shaw and he tells me all the time the company is always finding a way to increase prices for services.
    If Telus, Rogers and Bell charges $90 for a cell phone plan and Freedom Mobile charges $50, what’s not to say Freedom Mobile changes it to $70 and say well its still cheaper than the big 3.

  • NOHoldsBar

    Limited handsets support Wind’s LTE network. If the latest iPhone doesn’t have it will be a tough sell to have users switch. Most people have an iPhone. Whether people want to acknowledge that, thats another matter. For people with “inferior” devices, would they really need LTE any way since they’re device might be limited by professor power to run LTE at its optimal speeds?

  • NOHoldsBar

    Wind has already increased prices. I refuse to call them freedom mobile

  • Brandon Arneson

    They offer 2 everywhere plans that are $45&$55 per month the give u free roaming all across Canada and the USA out of their coverage areas.

  • Brandon Arneson

    I’m on their Everywhere55 plan and I enjoy my unlimited data,unlimited texting& picture messaging as well as 2400 Canada and USA calling minutes when I’m roaming and I’m quite capable to make over 50% of my usage on the freedom mobile network before I leave the city which is how your able to keep these plans

  • Tim

    Freedom’s LTE is Toronto and Vancouver are limited to two phones on Band 66. In Ottawa, Freedom’s LTE is on Band 4, similar to Telus and Bell

  • Dominic

    They don’t even have a network in Québec all just so they didn’t have to offer their services in French. Are they going to just keep being an English only company ?

  • Cornfed710

    Just join Public Mobile 🙂

  • The only way this is competitive is if it’s offered across Canada and not just around the biggest cities. I don’t benefit at all because I’m no where near Toronto etc. Nothing has changed for Canada.

  • Salinger

    Huh? Where did that come from? Can you provide some evidence of your assertions?

    I seem to remember from the initial spectrum auction at the beginning of the new entrants, that Wind tried desperately to obtain spectrum in Quebec but was consistently outbid by Videotron who seemed intent on locking up the Quebec market at any cost.

  • Brenda

    What’s wrong with the head of the CRTC being pro-consumer?

  • mcfilmmakers

    Nothing.

  • raslucas

    I think freedom would be in a much better spot right now if they’d gotten in on the 700 MHz auction. Oh and I guess if Shaw hadn’t given their aws-1 spectrum to Rogers I guess too eh? Shaw and freedom are a match made in heaven.

  • alexb88

    They have service in Gatineau. That’s something!

  • RoboBonobo

    That may have been true like 5 years ago.
    If you look at actual polling, instead of assumptions based on personal experience, most people don’t have iPhones anymore.
    A poll done in 2015 showed that Android takes a bit more than 50% of the phone market in Canada, and iPhone takes 38%.
    Also, LTE uses less battery than HSPA+, that’s just a fact. It’s also easier to facilitate more users per cell tower without leading to network congestion.
    I have an iPhone and a Galaxy, so no fanboy over here.

  • RoboBonobo

    They have, in fact, said they plan to roll out across country eventually. They said this at the end of the AWS-3 auction when they won spectrum in every region of the country.

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