Cogeco to push for regulated access to mobile airwaves

One of Canada's major telecom companiessays it will urge Ottawa to clear the way for a new type ofwireless broadband network that's been used successfully in other countries, but hasn't been available in Canada.

CogecoInc. CEOLouis Audet said he will press his case for Mobile Virtual Network Operatorsor MVNOs in which large wireless network owners are forced to sell airtime in bulk to smaller carriers at regulated prices at Canadian Radio-television and Telecommunications Commission hearings next week.

Audet told reporters and analysts Thursday in a conference call from Montreal that this type of network reselling is common in other countries, like the U.S. and Europe, but the idea it has not taken hold in Canada.

"The proposal we are making calls for a regulated access to the radio access network of the established carrier," Audet said. "Because we believe that anything short of regulated access will not lead to the successful implementation of MVNO in the country."

Audet, who heads a telecom and media business that offers internet, cable and phone service in Quebec and Ontario, said it's unlikely a fourth national cellphone carrier will emerge to challenge big three incumbents Rogers,Telus and Bell. The federal government has been hoping another major carrier would bring down prices and stimulate innovation.

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He said that "virtually all" of the new companies that emerged to build wireless networks after the 2008 spectrum auction "were strangled" before they could develop.

Two of the new carriers Public Mobile and Mobilicity entered court-protection last year because of their financial struggles, although privately owned Wind Mobile is growing its subscriber base.

In addition, two existing cable companies EastLink Communications and the Videotron arm of Quebecorare expanding new wireless businesses in their regions. Manitoba Telecom and Sasktel also have strong established wireless bases in their respective provinces.

However, the Big Three continue to collectively represent 90 per cent of Canada's wireless customer base and that their smaller rivals have found it difficult to compete against the national carriers.

Audet said that MVNOs are an good alternative for Canada provided that the CRTC uses its power as a regulator to compel the Big Three to provide access to their spectrumat a reasonable, regulated price.

Audet said there are more than 800 MVNOs around the world. One of the largest is Virgin Mobile, which operates in 10 countries.

He said that a similar approach has worked in Canada on the wireline front, where various companiescan buy network access on a wholesale basis from a major carrier and then resell it as aretailer.

"That is occurring on a daily basis. And that has helped invigorate the competitiveness of the marketplace. So we see no reason why this could not occur in wireless as well," Audet said.

The federal regulator will hold hearings next week to consider changes to the wireless industry.