Canada may reach 100 per cent mobile phone uptake within the next decade, matching rates now seen in most of the world, according to Wind Mobile backer Orascom Telecom Holding.
Passing 100 per cent is a matter of when not if, Khaled Bichara, chief executive officer of Egypt-based Orascom, told Bloomberg News on Tuesday.
Should Canada’s uptake rate, which was about 66 subscribers for every 100 inhabitants in 2008, double by 2020, if we even take a small percentage of that doubling, thats still a big business for us, » he said.
Wind is aiming for 1.5 million subscribers in its first three years. Bell, Rogers and Telus currently control about 95 per cent of the market, with about 22 million customers as of June 2009.
A number of countries surpassed the 100 per cent level years ago. In some countries, customers own several devices one phone for personal use and another for business, or a phone and a mobile internet stick for their laptop. In some European cases, customers also own multiple devices to take advantage of different roaming rates between countries.
Italy, a country where Orascom also operates a wireless company under the Wind banner, has an uptake rate near 120 per cent. Greece, another Wind country, tops more than 200 per cent.
Over all, the Egyptian company has about 120 million mobile subscribers in numerous countries around the world.
Orascom has invested more than $700 million U.S. in Toronto-based Globalive and has a 65 per cent equity stake in its wireless company, which launched in Toronto and Calgary in December. Orascom also controls about one-third of Globalive’s voting shares.
Globalive announced last week that Wind was hiring in Ottawa and Edmonton, with plans to launch in those cities as early as February. The company has also said its network in Vancouver is almost ready to go.
Canada’s mobile uptake trails much of the world. It is dead last among developed nations belonging to the Organization for Economic Co-operation and Development and lags that of many developing countries. Algeria and Tunisia, where Orascom also operates wireless companies, have respective uptake rates of 93 and 85 per cent. Many developing countries, however, lack the solid landline infrastructure that Canada has.
The Canadian government in 2007 ruled that the low uptake was because of a lack of competition and high prices from existing players Bell, Rogers and Telus. The government also recognized that better mobile phone usage is necessary for economic productivity and innovation.
For a country that wealthy, it is very low, Bichara said of Canada.
The government encouraged new companies to enter the Canadian with special rules for an auction of public airwaves held in 2008. Globalive, backed by Orascom, was the biggest new player in that auction, winning licenses across Canada, except for Quebec.
Last year, after lobbying from Telus and Shaw Communications, the Canadian Radio-television and Telecommunications Commission held an unprecedented public hearing into Globalive’s ownership. In October, the regulator ruled that Orascom had too much influence over the Canadian company so it would not be allowed to launch operations.
Canadian laws prohibit foreign entities from controlling the majority of an infrastructure-owning telecommunications company. In contrast, Orascom won a four-year contract in 2008 from the government of North Korea to operate wireless services in that isolated country.
In December, the Canadian federal government stepped in and overruled the CRTC, clearing the way for Wind to start up.
Orascom’s Bichara said growth in wireless will come as more Canadians take up prepaid services, something that existing carriers have discouraged.
Source: Yahoo
