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TELECOM UPDATE
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published weekly by Angus TeleManagement Group
http://www.angustel.ca
Number 515: February 3, 2006
Publication of Telecom Update is made possible by generous
financial support from:
** AVAYA: www.avaya.ca/
** BELL CANADA: www.bell.ca
** CISCO SYSTEMS CANADA: www.cisco.com/ca/
** ERICSSON: www.ericsson.ca
** MICROSOFT CANADA: www.microsoft.com/canada/telecom/
** MITEL NETWORKS: www.mitel.com/
** NEC UNIFIED SOLUTIONS: www.necunifiedsolutions.com
** ROGERS TELECOM: www.rogers.com/solutions
** VONAGE CANADA: www.vonage.ca
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IN THIS ISSUE:
** BCE in 2006 -- Layoffs, Spinoffs, and Price Hikes
"Bell Regional Lines" to Become Income Trust
IPTV Still on Hold
BCE Revenue Up 4%
Bell Union Not Impressed
** MTS Launches Business Review
** U.S. Government Wants RIM Injunction Delayed
** CRTC Orders Changes to VoIP 9-1-1 Routing Services
** Nortel to Sell Huawei Broadband Gear
** Ontario and Michigan Research Networks Linked
** Wi-LAN Leaves Equipment Business
** Nicer Canada Launches Hosted VoIP
** Western Union Stops Sending Telegrams
** Roadpost to Offer Satellite Broadband
** Laliberte Named Aastra EVP
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BCE IN 2006 -- LAYOFFS, SPINOFFS, AND PRICE HIKES: BCE Inc. held its
annual business review conference on Wednesday, February 1. Some
highlights:
** Bell Canada will reduce its workforce by between 3,000 and
4,000 positions this year. CEO Michael Sabia said that "at
least half" of the cuts will come from attrition.
** BCE will sell a minority stake in Telesat through an IPO
in the second half of the year.
** BCE will use cash from recent deals to buy back 5% of its
outstanding common shares ($1.3 billion) and reduce debt
($1 billion).
** Former Telus exec George Cope, who became Bell's President
and COO in January, stressed a policy of price discipline.
He announced near-term price increases in the LD network
charge (from $2.95 to $4.50), the ExpressVu system access
fee ($2.99 to $5.99) and Sympatico high-speed ($44.95 to
$46.95, in Ontario only).
** Wireless president Robert Odendahl promised "selective
price increases" for wireless offerings, including
eliminating existing all-in-one plans, and shifting the
start of night-time rates to 9pm on all mass-market rate
plans.
"BELL REGIONAL LINES" TO BECOME INCOME TRUST: Bell will spin off 1.6
million access lines, mainly in areas where cable competition is weak
or non-existent, into a separate corporation that will operate as an
income trust. Bell will keep 50% ownership and distribute the rest to
its common shareholders. One thousand Bell employees will be
transferred to the new entity. (See Telecom Update #484)
** The largest communities included in the spin-off areas are
Sudbury, Sault Ste-Marie, Chicoutimi, and Sarnia.
IPTV STILL ON HOLD: Speculation that Bell would use the conference to
launch an IPTV service proved incorrect. Kevin Crull, President of
Residential Services, told participants that the IPTV product works
but is not yet sufficiently differentiated from other TV offerings,
and that needed VDSL2 cards aren't yet available. He declined to give
a launch date, but said that IPTV would have "no material impact" on
Bell's video service sales this year.
BCE REVENUE UP 4%: BCE's total revenue for the full year 2005 was
$19.1 billion, up 4.0% from the previous year. Operating income was $4
billion compared to $2.9 billion. Earnings per share rose to $2.04
from $1.65.
** In the first year of competition from cable companies in
the local telephone business, Bell lost 324,000 local
access lines, a 2.5% decline overall -- residential lines
were down 4.8%. The telco expects to lose 3%-5% of its
lines in 2006.
** Long distance revenue fell to $2.0 billion from $2.3
billion.
** Wireless revenue was up from $2.8 billion to $3.1 billion.
Data revenue rose from $3.6 billion to $4.0 billion. Bell
added 387,000 new high-speed Internet customers, a 21%
increase.
BELL UNION NOT IMPRESSED: The Communications, Energy and Paperworkers
Union, which represents workers at Bell Canada, says it will oppose
the telco's plan to spin off rural lines into an income trust. "We
have a long-term concern about job stability and service levels in
what amounts to 15% of Bell's customer base," the union said.
MTS LAUNCHES BUSINESS REVIEW: Manitoba Telecom's new CEO, Pierre
Blouin, has hired advisors to conduct a "comprehensive review of our
entire business," to be completed by December. MTS previously
announced plans to lay off 800 employees, most of them in the former
Allstream division.
** The company's October-December revenue was $504 million,
the same as in these months in 2004. Net income fell to
$14.6 million from $42.3 million. Wireless revenue rose
16%; long distance revenue fell 10%.
** Chief Technology Officer Kelvin Shepherd has been named
President of MTS Manitoba, replacing Cheryl Barker, who
has retired.
U.S. GOVERNMENT WANTS RIM INJUNCTION DELAYED: The U.S. Department of
Justice has asked a Virginia court to delay an injunction that would
shut down Blackberry service. The brief described continuity of
Blackberry service as "imperative" for the government, and said it had
"serious questions" about whether service could be continued only for
government users, as plaintiff NTP Inc. has proposed.
** Also this week: the U.S. Patent Office issued a non-final
judgment that the last remaining NTP patent claim was
invalid, and RIM won two European court rulings against
patent infringement claims by Luxembourg-based InPro
Licensing.
** Despite lawsuit-induced uncertainty, RIM's subscriber base
has doubled in the past year: it now has about five
million customers.
CRTC ORDERS CHANGES TO VoIP 9-1-1 ROUTING SERVICES: CRTC Telecom
Decision 2006-5 gives final approval to Telus's tariff for routing
VoIP service providers' 9-1-1 calls to the correct emergency
centres. However, it orders Bell, Aliant, MTS Allstream, and SaskTel
to change their tariffs to allow VoIP service providers to subscribe
to existing zero-dialled emergency call routing services, including
access to 9-1-1 agencies' 10-digit numbers.
http://www.crtc.gc.ca/archive/ENG/Decisions/2006/dt2006-5.htm
NORTEL TO SELL HUAWEI BROADBAND GEAR: Nortel Networks and Chinese
telecom development giant Huawei Technologies have agreed to establish
a joint venture to develop "ultra broadband access solutions." The
Ottawa-based company will start production by September; in the
meantime, Nortel will sell Huawei's access products.
ONTARIO AND MICHIGAN RESEARCH NETWORKS LINKED: The Ontario Research
and Innovation Optical Network (ORION) and its Michigan counterpart,
Merit Network, have been connected by a one Gbps fibre link through
the Detroit-Windsor Tunnel. The link, which is the first of its kind,
is seen as a step towards a larger Great Lakes regional optical
network for research and education.
WI-LAN LEAVES EQUIPMENT BUSINESS: Calgary-based wireless broadband
developer Wi-LAN Inc. will close down all manufacturing by April 30
and focus on licensing its patents and technologies to companies such
as Cisco, which settled a patent infringement suit with Wi-LAN in
December. (See Telecom Update #509)
** Wi-LAN has begun a search for a new President and CEO.
Incumbent Bill Dunbar will remain in office during the
search.
NICER CANADA LAUNCHES HOSTED VoIP: Vancouver-based Nicer Canada
Corp. has launched a hosted Voice over IP service that provides
PBX-like functions for "businesses of any size." (See Telecom Update
#466)
WESTERN UNION STOPS SENDING TELEGRAMS: Western Union, once the largest
telecommunications company in the world, sent its final telegram
January 26, after 155 years in the business. It continues operations
as a money-transfer company.
** Its Canadian counterpart, CNCP Telecommunications (a
predecessor of Allstream), dropped out of the telegram
business in 1999.
ROADPOST TO OFFER SATELLITE BROADBAND: Toronto-based Roadpost
Inc. will offer France Telecom's new BGAN broadband satellite service
in North America when the service is launched later this year.
LALIBERTE NAMED AASTRA EVP: Concord, Ontario-based Aastra
Technologies, a manufacturer of residential and business
telecommunications equipment, has named Yves Laliberte as Executive
Vice-President. He previously held senior management positions at
Avaya Canada and Cisco Canada.
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The information and data included has been obtained from sources which
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