Bell enters faster lane on back-to-school internet

Competition heats up over speeds offered

BCE Inc. just turned up the speed in the battle over internet customers in the busy back-to-school shopping season.

Bell announced Monday that Ontario customers directly connected to its fibreto-the-premises network can now access download speeds of 1.5 gigabits per second (Gbps), a speed that’s 50-percent faster than industryleading offerings of 1 Gbp from Bell and its top competitor, Rogers Communications Inc. The new speed tier advertises upload speeds of 940 Mbps.

The service will first be available in cities including Toronto and Ottawa and will roll out to 1.5 million premises in Ontario by the end of the year, said Shawn Omstead, Bell’s vice-president of residential product management. Bell will eventually offer the speed in Quebec, the Atlantic provinces and Manitoba. “We always want to be the one delivering the fastest access speed. We just want to show off fibre,” Omstead said.

The new offering is part of Bell’s multibillion-dollar bet on deploying fibre optic cables directly to homes. Fibre enables nearly symmetrical download and upload speeds and will have the capacity to reach speeds above 40 Gbps as modem and central office technology improves in the coming years, Omstead said.

As of June, Bell’s fibreto-the-premises network reached 4.2 million homes, including about 70 per cent of Toronto, a key battleground where Bell spent $1.5 billion on network upgrades.

“We think that pipe into the home is very strategic,” Omstead said. “That’s why we’re making the investment in fibre that we’re making, not just in Toronto but across our entire footprint.”

Internet connections have become more critical as consumers retreat from traditional television to watch video online. Canadians now spend more on internet packages than on television subscriptions.

The industry’s retail internet revenue hit $10.2 billion in 2016, topping the $8.7 billion in revenue from TV subscriptions, according to the telecom regulator’s latest data. At the same time, the proportion of households with internet subscriptions rose to 87 per cent while the percentage with TV packages dropped to 75 per cent.

To lure customers away from competitors, Canada’s largest internet providers have been advertising based on speed — an increasingly important factor as the number of devices streaming video simultaneously within each household multiplies.

Bell, which claimed the title as Canada’s fastest internet provider in Pcmag’s annual speed test based on 12,000 tests, said its move to 1.5 Gbps was to give its highest end customers extra headroom. Omstead said it wasn’t a competitive response to Rogers’ advanced new Ignite TV product, which launched in late July. He added that Rogers’ network has limitations on upload speeds com- pared to fibre.

Rogers disagrees, and it has a competing speed test to back up its claims. On Monday, Ookla’s Speedtest named Rogers the fastest internet provider in Canada based on 17 million tests. Bell beat Rogers in the upload category, but Rogers easily won based on median download speeds. Download performance is more critical for most consumers.

“We’ve delivered 1 GB speeds across our entire footprint since 2016 for our customers, and Bell is playing catch-up and marketing 1.5 GB in Ontario when they don’t even offer a 1 GB speed across Toronto, let alone the province,” Eric Bruno, Rogers senior vice-president of residential product management, said in a statement.

The jockeying between the country’s two largest carriers over network speed appears to be fulfilling analysts’ predictions that competition between their Ignite and Fibe brands would heat up for the back-to-school season.

“Since Toronto is the most ‘speed-obsessed’ market in Canada, we believe BCE’S launch of 1.5Gbps service will help market/differentiate its offering just as Rogers begins to broadly launch the new Ignite TV,” Barclays analyst Phillip Huang noted to clients earlier this month.

Still, Huang noted to clients in July that he’s impressed by Rogers’ customer retention in cable despite Bell’s expanding fibre-to-thehome footprint in Toronto. He expects Ignite TV will help with retention, although he noted the potential for greater pricing pressure given Bell’s mass marketing of its fibre connections.

DARREN GOLDSTEIN / BELL MEDIA VIA THE CANADIAN PRESS Internet speed has become increasingly important as the number of devices streaming video simultaneously within each household multiplies.