Quebecor testing low-cost mobile brand
Quebecor Inc. is getting into the low-cost wireless game with a new mobile brand, Fizz.
The Montreal-based communications company is beta testing the cheaper brand across its LTE network in Quebec and the Ottawa area, where it currently offers wireless service under the brand Videotron.
A Videotron spokeswoman said Fizz will be an “entirely different” mobile player, although she would not confirm a launch date and declined an interview until then. Meantime, Fizz is looking for customers willing to test the service.
Fizz’s beta period will last three months, according to its website, which describes the service as “lightning-quick … without the frills, fees and extras.”
Quebecor’s foray into lower cost plans comes as the Canadian Radio-television and Telecommunications Commission, at the federal government’s insistence, pushes for more affordable service.
This spring, the CRTC asked the Big Three wireless players — BCE Inc., Rogers Communications Inc. and Telus Corp. — to propose lowcost data-only plans to address a gap in the market.
The largest players insist there’s already ample competition across price points through their midand low-tier brands Virgin Mobile and Lucky Mobile (Bell), Fido and Chatr (Rogers), and Koodo and Public Mobile (Telus). Still, they proposed new plans with 1 gigabyte of data at a drastically reduced rate of around $30.
The regulator also pondered whether there’s a need for price ceilings or data capacity floors in the wireless market, similar to the so-called skinny TV packages where it mandated basic access for $25 per month or less.
Quebecor and Shaw Communications Inc. argued such interventions aren’t necessary, asking instead for a handsoff approach in submissions to the CRTC.
In July, Shaw launched its own low-cost data-only plans through its brand Freedom Mobile. In August, Quebecor confirmed a lower-cost service was coming soon on a conference call with analysts.
Fizz launched this week on Facebook. It’s not yet clear what the pricing will be, but the website stated that users will only pay for what they need. To further cut costs, Fizz will be completely digital without any stores.
Desjardins analyst Maher Yaghi noted that Fizz’s launch comes amidst a renewed focus on lowervalue customers with prepaid accounts, a segment that accounts for about 15 per cent of the total wireless market in Canada.
“The trend among incumbents has been to focus on gaining share in prepaid so that they can convert a portion to postpaid over time,” Yaghi said in a research note Thursday.
Postpaid customers are on contract and typically have more expensive devices, larger data allotments and much higher monthly bills.
“Fizz opens the door for Videotron to be able to grab share in this business and in due time benefit by taking those subs and upselling them into the postpaid market,” he said.