Bell to launch low-cost Lucky Mobile

BCE Inc. is launching a new low-cost wireless carrier called Lucky Mobile.

Bell revealed its new prepaid brand on Friday, a move that lets it compete against its top rivals for what it says is “fast-growing demand” for cheaper mobile options from customers such as new Canadians, seniors and students.

In a release, Bell said Lucky Mobile will offer talk and text plans starting at $20 per month in Ontario, Alberta and B.C. starting next week. The plans are contract-free and available with no credit check for customers that bring their own devices or buy devices starting at $60.

Lucky Mobile marks Bell’s splashy re-entrance into the lowcost market, a space where Rogers Communications Inc. and Telus Corp. already compete under the brands Chatr and Public Mobile. Both offer prepaid wireless service without contracts at similar price points to Lucky.

Bell used to run a low-cost prepaid carrier called Solo Mobile, but it slowly discontinued the brand after it acquired Virgin Mobile in 2009. Virgin competes with Rogers’s and Telus’s second-tier brands Fido and Koodo, all of which offer postpaid services. Postpaid plans earn far more revenue from customers with premium smartphones on two-year contracts with higher data allotments.

Prepaid plans made up only 13 per cent of Canada’s wireless market in 2016, a proportion that has steadily decreased over the past five years, according to the latest data from the telecom regulator. Still, the wireless market grew to more than 30 million subscriptions last year, with all carriers celebrating a growing user base they credited in part to immigration.

Even though the prepaid market makes less money, Bell CEO George Cope indicated Bell wanted to get its share of customers in the space on a conference call with analysts in early November.

“There’s clearly some growth in the prepaid segment that is in the midst of going on. We are looking at that segment … to investors, stay tuned,” Cope said.

Each of the Big Three have carved out roughly 30 per cent of Canada’s entire wireless market. While their market dominance remains strong, they’re facing increased competition from Quebecor Inc.’s Videotron in Quebec and Shaw Communications Inc.’s Freedom Mobile in Ontario, B.C. and Alberta. Both new entrants offer better deals.

Lucky is scheduled to launch Dec. 4.

Bell hasn’t been operating a brand in the prepaid market because it’s priorities were elsewhere, namely on improving its network and promoting its Virgin brand, Bell’s vice-president of marketing Claire Gillies said in an interview.

But it saw an opportunity to compete in the space, she said, and decided to launch Lucky now in part because of the influx of new Canadians.

“As we see an increasing population of new Canadians arrive, it’s kind of an ideal time,” Gillies said.

Indeed, that’s why the brand is called “Lucky.”

“It’s a fun, likable name. Luck is very important in ethnic communities,” she said, adding it’s also enjoyable from a marketing perspective.

Lucky will operate in 17 zones covering most major cities in the three provinces where it will operate.

That means customers in Toronto, for example, will be able to buy plans that are cheaper as long as they’re in the city, with options for $3 or $5 top-ups if they travel. Customers can also buy provincewide or nationwide plans.

Lucky will operate on Bell’s core network. Plans with 1 gigabyte of data will start at $40 per month, but data speeds will top out at 3G speeds of 3 megabits per second.

Gillies expects many customers will bring their own devices, especially since the CRTC mandates that all phones must be sold unlocked as of Dec. 1. Lucky will sell four devices starting at $60.