Fourth cellular giant possible

Quebecor wants deal on roaming rates

The Canadian government’s announcement Monday that it will auction more wireless spectrum to smaller carriers may strengthen Quebecor Inc.’s resolve to get into the game as the country’s fourth national player.

But the Montreal-based media giant is really looking for a regulatory change on wholesale roaming prices before it commits to jumping into competition with incumbents BCE Inc., Rogers Communications Inc. and Telus Corp.

Those who think Quebecor isn’t serious “don’t know Quebecor much,” said Iain Grant of The Seaboard Group, adding that winning some of the 30 megahertz block of Advanced Wireless Services spectrum the federal government is setting aside next year would be very helpful to the company in combination with 700 MHz airwave rights it recently bought.

“The overlay (of the two) would give them a much richer coverage pattern,” Grant said. But spectrum isn’t the main make-orbreak issue that will influence Quebecor’s decision to proceed, Grant and others said. Roaming price is the key. “Quebecor is I think very clear in that if we change the roaming rules, they’re in,” said Grant. “If we don’t change the rules, they’re not.”

Last month, Quebecor chief executive Pierre Dion declared definitively that Quebecor was prepared to roll out a national wireless network to challenge the three incumbents.

“We are more convinced than ever that the wireless business, not only in our Quebec base but in the rest of Canada as well, is the future,” Dion said. “Under the right conditions, we are ready, willing and able to become Canada’s fourth wireless competitor.”

The central condition is the pricing on domestic wholesale roaming rights, which is what one carrier bills another to let customers use its network. Quebecor already serves half a million wireless customers in Quebec and has bought spectrum licences in Quebec, Ontario, Alberta and B.C. But it wants to make sure that when its clients are out of the range of its towers and have to piggyback on those of rivals, the rates it will be charged for supplying a seamless transition won’t be punitive.

“We want people to be able to use not only unlimited voice and text but also Internet data with significant volumes,” Dion said.

Canada’s telecom regulator is examining domestic wholesale roaming rights and industry observers expect it will introduce definitive limits on what the big national players can charge their smaller rivals. Any changes may not come until the end of the year.