Rogers outage highlights risk in Shaw takeover, observers say

‘Mega-network’ could leave even more users in the dark, advocate says

Internet connectivity is crucial and Monday’s massive outage of Rogers Communications Inc.’s wireless network brought that well-known fact to the forefront at the most inconvenient time for the company in the midst of convincing Ottawa to let it get bigger.

Rogers, Canada’s biggest cellular provider and operator of discount brands Fido and Chatr, said an update to the Ericsson software, which runs its network, caused Mondays service outage, knocking out voice calls, texting and data for about 11 million customers nationwide.

Service was largely restored by late Monday evening, but the damage was done. The outage, which Rogers said was “intermittent,” coincided with the opening of COVID-19 vaccine appointments for Ontarians 40 years and older, leaving some unable to register.

Others couldn’t log on to online school in the morning, the first day back after the province’s spring break. The province said Monday’s vaccine count was inaccurate because some clinics had to use paper reporting owing to the outage.

Furious tweets flooded Twitter all day with many frustrated customers demanding compensation for the lost time and some gig economy workers, such as Uber drivers, saying they were unable to log on for work. Rogers said Tuesday it will automatically apply a credit “equivalent to yesterday’s wireless service fee” to customers’ future bills, pro-rating the credit to what they pay on a monthly basis.

“We know our customers depend on us and yesterday we let them down — for this we are truly sorry,” spokesperson Andrew Garas said in an emailed statement.

He added the company is “undertaking an in-depth review in partnership with Ericsson” and hopes to prevent similar issues from happening again.

Networks go down sometimes. Fibre-optic cables cut by accident occasionally knock out internet service and large crowds, such as during the Toronto Raptors’ victory parade, can overwhelm mobile networks.

During the early days of the pandemic, the number of dropped calls were widespread with more people using their cellphones as they worked from home.

But this week’s failure comes as Rogers is under heightened scrutiny while it seeks approval of its $20-billion deal to acquire Shaw Communications Inc., the country’s second-biggest cable company and owner of the fourth-largest cellular business, Freedom Mobile.

Shaw has two million wireless customers in Ontario, British Columbia and Alberta, and the deal would see just one national network left as an alternative to Rogers: the shared network of BCE Inc. and Telus Corp.

Between them, Rogers and Shaw would have 52 per cent of the wireless market in Ontario.

The outage left some observers warning that a similar interruption in the future could leave even more Canadians disconnected all at once.

“Rogers is trying to argue that they need to consolidate their resources and network into basically a mega-network, because that will be the most efficient,” said Laura Tribe, executive director of consumer advocacy non-profit OpenMedia. “But then we see something like this where the value of having backups and redundancies and alternatives really matters.”

Tribe said the situation also highlighted the confusion that is sometimes created by the socalled “flanker” brands, with some Rogers customers saying Monday they planned to switch to Fido, only to find out it runs on the same network.

If the shared national network run by BCE and Telus were to go down, for example, it could also knock out service for customers of Virgin Mobile, Lucky Mobile, Koodo and Public Mobile, all of which are owned by the larger companies.

Will Mitchell, professor of strategic management at the University of Toronto’s Rotman School of Management, said the unfortunate outage is actually an argument in favour of Rogers and Shaw merging and gaining the scale they say they need to make new investments.

“The tension here is the more carriers we have, the less technically sophisticated any one of them is likely to be as we get into an era where we need really strong technical sophistication to provide the level of services that we need,” he said.