Wireless Wars

November 1, 2009

As our helicopter circles Anvil Island in Howe Sound, just off the Sea to Sky Highway, someone’s mobile phone rings. The copter is so deafening it’s impossible to hear the ringtone directly, but our padded green headsets pick up the interference, a clicking sound: dit, dit di-dit, dit di-dit.

Nathan Dubeck, the pilot, has heard it before. Having logged more than 4,000 hours of flight time, he knows exactly what causes this sort of radio interference. “Someone’s got a GSM phone,” he tells us.

An awkward silence fills the cabin. In Canada, only the Rogers wireless network uses GSM (Global System for Mobile) technology, one method of sending data through the air at high frequencies. But onboard the chopper are employees of a rival wireless company: a Bell manager, a Bell communications officer, a Bell photographer, and a Bell contractor. Is there a traitor among them, someone using a Rogers phone?

“Busted!” the communications lady exclaims, and everyone bursts out laughing.

It’s a funny moment, but wireless competition in Canada is no joke: according to the Canadian Radio-television and Telecommunications Commission, the country’s mobile wireless sector had roughly 22 million subscribers and revenues of $16 billion in 2008. With so much money at stake, it’s no surprise that the 2010 Winter Olympics have become ground zero in the wireless wars.

In 2004, Bell outbid Vancouver-based Telus (the third of the big three wireless companies, which together cover 94 percent of the Canadian market) for official sponsorship rights to the 2010 Games. (Rogers, which has the greatest market share, did not bid.) Bell’s success was a slap in the face for Telus, which spent more than $4 million bringing the event to Vancouver by contributing ideas to the city’s proposal, building the initial 2010 website, and funding community initiatives.

The winning bid? Ninety million dollars cash, $50 million for marketing and outreach programs, and $60 million worth of telecommunications services. Bell sees the Games as a chance to increase its market share in the West. “It’s all about business,” explains Jon Arnold of J Arnold & Associates, an industry analyst. “For them, it was an important coup to get the rights to 2010, right in Telus’s back yard.”

As part of the services component of their sponsorship, Bell has built a solar-powered dish on Anvil Island to strengthen the wireless signal in this remote area between Vancouver and Whistler. It has also built 41 other “cell sites” around the Lower Mainland, and connected each major venue to a new 285-kilometre fibre-optic cable, so that broadcasters can beam sporting events around the planet. Norm Silins, the Bell manager with us in the helicopter, calls it “the widest deployment of our capabilities for any customer, ever." We descend onto a makeshift wooden helipad surrounded by steep cliffs. The solar panels, the dish, and the other apparatus in the wilderness below make it feel like we’re landing at some lunar outpost. But as the copter touches down and we hop out like soldiers, ducking the wash from the rotors, the Apollo 13 moment morphs into Black Hawk Down: the pilot lifts off again quickly, as though it’s dangerous to linger. (Actually, he’s off to fetch some fuel.)

The dust settles and Silins, 47, shows us around. He wears a crisp white polo and black Ray-Ban sunglasses. He started his career as a mining engineer, extracting uranium in the Yukon. After earning an MBA from the University of Toronto in 1988, he spent five years at Nortel before joining Bell.

As we inspect the garage-door-sized solar panels, an inch thick and propped up at an angle by concrete and steel, Silins explains that his team had to make complex projections before expanding the company’s wireless network for 2010. How many people will be around for the Games? Of those, how many will use Bell’s network, either as Canadian subscribers or as roaming visitors? And how often will they be talking on the phone or sending data-heavy picture and video messages?

As part of his research, Silins shadowed Games organizers in Athens (2004), Turin (2006), and Beijing (2008), and found that there has been a tripling of Olympics-related wireless usage every two years. On top of that, there was an instant four-fold increase in demand during big events like the opening and closing ceremonies. After looking at these trends and their own internal projections, his team overbuilt Bell’s wireless potential here by 25 percent to be safe.

After the Olympics, Silins says, Bell will use this “legacy capacity” to better serve existing customers and to seek out new ones. And new ones will be important, since Bell will be competing against more wireless companies. Last year, Industry Canada auctioned off new swaths of wireless spectrum, much of it reserved for upstarts. The new carriers coming to Vancouver next year include Globalive Communications Corp., which adopted the brand name Wind, and the more secretive DAVE Wireless Inc. “You’ve got all these new players,” says Marc Choma, a spokesperson for the Canadian Wireless Telecommunications Association, an industry body. “It’s going to become a hyper-competitive industry.”

Anthony Lacavera, CEO of Globa­live, thinks his company is already having an effect on prices, which many Vancouverites complain are too high. “We’re seeing the incumbents react,” he says, citing recent ad campaigns by discount brands Koodo (owned by Telus), Fido (owned by Rogers), and Virgin Mobile and Solo Mobile (both owned by Bell).

Lacavera, whose company plans to open retail stores and mall kiosks here, says Vancouver is a high priority. He’s not sure whether the company will debut before the Games: “There’s a short-term revenue opportunity related to the Olympics,” he says, “but we only have one kick at the can. We will not launch until we’re comfortable.”

Wrapping up our tour on Anvil Island, Silins explains that Bell leased Crown land to put up the dish, just as it sometimes leases space on BC Hydro transmission towers for its wireless transmitters and inside underground conduits owned by local municipalities for its bundled fibre-optic cable. Each strand of the cable is only a hair’s width, yet the 144 strands Bell has installed along the Sea to Sky corridor are capable, he says, of handling all of Canada’s Internet traffic.

The helicopter, refuelled, touches down. We climb back aboard, and, as we settle in for the ride back down Howe Sound, check our phones for messages.

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