In 2008 Mobilicity invested $243.1 million to become a player in the Canadian wireless market. They took their time to launch and even before they gained a customer they promised all sorts of change. Looking back on when they were just called “DAVE Wireless,” then rebranded to Mobilicity, they boldly stated they’ll “bring simplicity and flexibility to the wireless market; customers will be able to choose easy to understand plans and services and know exactly what they are paying for. And our customers will always be confident that what they are getting is great value and will never be surprised by fees or charges.”
Their mission and values have stayed true by offering a few unlimited plans with no contracts. At the Canadian Telecom Summit today John Bitove, Executive Chairman of Mobilicity, said the market has slowly experienced a shift. Gone are the days in which carriers determine the rules, now it’s consumers. “The market is no longer a carrier’s market. It is a consumer’s market.
Bitove’s “consumer’s market” is an interesting point. He noted that wireless customers are demanding more from the carriers and the government. Several provinces have adopted consumer protection legislation (Bill 60 in Quebec), and customers have been putting “pressure on pricing,” thus making carriers offer more value and expecting them to work harder for their loyalty. Most Canadians get enticed by a low-priced 3-year contact term, but it’s now easier to cancel your service, pay the carrier a fee, take your device and switch to a new provider. Before the new entrant days, telecom was viewed as having limited choice. Now in the core cities in Canada (Toronto, Calgary, Edmonton, Ottawa and Vancouver) we have multiple players offering a wide range of services and prices.
The Big 3 carriers – Rogers, Bell, TELUS – have in some fashion offered customers reduced pricing and an option to purchase devices on a no-term basis. This strategy was evident via Rogers low-cost Chatr or Fido brand, Bell’s Solo or Virgin Mobile, or TELUS’ Koodo Mobile or CLEARNET. The Big 3 and their sub-brands still own the lions share of subscribers, which is over 95%, but the new entrants have certainly made a dent. Since Mobilicity is a private company they don’t need to announce their subscriber numbers, stats or ARPU (Average Revenue Per User). In an interview today Bitove stated to me they are “well above 200,000,” this was a vague answer as Mobilicity announced last Novemeber that they’ve successfully “attracted over 250,000 customers” since their launching in May of 2010. A recent report by the Convergence Consulting Group states that the new entrants (WIND Mobile, Moblilicity, Videotron and Public Mobile) will have 1.8 million subs by the end of 2012, or approximately 6.5% of the market.
There was one stat that stuck out during the Mobilicity presentation today. John Bitove said “I can tell you then when we bought our spectrum just a few years ago, we thought data would be 10% of our usage and today it is almost 90 per cent.” That’s a staggering number and it’s a good thing that Mobilicity offers their customers an Unlimited data plan.