Frédéric Perron, president and chief executive officer of Cogeco, said the company is well aware of the heightened competition in the wireless market and has factored those dynamics into its plans.Andrej Ivanov/The Globe and Mail
Cogeco CGO-T has struck deals with an unnamed national wireless carrier and with Bragg Communications Inc.’s Eastlink that bring the Montreal-based telecom closer to launching cellphone service within its Quebec and Ontario market.
The national wireless carrier will provide Cogeco with access to its network of cellphone towers, while Eastlink will provide access to technology platforms, including IT systems and core infrastructure. Both deals are for a period of five years.
“We now have all the building blocks to launch wireless, so now it’s a matter of assembling them together, but it’s a go,” Frédéric Perron, president and chief executive officer of Cogeco, said Monday. “That’s No. 1. And No. 2 is we now have a way to do it in a capital-light fashion, as opposed to trying to build everything ourselves,” he added.
Cogeco Inc. and its Cogeco Communications Inc. CCA-T subsidiary are preparing to enter a wireless sector that has become increasingly competitive after Quebecor Inc.’s 2023 acquisition of Freedom Mobile. (Shaw Communications Inc. previously owned Freedom and sold it when it was taken over by Rogers Communications Inc.) According to analysts, the telecoms have been locked in a price war ever since.
Mr. Perron said Cogeco is well aware of the heightened competition in the wireless market and has factored those dynamics into its plans.
“With the deals that we had on the table we were comfortable to go ahead, and we’re confident that we can offer a service that’s competitive and attractive to consumers,” Mr. Perron said.
The company did not divulge the details of its wireless deals, and it kept the identity of the national carrier confidential because it is that company’s policy to do so, according to Mr. Perron. Cogeco will share more details of its wireless rollout in the coming weeks, he said.
Cogeco has been discussing plans to launch a Canadian wireless carrier for some time. The company’s plan is to offer service within its existing market as part of a bundling strategy. Mr. Perron said customer demand for bundles – packages that offer discounts for customers who subscribe to multiple services such as internet, television and wireless – has been growing.
Cogeco recently launched cellphone service in the United States under its Breezeline brand by striking a deal to piggyback on AT&T’s network.
The telecom was able to strike a deal with a national wireless carrier after the Canadian Radio-television and Telecommunications Commission introduced its mobile virtual network operator, or MVNO, regime.
In 2021, after a lengthy review, the telecom regulator ruled that Rogers Communications Inc., BCE Inc., Telus Corp. and SaskTel must sell wireless network access to eligible regional competitors at rates that are negotiated between parties. If an agreement can’t be reached, the matter would be settled through arbitration. Securing a good rate is key for a prospective MVNO as operating profit margins for such services are typically thinner than those of a service provider that owns the network.
The framework is intended to increase wireless competition by allowing regional competitors to start selling services in new markets by piggybacking on larger rivals’ networks for a period of seven years while they build out their own infrastructure.
Eastlink, which was founded in Nova Scotia by the Bragg family, started out as a Maritime cable company. It has been offering wireless service since 2013 and launched 5G service in 2022.