MTS and Rogers customers in Manitoba will be able to do more with their cellphones in more places and at faster speeds thanks to a new precedent-setting agreement between the two telecommunications rivals.
The two companies announced Tuesday they have entered into a new strategic agreement that will see them spend tens of millions of dollars over the next 18 months to develop a "next generation" high-speed packet access (HSPA) wireless network in the province. Not only will the two companies share the development costs and the use of the new network, but also the ongoing costs of operating and maintaining it.
They also entered into a new roaming agreement that will see MTS Allstream pay Rogers Wireless for the use of its national wireless network to launch a new national wireless telephone service for MTS Allstream customers outside of Manitoba.
"We're pretty excited about it," MTS Allstream CEO Pierre Blouin said in an interview. "We believe it's a win-win."
Darryl Levy, Rogers Wireless's president for Western Canada, said this is the first time in Canada that rival telecommunications companies have struck a deal to share in the costs of developing and operating a new wireless network.
But he and Toronto telecommunications consultant Eamon Hoey predicted they won't be the last.
"Five years ago, if you were to suggest to Rogers or any other (telecommunications) company in Canada that they were going to share a network, you would have been booed out of the room," Hoey said.
But now, faced with mounting pressure to improve their financial performance, reduce their operating costs and provide a broader range of wireless products and services at cheaper prices, more and more telecos will likely be entering into these kinds of cost-sharing agreements, he added.
"The drivers will be overwhelming for them."
Blouin and Levy said the new network, which will be fully operational by late 2010 or early 2011, will enable MTS and Rogers to extend their coverage for voice and high-speed wireless data services to 97 per cent of the province's population.
"Customers will be able to get coverage they never had before and use (wireless) devices they never thought possible from places they never thought possible," Levy said.
For example, he said, customers will be able to use their handheld device, such as a BlackBerry or iPhone, almost anywhere in the province to search the Internet at the same speed as they could with their home computer.
They'll also be able to watch live video and TV, and conduct financial transactions -- pay for a product or service in a store or send money to someone else -- on their wireless device, he said.
Blouin said the big difference for MTS customers will be the speed at which they can send and receive data. That, and being able to use all of the new wireless devices and high-speed services that will be coming on to the market over the next few years.
And the new roaming agreement will mean MTS Allstream business customers in other provinces will now be able to get high-speed wireless services on top of their regular phone services, he said.
Let's talk partnership
MTS Allstream and Rogers Wireless
What have they done?
Entered into a strategic agreement that will see them share the cost of developing and operating a next-generation high-speed packet access (HSPA) wireless network in Manitoba. They also entered into a roaming agreement that enables MTS Alliance to use Roger's national wireless network to deliver a new national wireless service to its business customers outside of Manitoba, and to access to the same international roaming arrangements that Rogers has.
Why is it significant?
It's the first time in Canada two rival telecommunications companies have joined forces to develop and operate a high-speed wireless network.
How do the companies benefit?
Both save millions of dollars -- they're not saying exactly how much -- by sharing the cost of building and operating a single network, rather than doing it on their own. Some of that money can then be used to expand their product-and-service offering to their customers.
How do their customers benefit?
They get better wireless phone coverage at faster speeds. It also ensures they'll be able to access new generations of wireless handsets and voice and data services as they become available.
-- Sources: MTS Allstream and Rogers Wireless