Telecom Update #511, January 6, 2006

************************************************************ TELECOM UPDATE ************************************************************ published weekly by Angus TeleManagement Group Number 511: January 6, 2006

Publication of Telecom Update is made possible by generous financial support from:

** AVAYA: ** BELL CANADA: ** CISCO SYSTEMS CANADA: ** ERICSSON: ** MICROSOFT CANADA: ** MITEL NETWORKS: ** NEC UNIFIED SOLUTIONS: ** ROGERS TELECOM: ** VONAGE CANADA:

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IN THIS ISSUE:

** We're Back ** Wireless Number Portability Schedule Shortened ** Bell Cuts One-Third of Enterprise Team ** Videotron Leads IP Phone Race ** RIM Wins Another Patent Ruling ** Bell Told to Reduce "Naked DSL" Rates ** Bell Canada Plans Business-Line Rate Hikes ** Nortel Chooses Toronto HQ ** Telus Charged Over Cellphone Records ** BC Firm to Make Phones for Skype ** CRTC Holds Off on VoIP 9-1-1 Service Ruling ** Nortel Buys Router Maker ** Amtelecom Boosts Offer for People's ** NW Ontario Cellcos in Roaming Dispute ** U.S. Cellcos Miss E9-1-1 Deadline ** Exfo Buys Testing Firms ** Cygnal Names New CFO ** CIRA Meeting to Revise Bylaws

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WE'RE BACK! We've had a two-week break, we're relaxed and invigorated, and we're pleased to resume our weekly reports on changes in the ever-changing telecom industry. The rate of change shows no signs of slowing in 2006!

WIRELESS NUMBER PORTABILITY SCHEDULE SHORTENED: In Telecom Decision

2005-72, the CRTC orders Bell, Rogers, and Telus to implement full wireless number portability by March 14, 2007, in all areas of BC, Alberta, Ontario, and Quebec where wireline Local Number Portability is currently in place. This is six months earlier than the implementation date previously proposed by the cellcos. (See Telecom Update #497, 500)

** In other provinces where wireline LNP is already available, as well as in Regina and Saskatoon, these carriers must implement "porting-out" of wireless numbers by March 14, and "porting-in" by September 12, 2007. The same deadlines apply to other wireless carriers, including resellers, wherever wireline LNP is available.

** Wireless-to-wireless ports must be completed in 2.5 hours; wireless-to-wireline and wireline-to-wireless ports can take two business days.

** Wireless carriers (but not resellers) will have direct access to Canada's LNP systems without having to meet CLEC obligations.

BELL CUTS ONE-THIRD OF ENTERPRISE TEAM: Bell Canada laid off about one-third of the employees in its Enterprise Marketing organization in December. The company eliminated 65 full-time positions and 10 contract jobs, mostly lower level-managers who worked on video broadcast, international, and program management and on custom deals for large customers.

** These layoffs are in addition to September's cuts, which eliminated 5% of Enterprise Marketing positions, including three directors.

** According to CRTC figures, large and very large businesses make up 1.8% of incumbent telco business accounts, but generate 68% of their business revenues.

VIDEOTRON LEADS IP PHONE RACE: Videotron says it now has nearly 163,000 cable phone customers. The cableco's total year-end customer base of 1.51 million is 4% higher than a year ago.

** Videotron Telecom has been merged into Videotron Ltee as part of a new division, Videotron Business Solutions. The division includes business cable services and offers expanded small-office services.

RIM WINS ANOTHER PATENT RULING: The U.S. patent office has issued non-final rejections of two more patents involved in NTP's suit against Research In Motion. The agency has assigned a special "dispatch team" to fast-track the review of the NTP patents. (See Telecom Update #508, 510)

** RIM reports revenue of $561 million for the three months ended November 26, an increase of 53% on the year and 14% on the quarter. Net income of $120 million was a third higher than a year ago.

BELL TOLD TO REDUCE "NAKED DSL" RATES: CRTC Telecom Order 2005-415 orders Bell Canada to lower its unbundled loop rate by 50% when a "dry loop" is leased by an ISP in conjunction with Bell's Gateway Access or High Speed Access service. The Commission said Bell recovers the other half of the cost through the Gateway Access and HSA charges.

** A coalition of Quebec ISPs calls this a "landmark decision" that allows them to offer VoIP on "naked" DSL across Quebec and Ontario. The Commission has not yet ruled on the coalition's complaint that Bell is subjecting them to a margin squeeze (see Telecom Update #507).

BELL CANADA PLANS BUSINESS-LINE RATE HIKES: Bell Canada has asked the CRTC to approve monthly rate increases of between 2.9% and 3.7% for Business Primary Exchange service (local telephone lines) and for Local Link service, in most of its operating territory, effective March 1. The telco also wants to increase the minimum charge for Centrex changes from $60 to $100 per request, effective January 23.

** Primary Exchange: ** Local Link: ** Centrex: NORTEL CHOOSES TORONTO HQ: Nortel Networks has chosen an 11-storey, 160,000 square foot building in west Toronto as the site of its new global headquarters.

** Nortel's Chief Marketing Officer, Clent Richardson, will leave the company March 1 after only 18 months on the job.

TELUS CHARGED OVER CELLPHONE RECORDS: The RCMP received Telus cellphone records related to an Edmonton serial-killer investigation on December 23, nearly five months after requesting them. Telus will appear in court next week to answer charges related to the delay, which it says was due to "misunderstanding and miscommunication."

BC FIRM TO MAKE PHONES FOR SKYPE: Ascalade Communications, based in Richmond BC, has signed a development deal to develop telephones and other devices for Skype's VoIP service. The first product is a DECT-based cordless phone.

** At the Consumer Electronics show in Las Vegas this week, Skype announced a Netgear-developed phone that allows users to place Skype calls over Wi-Fi connections, and a D-Link adapter that enables Skype calls from a customer's traditional telephone.

CRTC HOLDS OFF ON VoIP 9-1-1 SERVICE RULING: In Telecom Decision

2005-73, the CRTC agrees to wait until after April 2006 to rule on CISC proposals to improve VoIP 9-1-1/E9-1-1 service. CISC reported on fixed/non-native VoIP 9-1-1 options in November, but says its proposals for nomadic VoIP services, due in April, may provide better options for both types.

NORTEL BUYS ROUTER MAKER: Nortel Networks has agreed to buy San Jose-based Tasman Networks, which makes wide-area network routers for small- and medium-office deployments, for US$99.5 million.

AMTELECOM BOOSTS OFFER FOR PEOPLE'S: Faced with a rival bid for People's Communications, the independent telco in Forest, Ontario, Amtelecom has raised its offer by 6% to about $22.6 million. The People's board is recommending acceptance. (See Telecom Update #509)

NW ONTARIO CELLCOS IN ROAMING DISPUTE: Superior Wireless, a cellco in northwestern Ontario, has asked the CRTC to order Thunder Bay Telephone to reinstate roaming on its digital wireless network for Superior Wireless customers, stating that TBT deactivated such roaming without notice on December 12. (See Telecom Update #318)

U.S. CELLCOS MISS E9-1-1 DEADLINE: Under a Federal Communications Commission order, U.S. cellular carriers were supposed to ensure that

95% of their customers were using digital GPS-equipped cellphones that can transmit location information when calling 9-1-1. Five of the largest cellcos have asked for an extension, saying that seven million customers have refused to give up their old phones.

EXFO BUYS TESTING FIRMS: Exfo Electro-Optical Engineering, based in Quebec City, has agreed to buy the assets of Toronto-based Consultronics, which makes broadband access testing equipment. Exfo will pay about $20 million.

CYGNAL NAMES NEW CFO: Cygnal Technologies has appointed James Shannon, who formerly headed finance for a hardware distributor, as its Chief Financial Officer. (See Telecom Update #500)

CIRA MEETING TO REVISE BYLAWS: The Canadian Internet Registration Authority (CIRA), the group that manages the dot-ca Internet domain, will meet in Toronto on February 1, to vote on bylaw amendments. The changes, it says, will provide more diverse representation on the Board of Directors and allow the group to broaden its operations. See

for details.

** All dot-ca domain owners are members of CIRA. Members who attend the February 1 meeting in person will receive a 128 MB memory key.

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