Telecom Update #546, September 15, 2006

************************************************************ TELECOM UPDATE ************************************************************

published weekly by Angus TeleManagement Group

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Number 546: September 15, 2006

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

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** Telus to Become Income Trust ** Stock Market Voodoo=20 ** 2006 Telecom Hall of Fame Awards Announced ** Wireless-Only Households Jump to 615,000 ** Telus to Run Ontario Government Network ** Bell Opens Montreal Testing Lab ** Rogers Provides Corporate Email Encryption ** Nokia, Nortel Chosen for Telus Broadband Project ** SaskTel to Launch Winnipeg Directory ** Rates for Toll-Free Carrier ID to Be Amended ** U.S. Wireless Auction to Reap $13.7 Billion ** MTS Buys Rural Manitoba Cableco ** Boisvert Steps Down as Telesat CEO ** Top Educators to Address "Enterprise Networks"

TELUS TO BECOME INCOME TRUST: If all goes as planned, Telus Corporation will become Canada's largest income trust following a special shareholders' meeting in January 2007. The carrier recently exhausted the tax shield it acquired by buying Clearnet in 2000: converting to an income trust will substantially reduce its future tax liabilities. Telus shares jumped 13.5% following the announcement.

STOCK MARKET VOODOO: Earlier this year investors yawned when BCE converted a big part of its assets into an income trust, and the BCE's stock price barely budged. But Telus's announcement this week caused BCE's stock to jump 8.5%. Does anyone really believe that the stock market is rational?

2006 TELECOM HALL OF FAME AWARDS ANNOUNCED: The six telecom pioneer and industry leaders who will be officially inducted into Canada's Telecom Hall of Fame at a gala dinner in Toronto on October 16 were announced this week. The 2006 laureates will be:

** Inventors and Innovators: Edward Rogers Sr (batteryless radio) and Donald Hings (walkie-talkie)

** Icons of Business: Ted Rogers (Rogers Communications) and Leila Wightman (Wightman Telephones in rural Ontario)

** Servants of the Public: Ernie Saunders (senior regulatory lawyer at Bell Canada)

** Advocates and Academics: Francis Dagger (champion of public interest in telecom, driver behind government ownership of western telcos)

** Special Recognition Award: "Digital World" (the SL-1/DMS digital switching technology developed by Bell-Northern Research and Northern Telecom in the 1970s)

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WIRELESS-ONLY HOUSEHOLDS JUMP TO 615,000: Statistics Canada reports that 615,000 Canadian households were using only cellphone service at the end of 2005, a jump of 285,000 from the previous year. Incumbent telcos' wireline revenues dropped by 3.8% in the year ending March 31,

2006, while wireless revenues shot up by 17.2%.

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TELUS TO RUN ONTARIO GOVERNMENT NETWORK: The Government of Ontario has awarded Telus a five-year $140 million contract to supply and manage the data network that links 1,500 government locations across the province. The previous provider was EDS Canada, utilizing network services from Bell Canada and Telus.

BELL OPENS MONTREAL TESTING LAB: A new Bell Canada laboratory in Montreal includes $100 million in technology and 125 km of fibre optics. It will test new products developed by Bell and other suppliers.

ROGERS PROVIDES CORPORATE EMAIL ENCRYPTION: Rogers Business Solutions has launched "Canada's first subscription-based encryption email service" for business users. The IBM-hosted service is $8.95 per email address per month.

NOKIA, NORTEL CHOSEN FOR TELUS BROADBAND PROJECT: Nokia and Nortel Networks will be major suppliers for Telus's $600 million broadband networking project. Nokia has a $150 million contract as integrator and installer of the telco's IP access network; Nortel will provide multimedia integration services. (See Telecom Update #545)

SASKTEL TO LAUNCH WINNIPEG DIRECTORY: DirectWest, SaskTel's phone book publishing subsidiary, says it will spend $3 million to launch a competitive directory in Winnipeg. DirectWest already publishes competitive directories in five Alberta cities, including Edmonton and Calgary.


2006-57 notes that the costs of the incumbent telcos' 800/888 Carrier Identification services, charged to competing carriers, have not been reviewed since 2001. The Commission says "costs for this database service have likely declined significantly" and directs Bell Aliant, Bell Canada, MTS Allstream, SaskTel, and Telus to file amended tariff pages and cost studies within 45 days.

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U.S. WIRELESS AUCTION TO REAP $13.7 BILLION: There were only two bids in the latest round of the U.S. auction of broadband wireless spectrum, indicating that the process is nearly complete. Top bidders to date are T-mobile, Verizon Wireless, and a consortium of cablecos and Sprint Nextel. The bids now total US$13.7 billion. (See Telecom Update #541)

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MTS BUYS RURAL MANITOBA CABLECO: MTS Allstream has bought Valley Cable Vision, which provides cable TV and Internet service to about 4,000 customers in southern Manitoba.

BOISVERT STEPS DOWN AS TELESAT CEO: Larry Boisvert has retired after

13 years as President and CEO of Telesat Canada. He is replaced by Dan Goldberg, previously CEO of the Netherlands-based satellite company SES New Skies.

TOP EDUCATORS TO ADDRESS "ENTERPRISE NETWORKS 2006": Among the speakers and topics at the Enterprise Networks conference, to be held October 24-25 in Toronto:

** Gary Audin, "Convergence Crosses Boundaries: Time for a Reality Check"

** John Riddell, "New Age Enterprise Wireless"

** Michael Dunne, "IP Planning, Migration, and Implementation"

** Henry Dortmans, "What Every Enterprise Needs to Know about This Industry"

For more information and to register online, visit

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The information and data included has been obtained from sources which we believe to be reliable, but Angus TeleManagement makes no warranties or representations whatsoever regarding accuracy, completeness, or adequacy. Opinions expressed are based on interpretation of available information, and are subject to change. If expert advice on the subject matter is required, the services of a competent professional should be obtained.

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