Telecom Update (Canada) #470, February 25, 2005


************************************************************ published weekly by Angus TeleManagement Group
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Number 470: February 25, 2005

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

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** Ottawa Announces Telecom Review ** Executive Shuffle at Bell ** ... And Two Executives Leave Telus ** Rogers & Second Cup Team Up for Wi-Fi ** SuperNet Delays Could Cost Bell $100 Million ** Chubb Sues to Cancel Nortel Insurance ** Bell to Re-Acquire Outsourced Techs ** Cogeco Announces VoIP Partners ** Rogers Picks Nortel ** Thomson Seeks to Buy Globemedia ** Utelcos Merge Sales Forces ** Call-Net Reports Solid Results ** Datacom Market Up 5% ** Telebec Files Dark Fibre Tariff ** CRTC Okays Access to U.S. Emergency Code ** Changing of the Guard at Wi-LAN ** Telecom Coalition Sets Two Gala Dinners


OTTAWA ANNOUNCES TELECOM REVIEW: In this week's federal budget, the federal government said it "intends to appoint a panel of eminent Canadians to review Canada's telecommunications policy and regulatory framework ... [and] make recommendations before the end of the year."

The Budget says Ottawa will also:

** Give the CRTC the power to impose fines.

** Ask the Commission to "move expeditiously to implement wireless number portability."

** Ask the Task Force on Spam to report quickly (see Telecom Update #433, 461).

EXECUTIVE SHUFFLE AT BELL: On Tuesday, Canada's largest telecom company announced multiple changes in its top management team:

** Michael Neuman has resigned as President of Bell Mobility and Bell Distribution Inc. No reason was given.

** Robert Odendaal, who joined Bell last year from European satellite TV broadcaster BSkyB, is now CEO Bell Mobility and Video Services.

** Gary Smith, who also came to Bell from BSkyB last year, has been promoted from Senior VP to President of Bell ExpressVu.

** Alek Krstajic, formerly Chief Marketing Officer of Bell's Consumer Group, is now President of Bell Mobility.

** Kevin Crull, until recently a Senior VP Wireless at AT&T in the U.S., has joined Bell as President, Consumer Solutions.

** Ron Close, founder and former CEO of NetCom Canada, which was acquired by MetroNet and then merged into AT&T Canada in 1999, will head a new VoIP unit within Bell's consumer group.

... AND TWO EXECUTIVES LEAVE TELUS: Two top executives are leaving Telus, apparently as part of a cost-cutting program. EVP Corporate Strategy Chris Carty has already left, and EVP Corporate Development Mark Schnarr will leave soon, but will remain on the company's Board.

ROGERS & SECOND CUP TEAM UP FOR WI-FI: Rogers Wireless has begun offering wireless Internet access in "select" Second Cup cafes across Canada. Service is free until April; after that, 15 cents/minute will be billed to the customer's Rogers Wireless account. Users who aren't Rogers customers will be able to charge time to a credit card at $9/hour or $15 for 24 hours.

SUPERNET DELAYS COULD COST BELL $100 MILLION: The Alberta government has told Bell Canada to complete the SuperNet project by September 30 or risk losing its $100-million performance bond. The high-speed network, which aims to link 4,200 civic and provincial buildings in

429 communities, was originally supposed to be finished by January.

** Bell and its subcontractor, Axia NetMedia, have agreed to a completion and commissioning plan that they say will meet the new deadline.

CHUBB SUES TO CANCEL NORTEL INSURANCE: Chubb Insurance Co. has asked an Ontario court to rescind $40 million in insurance coverage for legal costs of Nortel Networks directors and executives. The insurer says Nortel made misrepresentations to securities regulators "with the intent to deceive Chubb." Nortel says it will "vigorously pursue its rights under the policies."

BELL TO RE-ACQUIRE OUTSOURCED TECHS: In 1996, Bell Canada spun off much of its residential installation and repair operations into a separate company, Entourage Technology Solutions Inc. Bell, which currently owns 33% of Entourage, has now reached an agreement to buy another 57% of it, then buy all shares and make it a wholly owned Bell subsidiary.

COGECO ANNOUNCES VoIP PARTNERS: Cogeco Cable says its IP- based residential telephone service, to be launched later this year, will use Cisco technology, and will obtain connections to the public switched telephone network and long distance from Telus.

ROGERS PICKS NORTEL: Rogers Cable says Nortel Networks is the primary provider of softswitch technology to support the digital phone service it plans to roll out this year. The value of the contract was not revealed.

THOMSON SEEKS TO BUY GLOBEMEDIA: Published reports say that Woodbridge Co., an investment company owned by Ken Thomson, has offered $1.5 billion to buy BCE's 68.5% share of Bell Globemedia, which owns the Globe and Mail, the CTV network, and several cable TV channels. BCE head Michael Sabia has said that the media group is not a strategic holding, but has not yet shown any interest in selling it.

UTELCOS MERGE SALES FORCES: Hydro One Telecom, which provides Ontario-wide data services, and Toronto Hydro Telecom have merged their sales teams. The Toronto utility telco is managing the joint sales force.

CALL-NET REPORTS SOLID RESULTS: Call-Net had $211 million in revenue in Q4 2004, bringing its total for the year to $819 million, up 2% from 2003. Only 48% of its revenue is now from long distance, with the rest coming from local, data, and wireless.

** At year-end Call-Net had 310,800 residential local lines, 160,100 business lines, and 30,600 wireless lines. The company says it will launch a high-speed (DSL) Internet service in Q3.

DATACOM MARKET UP 5%: A new report from the Convergence Consulting Group says the Canadian data and Internet access market grew by 5% in

2004 to $6.95 billion. See for more information.

TELEBEC FILES DARK FIBRE TARIFF: Complying with Telecom Order 2004-21 (see Telecom Update #464), Telebec has filed tariffs for inter- and intra-exchange dark fibre. The rates are identical to Bell Canada's.

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CRTC OKAYS ACCESS TO U.S. EMERGENCY CODE: In the United States, Area Code 710 is used for federal government emergency services, but it cannot be dialed from Canada. CRTC Telecom Decision 2005-7 requires Canadian carriers to provide access to 710, and to route 710-calls as toll-free calls.

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CHANGING OF THE GUARD AT WI-LAN: Calgary-based Wi-LAN, a Wi-Max equipment developer, has named Bill Dunbar as President and CEO, replaying Sayed-Amr El-Hamamsy. Dunbar was formerly CEO of Northwestel and WIC Connexus. Co-Founder Hatim Zaghloul continues as Chairman, but now without executive responsibility.

TELECOM COALITION SETS TWO GALA DINNERS: The Coalition for Competitive Telecommunications, representing some 12,500 Canadian businesses, will hold networking and fundraising events in conjunction with Canada's two leading telecom conferences this year. The gala dinners and receptions are scheduled for:

** May 30, during the Canadian Telecom Summit, the principal event for telecom service and equipment providers.
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** October 18, during Telemanagement Live, the premier conference on business telecom and networking.

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