Comments on: Continued cellular disatisfaction

By: tom

tom — Mon, 19 Nov 2007 02:30:00 +0000

i am sure that I have heard that 85% of the budgets of the wireless carriers is related to marketing and not technology. if that is true than size of the network would not be the biggest issue affecting pricing. maybe they need to cut out all those TV ads and base the marketing campaigns on price instead. what we really need as consumers is the comoditisation of wireless voice and data. only than will there be any rationality to pricing.

By: Alec

Alec — Tue, 13 Nov 2007 19:39:25 +0000

I made that point, Steve, but apparently our regulatory environment requires that the far flung reaches of the Canada also be served. Not being competent to refute the point, I didn’t.

By: Steve

Steve — Tue, 13 Nov 2007 19:17:48 +0000

“Spread out over long distances, it’s more expensive to build out the nationwide network coverage” With all due respect to your house guest, who was probably just passing on the self-serving accepted wisdom in Canada’s mobile market (including CRTC), this argument is very weak.

Canada’s vast land mass is obviously not served by mobile carriers and even good stretches of our major transportation corridors are without it too. When we look at where the coverage is, and where the vast majority of our population is, the real story emerges. Canada is substantially more urbanized than the US: (http://www.demographia.com/db-intlua-area2000.htm) at 1550 people per square urban KM compared to 1150 in the US.

I know the network infrastructure costing & engineering models are based on a wide variety of factors in addition to population density (as a surrogate for demand/useage desnity), however this is a major variable. Many of the other demand variables, including in particular price, are within the industry’s ability to control.

By: Paulo

Paulo — Mon, 12 Nov 2007 20:50:44 +0000

I am sure that economies of scale do come into play to some extent.

However, this 10%-the-size argument doesn’t completely cut it since most of the high-speed networks in both Canada and the US only serve metro areas anyway, and there are fewer of them in Canada. In fact, I believe it’s the case that in Canada fewer metro areas cover a larger percentage of the overall population than the equivalent number of areas in the US.

It is true that it’s more expensive to hook up the vast distances *between* the metro areas, but that’s not a 3+G specific problem, and it’s likely already been done to some extent as part of the past “packetization” of the networks.

I just don’t buy the argument that it’s that much more expensive.

By: Tony Hung

Tony Hung — Mon, 12 Nov 2007 17:08:06 +0000

The argument that there are other factors which might make things more expensive in Canada. But there’s the issue of magnitude, which you rightly touch on — how _much_ more expensive should things be, if at that?

I expect the answer is “probably much, much, much less than everyone expects, or Telco’s want to share”. ;)

Cheers
t @ dji