Going Slow in Atlantic Canada

By Gerry Blackwell

July 19, 2006

Hesitant to talk details, Aliant trumpets its hotspot service as innovative despite lagging behind the competition — which appears similarly stalled in action.

The mills of the gods grind slowly, they say. Ditto, apparently, incumbent telcos. Earlier this summer, Aliant, the former monopoly telephone company in Atlantic Canada and now a subsidiary of Bell Canada Enterprises, launched an “innovative” commercial Wi-Fi hotspot service featuring eight hotspots in airports and a convention/entertainment complex.

It is difficult to see how the service can be “innovative” given that other telcos, including others in Canada, and private companies have been deploying similar hotspots for five or six years, and that at least two municipalities in Atlantic Canada – Fredericton and St. John in New Brunswick – have already launched citywide free Wi-Fi services.

Aliant had been offering service at some of its hotspot sites for free for over a year as part of a market trial. With the launch of the commercial service at the end of June, however, users must now pay – about $6.75 an hour or $11.75 for a contiguous 24-hour period. For that they get an upper speed of 1 megabit per second (Mbps).

If they take the latter option, they can use the service in any of the eight Aliant hotspots, but for the moment, nowhere else. No monthly subscription option for power users is available, and no bundling option with other Aliant services, such as mobile phone. Users can pay only by credit card for now.

“Additional payment or service options are being developed and will probably be launched before the end of the year,” says Paul Pothier, director of wireless business marketing for Aliant’s wireless division. The company decided not to wait to develop the new payment and service options because “we wanted to make sure we got into the market quickly,” Pothier says.

One might think that a project so long in gestation would emerge more fully formed, but not so. In fact, Pothier could or would say remarkably little about how the service works or how it might evolve.

Aliant is using provisioning, authentication and billing software from SolutionInc, a company based in Halifax, Nova Scotia, where Aliant is also headquartered. SolutionInc provisioned the access points, as well. Pothier couldn’t or wouldn’t say which network vendors' products are being used, but multiple vendors are involved. The sites use backhaul services from Aliant – “it varies depending on the number of access points and the expected potential users,” Pothier says – and brings traffic back to an Aliant network operations center (NOC).

There were three other hotspots still in trial mode, including the largest of the bunch at the international airport in Halifax, Nova Scotia, but Pothier could say nothing about when they might go commercial, or how quickly new Atlantic Canada hotspots would be added to the network.

“We will continue to plan to add additional hotspots,” he says. “We’re not making public yet which sites we will add, and I can’t say how many will be in place [by the end of the year].”

Aliant used the marketing trial period to gauge demand for a commercial service, explore how much users might be willing to pay and figure out what kind of support services would have to be put in place. “Now that customers have to pay, we have seen a drop in usage,” Pothier says. “We really need to determine now what kind of business case there is to add additional hotspots.” The company was “quite encouraged” by results in the first week or so of service, however.

Aliant and Pothier may be forgiven for playing their cards close to the vest. The company has seen some upheaval lately. As part of a complex set of stock transactions, Aliant’s wireless telecommunications division – the one responsible for the hotspot project – was recently transferred to Bell Canada, the much bigger incumbent in Ontario and Quebec that had for some time held a majority share in Aliant. Bell provides local phone service in Ontario and Quebec, as well as cellular, business telecom, high-speed Internet and satellite TV service in most places in the country.

Just to complicate things, a new publicly traded company also emerged from these dealings. Bell Aliant Inc. will go forth and manage Aliant’s wireline operations. The upshot is that there may be some uncertainty about what will happen to Pothier’s hotspot project.

Bell’s Wi-Fi hotspot strategy is two or three years ahead of Aliant’s, but still seems muddled and hesitant. After a long trial period of operating a double handful of AccessZone sites offering free service, it closed some down over a year ago while continuing to operate others, still for free. Then a year ago, it launched 275 hotspots in Mailboxes Etc. locations across the country. Mailboxes was to be just the first deployment in a new, more aggressive Bell hotspot strategy. The company expected to have 500 sites up and running by the end of 2005.

Bell is also part of a Wi-Fi hotspot roaming consortium with the other two major cellular carriers in Canada: Rogers Wireless, part of the Rogers Communications empire, and Telus Mobility, the cellular division of Telus Corp., the incumbent phone company in Alberta and British Columbia in the west. That initiative has been on the brink of going commercial for over a year, but appears stalled.

Pothier says his group is currently working on getting the Aliant hotspots into this larger roaming deal but, almost predictably, can provide no timeframe for when that might happen. He does say with some assurance that the Aliant brand will continue to be used in Atlantic Canada. There is also the possibility of Aliant customers being able to roam to private hotspots that Aliant and SolutionInc have provisioned for customers – none of which he can name – but that is a lower priority.

While Aliant is supplying services to some Atlantic Canadian municipal Wi-Fi projects, it has no plans at the moment to undertake projects of that sort on its own, Pothier says.

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