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Dec. 3, 2009

Canada's three major wireless service providers are agressively looking for new customers, especially for the holiday season, a period that traditionally increases their sales as people buy new cell phones for their loved ones.

But the battle is agressive and it's getting uglier by the day...

On Dec. 1st, Rogers has launched legal action against Bell Canada and Bell Mobility, the latest twist in a bloody war over who can claim to have the fastest, largest or most reliable wireless network in Canada.

Rogers filed a claim in B.C. Supreme Court in an attempt to stop Bell from perpetuating some of its advertising spots that Rogers says are false and misleading.

In the claim, Rogers said Bell cannot promote its network as being the largest, because it is shared with Telus, and that data suggesting Bell is the most reliable and fastest is misleading because it was compiled before the network launched in late November.

Rogers Wireless executive vice-president John Boynton says "we have our own data to suggest that Bell isn't the most reliable wireless network and we will show up to court with our own data."

So far, none of the claims have been proven in court. Rogers is also taking aim at Bell's claims to have the "best" and "most powerful network." Boynton says that testing an empty network does not comply with any industry standards, and this is something he will clearly prove to the Court.

"These add up to no less than ludicrous statements that don't even mean anything and there's no testing for the words powerful and best," Boynton added.

Bell's printed ads contain a footnote stating its claims are based on a September analysis, which tested the average download speeds, dropped calls and call clarity in large urban centers, comparing the shared Bell network to Rogers.

Bell spokeswoman Julie Smithers said the company stands by its advertising and is prepared to fully defend its claims. Rogers has asked the court to force Bell to remove the ads in an injunction similar to the one imposed Friday on Rogers that forces it to remove any advertising that claims it has Canada's most reliable wireless network.

The battle has now been brewing for many weeks and is rapidly intensifying say some wireless industry observers in Canada.

The injunction came after Telus asked a B.C. court to prevent Rogers from continuing to make the long-standing claim. The judge agreed with Telus's argument that new networks put in place in November by it and Bell Canada have made it impossible for Rogers to claim superiority.

Rogers is due back in court today to seek to appeal to the injunction. The court battles between Canada's three largest mobile rivals come after Bell and Telus upgraded their wireless networks, enabling them to sell Apple's coveted iPhone for the first time last month, and that what's it all about says Rogers.

Rogers has already removed its most reliable claim from its Web site and faces a Thursday deadline for television, newspaper and radio advertising. Ads plastered on public transit and billboards across Canada must also be removed as soon as possible with a final deadline to remove all material by Dec. 18.

However, Rogers spokeswoman Odette Coleman said Tuesday "we're going to keep fighting this vigorously, we're going to defend our claim to the fullest." Telus spokesman Shawn Hall said the company has the biggest network in Canada, adding that Telus was also reviewing Bell's claims.

Carmi Levy, a wireless industry analyst with AR communications, said the lawsuits underscore how much is at stake in Canada's mobile market. "If they're all prime for a pretty good fight, it means they're going to fight for the loyalty of Canadian consumers."

"By going for the jugular in court, they believe they are highlighting just how non-monopolistic this industry is and that there's still room for grabbing some market share."

"Canadian consumers make buying decisions in part on their understanding of who has the best wireless network and the wireless network who's going to best suit their needs and they should be able to make that fair judgment on truthful information," said Boynton. But he also questioned why Telus didn't launch a suit against Bell.

"How could Telus have the largest network and yet Bell have the largest, and maybe its worth asking those two why they're not filing against each other because they're definitive statements," he said...

In its ultimate motion for an appeal, Rogers argues it will cost around $3 million to remove the ads launched as part of a $10-million campaign. Don Fenton, a marketing consultant who teaches at the University of Toronto, said it would be tricky for Rogers to launch a new holiday campaign in the next two weeks.

But he added that the lawsuits likely wouldn't impact most Canadian consumers already skeptical of such wild advertising claims. "I think there's a saturation of claims," he said. "I don't think most consumers really care or believe them anyway."

The three wireless providers, which control about 89.8 percent of Canada's mobile phone market are preparing to fend off a new wave of rivals expected to launch networks in 2010 after buying up wireless spectrum in a popular Canadian federal auction in April 2009.

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Source: Rogers Wireless.