Telus leaves wireless group in a surprise move
The Canadian PressFriday, February 28, 2014
Big carrier Telus has pulled out of the lobby group representing the telecom industry and rival Rogers says it's also thinking over its membership in the Canadian Wireless Telecommunications Association.
In a surprise move on Friday, Telus said it can do a better job on behalf of customers on its own.
Chief corporate officer Josh Blair said Telus isn't at loggerheads with the industry group, but there are many times when "we have a unique view on what's right for our customers."
"We feel that taking our own position on the customer service front, customers-first front, is the right thing for us to do," Blair said.
The CWTA had already been hit by exits from new carriers Wind Mobile, Mobilicity and Public Mobile, now owned by Telus, which left in 2013. The small carriers had said the association favoured the big three carriers, Rogers, Bell and Telus, and that they could better serve their customers outside the organization.
Rogers (TSX:RCI.B) wouldn't say if it will remain in the organization.
"We've been reviewing our options and we'll make a decision that's right for our customers," spokeswoman Patricia Trott said Friday.
Bell spokesman Mark Langton said the big carrier has no intention of leaving the association, noting Bell is a long-time member which has been active in developing projects such as the stolen phone registry, Amber Alert program and the Mobile Giving Foundation.
Telecom analyst Iain Grant said the loss of a big carrier like Rogers could be fatal.
"This could mean the end of the CWTA," said Grant, managing director of the SeaBoard Group.
"I'm not sure the CWTA ever enjoyed a lot credibility," said Grant, adding it was seen as a "mouthpiece" for the big three telecoms.
The CWTA worked in co-operation with Rogers, Bell and Telus last summer in a campaign against U.S. telecom Verizon possibly coming to Canada, but Verizon decided against heading north. The campaign sparked a public backlash and was viewed by some as the big three carriers trying to prevent more competition.
Grant said the CWTA should act as a resource group and "stick to recycling" cellphones and keeping statistics rather than taking political positions and trying to set policy.
Analyst Eamon Hoey said the CWTA eventually will just "dwindle out."
Hoey noted that a similar lobby group of Canadian telecom companies in the 1990s, called the Stentor Alliance, also fell apart because it was out of step with a lot of its members.
Hoey said he's doesn't think all of CWTA's members supported last summer's campaign against Verizon.
"It (the association) has no credibility to begin with and I think Telus finally arrived at that conclusion," said Hoey, of Hoey Associates Management Consultants in Toronto.
The financial impact of Telus leaving isn't yet clear, said CWTA spokesman Marc Choma. Telus wouldn't say how much it pays in yearly fees to the association, headed by former New Brunswick premier Bernard Lord.
But Choma said the industry group would be pleased to welcome back Telus in the future.
While all three big carriers put a lot of emphasis on customer service, Telus has been setting itself apart from Rogers and Bell by getting leading results with customer retention and significantly lowering its complaints.
Blair said Telus wants to do what works for its customers and doesn't want to follow broad positions that are taken by the industry group aimed at suiting all of its members.
But Telus (TSX:T) said it will continue to co-operate with the Ottawa-based group on projects such as cellphone recycling, stolen handset registry and wireless Amber alerts.
The CWTA annoyed some consumer groups last year when it opposed getting rid of three-year contracts and wanted to give consumers the choice of either a three- or a two-year commitment to buy a mobile phone.
Telus was the first of the big three carriers to implement two-year contracts last summer in advance of the new wireless code, which has national standards for the content and clarity of cellphone contracts that were set by the Canadian Radio-television and Telecommunications Commission.
Rogers and Bell (TSX:BCE) as well as a host of other Canadian telecom companies are among the roughly 110 members that remain in the industry group.