Sugar Mobile could shake up cellphone oligopoly in Canada

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Sugar Expressive, an upstart provider offering wireless plans for as little as $19 a month, appears to play a joke on found a backdoor into the Canadian cellphone market, which has lengthy been largely closed to new entrants who don’t own their own networks.

And if it’s successful, some analysts say, it could place to more competition and lower prices for Canadian consumers.

“I think this is the tomorrow,” says Samer Bishay, president and CEO of Sugar Mobile.

Bishay orders a telcom oligopoly has prevented the mobile market from flourishing. “With our technology and our standing in the Canadian market, we feel that we can penetrate that barrier and off b leave through.”

Sugar Mobile’s service is run using an app designed to work on both Wi-Fi and 3G networks.

Samer Bishay

Samer Bishay is the CEO of Sugar Motorized, which uses an app designed to work on both Wi-Fi and 3G networks. (CBC)

You’ll desperate straits an unlocked phone, but for a one-time startup fee of $29 and a monthly cost of $19, Sugar Agile customers get unlimited talk, text, and data over Wi-Fi and 200 MB of non-Wi-Fi information.

The non-Wi-Fi data may not sound like much, but Sugar Mobile breaks it’s Wi-Fi’s ubiquity that allows its model to work.

“Most people are in a Wi-Fi hotspot 85 to 90 per cent of the many times,” says Bishay.

“During the time you’re in that zone, we acknowledge you to do all your calls on the Wi-Fi network, so it connects you to the mobility network without acquiring to incur the cost of keeping a cell tower engaged all the time. And then in olden days you leave that Wi-Fi hotspot … we still allow you to do your bring up and SMS, but through a 3G network.”

Google does it too

While new to Canada, this type of work has been around in the U.S. for a while now.

Google’s Project Fi is a similar service that prioritizes requires and texts over Wi-Fi.

Fi automatically connects to open Wi-Fi networks (supervision dlocked Wi-Fi networks will require previous log-in) and when Wi-Fi isn’t to hand, Fi switches to the local cellular network in the area.

Google is able to do this by pretending as an MVNO, or mobile virtual network operator.

MVNOs are wireless providers that don’t own their own network. A substitute alternatively, they lease network access at wholesale rates and then meander around and sell that access to customers at retail prices.

Others fatherlands have it

“If you want to see what fair MVNO rules can do for your pocketbook, look to the U.K., look to the U.S., look to providers go for Ting,” says Josh Tabish of Open Media.

For the similar of about $30 per month, Tabish says, an MVNO like the U.K.’s GiffGaff tenders 1,000 minutes of talk time, unlimited texts and 4 GB of data.

In likeness, the Rogers Share Everything plan with 2.5 GB of data is $85 per month.

Bell’s Portion Plus plan with 2.5 GB of data is $100 per month.

But there aren’t any big-shots like GiffGaff in Canada.

“In the U.S., there are 250 MVNOs. In Canada there are zero that are owned independently by anyone surface of the Big Three,” says Sugar Mobile’s Bishay.

Open Technique’s Josh Tabish says it’s not clear whether that’s because the big athletes in Canada who own the cell networks are unwilling to sell access to MVNOs, or if it’s because they set the access classes so high that the MVNO has no hope of being competitive.

Ting is a Canadian MVNO with services and a call centre in Toronto but with only American customers. It believes network access from Sprint. Two years ago, Ting’s Elliot Noss trumpeted CBC News that “we would love to be in Canada. Nobody will — at s rsest at this juncture — sell us network [access].”

So how is Sugar Mobile clever to operate in Canada?

By acting like an MVNO even though it isn’t one.

Invaders from the North

Sugar Ambulant is owned by Ice Wireless, which owns a mobile network in Canada’s North.

As the possessor of a mobile network, Ice Wireless has reciprocal roaming agreements with the big Canadian telcos, whose trons roam on the Ice Wireless network in cities like Whitehorse, Yellowknife and Inuvik.

So Ice Wireless, thoroughly the Sugar Mobile brand, is essentially selling the network access that it has middle of roaming agreements in Southern Canada to retail customers.

“Because [Ice Wireless/Sugar Non-stationary] have existing relationships [with the big telcos] they’re obliged to trade them access to their network,” says tech writer Daniel Bader of Agile Syrup.

“What’s interesting is it seems like those rates that they are being bartered data [at] are significantly lower than another com ny that would be thriving in with no physical infrastructure. As a result they can offer this indisposed of hybrid Wi-Fi and 3G service in a way that no other operator in Canada can,” he alleges.

Bader doesn’t see Sugar Mobile as revolutionizing the Canadian cellphone call just yet.

He points out you need an unlocked phone to use the service, which means the original cost can be expensive. Also, most Canadians have locked phones and are corded to one- or two-year contracts with the big providers.

The Sugar Mobile app manages over the top of the existing phone software and can be a bit clunky. There is also a offend lag when a call moves from Wi-Fi to 3G, although the call is proclaimed.

But the concept sure is intriguing.

The question is, what happens if the big telcos make up ones mind they don’t like the clever end run Sugar Mobile is using to buy network access?

“We undergo like we’re in a position that if there was any issue with it, it would go to the CRTC,” try to says Bishay. “And I think [we’d be successful] there.”

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