Canadian Cellular/PCS Market Report

CANADIAN CELLULAR/PCS MARKET REPORT

2000 EDITION

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copies of this report
call (416) 360-0424
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June 2000

Table Of Contents

Section	Page

About This Report	vi

A note on Accuracy	viii

The Canadian Cellular/PCS Market at a Glance	9
1.0 Overview/Executive Summary	10
2.0 The Canadian Cellular Equipment Market	21
2.1 Cellular Handset Shipments	21
2.2 Installed Base	23
2.3 Handset - Unit type and Technology	24
2.4 Manufacturers - Handsets and Infrastructure Equipment	26
2.4.1 Overview	26
2.4.2 Audiovox	27
2.4.3 Ericsson Canada	29
2.4.4 Lucent Technologies	33
2.4.5 Mitsubishi Wireless Communications	37
2.4.6 Motorola Cellular	38
2.4.7 NeoPoint	43
2.4.8 Nokia	44
2.4.9 Nortel Networks	47
2.4.10 Panasonic	50
2.4.11 Qualcomm (Kyocera Wireless)	52
2.4.12 Samsung	55
2.4.13 Sanyo	56
2.4.14 Sony	57
2.5 Additional Products and Services	58
2.5.1 In-Building Wireless	58
2.5.2 Handset Rental	60
2.5.3 Telematics (Automatic Vehicle Location)	61
2.5.4 OnStar	62
2.6 Handset Pricing	64

3.0 The Canadian Service Providers	66
3.1 Overview	66
3.2 Network Coverage	71
3.3 Churn Rate	72
3.4 System Usage and Usage Patterns	74
3.5 Customer Acquisition Cost	76
3.6 Basic and Enhanced Services	77
3.6.1 Rogers AT&T	78
3.6.2 Mobility Canada	80
3.6.3 Clearnet	82
3.6.4 Microcell	83
3.7 Cost of Service	84
3.8 Revenues	88
3.9 Distribution	89
4.0 The Future of Cellular Services	94
4.1 Overview
4.2 Next Generation	95
4.3 Bluetooth	99
4.4 Emergency 911	102
4.5 PCS and the Internet (HDML, WAP/WML and XML)	103
5.0 Regulatory and Associated Issues	111
5.1 Competitive Local Exchange Carrier	111
5.2 Local Number Portability	112
5.3 Joint Marketing	113
5.4 Roaming and Competition	114
5.5 Spectrum Cap and Auctioning	114
5.6 Calling Party Pays (Call Originator Billing)	118
6.0 Resale and Resellers	119
6.1 Rogers AT&T	119
6.2 Microcell Connexions	120

List Of Exhibits And Figures

Exhibit		Page
1.	Cellular/PCS Phone Shipments by Manufacturer (1998-2003)	116
2.	Cellular/PCS Phone Shipments by Manufacturer by Region (1999)	117
3.	Cellular/PCS Phone Shipments by Phone Technology (1998-2003)	118
4.	Cellular/PCS Phone Shipments by Region (1998-2003)	118
5.	Typical Retail Price Ranges by Handset Type (1999)	119
6.	Cellular/PCS Phone Installed Base by Manufacturer (1998-2003)	120
7.	Cellular/PCS Phone Installed Base by Manufacturer by Region (1999)	121
8.	Cellular/PCS Phone Installed Base by Phone Technology (1998-2003)	122
9.	Number of Subscribers/Net Activations by Service Provider (1998-2003)	122
10a.	Subscribers by Service Provider by Province (1998-2003)	124
10b.	Subscribers % Share by Service Provider by Province (1998-2003)	125
11.	Rogers AT&T Features and Service Costs (2000)	126
12.	Bell Mobility Features and Service Costs (2000)	127
13a.	Clearnet (MiKE) Features and Service Costs (2000)	128
13b.	Clearnet (PCS) Features and Service Costs (2000)	128
14.	Microcell (Fido) Features and Service Costs (2000)	129
15.	Activations by Distibution Channel by Service Provider (1999)	130
16a.	Subscriber Penetration by Canadian Population (1998-2003)	131
16b.	Subscribers by Service Type by Service Provider (1998-2003)	131
17.	Revenue, Minutes of use & Revenue per Sub. by Service Provider (1998-2003)	132

Figure
1.	Canadian Cellular/PCS Market - Number of Subscribers (1992-2003)	6
2.	Cellular/PCS Telephone Shipments - Manufacturers Market Shares - 1999	7

About This Report

At over 130 pages, NBI/Michael Sone Associates' Canadian Cellular/PCS Market Report, 2000 Edition is the most comprehensive study yet published on this industry. It examines in detail, for both the equipment and service segments, such topics as market size and growth, distribution strategies, pricing and technology issues and usage patterns. Section 1 consists of a detailed executive summary that provides an overview of the industry in Canada as well as an analysis of the key elements that will define the future of the industry. Section 2 is devoted to the handset and equipment manufacturers with reference to the latest technologies and particular strategies of the vendors. Also included are detailed profiles of the major manufacturers and discussions on their activities and future plans as the industry moves toward the next generation (3G) of wireless communications. Additional products and services including in-building wireless systems, handset rental and telematics round out the section along with an update on pricing policies.

Section 3 chronicles the ongoing development of the four carriers in Canada as well as the prospects for increased competition in the near future. In turn, the market development plans and strategies of the service providers are examined. Particular emphasis is placed on recent developments in the marketplace and the effects of different airtime plans, pre-paid packages, value-added services, marketing programmes and distribution channels on revenues, subscriber growth, churn, usage patterns and acquisition costs.

Next, Section 4 looks at the future of all cellular and PCS services and their place in the wireless mobile communications market. Included is an overview of 2.5G and 3G technology and the approach to its development taken by the different manufacturers. In particular, the ultimate resolution of diverse opinions on some aspects of the new standards, and their ultimate resolution is well chronicled. The emergence of Bluetooth, a new communications standard for mobile devices, is also discussed and its implications for the cellular industry are examined at length. Recent developments in establishing new standards for locating wireless 9-1-1 calls and the application of the Internet to cellular telephony complete the discussion. Section 5 provides the reader with an overview of current regulatory issues, including CLEC, local number portability, bundling of services, calling party pays and a detailed discussion on the upcoming spectrum auction. Finally, Section 6 examines the concept of cellular resale and introduces the current players in this market.

The substantive and comprehensive discussion is supported by 17 detailed exhibits and two figures that quantify the inter-relationship of these forces on the marketplace. Eight exhibits provide shipment and installed base data for handset manufacturers including projections to 2002, segmentation by province and by technology. Nine exhibits illustrate cellular/PCS subscriber data by service provider including projections to 2003 along parameters such as customer and revenue growth, provincial and technology segmentation, penetration rates and distribution channel analysis.

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