cts 2013 day 1 final

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BMO Capital Markets is a trade name used by BMO Financial Group for the wholesale banking businesses of Bank of Montreal, BMO Harris Bank N.A. (formerly Harris N.A.) and Bank of Montreal Ireland p.l.c, and the institutional broker dealer businesses of BMO Capital Markets Corp. and BMO Capital Markets GKST Inc. in the U.S., BMO Nesbitt Burns Inc. (Member – Canadian Investor Protection Fund) in Canada, Europe and Asia, BMO Nesbitt Burns Securities Limited (registered in the United States and a member of FINRA), BMO Capital Markets Limited in Europe, Asia and Australia and BMO Advisors Private Limited in India. ® Registered trademark of Bank of Montreal in the United States, Canada and elsewhere. ®† Registered trademark of Bank of Montreal in the United States and Canada. Need capital? Media & Communications companies turn to us for their capital needs. Media & Communications Investment & Corporate Banking contacts: Ashi Mathur Group Head, Managing Director 416-359-5855 [email protected] Robert Levine Director 416-359-8279 [email protected] CAPITAL RAISING • MERGERS & ACQUISITIONS • RISK MANAGEMENT • RESEARCH • INSTITUTIONAL SALES & TRADING Pending Lead Arranger $90.5 million Credit Facility and Subordinated Debt February 2013 Joint Bookrunner $550 million Senior Unsecured Notes October 2012 Joint-Lead Arranger, Joint Bookrunner and Administrative Agent $580 million Senior Secured Credit Facilities July 2012 Co-Lead Arranger, Joint Bookrunner and Administrative Agent $3.5 billion Credit Facility June 2012 & May 2011 Joint Bookrunner $305 million Senior Secured Notes Monday June 3, 2013 DAY ONE Schedule of Events MONDAY JUNE 3, 2013 SUMMIT DAILY Monday June 3, 2013 The Canadian Telecom Summit Daily News is produced for the delegates by www.cartt.ca Billions moving at light speed By Mark Goldberg and Michael Sone W HAT A YEAR IT HAS BEEN since we last came together. The communications sector contin- ues to move at light speed, while the mechanics of government appear to remain static by com- parison. Even in the absence of a national digital strategy, Canada’s transformation toward an inno- vation economy continues, led more by business realities than government policy. Investment continues. Billions of dollars are being spent by in- cumbents and new entrants try- ing to gain competitive advantage in delivering more advanced and more innovative services. Com- panies that compete in some are- nas are finding interesting ways to of certainty many find unnerv- ing. So, where new companies will spark a flurry of new services and promises and even delivery of better customer service, it is to be expected that some of those same companies that contributed to more market dynamism, will themselves perish. This is not necessarily evidence that market forces aren’t working. Competitive markets will flourish even as competitors come and go. This is the way it is supposed to be in a market-based economy. If one compares where we are at now with where we were 20 years ago, it isn’t hard to conclude that we’ve achieved a decent measure of success. Yes, there are more dollars leaving our wallets every month — but that is an individual choice we all make. We have more service options, more convenience in our personal and business lives, a greater number of companies vying for our loyalty, and more work together in others, especially as carriers and media companies come together under a single cor- porate umbrella. With more than 20 years of in- tense competition, some partici- pants have flourished, others have proved less enduring. A number of times, for long distance, for local wireline, and twice now for wireless, we have seen industry expansion followed by a period of consolidation. This is a recurring phenom- enon that has characterized the industry for many years. The ben- efits of lowered entry barriers that inhere from competition — in- novation, speed to market, lower pricing, greater employment op- portunities — also present a lack global opportunities for Cana- dian companies to demonstrate entrepreneurial and technological excellence. These are good things. We trust that the next three days will trigger ideas for each of you and hope you find the ses- sions enlightening and challeng- ing, stimulating and thought- provoking. Thank you for joining us. Mark Goldberg, right, is a telecom industry consultant and Michael Sone, left, is head of NBI/Michael Sone Associates, a telecom market research firm. Together, they are co-founders of GST Conferences, the producers of The Canadian Telecom Summit. DAY ONE Are you missing out on what everyone’s talking about? These and hundres more stories like it can be found on Cartt.ca, the Canadian industry’s home page. 7 a.m. – Registration and Breakfast 8:30 – OPENING REMARKS – Hall C 8:45 – KEYNOTE Rob Bruce, Rogers Communications 9:15 – KEYNOTE Peggy Johnson, Qualcomm 10:00 – KEYNOTE Hans Vestberg, Ericsson 10:30 – COFFEE 11-12:30 – CONCURRENT SESSIONS Devices, Screens and Apps – Donald Sutherland Room Paul Brannen, Samsung; Nauby Jacob, Bell Mobility; James Maynard, Wavefront; Alec Saunders, BlackBerry. Moderator: Ian Hardy, Mobile Syrup Customer Focused Business Transformation – Pierre Berton Room Serge Babin, Xplornet; Edel Ebbs, BlackBerry; Richard Eyram, Salesforce.com; Steven Kirkeby, JD Power. Moderator: Daniel Rydeen, PwC Network Transformation – Al Waxman Room Chris Bachalo, Juniper Networks; Carl Herberger, Radware; Chuck Kaplan, Ciena; Michael Strople, Allstream. Moderator: Peter Rhamey, TMT Advisors 12:30 – LUNCHEON KEYNOTE Doug Webster, Cisco 2:15 – PLENARY, HALL C Business Models in a Converged World Mike Couture, Amdocs; Alan Seiffert, Seiffert Media Advisors; Dave Caputo, Sandvine; Jeff Gilchrist, IBM Canada; Heather Tulk, Bell Canada 3:45 COFFEE 4:15 KEYNOTE Bernard Lord, CWTA 4:45 – KEYNOTE Mark Henderson, Ericsson Canada 5:30 – COCKTAIL RECEPTION www.cartt.ca CRTC: Wireless Code coming at 9 a.m. A re customers getting gouged? When can they walk away from their con- tracts? Should the three-year variety abolished? When should phones be unlocked? These and a number of other questions will be addressed by the CRTC when it releases its new Wireless Code of Conduct today (Monday) at 9 a.m. The Commission held a five- day hearing back in February where consumers and corpora- tions and many others had their say on how Canadian wireless companies should deal with their customers. This morning the Regu- lator will have its say and its chair- man, Jean-Pierre Blais, will speak to it tomorrow morning during his CTS keynote. We’d also bet it’s a key topic of conversation dur- ing Tuesday’s 11 a.m. Regulatory Blockbuster panel session…

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Canadian Telecom Summit 2013 Show Daily Day One.

TRANSCRIPT

Page 1: CTS 2013 Day 1 Final

BMO Capital Markets is a trade name used by BMO Financial Group for the wholesale banking businesses of Bank of Montreal, BMO Harris Bank N.A. (formerly Harris N.A.) and Bank of Montreal Ireland p.l.c, and the institutional broker dealer businesses of BMO Capital Markets Corp. and BMO Capital Markets GKST Inc. in the U.S., BMO Nesbitt Burns Inc. (Member – Canadian Investor Protection Fund) in Canada, Europe and Asia, BMO Nesbitt Burns Securities Limited (registered in the United States and a member of FINRA), BMO Capital Markets Limited in Europe, Asia and Australia and BMO Advisors Private Limited in India. ® Registered trademark of Bank of Montreal in the United States, Canada and elsewhere. ®† Registered trademark of Bank of Montreal in the United States and Canada.

Need capital?

Media & Communications companies turn to us for their capital needs.

Media & Communications Investment & Corporate Banking contacts:

Ashi Mathur Group Head, Managing [email protected]

Robert [email protected]

CAPITAL RAISING • MERGERS & ACQUISITIONS • RISK MANAGEMENT • RESEARCH • INSTITUTIONAL SALES & TRADING

PendingLead Arranger

$90.5 millionCredit Facility and Subordinated Debt

February 2013Joint Bookrunner

$550 millionSenior Unsecured Notes

October 2012

Joint-Lead Arranger,Joint Bookrunner andAdministrative Agent

$580 millionSenior Secured Credit Facilities

July 2012

Co-Lead Arranger,Joint Bookrunner andAdministrative Agent

$3.5 billionCredit Facility

June 2012 & May 2011Joint Bookrunner

$305 millionSenior Secured Notes

Monday June 3, 2013 DAY ONE

Schedule of EventsM o n day J u n E 3 , 2 0 13 SUMMIT DAILY

Monday June 3, 2013

The Canadian Telecom Summit Daily News is produced for the delegates by www.cartt.ca

Billions moving at light speedBy Mark Goldberg and Michael Sone

W HAT A YEAR IT HAS BEEN since we last came together. The

communications sector contin-ues to move at light speed, while the mechanics of government appear to remain static by com-parison. Even in the absence of a national digital strategy, Canada’s transformation toward an inno-vation economy continues, led more by business realities than government policy.

Investment continues. Billions of dollars are being spent by in-cumbents and new entrants try-ing to gain competitive advantage in delivering more advanced and more innovative services. Com-panies that compete in some are-nas are finding interesting ways to

of certainty many find unnerv-ing. So, where new companies will spark a flurry of new services and promises and even delivery of better customer service, it is to be expected that some of those same companies that contributed to more market dynamism, will themselves perish.

This is not necessarily evidence that market forces aren’t working. Competitive markets will flourish even as competitors come and go. This is the way it is supposed to be in a market-based economy. If one compares where we are at now with where we were 20 years ago, it isn’t hard to conclude that we’ve achieved a decent measure of success. Yes, there are more dollars leaving our wallets every month — but that is an individual choice we all make. We have more service options, more convenience in our personal and business lives, a greater number of companies vying for our loyalty, and more

work together in others, especially as carriers and media companies come together under a single cor-porate umbrella.

With more than 20 years of in-tense competition, some partici-pants have flourished, others have proved less enduring. A number of times, for long distance, for local wireline, and twice now for wireless, we have seen industry expansion followed by a period of consolidation.

This is a recurring phenom-enon that has characterized the industry for many years. The ben-efits of lowered entry barriers that inhere from competition — in-novation, speed to market, lower pricing, greater employment op-portunities — also present a lack

global opportunities for Cana-dian companies to demonstrate entrepreneurial and technological excellence. These are good things.

We trust that the next three days will trigger ideas for each of you and hope you find the ses-sions enlightening and challeng-ing, stimulating and thought-provoking.

Thank you for joining us.

Mark Goldberg, right, is a telecom industry consultant and Michael Sone, left, is head of NBI/Michael Sone Associates, a telecom market research firm. Together, they are co-founders of GST Conferences, the producers of The Canadian Telecom Summit.

DAY ONE

Are you missing out on what everyone’s talking about?

These and hundres more stories like it can be found on Cartt.ca,

the Canadian industry’s home page.

FPo

new ad to come

7 a.m. – Registration and Breakfast

8:30 – oPEnInG REMaRKS – Hall C

8:45 – KEynoTERob Bruce, Rogers Communications

9:15 – KEynoTEPeggy Johnson, Qualcomm

10:00 – KEynoTE Hans Vestberg, Ericsson

10:30 – CoFFEE

11-12:30 – ConCuRREnT SESSIonS

Devices, Screens and Apps – Donald Sutherland RoomPaul Brannen, Samsung; Nauby Jacob, Bell Mobility; James Maynard, Wavefront; Alec Saunders, BlackBerry. Moderator: Ian Hardy, Mobile Syrup

Customer Focused Business Transformation – Pierre Berton RoomSerge Babin, Xplornet; Edel Ebbs, BlackBerry; Richard Eyram, Salesforce.com; Steven Kirkeby, JD Power. Moderator: Daniel Rydeen, PwC

Network Transformation – Al Waxman RoomChris Bachalo, Juniper Networks; Carl Herberger, Radware; Chuck Kaplan, Ciena; Michael Strople, Allstream. Moderator: Peter Rhamey, TMT Advisors

12:30 – LunCHEon KEynoTE Doug Webster, Cisco

2:15 – PLEnaRy, HALL C

Business Models in a Converged WorldMike Couture, Amdocs; Alan Seiffert, Seiffert Media Advisors; Dave Caputo, Sandvine; Jeff Gilchrist, IBM Canada; Heather Tulk, Bell Canada

3:45 CoFFEE

4:15 KEynoTEBernard Lord, CWTA

4:45 – KEynoTEMark Henderson, Ericsson Canada

5:30 – CoCKTaIL RECEPTIon

w w w . c a r t t . c a

CRTC: Wireless Code coming at 9 a.m.

Are customers getting gouged? When can they walk away from their con-

tracts? Should the three-year variety abolished? When should phones be unlocked? These and a number of other questions will be addressed by the CRTC when it releases its new Wireless Code of Conduct today (Monday) at 9 a.m.

The Commission held a five-day hearing back in February

where consumers and corpora-tions and many others had their say on how Canadian wireless companies should deal with their customers. This morning the Regu-lator will have its say and its chair-man, Jean-Pierre Blais, will speak to it tomorrow morning during his CTS keynote. We’d also bet it’s a key topic of conversation dur-ing Tuesday’s 11 a.m. Regulatory Blockbuster panel session…

Page 2: CTS 2013 Day 1 Final

Monday June 3, 2013 Monday June 3, 2013DAY ONE DAY ONE

I T’S INSTRUCTIVE, TRAV-ELLING to a country where spectrum policy seems fo-

cused on what’s best for citizens and not what’s best for the gov-ernment itself.

In her keynote to the annual CTIA Conference in Las Vegas which we attended two weeks ago, acting FCC chair Mignon Cly-burn laid out just what the Feder-al Communications Commission has done and is doing on the wire-less front, in good detail. It was a straightforward account of what is going on with the spectrum file Stateside; concrete strategy geared towards the public interest, clearly spoken by a government official in a way that I have never heard set out so well by any public official in Canada.

The FCC has moved quickly and decisively on spectrum be-cause as data requirements con-tinue to escalate in size and speed, finding adequate spectrum to ac-commodate growth and feed the economic efficiency and prosper-ity broadband wireless can deliver to citizens is an enormous ongo-ing challenge.

Clyburn spoke of the upcom-ing voluntary incentive spectrum auction that involves U.S. TV broadcasters giving up their spec-trum (which we also covered the last two times we were in Vegas, at the CES Show in January and the National Association of Broad-casters’ convention last month) and more importantly of a myriad other spectrum issues in front of the FCC — and what the agency is doing on those files.

“While the voluntary incentive auction proceeding receives much of the attention these days, it is hardly the only wireless engage-ment in our portfolio. Consis-tent with Congress’s directives in the Spectrum Act, we are moving

forward with plans to auction 10 megahertz of spectrum in the H Block, and 55 megahertz in other bands, as required by the Act,” she said.

“We not only plan to clear and reallocate spectrum. The FCC is continuing to promote new strategies to use spectrum more efficiently. We are promoting in-novative ways to share spectrum, such as facilitating small cell tech-nology in the 3.5 GHz band.”

She also noted that the FCC and the Commerce Department are meeting next month to finish recommendations on sharing in the 1755 – 1850 MHz band and that the FCC has initiated a pro-ceeding on air to ground mobile broadband service in the 14 GHz KU band, geared at improving Wi-Fi in planes.

no visionOf course, I know there are many good folks inside Industry Can-ada who are working on all of these same files and have ideas on what should and should not be done. Publicly though, few know what the Federal Government, writ large, has in mind. We have a federal government with almost no overt vision on wireless or a digital economy (a strategy for which was to be released in 2010, but which the Minister of Indus-try says is still coming, someday), beyond perhaps, how many dol-lars it can bring in during the next auctions.

Right now the ministry is lurching through a crisis it helped create. As three of the newest wire-less companies teeter on the edge of going out of business, Indus-try Canada has slapped together a politically motivated spectrum transfer review which will only served to chill any outside invest-ment in the sector and may well

delay the 700 MHz spectrum auc-tion. How many outside investors would put their money in Canada when the government seems to want to change the rules partway through the game?

Our Minister of Industry, Christian Paradis, has made em-barrassingly few direct public announcements of what the gov-ernments goals are for wireless and spectrum policy, especially in the level of detail given by Cly-burn. The last substantive thing the Minister said formally to and about the industry came in Octo-ber at the International Institute of Communications Canadian chapter conference, where three-quarters of the speech was pure federal government talking points.

Thankfully, he did have a pro-nouncement on white spaces and that file is moving forward, as it is in the States.

However, that speech, as all ministerial speeches are, was pep-pered with retread and tired po-litical statements on the achieve-ments of the federal government. Clyburn, who is acting chair while the FCC waits on Congressional approval of President Obama’s appointee Tom Wheeler, never mentioned the administration it-self once.

“My goal during this transi-tional period is simple: to keep the agency moving in the right direc-tion,” she said. “This requires three key things: openness and trans-parency, ensuring that the public understands and engages with the agency; expediency, processing and making decisions in as timely a manner as possible; and a con-tinued focus on the consumer.”

This is exactly what she should be saying. This is exactly what the FCC should be doing. This is just what the CRTC is doing on the many files under its control.

CommenTaRy: It’s time to take spectrum away from the politicians

vices will modernize the way we work. In addition to providing us with added mobility, features such as speed dial, access to con-tact lists or texting are what many of us are already using in our per-sonal lives. By adopting cellular usage at the CRTC, we are dem-onstrating our commitment to workplace renewal.”

So, a pilot project will start on June 3rd where the Commission’s telecommunications and new decisions group will begin tran-sitioning from landlines to cell phones. It will then be evaluated in the fall and if successful will be

GATINEAU – While many Canadians themselves wonder why they need a

phone line attached to their home when they already carry their lives around inside the smartphones in their pockets and purses, the CRTC announced last week it plans to cut that old phone cord.

An initiative announced to staff said the Regulator will begin to move from landlines to mobile phones starting with a pilot proj-ect today.

“As you know, the CRTC is committed to providing technol-ogy to support our employees to

Commission itself looking to “cut the cord”effectively perform their day-to-day work activities. Over the past few years, there has been a signifi-cant increase in adoption of cel-lular devices. This is consistent with the trend in private industry and in the consumer marketplace, as more and more people are re-placing their traditional landline telephones with cellular devices,” reads the note to staff.

“The adoption of cellular technology provides an oppor-tunity for us to modernize the workplace and, at the same time, achieve significant savings.

“Transitioning to cellular ser-

By Greg O’Brien

This is not what happens in the Minister’s office. Expediency? The Americans held their 700 MHz spectrum auction four YEARS ago and are deploying LTE all over the place with it right now.

What this shows me (and some others) is that managing spectrum should fall under the jurisdiction of the CRTC and be out of the hands of the politicians altogether.

This is something former CRTC chair Konrad von Finckenstein knew well. Only an arms-length agency where no one is worried about the impact on polls should be permitted to manage spectrum for the benefit of all Canadians. In fact, Canada is alone in the western world with spectrum managed by the politicians.

give it to the crtc“We now have fully integrated companies offering telephone, wireless, broadcasting and Inter-net services. It no longer makes sense to have a single regulator for wireline service providers, but two different civil regulators for wire-less service providers. More to the point, the lack of regulatory coher-ence is an obstacle to innovation and competition, and makes it dif-ficult to maximize economic and social benefits for Canadians,” said von Finckenstein back in 2010.

I don’t know what CRTC chair Jean-Pierre Blais thinks about this issue directly, but having heard him speak often enough, the quote above from Clyburn on transpar-ency and openness and the focus on the consumer could have come directly from him.

Political dithering has left us frighteningly behind our southern neighbours and many others on spectrum development. The folks at Industry Canada have done the work. There is a spectrum road map, but as long as we have to wait for politicians to move, the farther behind we fall. Taking spectrum decisions from the hands of the politicians is the only way to make sure it can be managed, cleared and deployed in the way we all know it will need to be now and into the future.

Fuller versions of all these original news stories can be found on Cartt.ca.

Rogers launches low income broadband planBy Susanne Hasulo

TORONTO – Rogers Com-munications announced to-day it will launch of a new

broadband internet pilot project designed to provide affordable broadband internet, comput-ers and software to residents in Toronto Community Housing (TCH).

Many, including Cartt.ca, have been urging Canada’s internet service providers and govern-

ment stake-holders to do something to

make the delivery of inexpensive broadband access to low-income Canadians a priority and we are heartened to see Rogers take this step.

Rogers’ new Connected for Success initiative, slated to begin later this year, will provide TCH residents and families with low-cost internet access, as well as access to subsidized computers, software and tech support. “Over two million Canadians are with-out internet at home today, and our youth have the most to lose without access to the technology,” said Rob Bruce, Rogers’ presi-dent, communications. “We must

invest and develop our youth to ensure they have the digital savvy they need to be part of and pros-per in Canada’s digital future. And it starts with a broadband connection.”

Robert Goodman, Rogers’ se-nior director of Internet product management, told Cartt.ca that Toronto Community Housing will handle the identification of which residents will be eligible (as an example, residents who receive rent subsidies) and help them co-ordinate with Rogers technicians, who will then install a new system or switch a resident’s existing in-ternet account to the Connected for Success program.

Participants who qualify will have access to $9.99 per month for broadband internet speeds of 3Mbps and usage allowance up to 30 GB. Microsoft Canada and Compugen are also support-ing the Rogers program by pro-viding the option to purchase a computer for $150 that will come pre-loaded with complimentary software along with access to technical support.

Toronto Community Hous-ing is Canada’s largest affordable

housing provider, with 58,000 units and approximately 170,000 residents. Goodman estimates roughly one-third of TCH resi-dents may qualify for the Rog-ers affordable internet program. Connected for Success partici-pants will additionally have ac-cess to digital literacy program-ming and resources that will help them get the most out of their internet connection.

According to Statistics Canada, in 2010 (the most recent StatCan data available) 21% of Canadian households didn’t have Internet access at home. However, while the vast majority (97%) of house-holds with incomes of $87,000 or more had home Internet access, just 54% of households with in-comes of $30,000 or less had it.

“It’s unfathomable that Cana-dians are living without internet access today because they simply cannot afford it. With Connected for Success we’ve taken the first step to connect youth and we urge our competitors, our part-ners and communities to work with us to bridge Canada’s digital divide,” said Bruce.

In developing the program,

Goodman says Rogers studied Connect 2 Compete, launched in the U.S. in 2011 by private indus-try to provide low-income fami-lies with access to broadband for $9.95 a month as well as to low cost computers and tech sup-port. “For sure we tried to do our homework and tap in to other programs in other places to try and make sure this has the high-est probability of success,” said Goodman.

In 2012, Rogers launched Rog-ers Youth Fund and Tech Essen-tials, programs dedicated to the development of digital literacy and technology skills among Ca-nadians. The Rogers Youth Fund program, www.rogersyouthfund.com, focuses on giving youth a brighter future through funding after school programs that pro-vide digital access, digital literacy and academic support. In the past year, over 85,000 students have participated in programs sup-ported by the Rogers Youth Fund.

So with Rogers now taking the lead on this, we at Cartt.ca are very hopeful Canada’s other ISPs will join in or launch such pro-grams of their own.

rolled out to headquarters and the regions later this fiscal year.

“We recognize this is a big change and we are committed to working through this transition gradually and efficiently,” says the note to staff. “This is part of a wider government of Canada initiative being led by Shared Ser-vices Canada to modernize tele-phone services to support a more mobile, connect-ed, and efficient workforce.”