Rogers to Launch Canada's First LTE Network This Year

Market leader Rogers has announced the launch of Canada's first LTE network by the end of the year, launching in Montreal, Toronto, Vancouver and Ottawa, before expanding to the top 25 markets in 2012. The operator has promised downlink speeds of up to 150Mbps, between three and four times higher than the current available speeds on its HSPA+ network, as well as uplink speeds of up to 70-Mbps; the technology will also offer lower latency to customers. Rogers plans to offer LTE services in multiple bands, but will first launch services in the AWS band (see Canada: 28 July 2008: AWS Auction Ends at USD4.23 Bil.), and has selected Ericson as its LTE supplier, with the vendor already supplying its 3G network.

Outlook and Implications

• Technology leader: Rogers continues to be the technology leader within the Canadian wireless space, as it becomes the first operator to launch 4G technology, pre-empting competitor Telus, which had announced a planned LTE launch for early 2012 (see Canada: 7 April 2011: Telus to Begin LTE Roll-Out in 2011); Rogers was also the first operator to offer the iPhone in the Canadian market, it was the first carrier to offer HSPA+ services to customers when it launched the network in Q3 2009, and has always prided itself with being the first to offer new wireless technology to Canadians. Rogers will try to use this early adopter strategy to its advantage, and will try to build on increasing data revenue, with the latest Q1 figures showing a 30% y/y increase, with data revenues representing 34% of network revenue, up from 26% a year ago (see Canada: 27 April: Rogers Reports Q1 Growth). Furthermore, the operator will also try to take advantage of Ericsson's experience in LTE networks, with the vendor having already signed 12 commercial contracts with operators around the world.
• Capacity over coverage: Rogers will eventually offer LTE services in several bands, but with the 700MHz still being unavailable to customers, and with a planned auction for 2012 (see Canada: 6 October 2010: 700-MHz Spectrum Auction for Canada Planned in 2012 and Canada: 4 November 2010: Rogers Calls for 700-MHz Spectrum, Plans Home Monitoring Service), the operator will at first launch services in the AWS band. This won't be an issue in the short-term, as the launch will take place in the large dense urban areas of Canada's top four cities (Montreal, Toronto, Ottawa and Vancouver), where coverage will be less of an issue and the focus will be on capacity, but lower frequencies will be needed in order to reach other areas. The digital dividend is due to be completed by August 2011, from which time the 700-MHz frequencies will be freed, and it is imperative that it becomes available to mobile operators for high-speed wireless internet services to reach the less dense rural areas.
• Devices: Rogers did not focus on devices in its press release, but it is expected that the focus will be on dongles and data cards rather than smartphones in the short-term; the relatively low coverage at launch will mean that any devices should be multi-mode, and able to switch to Rogers' HSPA+ network seamlessly. Rogers won't be able to offer the same range of devices as Verizon in the US for instance, as the latter operates its LTE network in the 700-MHz band, and any smartphones it offers, such as the HTC Thunderbolt, will not work on Rogers' AWS-LTE network. This is another area where the 700-MHz will be important to Rogers and other Canadian operators, as with it they should be able to offer the same type of handsets offered by US carriers, as handset vendors look at economies of scale.