Posted in Opinion, Technology

Chatr and the fake mobile competitors

Rogers yesterday launched a new wireless “brand” called Chatr, which is being rolled out in several Canadian cities and is supposed to come to Montreal soon.

The launch has caused some ruckus because its pricing plan is seen as targeting one of the new wireless competitors just starting up. Mobilicity, which says Rogers is using predatory pricing to drive it out of the marketplace, says it will take legal action.

I’m no mobile pricing expert, but $45 for unlimited talk and text doesn’t seem unfair to me. And bringing everyone’s prices down was the entire point of having new entrants into the wireless market, no? (Admittedly, the fact that Chatr is available only in the largest cities is kind of suspicious since it uses the Rogers network.)

What bothers me about this launch isn’t the fact that it’s competing with other wireless providers, it’s that Rogers is doing its best to fool people into thinking the service has nothing to do with Rogers.

Take a look at the press release. The word “Rogers” doesn’t appear anywhere. It makes a vague reference to “a trusted network”, but no mention of what network that is. The blurb “about chatr wireless” also makes no reference to Rogers, making it seem as if this is an independent company.

Same thing on the website (which is neither chatr.com nor chatr.ca, meaning Rogers has picked this stupid name without even getting the benefit of the stupid name domain name). Not on its frequently asked questions page, its coverage page, or its “about chatr” page. This isn’t just being forgetful or not wanting to draw attention to something. There’s a serious effort here to hide the fact that Rogers is behind this brand.

They’re all doing it

This is nothing new. When Koodo launched in 2008, Telus did everything it could to hide the fact that they were behind it. The word “Telus” doesn’t appear on Koodo’s “About Us” page or coverage page either. You have to go to the fine print of the privacy policy, and read its fine print to see them say that Koodo is actually a division of Telus.

Virgin Mobile Canada makes it seem as if they’re owned by Virgin Group, but in fact it’s owned by Bell Mobility, a name that appears nowhere on their website.

Of the virtual brands, only Solo Mobile (Bell) and Fido (Rogers) make it clear who they’re owned by.

8=3

Let’s count that, by the way. Eight mobile brands run by three companies. And I’m not counting the weird stuff involving third parties like Petro Canada Mobility or President’s Choice Telecom. While most companies think of centralization and imposing a national brand on its subsidiaries, Canada’s wireless companies do the opposite.

When your reputation as an industry is so shattered that you have to create fake competition to appeal to a large segment of the population that hates you, and then when that doesn’t work you create a second fake competitor … honestly, I don’t know what to say.

The worst part is that Canada’s Big Three wireless companies don’t think this explosion of “brands” is evidence of a larger problem.

34 thoughts on “Chatr and the fake mobile competitors

  1. Marc

    The biggest problem is how complacent the population is. The providers aren’t stupid; they know this and can get away with it. I wonder if Chatr’s $45/month plan will really cost $45. With all the crap that is added on, your $25/month plan (which is bare-bones to say the least) ends up costing around $37, for example.

    I’ll forever hate Rogers. They made life a living hell to some friends & family of mine; plus they sent a guy to my door to beg me to switch my house phone service over.

    Reply
        1. Vahan

          I could say that I am proudly also not a subscriber to Rogers, or Bell or Telus or any other cell phone provider. I carry two quarters around with me for “emergency” purposes, I have a home phone I rarely use and a work phone. I make solid plans with friends and we meet at the designated place on time, so we don’t have to do the annoying “where are you?” calls. Honestly what else are most dopes using cell phones for, to talk loudly in public places, to show others they have a life, when in fact they desperately are starving for attention. I don’t need to be one of the cool people on a terrace with a beautiful girl who I am ignoring because I rather talk to my ‘bros on the phone. Idiots!

          Reply
          1. Lord

            There you go! You just proved my point. Ultimately it is YOUR decision what you do or do not buy. Therefore anybody complaining should really just follow your steps.

            Reply
  2. Guillaume Theoret

    A problem? Yeah right. They obviously think this strategy is great.

    “Rogers Communications Inc. felt the impact of new competition in the wireless sector, but the communications and media giant still managed to either meet or beat analyst expectations with strong second-quarter growth.

    A man speaks on a phone as he walks past a Rogers Wireless retail store in Vancouver. (Darryl Dyck/Canadian Press)
    Net income for the Toronto-based wireless, cable and media company was up 21 per cent from a year earlier”

    […]

    “But the wireless division did continue to grow and accounted for $1.7 billion of revenue, or more than half of the total for the entire Rogers business, which also includes cable, internet, phone, specialty and conventional television, radio, magazine publishing and the Toronto Blue Jays.

    Wireless data services were the main driver of the division’s revenue growth, while profit margins also improved.”

    http://www.cbc.ca/technology/story/2010/07/27/rogers-earnings.html

    So yeah, I don’t think anything is going to change volountarily from that industry. They’ll just keep abusing us for as much short term profit as they can possibly extract while retarding the growth of the Canadian tech industry for as long as they can.

    Reply
    1. Lord

      At the end of the day having a cellphone is not a right. If prices feel too high for people they should stop buying it. We live in a market driven world people should understand the power they have. Except everyone wants soeone else to do it. It was no different when the gas companies raised their prices before long weekends. People were told to strike back and don’t buy as much gas. That never happened. And not because having a car is an absolute necessity in this country.

      Reply
  3. Fassero

    The bigger “problem” is really the regulatory framework which allows yet another industry in Canada to operate as an oligarchy. Let’s be serious – is this any different than what goes on with the gas stations every day (and has for years)? Or (pretty much) the duopoly with the airlines? Yes, Rogers is a deplorable operation (and Bell is catching up really fast in that department if not surpassing it) but Rogers-Chatr, Bell-Virgin, and Telus-Koodo is no different than, say, Loblaws-Maxi or Metro-Super C.

    Maybe that’s all the marketplace can handle. I don’t know. Anyway, for one or two years, customers with expiring contracts will get some victory as they’ll just threaten their carriers with moving unless they match or beat the competitive offers and likely win most of the time.

    Reply
    1. Fagstein Post author

      Rogers-Chatr, Bell-Virgin, and Telus-Koodo is no different than, say, Loblaws-Maxi or Metro-Super C.

      I can sort of understand companies keeping brands that they’ve acquired, like Loblaws owning Provigo or Rogers owning Fido. But creating a new brand because you know there’s a segment of the population that hates yours so much…

      Reply
      1. Lord

        You have to understand that Rogers is a teflon brand. We all like to talk about how much we hate it but none of us are gutsy enough to give up what they have. Look at their wireless results. Their attrition of or churn of customers is the lowest out of all carriers in Canada.

        Reply
        1. wkh

          The thing about Rogers and how they keep people coming back is their damned phones. You simply cannot get the kind of high end quality phones they have anywhere else (unless you’re an iPhone person, which I’m not. I just don’t need THAT much phone, but I’d like a nice one). Sure, you can go drop a couple hundred outright on an unlocked LG Quickfire or LG Even or HTC Whatever, but if you’re already with Rogers, and your contract is up, and you don’t have a couple hundred laying around for an unlocked phone, and you look around at the competition and know you hate Bell, heard about how Telus fucked your friends over, and how Fido couldn’t even keep the LG Gossip in stock for a month (and hey they’re just Rogers Lite anyway) it feels very defeatist to bother changing. :-/

          Reply
  4. Franco

    It’s funny how back in the day when Rogers bought out Microcell (Fido), the CRTC stated that this would not impact the competition in the cellular market, sice up until then all 3, Bell, Telus and Rogers ganged up against Microcell. see http://www.seaboardgroup.com/~seaboard/main/index.php?option=content&task=view&id=73&Itemid=82

    They immediately put a stop to what was then, the ground breaking plan , City Fido that was offering unlimited local min and killed the only company that treated customers as customers, not cash cows. I just wish more people out there knew how much they are getting manipulated and ripped off by the Big Three incumbants

    Reply
    1. wkh

      What’s sad is that wasn’t even ‘ground breaking’. That had been standard in the US for years at that point and now “Country Fido” (which I have, and that’s why I’m not going anywhere) is the standard in the US… for about half the price I’m paying for it. And don’t give me the song and dance about Canada being a more spread out population. I grew up in the NWT equivalent of the US, where there STILL isn’t reliable mobile coverage. Just like in Canada, mobile coverage is kept in the main population centres.

      Reply
      1. Lord

        Really no one stops you start a mobile phone company in NWT. Raise some fund, build a network, just don’t expect to make any money. And don’t ask taxpayers to fund your exercise.

        Reply
        1. Fagstein Post author

          Really no one stops you start a mobile phone company in NWT.

          Well, the CRTC does. And Industry Canada, which allocates radio spectrum. Not to mention the owners of land where you might want to setup cell towers. But your point is taken.

          Reply
  5. Lord

    You are really losing it Fagstein. People don’t give a crap if Fido is owned by Rogers or Koodo by Telus. As a matter of fact the guys selling Chatr proudly told me that they are owned by Rogers and that gives them an advantage when it comes to the network. All people want to do is pay less for everything they can. Haven’t you figure it out yet? That’s why we have crappy products surrounding us. No one one wants to pay for quality anymore.

    Reply
  6. Kevin

    Does anyone like *any* cell phone company in Canada? Or should I just get an unlocked iPhone and wait for Videotron to resume taking new customers?

    Reply
    1. snowy2004

      I’m not living in Quebec so I’m not sure about this but is the new 3G+ network Videotron is talking about part of their purchase of the Quebec wireless spectrum? Because if it is, I think they’ll be in the same boat as Wind Mobile regarding the iPhone: the phone just doesn’t have the antenna to run on their network.

      Reply
  7. Bob Gervais

    > All people want to do is pay less for everything they can.
    > That’s why we have crappy products surrounding us. No one one wants to pay for quality anymore.

    I find this true many products. Stuff used to last longer years ago, but you paid more for it. Now it’s cheap, but doesn’t last.

    Reply
  8. Becks

    I hear all the rants and complaints…and am I glad i never got hooked on the cell-phone habit LOLOLOL!

    Reply
  9. Julie Bélanger

    I’m with Public Mobile and although the first 2 weeks has been rough (to say the least) but after the two first week, the service is exactly that it says it is. No contract, no secret cost, no surprise. I pay $40/month for unlimited calls anywhere in Canada (although this might have been only offered to clients at the moment of the launch) and unlimited text messages in 140 countries. Works great, coverage is getting better and better every week and it’s only limited mostly to the island of Montreal but since this is where I spend 95% of my time, it’s fine with me.

    And Public Mobile has its own towers, which means the service was appaling at the launch but is not a lot better, there is no roaming possible but heck – 40$ for unlimited calls in Canada and text messages in 140, I’m happy to support an independant company and NOT give my money anymore to ROGERS, BELL or some other crappy telecom giants that doesn’t care about me!

    Reply
    1. Lord

      You are dreaming if you think Wind is independent. It’s owned by a billionaire Egyptian with a Canadian puppet head. They have 91 million customers (you should see how badly they treated some of them in Poland), so they the largest mobile company in Canada based their global customers size.

      Reply
      1. Kahn

        Public Mobile is not owned by Wind.

        “Initially the primary Canadian shareholder was the investment fund Novacap Technologies III L.P. who was to control 66.67% of the voting shares. A group of foreign investment funds including Columbia AWS Canada Inc., AWS Canada M/C Inc., CTC Catalyst L.P., Battery Ventures VIII Canadian Spectrum Holdings Inc. and CRP XIII Blocker Inc. held the remainder of the voting shares and all of the non-voting shares. However on May 15, 2008, just 12 days for the start of the auction, 6934579 Canada Inc filed a new beneficial ownership structure with Novacap replaced by three new entities Rho Canada Ventures LP, 6976387 Canada Inc. and BMO Capital Corporation.”

        Reply
  10. AlexH

    What the wireless companies are doing is trying to create “choice” in the market place, where no real choice exists. It is the same reason why we have “Future Shop” and “Best Buy”, which have the same owners. Providing the public a choice, an option, a way to think they are sticking it to the man is a grand marketing scheme that appears to work.

    In the end, we are still paying way over cost for service, way beyond what is paid in other markets, and we eat it up. Go figure!

    Reply
    1. Fagstein Post author

      It is the same reason why we have “Future Shop” and “Best Buy”, which have the same owners.

      Future Shop and Best Buy have the same owners because Best Buy bought Future Shop in 2001. Best Buy didn’t create Future Shop because its brand was so poor in Canada that it needed to create a fake competitor (though the fact that it kept the Future Shop brand certainly says a lot about the two companies’ relative brand power).

      Reply
      1. AlexH

        Yes, and Best Buy actively sought to position it’s stores close to Future Shop AFTER the buyout, to give the consumer the false sense of having a choice (where no actual choice is made). They have pretty much crowded out the marketplace and moved everyone else a distance third. It does say a lot about their brand power, but it also says a lot about muddying the waters of the marketplace and creating the (false) illusion of competition.

        One great example is a trick that the use on things like computer screens and flat screens. They have a “price match and beat” in place for exact matching models. But in order to avoid paying it off, they often get the manufacture to create a special model number just for each of their stores, such that there is no actual price match possible because nobody else has that exactly model number.

        The wireless companies are attempting to create the illusion of competition where none exists, only something between a biopoly and triopoly. It’s great marketing, but when the truth comes out, it is usually wasted effort.

        Reply
  11. snowy2004

    I’m wondering if Chatr is almost a throwaway effort to kill, not just compete with, the smaller wireless companies. I mean, look at the website: it looks like Rogers murdered its own web design team and then just used some template they got for $50. I just doesn’t look like they honesty care for Chatr themselves.

    Reply
  12. Baobab

    This is clearly an attempt to attack Public Mobile. For all these years, the big three have never cared about the average guy. It was all about business men and students. Now, that Public mobile is here, they need to fight back.

    Reply
    1. Lord

      Really? Public is lead by no other than Alex Krstajic, a one time Bell executive who has absolutely no interest in providing decent cell service. He just wants to sell out. His price, as per his quote is $2 billion. He is the only company that can sell, the other will have to wait 5 years.

      Reply
  13. Journo

    @JohnF

    In the beginning, Virgin Canada was 50 % Bell 50 % Virgin Corp… Then Bell bought the other 50 % and customer service went down the drain.

    Reply
  14. Joe BW

    Realise I’m a bit late to this discussion, but I’ve been living in Canada on a one year student visa since September. I got a ChatR phone because they were the only ones who didn’t require me to buy into a three year contract. Buying the ChatR cards to LOAD the phone is a pain in the ass because… wait for it… neither Rogers nor Fido (also a part of Rogers) will sell the cards. I actually went into the Fido Store on Queen St West in Toronto and was told that while the ChatR vouchers were on their register they weren’t allowed to sell them because they were a different division of Rogers… the places to go are Shoppers Drug Mart and 7-11 but they often run out and sometimes don’t even know what ChatR is.

    Stupid stupid system, I should be able to buy my Rogers product top-ups in any Rogers branch!

    Reply

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