Montreal Tech Watch

The arrival of iPhone has spurred many reactions in the press and in canadian blogs about the possible opportunities in Canada. Netchick has made a list of bloggers who wrote about it. The CWTA, which represents telecommunications companies, published a press release a few days after the iPhone’s launch. The Vancouver sun had an interesting article this week-end stating that we might never see unlimited data plans in Canada.

I have read this morning another article from IT Business Canada, which says noone needs high-bandwith services, and that even businesses are happy with slow services. I found the logic very stupid; It’s like saying nobody needs mobile phones because there is already fixed telephony and most companies can do their business with it. Or for instance, in 19th century, you don’t need telegraphy because most people were already happy with the postal system.

Of course companies can conduct their business without high-bandwidth access or unlimited internet access. And for a while, it can be seen as an unnecessay luxury. But meanwhile, the rest of the world thinks otherwise.

I know the telecommunications industry has very high fixed costs. It takes billions to install a mobile network in a country the size of Canada, and it takes even more to support it every day you run it. But what they don’t understand is that by lowering prices to a reasonable monthly cost, they will open its access to the mass market. That’s a basic marketing rule Ford proved at the beginning of last century. It doesn’t make sense for profits in the short-run, but it will after a few years.