Wind Mobile hits Chatr with competition complaint
Wind Mobile has filed a complaint with the federal Competition Bureau over claims made by rival Rogers that its discount brand Chatr has fewer dropped calls and a better network than its new competitors.
Wind chief executive Anthony Lacavera said Thursday that Rogers' claims are anti-competitive and have no technical basis.
"It's a classic case of the incumbents playing games here domestically," Lacavera said in a speech to the Toronto Board of Trade.
"Instead of really focusing on growth opportunities — genuine growth opportunities — they'd rather spend their energies trying to kill nascent competition."
Lacavera said Wind is one of those carriers still in their early development stages, which means it's working out some technical kinks.
Wind Mobile launched last December and is aiming to be Canada's fourth-largest national carrier. There were complaints about its network quality, but this has since improved, Lacavera said.
The Wind complaint to the Competition Bureau isn't the first filed against Rogers' talk-and-text brand, Chatr.
New wireless player Mobilicity has also contacted the Competition Bureau about Chatr, saying the rival service is too similar to its own and aims to put the smaller company out of business.
Mobilicity alleges Rogers is in breach of Section 78 of the Competition Act, which prohibits market leaders from using "fighting brands to discipline or eliminate a competitor."
The Competition Bureau is now investigating Mobilicity's complaint.
Chatr was recently launched by Rogers, and Bell relaunched its Solo brand to compete in the unlimited talk-and-text market.
Wind Mobile claims that established wireless carriers are taking advantage of a "loophole" in government policy that allows the bigger carriers to intentionally drop calls.
Lacavera said the problem begins when a wireless subscriber travels outside their carrier's coverage area.
Ideally, the call would be seamlessly transferred to another carrier's network, a shift known in the industry as a "soft handoff."
"In Canada, however, when a caller moves from our Wind home zone to roam on a (competitor's) network, their call is immediately dropped by the incumbent — a process called the hard handoff," he said.
This means that technically, Wind calls are dropped, and Lacavera said wireless giants are using the practice to sell consumers on the idea that the networks have fewer dropped calls.
"What our complaint surrounds is taking a regulatory loophole and leveraging it for a marketing advantage," he said, adding the complaint was filed earlier this month.
Lacavera said Chatr is offering the same coverage and rate plans as Wind while asserting network superiority.
"The advertising is so misleading, so anti-competitive, that we have lodged a complaint with the Canadian Competition Bureau, which is now investigating Rogers' Chatr's misleading claims," he said in his speech.
"There is absolutely no solid or objective technical basis for Chatr's claim to have more network reliability and few dropped calls than Wind."