Waterloo telecom company Fongo, which allows subscribers to place calls for free using data networks, says it plans to offer data plans in the $15 range by the end of the year.
A cheap data plan would allow people to skip buying airtime on traditional mobile networks, and simply buy a data plan, then use Fongo's free app to make calls over a data network. So customers could have data and mobile phone service for much cheaper than plans offered by traditional telecom offerings from companies like Bell and Rogers.
Fongo made headlines last week for offering to buy Toronto-based WIND Mobile for a dollar and a 49 per cent equity ownership stake in Fongo. WIND was put up for sale by its parent company VimpelCom earlier in March.
"We’ve been working very quietly in the background for the last six months to make sure we can find a data plan. And we’ll be offering one to our users within the year, but WIND coming on the market kind of accelerated all that," Fongo president Dave Bullock said in an interview with The Morning Edition’s Craig Norris on Monday.
Bullock hopes to exploit WIND's wireless spectrum and their infrastructure in order to deliver the cheap data plan.
"We've spent a lot of time surveying our customers on this and sharpening our pencils to see how lean we could go. We haven't announced details of any plans yet, but I think it's safe to expect it will be possible to achieve a mobile bill below $15 all-in with Fongo," Bullock wrote in a live online chat later Monday morning.
Fongo’s plans, however, were dismissed by WIND Mobile's chief regulatory officer Simon Lockie, who took to Twitter to voice a mocking response:
I hereby publicly offer to buy Fongo for $1 and half my sandwich.Hopefully the story gets picked up before I get too hungry to deliver.— Simon Lockie (@LockieSimon) March 27, 2013
Bullock wasn't fazed by the tweet.
"The fact is I am less concerned with that particular response, obviously they have a good sense of humour," said Bullock.
But even if they don’t forge a partnership with WIND, Fongo says they’ll go ahead with their data plan offering.
"We believe at the end of the day, it’s the only chance to have a true fourth national carrier. And I think that’s WIND’s view as well. They want to be that fourth national carrier, we think we can help them get there," said Bullock.
"Mobile VOIP is something that can’t be ignored," he added.
Fongo uses a mobile VOIP (voice-over-internet protocol) to allow users to make calls. App users are able to access traditional calling features like call waiting and caller ID, but also have unlimited calling across Canada and unlimited text messages. The Fongo app is available for iOS and Android devices as well as for home phones.
Bullock said he has seen a lot of demand for data plans in the $10-$20 dollar range.
"That’s really what we’ve created, is an environment where you only need data," said Bullock.