Telus (TSX:T) is investing $1 billion in infrastructure to connect 400,000 homes and businesses to its fibre optic network over the next five years in a bid to deliver some of the fastest Internet speeds in Canada.
“These are speeds that will dramatically change our society,” Telus CEO Darren Entwistle said at Friday’s (October 2) announcement in downtown Vancouver.
The telecom giant’s fibre optic network can provide speeds of 1 gigabit per second (Gbps). At that rate, it would take someone less than one minute to download two high-definition movies from iTunes.
But Telus said the first Vancouver homes and businesses connected to the network would only have access to speeds of up to 150 megabits per second (Mbps). It would take someone about five minutes to download one high-definition film from iTunes at that rate.
Telus chief corporate officer Josh Blair said offering up to 150Mbs makes the most sense for the majority of customers.
“Because of the limitations in the Internet itself these days, more speed than that isn’t going to be helpful or necessary within a home environment,” he said, adding 1Gbps service would be available to tech companies that could effectively make use of those speeds.
“However, as Internet performance improves in the months and years ahead and where it makes sense for our customers to have those higher speeds, we can easily enable those higher speeds.”
Burnaby-based Urbanfibre’s 200-kilometre optic fibre network is already offering speeds of 1 Gbps to some homes and offices in Metro Vancouver.
Vice-president of product Jon Paul Janze, whose company plans to make its service available to 20,000-30,000 homes in the region in the next few years, said he found Telus’ announcement disappointing.
“They’re laying the groundwork for the future, but even two or three years down the road they’re not planning to offer speeds that are any much faster than what’s available today,” he said.
“It really begs the question, why aren’t they offering faster speeds? Obviously there are business decisions for it.”
Janze said he speculates it has to do with price packages.
Users in communities already connected to the fibre optic network, such as Port Coquitlam and Sechelt, pay $120 a month for Telus’ Internet 150 service.
Urbanfibre’s 1Gbps service costs $70 a month, although its network is available to a much smaller number of homes and offices.
“If they (Telus) came out with a gigabit product and tried to compete with our product, what would it do to their (other Internet package) offerings?” Janze asked.
Meanwhile, B.C. Premier Christy Clark, who attended the announcement, told reporters Telus’ fibre optic network will serve as the go-to “platform for business to really thrive” in Vancouver.
“There are many, many big businesses in this city who already have very good connectivity but many of those small businesses don’t,” she said.
“What an asset, what a gift to the city and the province.”
Speaking at the announcement, Vancouver Mayor Gregor Robertson referred to a September report from the Conference Board of Canada forecasting the city was poised for the strongest economic performance among cities at 3.4% economic growth in 2015 and 3.5% growth in 2016.
“We’re on a roll and innovation is at the core of that growth and that success,” he said.
“Having this kind of investment bolster that growth and enable even more diversification, it is really a fantastic next step.”
Robertson added he expects the network to help attract more tech and digital animation companies to Vancouver.
The planned rollout of this infrastructure in Vancouver comes after Telus announced in June it would connect 90% of Edmonton to its gigabit-enabled network.
Blair said Telus is making a “generational investment” in these cities and the long-term plan is to roll out the network equally in both rural and urban centres across Canada.
“It will be a great bridger of the digital divide,” he said.
