Opportunity for Tbaytel

One of the issues that Tbaytel faces is that the population base of northwestern Ontario is small and the region size huge. The mismatch of people to size has made the area famous for hunting, wildlife, trees, lakes and other environmental adventures but as a telecom company it makes it almost impossible to cover. The rolling hills and the massive size of the landscape means that there needs to be a huge investment into towers to properly provide the service. Tbaytel has been around for over 100 years which means that they have had a long time to be able to build up their network and improve coverage. Even with that amount of time they still have spots where the coverage goes dark and its back to the days of LAN. Tbaytel is able to justify expanding into these regions because it promotes itself as a NWO telephone company. Other larger companies have tried to avoid this region like the plague with the exception of Thunder Bay and Kenora. It isn’t worth their time or money to invest in the region to connect the east and west networks. While Bell has stated that they will connect the region over the next couple of years by lighting up Highway 17 with their 4G network, it will remain to be seen if it happens. Thunder Bay/ Kenora becomes the battle ground for people to decide if they want to stay with Tbaytel or if they want to go to a competition’s offer. Continuing to improve the network and expand will be important for Tbaytel to reach new customers and supplement the income it loses to Bell/ Virgin Mobile.

One would think of possibly expanding west into the Manitoba region to tap into the Winnipeg market. That region right now is quiet but in 2013-2014 will be a battleground between MTS, Rogers, Bell, Telus and others as they launch their LTE networks and try to expand to cover more territory. The agreement with rogers will see them do all the heavy lifting when it comes to expanding the network west and east. Staying out of the battles between the big 3 will allow for Tbaytel to improve its own network and roll out more towers, technology and service. I believe that there is an opportunity to expand south to the USA.

Thunder Bay and Duluth are more then simply sister cities. The successful of one directly helps the other and the constant movement of people between the two would make it seem like they are much closer together. Duluth is around the same population size as Thunder Bay but they have some retail and service outlets that we cannot yet get in Thunder Bay. In turn there are some fishing experiences and attractions that they can’t get down there which is why they come here. The land mass is much closer then the time traveled would make it seem. If it wasn’t for a number of smaller towns the trip could be done in two hours. The one issues that many complain about between the 2 cities though is the terrible reception that mobile phones get after the border. AT&T, Verison, T-Mobile and others all provide service to this area but like Northwestern Ontario it isn’t worth their time to invest into the region because of cost. The tenacity to build where others wont and expand could make this a prime region for Tbaytel to move into. The distance between Thunder Bay and Duluth is around 305 KM which is about 50KM then driving to Dryden. The difference between the Duluth run and the Dryden run is the possible subscribers and population base to tap into. Between Thunder Bay and Duluth there are a number of smaller towns built around the coast line; together they form a population of 7343 including some of the best ski hills in the area. Lutsen while only a small town of 360 sees a huge amount of tourists from Northwestern Ontario going down to golf in the summer and ski in the winter. Its likely that the town triples in population when the tourists all flock to the area, this could be an important spot for Tbaytel to introduce some coverage to the area. In total, Duluth -Thunder Bay has 93, 608 people but adding in the Duluth MDA its over 373, 379 people. Basically in a 300 KM stretch the Duluth run could put all of Northwestern Ontario into 1 area. Tbaytel’s income of 170 million could easily be doubled if it were able to make a significant headway into these regions.

There would likely be some challenges when it came to bringing new networks to the Duluth region but it seems that the money could be there to make it worth Tbaytel’s wile. Depending on Rogers and AT&T agreement and a number of other factors the Duluth run could end up being one of Tbaytel’s best expansions to date. It could help fuel the expansion in Canada and help to bring new investment into Thunder Bay.

This is just what I think. What about you?