Bell Canada makes $200-million investment in IP

A $200 million investment from Bell Canada in IP research and development will see the telco attempt to expand its influence in the Western provinces.

Bell Canada, through an agreement with Bell West, Aliant and Nortel Networks,

will develop IP-based voice, data and multimedia solutions to sell to enterprise customers beginning next year in B.C. and Alberta.

The $200 million investment will be spread over three years and is designed to attract large corporate customers first with a trickle down effect to Canada’s small and medium-sized enterprise economy.

Eugene Roman, Bell Canada’s group president systems and technology, described the venture in a Monday Web conference as “”a gateway to simplicity for our customers.

“” IP telephony will fundamentally alter the way people communicate with one another over our networks with the same impact that the Internet itself has had,”” he said.

The idea behind IP service delivery is to make voice and data available on the same network and to allow that content to be routed to any device seamlessly.

“”It allows us to be in charge of our communications instead of our communications controlling us,”” said Al Safarikas, vice-president of marketing for Ottawa-based Nortel Networks.

“”Is my boss calling me? I want it in one place. Is my wife calling me? I want it somewhere else. And those may have different priorities on different days of the week.””

Bell has made the decision to make these services available first to Western customers, then slowly roll them out across Central and Eastern Canada.

The West to East move makes sense for the telco giant, said Forrester Research analyst Brownlee Thomas, since it can put some IP roots down in rival Telus’ main stomping grounds. Bell will still have to use Telus for local loop access, but will be able to use its own equipment co-located in Telus’ central offices.

“”The idea is to get their points of presence as close to the large customer base that they’re going after — institutional, government, large enterprise, national accounts,”” said Thomas. “”This is pretty cost-efficient for them to do.””

The demand for the types of services that Bell will be selling remains to be seen, however. Thomas said that few companies are willing to part with their traditional telephony when its still reliable and spend the extra cost on an upgrade.

Roman acknowledged that this could be a slow process, but it was time to start.

“”We’re not going to miss a beat here. We have put a lot of work in to make sure that we are not too early and not too late. This is a balancing act,”” said Roman.

“”This is a five-year journey we’re on, and in many ways it’ll take longer than that. In the U.S., they’re talking 10 or 15 years.””

Nortel was chosen from a field of 35 equipment providers as a development partner for Bell and will provide switching technology to make the IP networks possible. Bell and Nortel are also jointly opening a dedicated innovation centre in the Ottawa area to conduct research and development. “”Little r, big D,”” said Roman.

“”This is a step that I personally requested. I believe we need to go to ground with the top researchers in this area,”” he added.

The centre will connect to satellite lab facilities across Ontario, Quebec and the Maritimes and is an extension of Bell’s iTechCentre which was established in 2001 to conduct IP-based research.

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