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Telco court fight, round two: Rogers vs. Bell

Last week it was Telus versus Rogers. Now it's Rogers against Bell over wireless marketing claims of superiority

After getting roughed up in a B.C. court by Telus Corp. (TSX: T) over its wireless marketing claims, Rogers Communications Inc. (TSX: RCI.B) is taking out its anger on Bell Canada Enterprises Inc. (TSX: BCE).

On Tuesday, Rogers demanded a British Columbia Supreme Court injunction preventing the Montreal-based telco from claiming that it operates Canada’s most reliable wireless network on its new HSPA Plus-based data network, which Bell shares with Telus.

“Bell is claiming superiority based on a new, unproven network with virtually no customers,” Rogers said in a news release. “In addition, a recent public opinion poll by Ipsos confirms that most Canadians agree that network reliability is not something that can be claimed by a new, unproven network with no track record.”

According to the statement of claim, Bell is allegedly making false and misleading representations in its ads by claiming to have “the largest and most reliable” wireless network in Canada.

Bell can’t make that claim, Rogers alleges, because the telco’s new HSPA Plus network is so new it has “virtually no customers” on it. In addition, the claim alleges, there has been “no adequate testing” of the new data network.

The Rogers’ statements have yet to be proven in court.

Rogers’ moves comes days after a B.C. judge ordered it to stop saying it has the country’s most reliable network. Rogers will be in the B.C. Court of Appeal on Wednesday trying to get a stay on that ruling.

The court actions are an early indication of how tough the wireless wars between the three incumbents have become. Until last month, Rogers could fairly claim it had the fastest data network in the country when it launched its HSPA Plus service, with a potential top speed of 21 Mbps. Bell and Telus had data networks using EVDO technology that could get up to only 3.5 Mbps.

However, early in November Bell and Telus launched their new HSPA Plus network, which runs parallel to the old network. That is allowing Rogers to say that most Bell subscribers are still on the old network.

Rogers also complains that in ads the telco says “Being with Bell just got better,” when to get better speed a CDMA subscriber has to have a new phone compatible with the new network.

“The new network does not have sufficient customer load, nor has it been operating long enough to permit Bell to fairly or adequately to compare the speed or reliability of service on its new network to competitors,” the statement of claim says in part.

The claim also says Rogers has asked Bell to stop making such statements, but the telco has refused.

No date for the hearing has been set.

This is only the first round of the wireless war. Two new wireless companies are about to start service to increase the competition: Toronto-based DAVE Wireless Inc., which will operate in many major Canadian cities, and Public Mobile Inc., which will do business in Toronto and Montreal. Quebecor Inc.’s Videotron cable division, which is already in the wireless business by reselling spectrum from Rogers, bought its own spectrum at last summer’s AWS auction and will be better able to take on Bell and Rogers in Quebec.