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Telecommunications generates manufacturing jobs.

In addition to its important role as an enabling technology, telecommunications services and manufacturing employ more than 300,000 people in Canada, more than the number of employees in such traditional industries as automobile manufacturing, banking, or pulp and paper.

In Ontario more than 90,000 people are employed in telecommunications services and manufacturing. The province's industry generates more than $9 billion annually and spends more than $600 million each year on research and development.

Telecommunications is an increasingly important sector in the province's overall economy, and its continued growth will result in increased domestic sales, new revenues from international markets and more jobs for Ontario workers.

The largest percentage of revenue in the telecommunications services sector comes from basic local and long distance telephone services. These are currently provided on a monopoly basis by the nine member telephone companies of Stentor Canadian Network Management (formerly Telecom Canada) and several other provincially and locally based companies.

Employing close to 100,000 people full time, these companies generated $13.6 billion in 1991, up 4.8 per cent from the previous year.

In Ontario local and long-distance services are provided primarily by Bell Canada which is regulated by the Canadian Radio-television and Telecommunications Commission (CRTC).

Thirty independent telephone systems, which are regulated by the Ontario Telephone Service Commission, also provide local service to specific regions or local areas of the province. All of these systems, such as the City of Thunder Bay and Northern Telephone Limited, have special connecting agreements with other carriers to provide long-distance services in their territories and to share revenues generated by these services.

Ontario Northland Telecommunications, a branch of the Ontario Northland Transportation Commission, also provides a variety of telecommunications services such as long distance and private line voice and data service to communities in Northern Ontario.

Toronto-based Unitel is another major player in Ontario's telecommunications industry. Unitel and Bell Canada provide a wide range of telecommunications services including private-line voice and data communication, facsimile, electronic mail and voice mail and circuit-switched telecom services.

Since the decision by the CRTC in 1990 to lift the restrictions on the enhanced service providers, the reseller industry has grown significantly.

Resellers lease private line circuits from facilities-based carriers such as Unitel and Bell Canada and resell this capacity to businesses and other organizations. They are permitted to sell both voice and data services and to combine traffic from multiple customers.

Resellers provide services such as customized billing and call-detail recording, dedicated access lines, WATS lines and access to U.S. 800 numbers. Several resellers offer these services domestically and internationally. Major resellers include Call-Net Communications, ACC Long Distance Ltd. and Cable and Wireless Communications.

Resellers in Canada now account for three per cent of the $250-million long distance market. Two-thirds of that revenue is generated in Ontario. There were 40 resellers offering services in Canada in 1991, 26 of them with offices located in Ontario.

Telecommunications services are also provided by satellite service providers. In 1990 the satellite-based service providers generated revenues of more than $80 million. These companies included Telesat Canada and other companies such as Canadian Satellite Communications which lease satellite capacity from Telesat. Satellite-based services include voice-data transmission, mobile radio and teleconferencing services.

The cellular service industry has grown dramatically since cellular was first introduced to Canada in 1985. In 1991 cellular service providers generated $685 million. Although the bulk of these revenues came from voice services, cellular companies also offer mobile data transmission and facsimile services to businesses and organizations.

Bell Cellular and Cantel Inc. are the main suppliers of cellular mobile service in Ontario. Some independents such as Kenora and Thunder Bay Telephone also offer cellular service.

Other important telecommunications services industries include voice mail and paging services. The Canadian market for voice mail services grew from $69 million in 1990 to $100 million in 1991. It was dominated by Octel Communications Corp. which was responsible for 40 per cent of the parts shipped in 1990. Northern Telecom was a strong second at approximately 20 per cent.

The market for paging systems in Canada was $39 million in 1991. It is dominated almost completely by Motorola, NEC and Panasonic. There were 580,000 subscribers at year-end 1991, a 15-per-cent increase over 1990.

The direct contribution of Ontario's telecommunications manufacturing sector to the province's economy is significant. In 1990 revenues from shipments of telecommunications and related electronics equipment and components totalled approximately $4.5 billion.

The telecommunications manufacturing sector includes several specialized segments. Telecommunications products manufactured in Ontario include public network central office switches, cable and transmission equipment, private branch exchanges (PBX) key systems and basic telephone sets.

Public network central office manufacturers generated sales of more than $1 billion in Canada in 1990 while the public network cable and transmission markets were worth $455 million and $575 million, respectively.

Another important part of the telecommunications manufacturing sector in Ontario is the interconnect equipment industry. This industry generates $400 million in revenues nationwide, with close to $250 million of this total coming from Ontario.
COPYRIGHT 1992 Laurentian Business Publishing, Inc.
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Copyright 1992, Gale Group. All rights reserved. Gale Group is a Thomson Corporation Company.

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Publication:Northern Ontario Business
Date:Nov 1, 1992
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