Telroute Communications has kicked off its first major advertising campaign, entering the fray with an aggressive bid for market share in the burgeoning long-distance wars.

Launched in early November, the campaign follows closely on the heels of a decision by the Canadian Radio-television and Telecommunications Commission to grant the long-distance company full carrier status.

Get message out

‘The campaign is designed to get the message out – educating people and letting them know that TelRoute is there,’ says Ryan McGirr, company marketing manager. ‘An educated consumer is our best opportunity.’

The privately held company, formerly a reseller, is now the third facilities-based long-distance supplier after Bell Canada and Unitel Communications.

It will build and operate the country’s first fully digital microwave long-distance network.

The multi-million dollar campaign, developed by Toronto’s LA Ads – which won the account only weeks before – was introduced with advertising in newspapers such as The Globe and Mail and The Financial Post.

The ads will soon appear in magazines such as Maclean’s, Time, Canadian Business and Toronto Life.

Print advertising will be followed up with a radio campaign, according to LA Ads President Lawrence Ayliffe.

Initially, TelRoute’s target market will be small and medium-sized business, McGirr says.

However, the company has plans to expand its service to residential users over the next two years.

Not only does the advertising explain the company’s evolution from reseller to a full carrier service, it also trumpets the fact that TelRoute is wholly Canadian-owned and -operated.

‘We think the campaign will have a strong impact,’ McGirr says.

‘The telecommunications industry is being usurped by American companies – it’s a serious issue that we think Canadians are concerned about,’ he says.

It is a novel tactic in what has already proven to be a vicious marketing battle between long-distance companies.

The campaign may be an attempt to differentiate TelRoute from Sprint Canada, formerly Call-Net of Toronto, which has formed an alliance with Washington-based Sprint International, according to industry analysts.

Sprint is expected to be granted full carrier status by the crtc soon.

Susan Jeppesen, Sprint Canada’s vice-president, says while TelRoute advertising may be focussing on its Canadian ownership, some consumers will have more confidence in a company that has international financial backing.

‘Our view is that consumers will be more interested in the long-term financial stability of the company,’ Jeppesen says.

‘If it has got a diverse group of investors, you can count on the fact that it’s going to be around for a while – that is a concern in this market,’ she says.

To promote its service, Sprint runs tv spots featuring Candice Bergen, star of the hit tv sitcom Murphy Brown.

Jeppesen says she expects the battle over the long-distance market will intensify this year.

Ayliffe agrees.

‘It’s going to be a bloodbath out there,’ he says. ‘Right now, it’s like a wild west shoot-out. Price is obviously going to be a focal point.’

TelRoute is positioning itself as the carrier with the lowest prices.

McGirr says broadband service will be priced 12% to 15% below Bell, and 10% below Unitel.

Canada’s domestic long-distance market, which measures about $8 billion annually, is split fairly evenly between the residential and business sectors.

The market will likely support only three national carrier services, according to Jeppesen.

She says the crtc has estimated that Bell will eventually lose about 30% of the market to resellers and other carrier services.

Joe Schmidt, president of the Canadian Business Telecommunications Alliance, says Canadians should see lower prices, better service and more sophisticated services as the numbers of long-distance players continue to multiply.

In addition to business and residential voice traffic, TelRoute will carry facsimile, data and business video signals.

The former reseller will now also make its network available to other resellers.

Long-distance resellers lease phone time from companies such as Bell and Unitel on a bulk basis, and sell it to their customers more cheaply.

TelRoute plans to roll out its network in phases, beginning in the lucrative Montreal-Ottawa-Buffalo, n.y. corridor that represents 75% of Canadian long-distance traffic.

McGirr says, eventually, the microwave service will operate nationally.

He says digital microwave offers clearer transmission and will be able to service smaller communities that are too costly for resellers to reach on leased circuits.

TelRoute expects building the network will cost between $50 million and $55 million.

The advertising campaign is scheduled to run until the end of February.