Very early on, Clayton Zekelman knew he was headed for a career in telecommunications. He liked to tinker with phone equipment, taking it apart and then reassembling it. The process was fun because when he was finished the item still worked and there were no parts left over.
At the dawn of the internet age in the early 1990’s, he had big plans. Zekelman wanted to bring the internet to his home town of Windsor, so he launched his firm Managed Network Solutions Inc. (MNSi) in 1995 and by the end of the 1990’s he had 30,000 local internet subscribers serviced through traditional phone lines.
These subscribers disappeared quickly once high speed service became available from his competitors, but he kept his firm alive and in 1998, the CRTC announced its historic decision to force existing telecom companies to share their lines with local competitors for resale, to promote “competitive entry and foster consumer choice”. Bell is the incumbent local exchange carrier (ILEC) in the Windsor area, which until then held the regional monopoly on landline service. Once it gained access to Bell’s network, MNSi began to offer phone and internet services to Windsor and the surrounding area which it continues today.
Over the years, Zekelman had met the Downs brothers of Nexicom and found they had a lot in common. Their businesses are smaller, locally owned and operated communications firms and providing on-site technical support for their customers. One difference is the businesses sit on opposite sides of the regulatory fence: in our area, Nexicom is the incumbent service provider whereas MNSi is the competitive carrier in its market.
When John and Paul Downs began to seriously consider retirement, they reached out to Zekelman who shared their ideals, vision and support for the community. The purchase was finalized earlier this year, with the Downs staying on until year end to ease the transition. So far, so good.
The competence of existing Nexicom staff means Zekelman makes his significant commute to Millbrook just two days per week. It’s a good thing both firms have a stable and effective workforce, because the new owner has big plans for both firms.
MSNi recently began installing fibre optic cable across the city of Windsor to provide internet speeds that can be hundreds of times faster than traditional service providers. It’s an expensive proposition to which he is committing roughly $5 million per year according to local media reports. Zekelman wants to own his networks so he is not relying on the resources of others to deliver the new fibre service. There are big fibre projects on the drawing board for Nexicom as well. In addition to wiring the new development with fibre and extending fibre to other parts of the community, Nexicom has made three submissions for internet projects around Warsaw, South Monaghan and Bewdley. If approved, the firm will receive partial funding for the “backbone” section of the projects, and be on the hook for the cost of the “last mile” of the cable to connect to each home and business in the area.
The internet upgrade announced by the CRTC is also good news for Nexicom’s wholesale telecommunications distribution business, which provides cable and components to companies building their voice and data services network. Having relocated to a larger, modern facility this summer, they are poised to take advantage of the coming boom in network construction, whoever takes it on.
Telecoms like MNSi and Nexicom are investing in small communities and rural areas that are not top of mind for the larger service providers who are focusing on meeting new CRTC internet speed targets in big urban centres. These local firms are helping to bridge rural and urban gaps in connectivity, which is good for them as well as their customers. Currently, streaming video from sources like Netflix and YouTube is responsible for about 60 per cent of traffic on the internet. Fibre optic cables can not only handle existing demand but will also have the capacity to address increases stemming from new uses. These will come from what is called the Internet of Things, including home automation applications where devices communicate with each other.
The challenge in operating in a regulated industry is to be position to take advantage of market opportunities resulting from government intervention. Under new ownership, Nexicom and its sister companies are poised and ready to grow. KG