TekSavvy Solutions Inc.
In the exceedingly competitive, rapidly-changing world of telecommunications, TekSavvy Solutions Inc. has established itself as one of the fastest growing and innovative pioneers in providing residential and business solutions throughout much of the country.
The Canadian Business Journal had the opportunity to speak with TekSavvy’s progressive and dynamic young CEO Marc Gaudrault about the history of his successful privately-owned enterprise, dating back to its launch in 1998 and where he sees both TekSavvy and the industry heading in the future.
Gaudrault began by explaining what inspired the creation of TekSavvy 17 years ago this January in Chatham, Ontario, which remains the location of the corporate head office. TekSavvy and online communications have come a long way during the intervening years.
“If you recall that period of time, the Internet was in its infancy and we were still using dial-up, pre-2000 dotcom bust,” he reflects. “We were just young and trying to do business. It was an exciting time with so many advancements in technology.”
TekSavvy’s tremendous growth since those early formative years is reflected by the 250,000 homes it now serves across Canada along with about 450 dedicated employees in both Chatham and Gatineau, Quebec who work around the clock ensuring top-notch customer service.
“Oftentimes people wonder how we started the company in Chatham,” he chuckles. “We were out there and wanted to make a difference and were lucky to be there at a critical point in history where all the things happened to be coming together.”
The great thing for TekSavvy is that in this digital age, the company is able to run a highly sophisticated technical enterprise from a smaller urban centre such as Chatham as opposed to having to deal with the congested hustle and bustle and daily headaches of Toronto.
“There are some things were proximity is important, but for the most part, from what I’ve witnessed working between our Gatineau and Chatham office, I find it pretty much seamless,” Gaudrault affirms. “We do some travelling because there are times when you need to do some fact-to-face, but in general what I would say is that Chatham, for example, is definitely a strategic positive aspect. You can drive to work in five minutes. The price of housing and office space gives it a real competitive advantage. The success speaks for itself.”
When ownership and senior management at TekSavvy first opened the doors for business they were not selling Internet or telecom services, but rather were focused on providing professional Web design services, expert onsite training and technical networking. It was following the tragic events of September 11, 2001 where a sizeable portion of the Internet technology industry suffered for a prolonged period of time, and in fact many companies never recovered from it, failing to either resume where they had been or to reinvent themselves.
“I remember at the time we had a number of proposals out for various contracts,” Gaudrault notes. “We received very limited response back and so then it became clear that we needed to change our focus to something that can weather these sort of events more readily.”
During the company’s existence there have been enormous advancements in ISP technology, beginning with low-speed dial-up modems to the uber-fast broadband network capabilities of today. TekSavvy serves a wide geographic range across Canada, with the exception of the Prairies.
“We’re continuing to look at the business case for those areas as well,” Gaudrault confirms. “We have a data centre in Halifax, Vancouver, Toronto, Montreal and New York.”
Infrastructure
TekSavvy operates using what is known as “last mile” infrastructure whereby they incorporate the backbone networks of other large telecom companies such as Bell, Rogers and Telus. There are also agreements in place with Bell Aliant, Cogeco Cable, Shaw and Videotron in various regions. Much like the wireless industry where new entrants have often butted heads with the established giants about network and tower sharing, there has also been a level of acrimony between newer companies such as TekSavvy and the incumbents, who many believe have been blocking competition that would allow Canadians better access to affordable independent services. Gaudrault and his team have been consistently amongst the leaders in lobbying for positive change and promoting a more conducive working environment between the two sides, which would ideally include opening up networks by splitting them from the total control by the incumbents so Canadians would be able to select their provider with everything being on an equal technological and pricing footings.
“There’s no doubt over the years we’ve had a strong consumer advocacy and there are decisions outstanding at the CRTC that were raised by us and others,” Gaudrault says. “I’ve blogged about it quite often. There are definitely still some difficulties there and I do believe that on some level changes are required.”
At TekSavvy, the primary goal is now, and always has been, providing customers with preeminent service. The company prides itself on dispensing faster upload and download speeds and greater bandwidth than most people would expect, all for a great price. In addition to cable and DSL services, TekSavvy offers home telephone services through landline and voice over Internet protocol (VOIP), with competitive long distance packages and Web hosting in eight provinces.
“At the end of the day, consumers get to have service and quality that they expect,” Gaudrault replies. “We are a company that prides ourselves on quality customer experience. This rubs up against that when we’re not able to deliver what we are trying to. We have to deal with the reality that it goes through a third party.”
Suitable news is that the federal government, including the Ministry of Industry and the CRTC, have been taking proactive steps that seem to be sliding the scale towards a more balanced equilibrium. But the changes can be cumbersome and take what feels like an eternity to those it impacts on the most.
“These are really complicated issues and they are not simple fixes,” Gaudrault rationalizes. “It’s a positive point in time what I’m seeing from the government and the CRTC is that they are really trying to make a difference and I feel they’ve done some great work to date.”
Promoting a Fair System
There is still an enormous amount of work to do in order to bestow an equal playing field that will truly promote a competitive environment in Canada, which will serve to benefit consumers. As the industry evolves, so too will the government need to react, as will the lobbyists for continuing change.
Not that long ago the principal point of consternation within the industry was something known as user-based billing (UBB), which essentially imposed caps on the amount of data individuals could download per month. TekSavvy and several other ISPs (Internet Service Providers) felt it was evident the incumbents were purposely trying to steer them off in a direction they quite simply didn’t want to follow.
“The government stepped in – and rightfully so,” Gaudrault remarks. “Initially the incumbents were trying to force on to us a specific way of how to sell to our own customers. When we say we are an independent ISP it means we can take these underlying parts and pay for that and then provide a service that is different or innovative from what is otherwise out there. I believe we had a solid win there (with UBB).”
The victory for the newer entrants against user-based billing ultimately led to what is currently known as capacity-based billing, whereby companies such as TekSavvy are billed on an aggregate and are then able to bundle services how they see fit for their business customers. It means there is a separation between how TekSavvy chooses to run its business and how the incumbents choose to run theirs, which is exactly how Gaudrault – and many members of the public – feel it should be. But it turns out there are no shortage of wrinkles in this evolutionary move towards levelling the playing field either.
“The caveat is that the price point for these things and how the costing is being done – there is still significant work to be done,” Gaudrault states. “To make services available is just not representative of the actual costs. It doesn’t make for a proper solution right either. You need the framework and costing done right in order for us to compete on an even, fair playing ground. We pay for everything we’re getting. In fact we pay a lot and that’s precisely the issue.”
Another contentious matter that the federal government recently ruled on was passing updated copyright legislation in an effort to strike a balance between content creators and the rights of users.
“That’s not our role to play,” Gaudrault says. “The copyright business is for those making movies and whatever else. However, the touch point that affects us is that our customers are using the likes of Netflix and YouTube and so there’s a convergence happening. As an ISP, there are definitely touch points where we need to adhere to these legislations and rules that come into effect. Many moons ago we initiated a rally on Parliament Hill on Net Neutrality. When it comes to things like copyright we are first and foremost, neutral.”
Industry Accolades
Several highly-respected print and online tech publications including DSLreports.com have consistently ranked TekSavvy as the top ISP in Canada. TSI has been on the list of top-100 fastest growing companies for the past five years and been named in the Top 20 Movers & Shakers rankings.
“We’ve been ranked No. 1 for a long time and we’ve done really well,” Gaudrault proudly says. “The thing that makes me most proud is seeing the response from our customers. We do care – and we empower our staff to care. It’s culture through and through and not just lip service.”
TekSavvy is widely known for its ongoing commitment to protection of consumer rights online, which is near and dear to Gaudrault’s heart and that of the entire team.
“Lately, one of the biggest focuses, if you will, is privacy and on that front I think we were the first to put out a transparency report earlier this year and that will continue. It began with Net neutrality. A lot of these things have to do with these similar things, where people want to have something that makes sense to them without having all the extra attachments they might not want or desire.”
Customers to TekSavvy’s services are quick to point out their pleasure and gratitude at having no hidden fees or contracts thrown at them at any point during the subscription process. That business practice is exceedingly rare and quite unique within the industry. It’s another aspect of Gaudrault’s company that he is adamant about continuing.
“We’re straight up; what you see is what you get,” he responds. “That’s kind of refreshing in and of itself. It’s a big point internally for me. In general, it’s the concept that we’re trying to offer a great service at a great price and we’re mindful of that when we go about doing things. The value proposition is solid. We treat our customers right and are willing to earn their business.”
In addition to the company subscribing to the WYSIWYG philosophy, TekSavvy customers can also gain access to their accounts online via a portal where information can be gleaned. More and more of that becomes available with each passing day. Invoices can be found and requests can be made online in either English or French.
Along with Gaudrault, there are several other key executives who make up part of the team’s decision making process and Gaudrault is quick to point out how each has been integral to the success at TSI. They include: Chief Information Officer Pascal Tellier, Chief Operations Officer Pierre Aube, Chief Legal and Regulatory Officer Bram Abramson, Chief Financial Officer Catherine Playford and Director and Marketing & Communications Director Tina Furlan.
“There is a very strong team aspect to our operation internally and we enjoy working together. We not only try to do great things but have a bit of fun while we’re doing it. It’s hectic and there’s always a lot going on, so if we weren’t having a bit of fun doing it might otherwise be really stressful,” Gaudrault laughs.
Recent Acquisitions
As part of its steady, continued growth pattern, TekSavvy has made several rudimentary acquisitions since the summer of 2014 designed to enhance and expand their existing servicing capabilities. Lightwave Wireless Internet Services is a fixed-wireless broadband company in the Chatham-Kent area. The purchase strengthens TekSavvy’s ability to provide high-speed Internet to rural residents in Chatham-Kent, Ontario.
TekSavvy’s engineering and technical teams completed an upgrade of the Lightwave network, which has since been integrated into TekSavvy’s SkyFi network to expand TekSavvy’s wireless broadband footprint, which now features consistent uptime and speeds of up to 10Mbps.
“This is a continuation of the facilities initiatives that we’ve undertaken,” Gaudrault relates. “In Chatham we had been deploying fixed wireless, so basically a mounted dish on your home primarily focused on locations outside the core of the city. Lightwave is an addition to that. We’ve augmented our footprint and client base with that. The majority are residential, but it does give us options. It’s an area where we are investing to expand that footprint.”
Another key acquisition has been Openjive Inc., an up-and-coming software development firm headquartered in the Ottawa area. With expertise in delivering applications and services to the commercial and government sectors, Openjive focuses on building Unified Collaboration solutions that integrate with Microsoft platforms like Lync, SharePoint, Dynamics CRM, Exchange, Office and Office365. Openjive is the company behind Lingo, the Qualified Lync Solution for connecting disparate systems and processes to extend business applications to Lync 2013 Persistent Chat. During our discussion with Gaudrault, we were connected via the Microsoft Lync platform, a top-level productivity tool used internally by TekSavvy.
Openjive is a Microsoft Partner and will provide the Gatineau location a method of offering software-as-a-service and professional systems integration services. Along with TekSavvy’s recently-announced strategic investment in the ROOT Data Center, it allows TekSavvy to offer a growing range of professional services to small and medium enterprises right across Canada.
“A lot of the strategy there is that internally, with the size we are at, there is a real need for enterprise-class solutions in house,” Gaudrault notes.
“We’ve had an initiative internally for the last few years where a lot of automation and Microsoft Solutions, Sharepoint and Dynamic CRM – basically the Microsoft Business Productivity Suite – As we are developing our own solutions these are solutions that will be reusable and be able to go out to the business community and make a difference there.”
Future Plans
In addition to the consideration of possible expansion into the Prairie provinces, Gaudrault says he and the executive team will also look at growing their offerings to the business community. At this point in time, about 80% of their existing customers are residential.
“It’s one of the areas of focus for the future – rounding out the business offerings,” he says. “We want to continue working hard on the residential side and round out our portfolio on the business side.”
While Gaudrault could not provide specifics on possible projects in the near term, it’s clear they’ve got no shortage of work in front of them.
“I wish I had a crystal ball,” he chuckles when asked where the company will be five years down the road. “So many things are changing, but to some degree it would be more of the same. We are doing really well. On a personal level, the things I enjoy on a daily basis is to make a difference in people’s lives. I like answering people’s emails or calls. I can be seen online responding to questions. It’s important to stay grounded more than anything.”
On a purely business level, Gaudrault is quite pleased with the progress of TekSavvy, feeling it is producing fantastic services and will continue to round the offerings on the residential and business side, while continuing to be a vocal leader in fighting for consumer rights. Privacy and laws in that vein will undoubtedly become increasingly more important over the next few years.
TekSavvy appeared at the CRTC’s “Let’s Talk TV” hearing recently, requesting an accelerated push for greater competition for Canadian television viewers. In order to ramp up competition, a number of barriers still need to be removed.
“Unnecessary barriers to entering the broadcasting distribution market mean that Canada is missing out on innovation that consumers are instead finding elsewhere,” said Bram Abramson, TekSavvy’s Chief Legal and Regulatory Officer.
During the appearance at the Let’s Talk TV hearing, TekSavvy announced a partnership with newly-affiliated cable company Hastings CableVision.
“This partnership will give TekSavvy the experience and expertise we need to build on our commitment to our customers,” Gaudrault says.
“We continue to look at that and obviously at some point in the future we’d like to entertain a TV offering of some kind,” he continues. “There’s obviously been big news recently with a variety of big players out there. This is an area that has its own issues for us and will get touched upon in the proceedings but as time goes on we certainly have a significant client base and many of them might like an innovative TV service from us.
We’re making important, solid steps and doing some pretty cool stuff.”
If TSI were to run a TV service it would almost certainly need to be on the network infrastructure of one or more of the so-called incumbents. Contentious pricing issues remain on the ISP side of things, so gaining traction in this area will require a greater level of cooperation from the big players in order for Canadian consumers to enjoy a greater level of competition, such as a company like TekSavvy is definitely willing and able to provide.
As the underlying contentious issues are whittled away over time, it will help to create a palatable environment, resulting in a more even playing field. The Wireline wholesale proceedings are expected to last several months after which the picture should become less fuzzy and at that time Gaudrault and his team can better evaluate what direction and projects to focus their attention upon.
