As Primus, Allstream Sell Off, Bluarc Offers Free Migration to Its Platform

The year did not kick off with good news for Canadian Voice over IP provider Primus Telecommunications Canada Inc. It wasn’t a field day for business and residential customers, either, as the company announced its court-ordered protection from creditors. The company has also stated its intent to seek approval of a plan to sell its business to a United States telecom provider known as Birch Communications Inc. Primus has more than 200,000 residential customers and a reported 23,000 clients that are small and medium-sized businesses. Based out of Toronto, the company is one of the largest Voice over IP telecom providers in all of Canada. Reports indicate that the company has been seeking a buyer since sometime in August, compiling some serious bills that it’s been unable to pay.

In similar news, another Canadian telecom company known as Allstream announced a cell to another United States based company known as Zayo Group Holdings Inc. Both business and residential clients can expect their services to continue from the companies at the root of each of these developments, until the logistics and completion of the sales process take place.  bluArc, a competitor to these soon-to-be aforementioned businesses, has offered to step in and migrate business clients belonging to both Allstream and Primus over to their virtual PBX systems free of charge. bluArc is promising stable services and easy transitions, along with the knowledge of a strong history of business in Canada.

Primus’ troubles stem from a number of business pressures, including high fixed overhead costs and ramifications from its overall business model. Primus has largely resold telecom services including internet and voice calling. It buys these services at wholesale rates from major companies (including Allstream), then resells them to the end customer. In recent years, customers have fled these services in a move towards cancelling legacy products. This created a gap I couldn't be filled with the promise of higher speed internet services which promised higher profit margins for the company. Additionally, telecommunications have embraced virtual and mobile platforms, which have instigated a structural change throughout the industry.

Edited by Kyle Piscioniere