New Canadian hopeful Public Mobile plans to launch services in Toronto and Montreal in mid-May and has already opened 25 stores in the cities. The low-cost operator is touting a contract-free plan with unlimited local calls and North American text messaging for a C$40 ($39.60) monthly fee in an effort to differentiate itself from other operator start-ups and the country’s three incumbents (Bell, Rogers and Telus). The privately held company, which plans to expand service in Ontario and Quebec through 2010 and 2011, is offering handsets from ZTE, Kyocera and Samsung. Public Mobile paid C$52 million to buy wireless spectrum in a 2008 government auction meant to spark competition. It says the spectrum it acquired covers almost 19 million Canadians in Ontario and Quebec.

Reuters notes that Public Mobile is one of five new entrants set to compete in Canada’s mobile market, where one third of the country’s inhabitants don’t have a mobile phone according to the operator. Globalive launched its Wind Mobile service in December and Data & Audio Visual Enterprises (DAVE) Wireless recently said it expects to launch service under the Mobilicity brand in Toronto this spring. Quebecor’s Videotron has said it will start service in Quebec this summer, while cable operator Shaw Communications has said it will begin services sometime this year.