Ottawa Aggressively Courted Verizon, Rogers Claims

by Istvan Fekete on July 29, 2013

As the September 17 deadline for 700 MHz bidders is approaching, Canadian incumbents are attacking Ottawa on every angle via the media: after the Verizon bombshell dropped earlier this month, Telus has given the tone by claiming it will be a wireless bloodbath in the event the red U.S. carrier is treated as a startup, and its tone was picked up by both Bell and Rogers. The latter goes even further: it claims Ottawa has aggressively courted Verizon, and even flew to the United States to convince it to step on Canadian soil.

The allegations come from Philip Lind, regulatory vice-president and vice-chair of Toronto-based Rogers, who sat down with the Star.

“Everything that they could possibly ask for they’re doing for Verizon,” Lind said. “Without favours, we know they would not be coming,” added Rogers CEO Nadir Mohamed.

According to Lind’s sources, federal government officials travelled to New York, offering favours to bid to establish a strong fourth wireless carrier in Canada. The market is currently dominated by Rogers, Bell, and Telus, which own more than 90%.

Nadir Mohamed claims that U.S. carriers had decided not to step in the Canadian wireless market, which is regulated, thinly populated, and expansive. However, as the Verizon CTO already has emphasized, the carrier is exploring options.

Ottawa’s push for a fourth carrier is backed by its commitment for effective competition across Canada, which ideally would bring better prices for Canadian consumers.

We had to admit that after 2008 prices have changed because wireless startups brought competition into the mobile market. However, the viability of the plan is kind of questionable in the light of the struggling startups — after three-four years of existence on the market.

The scenario could be improved by allowing one powerful fourth player, instead of three financially struggling wireless startups, which are on the auction blog – although Public Mobile was recently acquired. And former Industry Minister Christian Paradis emphasized that the market needs foreign investment to maintain competitiveness.

In the end, the incumbents are now afraid to see a powerful new entrant, Verizon, to cherry-pick wireless players, which already have built a wireless infrastructure. Most of all, they are afraid that one of them will remain without the valuable 700MHz spectrum block.

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Written by: Istvan Fekete. Follow by: RSS, Twitter, Facebook, or YouTube.

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August 1, 2013 at 6:05 am

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