Ottawa Would Reject Third Telus Bid on Mobilicity

by Istvan Fekete on February 11, 2014

Telus may want to acquire the struggling Mobilicity, but the government still hasn’t changed its position. Ottawa signaled yesterday that it still opposes any of the country’s established wireless companies taking over the wireless startup, despite it being under creditor protection since last fall. And this won’t last forever, as the operator has announced it will run out of cash by the end of February.

As we previously reported, Canada’s No. 2 wireless player has reportedly place a third bid for Mobilicity, as the five-year ban on the transfer of its wireless spectrum expires tomorrow, Wednesday, February 12, 2014

When the government initiated the 2008 wireless auction for the AWS spectrum, it specified that it would prohibit the transfer of set-aside AWS wireless frequencies, as it aims to foster more competition and more choice for Canadian mobile subscribers in an industry dominated by three carriers, Rogers, Telus, and Bell.

So, it set aside wireless airwaves for new players such as Mobilicity, Wind Mobile, and Videotron. We all know how they have performed over the past three years since they launched their own wireless networks.

Although Telus refused to comment on whether it is planning a third bid on Mobilicity, sources speaking with the Globe and Mail earlier last month have reported that the carrier has expressed its interest in the struggling carrier to the tune of $350 million. The catch is, it isn’t the only one competing for the set-aside AWS spectrum: Videótron has reportedly placed a bid of its own.

When asked whether Ottawa plans to extend the spectrum transfer moratorium, a spokesman for Industry Minister James Moore emphasized that the government’s position has not changed since last June, when it rejected Telus’s Mobilicity takeover bid.

“The minister has made his position clear already on spectrum transfers,” said Jake Enwright, a spokesman for Industry Minister James Moore. “We’ve been clear that we will not approve any spectrum transfer that results in undue concentration.”

In a marketing campaign launched last year, Ottawa clearly expressed that it wants to provide more choice and more options for Canadian mobile subscribers. The latest statement regarding a possible incumbent takeover of Mobilicity seems to corroborate that effort.

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

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