Industry Minister Approves Mobilicity Sale to Rogers

by Istvan Fekete on June 25, 2015

The Canadian wireless landscape is undergoing a major change: Rogers just made the Mobilicity acquisition official in a deal that aims to boost wireless speeds and quality for wireless customers in BC, Alberta, and Southern Ontario. On top of that, this is the fastest government approval for such a merger. Shortly after Rogers’ announcement, Industry Canada approved the sale.

But there are a couple twists to this transaction: Rogers will complete the previously announced acquisition of Shaw’s AWS-1 spectrum and acquire 100% ownership of Mobilicity. The price for the latter was $440 million (interesting how prices went up from last year), and Rogers will also pay $100 million to Shaw for the remaining spectrum.

And there’s more: On top of the spectrum acquisition from Shaw and Mobilicity, Rogers and Wind will undertake an AWS-1 spectrum swap in Southern Ontario to create contiguous spectrum for Rogers. Rogers will also divest certain non-contiguous AWS-1 spectrum to WIND Mobile in BC, Alberta, Saskatchewan, Manitoba, Northern Ontario, and Eastern Ontario.

This is a huge step forward for Wind Mobile, the carrier announced, as it will at least double its network capacity in B.C., Alberta, Saskatchewan, Manitoba, and Northern & Eastern Ontario, and will strengthen its position as the fourth national player, although there is a long way to go until we can refer to it as a national carrier . . .

Rogers had already said it was working with the federal government when preparing its bid for Mobilicity. Still, I was amazed to read Industry Canada’s approval of the deal just a couple of hours after Rogers officially announced its offer.

The message the government is trying to transmit with this transaction is that this is good for Canadians. Actually, it’s too early to tell whether it is good or not.

“Wireless spectrum is a vital public resource, and our government has released more of it than all other previous governments combined. Our objective in doing so has been to promote more competition in Canada’s wireless sector. In 2006, 98 percent of available spectrum was held by Canada’s largest wireless firms. Today, thanks to our policies and recent spectrum auctions, new wireless companies now hold approximately 25 percent of the total wireless spectrum available—creating the conditions for more competition in our wireless sector than ever before.

“The approval of these spectrum licence transfers is a win for Canadian consumers. A new wireless competitor has secured valuable spectrum it needs, and high-quality spectrum that went unused for almost a decade will now be deployed for the betterment of all Canadians, Industry Minister James Moore said in a statement.

“Our government has one goal: to take deliberate, concrete steps to create more choice, lower prices and better wireless service for Canadians and their families. Today’s approval of these licence transfers delivers on this objective.”

One thing is sure, though: Prices for wireless services during the past five years have gone up, and it looks as though the discounts Canadians previously got from wireless startups will soon vanish.

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

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