The old adage in real estate that it only takes one buyer held true in the Canadian 700 MHz spectrum auction. After potential new entrants such as Verizon declined to enter the Canadian market and Wind Mobile dropped out of the bidding at the last minute, many declared the spectrum auction a failure. Industry Minister James Moore and the government got the last laugh, however, with the auction generating $5.3 billion and the emergence of potential new national wireless player – Videotron (parent company is Quebecor). There had been some speculation that Quebecor might make a move outside of Quebec (Nowak, Corcoran) and seeing the company scoop up prime spectrum in Ontario, Alberta, and British Columbia offers renewed hope for a more competitive environment.
Post Tagged with: "Wireless"
Competition Bureau Raises Concerns Over Canadian Wireless Market
The longstanding debate over the state of wireless services in Canada has veered across many issues – pricing, roaming fees, locked devices, new entrants, and foreign investment to name a few. At the heart of all of these questions is a single issue: is the current Canadian wireless market competitive?
My weekly technology law column (Toronto Star version, homepage version) notes the competitiveness of the Canadian market is a foundational question since the answer has huge implications for legislative and regulatory policy. If the market is competitive, regulators (namely the CRTC) can reasonably adopt a “hands-off” approach, confident that competitive forces will result in fair prices and consumer choice. If it is not competitive, standing on the sidelines is not option, thereby pressuring government and the CRTC to promote more competition and to implement measures to prevent the established players from abusing their advantageous position.
Competition Bureau Raises Concerns Over Canadian Wireless Market
Appeared in the Toronto Star on February 1, 2014 as Competition Bureau Raises Concerns over Canadian Wireless Market The longstanding debate over the state of wireless services in Canada has veered across many issues – pricing, roaming fees, locked devices, new entrants, and foreign investment to name a few. At […]
Competition Bureau Raises Wireless Competition Concerns, Concludes Big Three Have “Market Power”
The Competition Bureau of Canada has just released its submission to the CRTC’s consultation on domestic roaming rates and with it left no doubt about its concerns with the state of wireless competition in Canada. Despite repeated efforts of the big three incumbent providers to argue that the Canadian market is competitive, the Competition Bureau has concluded that the big three enjoy “market power.” As the Bureau notes, market power is “the ability of a firm or firms to profitably maintain prices above competitive levels (or similarly restrict non-price dimensions of competition) for a significant period of time.”
Given its market power, the Bureau finds the wireless incumbents can use roaming to shield themselves from competition. It states:
“Incumbents can use the terms and conditions of roaming agreements to raise their rivals’ costs such that incumbents are shielded from the full effect of their the rivals’ (i.e., entrants) entry. Making it more costly for entrants to access incumbent networks through roaming agreements is one way for an incumbent service provider to relax competitive pressure.“
Rogers’ Changing Tune on Fully Opening Canadian Wireless to Foreign Investment
Rogers’ executive Rob Bruce in 2012 on changes to Canadian foreign investment rules that removed restrictions for companies with less than ten percent of the market: “Our view is ‘bring it on. As far as competition goes, we’ve always been a full-speed-ahead competitor and we’re ready to go with whoever […]
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