Canadian Incumbents Fight to Keep Verizon Wireless Away
Telus Whines About 'Level Playing Fields' and Fairness
As we noted yesterday
, Verizon Wireless is putting out feelers and exploring the option of an expansion into Canada, specifically in the form of buying up one of the nation's struggling smaller carriers. Not too surprisingly, incumbent operators there don't want this to happen. Telus CEO Darren Entwistle has spent the last week complaining about how there needs to be a "level playing field" if Verizon enters the market (pro tip: the majority of people complaining about "level playing fields" want the exact opposite).
In the Financial Post
, Entwistle warns of a "bloodbath" if Verizon Wireless is allowed to enter the Canadian market, and actually went so far as to insist that more competition would result in things getting worse for the country:
Darren Entwistle, chief executive of Telus Corp., told the Financial Post during an editorial board meeting Thursday that the government’s campaign to have at least four wireless carriers in a every market will lead to overspending by the incumbents, could leave one of them behind technology-wise, and even threaten investment in services for rural communities.
Of course competition usually does the exact opposite, but who needs facts? Over at the Globe and Mail
, Entwistle complains that all they really want is a "level playing field" (again, read: unlevel playing field):
"All we are asking for is not to be punished. And if we are going to compete against foreign entrants such as Verizon, we feel we have earned the right to a level playing field by the investments that we have made in this country," he said in an interview Thursday, noting the cumulative operating investments of the big three telcos have totalled $420-billion since 2000. Telus alone has invested $100-billion in Canada over the last 13 years.
Whine about unlevel playing fields, tout your often-massaged network investment stats, then malign regulation (unless it's regulation you wrote specifically to screw the other
guy). Sound familiar? Under Canadian regulations, while Verizon can own 100% of a company, the company at the time of purchase can't have more than a 10% market share. It also can only grow naturally, and can't engage in further mergers or acquisitions.
Like in the States, the playing field is already tilted in favor of incumbent operators, and most regulators are equally beholden to the biggest, wealthiest companies.
While Bell and Rogers will likely join Telus in crying like toddlers about Verizon Wireless entering the Canadian market and creating more competition, this is a kind of fight Verizon's all too familiar with -- since here in the States, they're
usually the ones fighting to keep competition at bay. Unlike Canada's smaller, dying cellular providers, it's a battle Verizon can certainly afford to fight.
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Re: I disagree...
said by Beans5:Not sure if it would be Bell. More likely Rogers.
I think that once Verizon hits the market, Verizon and the Bells will come together to somehow make a 4 way monopoly so Verizon can magically grow but have no real competition.
Whatever the case, though, I really can't see it going well for Canadians if Verizon were to acquire WIND Mobile. They're the only ones that have a decent monthly plan. Verizon would want to change it to be marginally cheaper than Rogers/Bell/Telus. (Robelus)
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Telus is probably worried about 700MHz Not sure if 700MHz has been auctioned off yet in CA, but if it hasn't, Verizon can afford to bid more for it than the CA carriers, specifically in the upper C block, because they already have phones and base stations (at scale) that work on that band. Their costs will be lower, though they'll probably wait for VoLTE to switch stuff to the Verizon banner, since none of their phones Stateside support WCDMA in AWS (only LTE).
Assuming Verizon buys Mobilicity, Wind or both (Public Mobile could be an acquisition target due to PCS-G working for slightly modded CDMA devices), Verizon could basically extend Share Everything north of the border and price it $20 lower than in the US for the 1GB plan...and actually get some customers. It won't be the typical Verizon way of doing things, since they won't have an expansive network out of the gate, but they could build one within a year or two.
Re: Telus is probably worried about 700MHz There are four desirable 700MHz blocks that will be the most contested (they're presumably the same blocks as in the US). The rules, if memory serves, are that incumbents (such as Telus) can get at most one block, while new entrants (as Verizon would be) are limited to two. This means that even if Verizon decided to throw money at the problem and outbid everybody else, there are still two blocks available in every spectrum region. Verizon couldn't buy out the whole auction even if they wanted to.
Couple this with the fact that Bell and Telus have spectrum/network sharing agreements and that there are only three incumbent carriers, this means that even if Verizon buys the maximum allowable spectrum, all existing incumbents can still get 700 MHz spectrum.
Even in Quebec, where one of the new entrants (Videotron, a cable provider) is basically an incumbent, they have an agreement with Rogers, so still all four incumbents can get 700 MHz spectrum.
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said by eco:Not really.... 'T' is a public corporation that anyone (with the $$$) can buy into. They are not wholly American owned by any means.
In any case, I agree with you. AT&T Wireless is our only completely domestically owned major wireless network.
said by eco:Protectionism. Sounds great on paper, never works out in the long run....
What's the point if protecting national carriers from foreign competition if foreign competition could mean better pricing and service for customers?
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said by FFH5:I think you're the one out of their depth here, son. Telus has what is known as 'Employee Concession Plans' that are very rich with minutes, features, and data. The cost is minimal. When I worked for Telus, it was $6.95 a month plus tax. said by Mike_C:
Their employee cell plan is quite generous and only $15 which they STILL make a profit on.
How do you know? Do you have access to proprietary cost info? Otherwise, you are merely guessing.
So, STFU unless you know what you're talking about. You obviously don't.
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