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Category Archives: telus

Ottawa’s best option: Let Mobilicity die

mobilicityTelus is trying yet again to acquire struggling wireless company Mobilicity in a deal worth $350 million after being rebuffed by the federal government twice last year. The difference this time? The moratorium on spectrum transfers from so-called new entrants to big carriers that began five years ago is now up.

Under those original rules, Telus or any of the two other big cellphone companies (Bell or Rogers) would have been free to acquire Mobilicity and its prized airwaves, or even Wind Mobile for that matter, as of early this year. But in June last year, the government changed all that with a new set of rules that gave it the power to review all spectrum transfers. In no uncertain terms, Industry Minister James Moore has repeatedly and ardently stated, “We will not approve any spectrum transfer request that results in excessive spectrum concentration for Canada’s largest wireless companies, which negatively affects competition in the telecommunications sector.”

Not surprisingly, Bay Street is trying to make a case for why the Mobilicity sale should be allowed. Telus would get to take out a competitor – more on this in a second – and it’s also the best possible outcome for the smaller company’s investors. To this extent, some financial analysts are even overstepping their roles in trying to give Moore and the government a face-saving out. As TD Securities analysts wrote in a note to clients last week: Read the rest of this entry »

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Posted by on April 21, 2014 in telecom, telus

 

SaskTel cries poor over wireless competition

PalpatineOne could be forgiven for thinking a story last week about SaskTel’s wireless woes was an article from The Onion. The story, which featured chief executive Ron Styles complaining about too much wireless competition in his home province of Saskatchewan, did indeed read like something from the notorious news parody outlet:

The CEO of SaskTel says he is heading to Ottawa to argue that new federal regulations are hurting the Crown corporation’s bottom line.“We just need to make our case … that some of the things they are putting in place … are having unintended consequences,” Styles said as he outlined the position he will take when he meets with federal government officials.

The humour, of course, lies in the apparent fact that Styles hasn’t been paying attention to anything regarding his industry for… oh, the past few years. Those lower profits – and therefore lower prices – are actually exactly what the federal government has been desiring for some time, not just in Saskatchewan but in every part of Canada. It’s reminiscent of the Emperor telling Luke Skywalker near the end of Return of the Jedi that when his friends arrive at the Death Star, they’ll find the shields to be “quite operational,” except in this case our young executive Padawan must be learning that the consequences his company is experiencing are, in fact, “quite intentional.” Read the rest of this entry »

 
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Posted by on April 15, 2014 in bell, rogers, telecom, telus

 

Four really is the magic number in wireless

monkeyThere was considerable confusion last week over the price hikes being instituted by Canada’s Big Three wireless carriers. Several news outlets jumped on the fact that Bell, Rogers and Telus were raising rates, perhaps too exuberantly in some cases where reports suggested that all three were moving in collusive tandem at the exact same time. Telus was quick to point out – as both wireless specialty site MobileSyrup and I mentioned in our respective posts – that its hikes had in fact taken place in January. Bell and Rogers were simply playing catch-up.

Daniel Bader at MobileSyrup had an excellent follow-up the other day explaining the exact nature of the increases, as well as some background on the recent wireless spectrum auction and the future of Videotron. In a nutshell, Telus kicked off the whole smorgasbord in January by raising its basic rates and lowering some of its data fees. The end result was that many plans maintained the same price, although higher fees are now likely for households with multiple phones. Bell and Rogers followed suit and, by matching Telus’s plans, pushed through big increases in some cases.

A few important points may have been lost amid the specifics of which plans went up and which didn’t. First and foremost is the resumption of the status quo, where the Big Three are once again moving prices in virtual tandem. With the threat of start-ups Wind and Mobilicity now subsided, regular virtually synchronized rate hikes are now back for the foreseeable future. Actual collusion is irrelevant and unnecessary when real competition has been neutralized.

Read the rest of this entry »

 
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Posted by on March 25, 2014 in bell, mobile, rogers, telus

 

Wireless carriers are begging for it with rate hikes

fight-clubIn case you haven’t heard, all three of Canada’s major wireless carriers are raising the rates on their plans, all coincidentally by $5. It’s hard to figure out which department to file this one under: it could go under “Are You &$%$# Kidding Me?” or “Oligopoly 101,” but it most likely qualifies for “Digging Our Own Graves.”

Telus, which recently announced it was quitting the Canadian Wireless Telecommunications Association lobby group, was the first to strike, with leaks in January basically informing the other two of what the acceptable fee increases would be. Bell and Rogers of course followed Canada’s “uncarrier” (chortle) and now all three are moving in unison.

This marks the second major fee increase since the summer, when the Big Three all simultaneously brought in hikes to coincide with the elimination of three-year contracts. Read the rest of this entry »

 
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Posted by on March 17, 2014 in bell, mobile, rogers, telus

 

Videotron has at least 6 wireless options

VideotronAfter months of will-they, won’t-they, Videotron has indeed pulled the trigger on acquiring wireless spectrum licenses for much of the rest of Canada. The Montreal-based cable company has emerged as perhaps the biggest winner of the 700 MHz auction, with licenses in its home province of Quebec but also Ontario, Alberta and British Columbia. And so begins a new game of will-they, won’t-they.

As several observers note in my analysis of what the auction results mean for consumers, there’s no guarantee that Videotron’s parent Quebecor will in fact roll out service. As the company itself said in a release on Wednesday night, getting the licenses means it has “several options.” What are those possibilities? There are at least five, plus one I’m really hoping for:

Do nothing: At $233 million, Quebecor got the licenses at a relative steal thanks to having few competitors in the auction. With new carriers Mobilicity in creditor protection and Wind pulling out at the last minute because of a lack of funding from its Russia-based backer Vimpelcom, the path was clear for the Montreal company to swoop in and grab licenses on the cheap. Its only potential competitors were regional wireless providers such as Eastlink, MTS and Sasktel, plus Vancouver-based internet provider Novus and Feenix, a Toronto-based operation started by entrepreneur Mobilicity founder John Bitove. However, none of the regional players had shown much interest in expanding out of their home territories while both Novus and Feenix were relative minnows compared to deep-pocketed Quebecor. Read the rest of this entry »

 
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Posted by on February 20, 2014 in bell, rogers, telecommunications, telus, videotron

 

Harper and wireless: Is it Lost or Breaking Bad?

Is Stephen Harper really Walter White?

Is Stephen Harper really Walter White?

This past weekend, Breaking Bad cashed in big time at the Golden Globe awards with wins for both best drama and lead actor, with the inimitable Bryan Cranston finally getting accolades at the annual event for his fantastic portrayal of anti-hero Walter White. Anyone who has watched the show, which wrapped up last year, probably felt the kudos were well deserved – it truly was one of the best series to ever grace the airwaves.

What I liked most about Breaking Bad were how seemingly minor details were introduced in one episode, only to be revisited in later ones to further flesh out and illuminate the ongoing plot. It was these sorts of things – like Walter spelling out his birthday numbers with bacon – that really impressed upon viewers that the writers knew exactly what they were doing all along.

On the flip side, there’s the Canadian wireless market. In discussing the federal government’s long-running quest to bring more competition to the industry, most pundits – regardless of what end of the spectrum or ideology they subscribe to – have generally agreed that there’s been little rhyme or reason coming out of Ottawa. By all accounts, Prime Minister Stephen Harper and his crew have been making things up as they go, as the current disarray seems to prove. Rather than Breaking Bad, it’s been more like Lost – a show that didn’t really make sense but promised an epic resolution, yet failed to pay off in the end.

But what if everyone is wrong and the government’s plot really isn’t like Lost? What if, like Breaking Bad, the whole situation really has been meticulously planned and crafted, and is in fact playing out perfectly?

I know it sounds crazy, but hear me out. Read the rest of this entry »

 
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Posted by on January 15, 2014 in bell, government, mobile, rogers, telus, wind

 

Two-year contracts the latest wireless strawman

straw-manIt’s Dec. 2, which means the CRTC’s new wireless code is officially in effect. As of today, consumers will enjoy several new protections, including caps on roaming fees and a ban on cancellation charges after two years of a contract, which is the regulator’s de facto prohibition on three-year agreements.

Carriers have been busy implementing the new requirements for some time now, but some of them just couldn’t resist throwing out some parting shots in the process. About a month ago, both Bell and Rogers suggested that the required shift from three-year to two-year contracts was slowing smartphone growth, with the insinuation being that regulatory interference was somehow hurting Canadians’ supposedly insatiable hunger for the devices.

A number of industry observers evidently swallowed the line. As the lead of a Globe and Mail story proclaimed:

The introduction of new two-year cellphone contracts slowed subscriber growth for some of Canada’s biggest carriers during the back-to-school season, a sign that consumers are spurning those higher-priced plans even before they become the industry standard in December.

Ordinarily, such a statement would be attributed to the companies since it’s their position, but evidently the support of a market analyst or two is enough to make it fact. Scotiabank Capital analyst Jeff Fan provides the required back-up: “I would call it one of many ‘unintended consequences’ resulting from regulatory moves over the past summer,” he says in the above story. Fan also repeated the claims during our panel at the International Institute of Communications conference a few weeks ago. Read the rest of this entry »

 
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Posted by on December 2, 2013 in bell, rogers, telus