Quantcast

Bell CEO: Verizon Delay Reveals “Absurdity” of Ottawa’s Wireless Rules

Bell Canada CEO, George Cope, has spoken in regards to news Verizon reportedly delayed its intent to acquire WIND Mobile and Mobilicity, pointing out the delay by the U.S. carrier only shows the “absurdity” of the Federal Governement’s wireless policies, in an interview with the Globe and Mail (Bell owns a 15 per cent stake in the newspaper).

Cope said Verizon’s move “illustrates…the absurdity of loophole three, where a company just possibly waits for a while because there is nobody else to compete to buy a business.” He went on to add Bell would be eager to acquire either wireless entrant start ups, which have close to 900,000 subscribers between them.

The CEO went on to say there is no competition when a company like Verizon would be allowed to acquire and hold onto new entrants:

“The idea that you could just maybe park the assets for a while and leave them because nobody else in Canada could buy them is a rather jerry-rigged structure.”

He continued to say incumbents should be on a level playing field like Verizon and also clarified how Bell, as a Canadian company, continued to invest in Canada while U.S. carriers left town during 2000:

“We just want to be equal to someone else who has not contributed anything to our country. Verizon came and left. When the going got tough in 2000, Verizon and AT&T and Sprint left Canada,”

[…]

“Those companies have been in our marketplace before and we had a capital markets meltdown in 2000; you all remember the tech bubble. And it was the Canadian companies that continued to invest in Canada, and the U.S. companies continued to invest, but in their domestic carriers.”

The Globe asked Cope if he had any concerns whether Verizon would seek more concessions from Ottawa. He responded: “I am worried about everything at the moment.”

One Bay Street source told the newspaper Bell has informed analysts it has “plans to bid aggressively for 700 MHz spectrum to ensure that Verizon gets squeezed out.”

The news of Verizon’s reported delay has benefitted the Big Three, as stocks reacted to the move, as Rogers jumped 5 per cent, Telus went up by 4.8 per cent and BCE had gains of 1.7 per cent.

The Bell CEO previously published an open letter in various newspapers across Canada, to warn Canadians about Verizon; this prompted one particular Canadian to cleverly respond directly to Mr. Cope with his own ‘open letter’.

Bell, along with Rogers and TELUS, currently have ongoing PR campaigns aimed at pressuring Ottawa to reverse its wireless spectrum policies, despite Industry Minister James Moore and Prime Minister Stephen Harper reaffirming Ottawa is staying the course on its plans to create a fourth national wireless carrier.

Founder and Editor-in-Chief of iPhoneinCanada.ca. Follow me on Twitter, and @iPhoneinCanada, and on Google+.

  • FragilityG4

    Can someone get these whiners a muzzle already.

  • MapleHoney

    I mean come on Cope. Just stop talking and people MIGHT like you.

    How do Bell’s shareholders put up with him?

  • wstoneman

    It pays good dividend :P

  • ward09

    I can’t believe these guys actually think we should feel sorry for them. And their simplistic message about a level playing field…ugh!

  • K3

    Whats it going to be like once Verizon sets up shop?

  • mcfilmmakers

    Be disagreed with every argument they made so far but this time, there’s an element of truth in that it is unfair to simply “park an asset” and let it down in valuation because there simply is no fear that someone else can come and buy it. There’s truth in that, and that’s an objective fact. That said, it has nothing to do with the auction itself and everything to do with market share controlled by the big three. The reason it is unfair is because of the big three in the first place.

  • draz

    Indeed! Verizon is bad news for Bell, Telus, and Rogers shareholders.

    And the aggressive bidding they plan on doing is only going to make it that much harder for them to lower prices.

  • 1His_Nibs1

    Correction: someone CAN buy it (WIND) just not the big 3 and there’s the rub for Cope. Ottawa isn’t stopping say AT&T from jumping into the fray and buying WIND or any other wireless telecos for that matter. Ottawa’s just made it abundantly clear that when it comes to the big 3 they need not apply. Ottawa can see the big 3 are making every effort to strengthen their oligopoly and I for one applaud Ottawa for stonewalling them. And to Mr. Cope: STFU already. Canadians have grown tired of this whole “woe is me” act being perpetrated by you and your two fellow CEO crooks!

  • 1His_Nibs1

    Yeah, but Verizon has much deeper pockets to bid with. They are 4x’s bigger than the pig 3 combined so not sure where the pig 3 are going to get the capital to outbid Verizon especially considering that this 700Mhz spectrum is highly coveted. Mind you, I guess the pig 3 probably have some decent cash reserves built up after years & years of gouging Canadians on their cell phone plans!

  • mcfilmmakers

    The crux of the argument is NO ONE wants WIND beyond Verizon and the Big 3 so if Verizon won’t buy, why then shouldn’t the Big 3?

    The reality is that Verizon’s chance is NOW, but it will not take it so the argument is that if Verizon won’t make a move, shouldn’t the Big 3 be allowed?

    As much as I don’t want that to happen, it will anyway by virtue of bankruptcy. At that point, Verizon loses it’s chance anyway and the Big 3 pick up spectrum in the bankruptcy auction for even cheaper.

  • mcfilmmakers

    Who cares? Verizon can’t own more than 10% marketshare ANYWAY. They can say it’s unfair all they want but I don’t call 10% cap unfair vs Bell’s 30%. Besides, this auction can’t mathematically give Verizon 10% marketshare anyway even if they bought ALL of the spectrum (which they also can’t do).

  • mcfilmmakers

    Better.

  • K3

    As in the whining will stop or chaos begins..

  • kkritsilas

    A couple of fast points:

    1. The delay by Verizon has nothing to do with the Fed’s wireless policies. It has a lot to do with Verizon wanting to minimize the costs of buying Wind and/or Mobilicity. It has a lot to do with how much Verizon will need to spend to secure the 700MHz spectrum license it wants (i.e. the same frequencies that are already in use by Verizon in the US).

    2. Ottawa has not changed ANY policies. They have basically said that the policies in place will be enforced. The non-buyout of new entrants was in place even before the AWS spectrum was auctioned off. The Big 3 knew it, any of the potential new entrants knew it prior to be bidding even starting. Now, the Big 3 want the well known rules in place for almost 5 years changed so that they can further entrench their oligopoly. And Ottawa said NO. Why is this an issue now? Is it because they cannot bully around a financially strong, soild player like Verizon? They have pushed the new entrants around at will with everything from flanker brands to financing sham court cases through proxies. Verizon will not be intimidated by any of this.

    3. Asset parking is exactly what the Big 3 have been doing for years. Rogers has more spectrum under its control than Verizon and AT&T combined. Why? the Rogers network serves roughly 9 Million people, the Verizon and AT&T networks serve roughly 200 million people (combined). Why does Rogers need that amount of spectrum? Especially in consideration that their network has roughly 10% (probably closer to 5%) of the towers that Verizon does. Truth is, Rogers didn’t need to buy up any AWS spectrum, and neither did the other big 3 members. The reality is that they bought up spectrum to limit competition, and they will be pulling the same stunt for the 700MHz spectrum. They are using their financial strength/ability to spend on spectrum, to keep competitors out. Verizon changes this. They can outspend, if so inclined, all of the Big 3, combined. All Verizon really wants is the 700MHz block that is common to their US spectrum. and I sort of doubt they will even bother to bid on the other blocks, despite the fear mongering of the Big 3. What I would really like to see is to have Bell/Telus, who operate a joint network, be allowed to bid only on one block between the two of them. After all, it is one network, and if Bell owns a 700MHz block in Quebec, it doesn’t mean that Telus can’t use the same block in Quebec; it is the same network. With the way it is structured now, Telus can get one block, Bell can get a second block, within the same region, giving them two blocks within any region possibly. I really think this limits people like Videotron, MTS, and Sasktel. What U would also like to see is to have the Feds take back any unused spectrum that was granted to the Big 3 at no cost, and then made available to new entrants only.

    4. The big 3 have had a lot of benefits come their way, from free spectrum licenses in the beginning, to having consumers pay for their networks through the hated “system access fees” to restrictive (until recently) very restrictive foreign investment rules fir the telecom sector. And what they did with those benefits is collude and screw over their customers. Customers are fed up, and the Big 3 can’t seem to understand that. The Feds do, and they are looking after the consumer, not because of the goodness of their hearts, but because they want to get re-elected, And politicians will do anything to get re-elected; it is much more preferable to get re-elected than to try to get a real job.

    5. This level playing field crap has been done to death. The last thing any business wants is a level playing field. Every business wants to have an advantage over their competition; its how business prospers. Except in the wireless sector in Canada, where the theme is collude to artificially keep cell phone plan prices as high as possible. The Big 3 would never even dream, or even conceive, of anything like competing. Every plan that include data is pretty much priced the same, even for the “flanker brands” now. The only time this even begins to change is where there are regional carriers that actually have better plans (Saskatchewan, Quebec), where they price match. If that is not the clearest indication of collusion amongst the Big 3, I don’t know what is.

    Kostas

  • Mark Mark

    Oh how I love seeing the big 3 squirm! I will keep saying it over and over if Verizon comes in I will be the first to switch over and I encourage everyone reading this to do the same. It will finally mean competition where there was non for years. Has anyone looked closely at a Bell contract? It is one of the most shameless attempts at thieving as much as possible out of the Canadian consumer. What did they expect after years and years of screwing people over? Every policy that they have is intended to extract as much as possible out of your wallet.. and they didn’t think anyone would mind??? I think Canadians are finally fed up with their bs and the federal government has heard them.

  • Justin Chen

    Mr. Cope purposedly misled us with the concept of Competition.The competition Mr. Cope talked about is about business competing to be a monopoly by acquisition and merging, which is the opposite of what we consumers understand as competing to win customers with better pricing and services. Verizon did nothing wrong to de-valuate Wind/Mobilicity so that they can keep the cost low to provide better price and service to consumers.

  • 1His_Nibs1

    Well then I’d rather see WIND/Mobilicity go bankrupt as opposed to the big 3 being allowed to acquire them. Please read below (Justin Chen’s comment) as I’m in total agreement with what he has stated.

  • mcfilmmakers

    I don’t disagree with those statements. My point however, is that the Big 3 will own them through bankruptcy rather than acquisition. There’s no difference to the consumer.

  • 1His_Nibs1

    Pray tell exactly how will the big 3 “own” them? I don’t believe WIND/Mobilicity’s spectrum automatically defaults to the big 3 should either go bankrupt.

  • mcfilmmakers

    Common sense please. Big 3 are the only ones in this country with the money and the will to buy the assets. Proof is that Verizon is the only one NOT a part of the Big 3 even thinking of bidding in the spectrum auction.

  • 1His_Nibs1

    Perhaps you’re the one lacking common sense. Have you not been following this whole debacle? Telus was denied acquiring Mobilicity and hopefully Industry Canada blocks Rogers’ attempt to acquire unused AWS spectrum owned by Shaw. If WIND/Mobilicity go bankrupt what makes you think the government will automatically allow any of the big 3 to acquire their assets? Yes they’re showing interest in the assets BUT the government wants to encourage competition and allowing them to purchase said assets flies in the face of that (even if they’re the only ones interested). So basically the government has stonewalled the big 3’s attempts at expanding their oligopoly only to do an about face and let them purchase WIND/Mobilicity’s assets at a later date? Can I have some of whatever it is you’re smoking?

  • mcfilmmakers

    Grow up and quit calling names. If WIND/Mobilicity go bankrupt, who can the gov’t allow to buy the assets? There is no one left! Again, common sense.

  • 1His_Nibs1

    Grow up yourself. I have plenty of common sense. Again you assume the government allows the sale of the assets to begin with & to the big 3 on top of that. You obviously want to argue for arguement’s sake and continue to ignore the governments actions to date. You strike me as the type who has to have the last word but as I see your arguments as invalid your efforts are moot. By the way did you even read my previous statement?

  • mcfilmmakers

    It isn’t the government that allows it, it is the law. I do not have to have the last word but clearly you are a troll. You stoop to name calling rather than facts and retort with “no, you”. Clearly, nothing can be said to such a person. Furthermore, YOU are the one replying to my comment, not the other way around.

  • 1His_Nibs1

    Yep I’m a troll…….check out all my other comments on the other posts on here. Oh and if, (and I quote) “Clearly nothing can be said to such a person” then why do you keep replying to me? Seems you do your fair amount of trolling here too lol. Oh and one last thing before I’m done talking to you. If it’s the “law” then how is the government able to block Mobilicity’s purchase by Telus? By your logic that is against the law. If that’s the case then how come Telus hasn’t taken the government to court?

  • 1His_Nibs1

    I’ve given you the facts. The government stopped Telus from increasing their monopoly on the attempted acquisition of Mobilicity. I have stated if they did it once they’ll do it again and that the government is trying to create COMPETITION yet you continue to ignore those “facts”. I replied initially to your original comment but you continue to reply back even though “Clearly nothing can be said to such a person”.

  • mcfilmmakers

    You continue to ignore me. I am speaking about HYPOTHETICAL BANKRUPTCY, not what occurred in the past as you are so intent on repeating. There is a massive difference.