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SaskTel CEO Highlights Four-Player Wireless Competition Flaws

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The four-carrier-per-province scheme dreamed of by the government is apparently working as it pushes down the prices of wireless services. But there is one problem: The only ones suffering as a result are the local (smaller) players such as SaskTel.

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The local player has posted a net annual income of $90.1 million. But this number is expected to drop to $59.2 million next year, raising concern over the company’s future.

And you know what’s interesting? The fact that incumbents are able to launch wireless service packages in areas where a strong local player is present (see Quebec and Manitoba), but they charge double that price in other areas where only the national players are present.

SaskTel’s CEO is determined to make a case in Ottawa, bringing up the issue politically. He won’t accuse the Big Three of anti-competition pricing, but he would like to outline the position of a local player when he meets with government officials next Thursday, he told the Huffington Post.

“We just need to make our case … that some of the things they are putting in place … are having unintended consequences,” SaskTel CEO Ron Styles said as he outlined the position he will take when he meets with federal government officials on Thursday.

The annual report released by SaskTel also reveals that Saskatchewan residents are adopting smartphones, up 17% compared to the prior year, buying more than 410,000 smart devices, leading to a $17.6 million revenue jump for wireless services.

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  • SV650

    An interesting comment, as both Telus & Bell have no direct presence in Saskatchewan, but piggyback on SaskTel’s network. Is SaskTel the author of its own fate by trying to undercut their partners only to find they price match?

  • Ed Johnson

    The gov’t needs to prevent the big 3 from offering different prices in different provinces for the same services. Why cannot I buy a cheap cell phone plan from Saskatchewan and use it in Alberta? Because the big 3 say I don’t have a Saskatchewan address.

  • SkAshe

    The problem is that ROBELUS are far more powerful than Videotron/MTS/SaskTel/etc and they can undercut the price in only a couples of provinces until the smaller company struggle to make a profit and go bankrupt and still make a absurd ton of money in the other provinces where there’s no competition at all.

    This is a really big problem for the smaller providers.

  • SV650

    Yes Telus has grown its wireless base through careful planning since the merger of BC Tel and AGT. SaskTel and MTS had the same opportunity, but chose other paths. SaskTel chose to provide roaming agreements with Bell and Telus, likely to mutual benefit. Now they have chosen to differentiate on price, rather than services. MTS on the other hand, has not offered the same roaming agreement, and as such can differentiate (for the time being) on coverage. SaskTel could have played the game differently, but chose to remain a regional player, providing a service that works well for landline customers, but less so for mobile customers.

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