The Canadian mobile landscape is about to undergo a change, as Shaw has announced that it will acquire WIND Mobile (and also sell its Media assets to Corus to fund the $1.6 billion deal). If you are wondering whether this acquisition will bring benefits to wireless customers, you aren’t the only one. Vafa Akhavan, founder and senior adviser at NueBridge, has serious doubts (via Globe and Mail). Furthermore, he thinks WIND should be acquired not by Shaw, but by T-Mobile.
So here’s my proposed alternative: That Wind be acquired by T-Mobile instead. It’s a better fit in terms of business model, and T-Mobile would be a far greater innovator and disruptive force in the Canadian wireless landscape. Everything it’s done in the United States has been positive for the customer. There, it has emerged as a customer-centric company, something we lack in Canada.
Fact is, we’ve seen how the dynamics of the US wireless market have changed since T-Mobile launched its “UnCarrier” offerings. Akhavan highlights the core benefits of these offerings: unlimited everything and great service, at great prices. That’s a business model that doesn’t seem to exist in the list of business 101 books read by the leaders of the Big 3.
As sketched out by Akhavan, the business models of WIND and T-Mobile have similarities and even strong ties: both offer deals on all-exclusive data, voice, and text, and T-Mobile even offers unlimited data in more than 120 countries. By the way, David Carey (T-Mobile CEO John Legere’s right-hand man) sits on Wind’s board, as does Hamid Akhavan, previously CEO at T-Mobile International.
But before we jump to conclusions and start calling Legere to outbid Shaw in a possible Wind Mobile acquisition, let’s not forget what happened not so long ago when a US carrier was rumoured to be entering the Canadian mobile market.
We don’t have to go back too far to see the reaction from all the major players to rumours of Verizon possibly acquiring WIND Mobile. You may recall the outrage and concern of Canadian carriers, who fought to defend their investment in building their business.
Verizon ultimately walked away, and everything returned to “normal”. The Big 3 still control the majority of the mobile market, and it will take years before we see the effect of the Shaw–WIND merger.
By the way, the CRTC has tweeted today that it needs your input on the transfer of Shaw Media’s shares to Corus. This is vital for the Shaw–WIND deal, because Shaw will use the money to fund its wireless ambitions. The deadline for submissions is 15 February 2016, and you can submit a comment by clicking on the following link.