Verizon Delays Possible Acquisitions of WIND Mobile, Mobilicity [u]

According to a report by the Globe and Mail, Verizon has delayed its acquisitions of WIND Mobile and Mobilicity, which appears to put its entry into Canada in jeopardy despite Ottawa pursuing the company as a possible national fourth wireless carrier.

After tabling a $700-million preliminary offer for Wind and signing a non-disclosure agreement with Mobilicity in recent months, Verizon has now decided to delay pursuing those deals until after a government auction of wireless licences in January, said two people familiar with the situation.

The company will now shift gears to decide whether it will participate in the upcoming 700 MHz spectrum auction. If Verizon is able to enter bidding and win spectrum it desires, then sources say it will consider bidding for WIND and Mobilicity possibly in the next year.

This delay will allow Verizon more time to contemplate entering the Canadian wireless market as the auction isn’t set to begin until January 14, 2014. The deadline for carriers to apply and place a deposit for the auction is September 17. Once prospective spectrum bidders apply and paperwork submitted, they are banned from negotiating deals with other players until 2014.

The Globe report says there is no clear reason why Verizon has changed its strategy, with speculation this could be an attempt to drive down prices of WIND/Mobilicity, seek more concessions from Ottawa or saving cash for the spectrum auction.

Earlier today it was revealed Verizon official met with Federal Government officials in May, prior to the US carrier making its potential bid for WIND Mobile.

By delaying its acquisition of these two wireless entrants, Verizon’s new timeline means it will have to wait until the 700 MHz auction has finalized and paid for by players before it can pursue the startups again, to prevent breaking anti-collusion auction rules.

By next spring, both WIND and Mobilicity would no longer be banned from selling its spectrum to incumbents, so the possibility of TELUS again trying to acquire Mobilicity would be possible.

Despite Industry Minister James Moore calling the ongoing Big Three PR campaign as “dishonest” lobbying, incumbents have refused to cease spreading their message. Rogers told Reuters the advertising will not stop and will continue:

“We think this is an important issue for Canadians. We’ll continue to work to make sure they understand the consequences of current government rules, which give an unfair advantage to large foreign players,” Rogers spokeswoman Terrie Tweddle said.

If you were eagerly awaiting the arrival of Verizon in Canada, looks like you’ll be waiting a lot longer now, that is if they still are coming.

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

  • Defino

    Come on let’s get this deal done
    Canadians deserve a much better deal than they currently get from the so called ‘Canadian Providers’ only people they provide for is them selves ………..

  • http://www.deanlubaki.com/ Dean Lubaki

    They should even get an authorisation to build their network before the auction.

    Every idea is good to get rid of Rebellus xD

    It would be great if Verizon could build a VoLTE network! :O They’d have another advantage!

  • wstoneman

    I agree that we need competition… but why does everyone think that they are going to give us fantastic plans at low prices… have you seen the prices they have… its not super fantastic.

  • WatDah

    Just goes to show how Robellus has been driving Canadians crazy. It has come to a point where Canadians don’t even care if the plans and price are similar to what’s being offered by Robellus, Canadians just don’t want their money going to them.

  • PRSHAN

    something fishy about this The Globe and Mail – 15% being Bell Hopefully that’s simply coincidence. It will probably still happen, they are just waiting it out in order to get a lower price for wind and mobi, Smart Move

  • wstoneman

    I think that they are going about this wrong… I agree with there 3 points, but they are dealing with it in the worst way possible. Everyone sees it as complaining and whining about competition… but there is a threat to the Canadian infrastructure… now is it as big as they want to make you believe… probably not.

    Don’t get me wrong I want competition… but I want the government to help wind and mobilicty… they actually seem to want to help the consumers and offer reasonable rates. I’m not convinced that verizon will bring any real competition. Why stop giving your money to one greedy company to give it to another.

  • PRSHAN

    VERIZON Original PLAN was to get WIND/MOBILITY and than enter the 700MHz SPECTRUM auction
    PLAN B get the 700MHz SPECTRUM first than get WIND/MOBILITY Smart Move on there hand NOW THE BIG 3 NEED SHUT UP NOW

  • Chrome262

    Not sure if this is real, as Globe and Mail is owned by Bell, but if so its kind of a smart move, and it also means that Verizon could buy spectrum and start its own show. Although that seems like a lot of effort. But waiting after the auction could mean they hope to get a lower price for the two, as well as they said concessions from the government. Remember they have shareholders as well, and caution is a good bet to keep them happy.

  • PRSHAN

    now the big 3 going increase the price after they spent campaign ADS

    WE HAVE WAIT UNTIL NEXT YEAR WHEN VERIZON ARRIVE here :(

  • ward09

    NOOOOOooooOOOOOoooooOOOOOOOoooooooooooo!

  • BCKid

    Are we Canadians that desperate or just that naive? I, as well as all my family and friends, want cheaper plans as well but this is getting stupid. This changes my view a bit.

    This action by Verizon just show what kind of moral and business practice they are in. They just want to have more advantages and favors from the government since we are all “begging” them to come right now. Yes. We are begging an American company to take over and we are shaking our legs worrying. Our government might need to give them more “candies” to attract them.

  • BCKid

    Call me stubborn or maybe I have been living here way too long. But I rather pay my bills to a Canadian company than an American company any given day. It’s just me. You have your view and I have mine. So don’t assume you speak on behalf of “every” Canadians out there.

    Do you have any idea how many times American government and companies trying to rip off Canadians. Let’s put cross border shopping as an example. They were thinking about charging us to cross border to shop at “their” places until everyone ban the idea. Let’s not start on lumber business and other craps. Maybe Verizon is the one that is driving you crazy to believe they are charity.

  • Al

    “Not sure if this is real, as Globe and Mail is owned by Bell”

    C’mon dude. Do you wear a tinfoil hat as well?

  • Al

    BC”kid”… I’m guessing under 15, maybe? And with a D average, perhaps? You need to learn how to get actual facts and to form a coherent thought.

  • Chrome262

    why yes, yes I do, keeps the sun and the Aliens from listening to my thoughts.

  • Al

    Great – more government supported companies that we have to pay for with our taxes.

  • Al

    Whose going to give you a better deal? Not Verizon. Just maybe a couple extra features, but nothing that will lower your monthly rate.

  • Al

    Not going to happen. There is not as much drama here as you wish to assume.

  • Al

    Ummmm… No. This opens it up for the Rogers and/or Bell to grab, since they are already pursuing them as well. Verizon is clearly willing to let them go. They may have different ideas. For example, part of the reason to buy a company is to acquire its customers. But they’ve noticed the interest in them by Canadians, so they may figure it’s not worth the money, as they can just use that to help build their towers. But that’s just one possibility.

  • http://www.iphoneincanada.ca/ Gary

    Come on let’s keep it clean around here please

  • BCKid

    I wish I am under 15 but I am not. Your cartoon profile tells a lot about you as well but I am not going start an off topic battle. :)

  • BCkid

    It’s okay. This is internet. Some people hiding behind keyboard like to type what they want and feel powerful.

  • WatDah

    Yes, sir. You have your view and I have mine, So don’t assume you speak as if you know what I’m thinking. Your assumptions is what’s driving me crazy. I merely pointed out what people are generally feeling right now, and you’re assuming I’m one of those Canadians, that I’m speaking on behalf of “every Canadian”, Verizon is “driving me crazy”, and try to teach me a lesson about Governments and Companies ripping people off. Wow, you’re so cool and wise.

  • Kael

    If Canadians were given reasonable prices from the big 3 players, it would be the customers that would be against Verizon coming to our country. We have been charged to much for to long and don’t want to any more. When the iPhone came to Canada, we were the 2nd most expensive country to get plans from. I think we are the only country that has 3 year contracts. The big 3 need to dramatically drop their prices to be more inline with the rest of the world. Then lets see what Canadians think about Verizon coming to Canada….

  • Al

    Seriously?!? You’re cautioning me?! They were bashing the previous comment by using childish, nonsensical, illiterate, dribble. If they used a coherent and relevant fact to support whatever it was they were trying to say, then that may be different. Something needed to be said, or they will continue to do the same around here.

  • Chrome262

    I think we wouldn’t care either way, and they big 3 would be more secure in their position and would welcome another entrant. Their reaction is almost and admission of guilt, why worry if your customer base is happy.

  • kkritsilas

    The real way that the gov’t could help Wind/Mobilicity is to take back any of the unused 800/850/900 MHz spectrum (not that the Big 3 never paid for any of it) and give it to Wind/Mobilicity. Why give it away instead of auctioning it off? For the same reason that they gave it to the Big 3 in the first place: encourage a network build out. This would have a number of things going for it:

    a) doesn’t cost the taxpayer very much, if anything;

    b) allows Wind/Mobilicity to build out far more cost effective networks, as well as allowing the use of far more standard handsets;

    c) will force the Big 3 to roll out more rural networks or face the possibllity of losing more spectrum.

    This would not be a financial loss by the Big 3, as they are not gaining any revenue from the unused spectrum, and they didn’t pay for it in the first place, as well as sending a message that the competition limiting spectrum hoarding will not be tolerated going forward.

    Kostas

  • kkritsilas

    if Verizon’s CFO says that there is interest on Verizpn’s part in entering Canada, then I would believe that.

    I am far more inclined to think that Verizon is engaging with gamesmanship with Vimpelcom (owners of WInd) and the owners of Mobilicity. They will bid on the 700Mhz spectrum, and win whatever they want. After that is done, they will then re-start the talks with Wind/Mobilicity from a position of strength. Right now, Verizon needs Wind a lot more than Wind needs Verizon (Wind is not losing money, unlike Mobilicity). Mobilicity is losing money, but Verizon doesn’t want to pay any more for either Wind or Mobilicity than they have to. it may be cheaper, by a considerable amount, for Verizon to let Mobilicity go bankrupt than to buy it before it goes bankrupt. After it goes bankrupt, the price will be cheaper, and Verizon will not have to take on any existing agreements that Mobilicity has in place (anything from tower lease agreements to store leases). Just some ideas.

    Kostas

  • http://www.iphoneincanada.ca/ Gary

    Good theory, Verizon could very well have their best poker face on right now.

  • 1His_Nibs1

    EPIC!!!!!!!!!

  • 1His_Nibs1

    I thought one of the bloggers on here or maybe it was a newspaper article that stated there is interest from other companies abroad or that the federal government is open to DoCoMo, Vodafone, AT&T etcetera opening shop if Verizon decides to pass on coming to Canada in order to get that “coveted” 4th national wireless carrier. if that is indeed the case then I’m for ANYONE coming here to beat up and kick Robellus all over the place by offering MORE COMPETITION!!!!!!!!

  • Chrome262

    To bad though, there is F-all on TV, was hoping for a new drama

  • Al

    Beware… Verizon is on the Horizon. Tuesdays at 9:00.
    …ok – that was just lame. sorry.

  • kkritsilas

    When I was still working at Nortel, there was a situation where Lucent, a major competitor in CDMA base stations was in trouble. I just casually said to my boss at the time that Nortel should buy out Lucent and thereby not only get the entire CDMA base station market, but get some of the proprietary technology that Lucent had in their RF amplifier designs, which had some advantages over our own designs. My boss had an interesting reply, which was “Why buy it now, when you can wait for them to go bankrupt, then pick them up for less than 10% of what it would cost now”. I, as a technology oriented person, never really thought that way, seeing the technology advantages only. She, as a business/finance oriented person was always thinking money.

    In a similar way, Verizon can spend $270-300 Million on Mobilicity now, or wait a few months, and spend $30-40 Million after Mobilicity goes bankrupt. If this happens, and assuming that Verizon has a 700MHz license in hand, they will then be able to get Wind at a better price as well, as I don’t think Wind will be able to get a 700MHz license due to the money required (assuming that parent company Vimpelcom doesn’t do an about face and decide to make a big investment in Canada).

    Kostas

    P.S. Lucent ended up being bought out by Alcatel.