Verizon Launch in Canada Would Impact Rogers, TELUS the Most


In the light of Verizon’s possible entrance into the Canadian wireless market, analysts have reassessed their views on the incumbents and the future isn’t looking good at all — at least for Rogers and Telus.



The Globe and Mail dropped the bombshell yesterday by reporting that Verizon has opened up talks with Mobilicity and has already bid $700 million for Wind Mobile. The shockwave was immediately felt on the Canadian stock market: share prices for Rogers and Telus began to tumble and are down for the second day, and face further downgrades.

The fact is, Verizon entering Canada would change the Canadian mobile landscape due to its significant financial resources. Verizon has double the market value of Bell, Rogers and Telus combined.

As for Rogers and Telus, Verizon’s entrance would be devastating, for the following reason: both companies depend on wireless profits, as the analysts cited by Bloomberg reveal. Looking at their recent quarterly reports, we find that earnings before interest, taxes, depreciation and amortization from the wireless business account for more than 60% of the total profit.


For Bell this looks slightly different: mobile phone business accounts for only 30% of total profits. This is the result of Bell’s $8 billion investment in acquisition over the past four years.

“The entry of Verizon into the Canadian wireless market would be the best-case scenario for the Industry Minister and the worst case scenario for the incumbent players,” said Tim Casey, an analyst at BMO Capital Markets in Toronto. Verizon has “deep pockets, and considerable scale and expertise in the business.”

Verizon is awaiting the federal government’s spectrum transfer rules, which are due out any moment. It is also looking forward to finally seeing the rules for the forthcoming wireless spectrum auction.

The above are only a few of the possible roadblocks Verizon faces before entering Canada. And in case of a green light, the impact on the incumbents’ balance sheets would likely appear starting next year.


  • Jeeverz

    I cannot wait!!!! Verizon will dominate face in Canada sands CDMA

  • Chrome262

    I don’t care if they dominate, I just want them to make the others deperate enough to lower prices. And if they offered internet, prices for that will drop as well. We need competition. the above assumes that they will gain a bigger share of the market then wind and others have. Not saying they wont but still

  • It’ll get real interesting if this is approved and goes through.

  • ????Dennis

    And why is all this happening? We can give a BIG thanks to the PC government and their finance minister for rejecting the Telus acquisition of Wind. It’s funny how Rogers and Bell never complained about Telus wanting to purchase Wind… Now all of a sudden it’s a big deal that Verizon wants to. Cause now the big 3 are sh!tting their pants. Good!!! It’s about time we were given a choice and have the companies fighting over customers. Not us fighting for better deals!!!!!! Bring on Verizon. I’ll switch over easily!!!!

  • Anthony

    You really think Verizon is a charity don’t you? In fact, Verizon has the most expensive plans in the US. Everyone who lives in the US can confirm that fact.

    People thought the same way when Wind and Mobilicity came to Canada. Look at them now. Better deals? Yes. Bankrupt? Yes. Price plan that low is suicide.

    Verizon is bigger but the fact is if a company doesn’t invest enough money to build towers and expand network within Canada, same crap will happen again. Even if Verizon is willing to spend that much time and money doing it, it is going to take a long time and so much money. Where do you think Verizon will get the money from?

    We are a country with only 35 millions in population as oppose to 315 millions in US. Our market is quite small.

  • ????Dennis

    We all know Verizon is a business and in it to make money. However, we all know that the big 3 gouge the $hit out of us. By bringing in another player in the mix, it forces the others to finally want to compete for customers as opposed to us competing with each for a better plan.

    I live in Ontario, where most of the population in Canada is. That’s where Verizon will start first. Once they start making a profit they will invest in the more rural areas.

    What really pisses me off is that the big 3 have awesome plans for customers in Saskatchewan but don’t offer it to us here in Ontario. Why??? They have to invest in a lot more for less customers but doesn’t stop them from making a profit by charging less. The Bog 3 know that us in Ontario have no choice… So why not gouge us. Well once Verizon comes in they will have to compete. Competition is good for the consumer. In the end that’s all we can ask for.

  • Shameer Mulji

    “Verizon has the most expensive plans in the US.”

    They also have the highest quality cellular network and approximately 90 million customers, which is almost 3X Canada’s population. So they know a thing or two about how to build & manage networks.

    And more (and better) competition never hurt the consumer. If anything, it benefits us.

  • 1His_Nibs1

    “The shockwave was immediately felt on the Canadian stock market: share prices for Rogers and Telus began to tumble and are down for the second day, and face further downgrades”. I won’t be shedding any tears about lost profits for either of these companies. They’ve had it far too good for far too long and if they see their profits shrink even further when/if Verizon enters the Canadian marketplace then they have only themselves to blame for how they’ve treated and gouged their clients over the years. And because of their arrogance and taking their customers for granted I would suspect a good percentage of them will happily give Telus/Rogers the big middle finger and sign up with Verizon….thus lowering their profit margins even more. Corporate greed and the karma that hopefully ensues……gotta love it!

  • Al

    Where are they going to get the money from? They HAVE the money! Remember that, aside from Ontario being the densest population, the vast majority of Canada is close to the US border – so, unlike the US, there isn’t a whole lot of area to cover to reach 80+% (I’m guessing) of the country’s population.

    And also, would this mean the end of US/Canada roaming charges for Verizon customers?! Now THAT’s an exciting concept!

  • gigi

    I will gladly leave Bell and jump on the verizon ship the second it is available!

  • tryhere

    Anybody who says Verizon is expensive they are idiots. My phone bill with bell was on average 1100.00 a month with Verizon and better package 300.00 a month. yeh expensive…

  • PB

    Competition is good, if the big three are spending huge sums of money on this media blitz and portraying themselves as the victim in this ordeal you know they are worried…… I say great, its about time these greedy, spoiled parasites get a reality check.
    Welcome to Canada Verizon …… don’t mess this up Mr Harper.

  • Arlo

    Rogers and Bell have been ripping Canadians off for years with inflated rates and poor customer service.

    Now they want Canadians to feel sorry for them, give me a break!

    If allowing Verizon into Canada lowers my rates, I’m all for it.

    Its a Global marketplace, if our monopolizing cell providers can’t compete, tough.

    I want lower rates and better service, period.

    If they’re really concerned about Canadians, (and not lining their own pockets), they should merge through acquisition and purchase each other to compete against the perceived US threat.

    In fact, with stocks plummeting, we might see US carriers bidding for Rogers, Bell and Telus as well.

    Wouldn’t that be interesting?