With the Bell–MTS deal now official, wireless competition in Manitoba has just taken another hit; and Innovation, Science and Economic Development Minister Navdeep Bains has agreed with that, law professor Michael Geist says.
Bains gave the green light to the acquisition deal, which means wireless services in Manitoba will soon cost much more, without taking the Competition Bureau’s findings into consideration. But it wasn’t just Bains, I would argue; it was also the Competition Bureau that agreed to the Bell–MTS deal, despite having concluded the following:
“as a result of coordinated behaviour among Bell, TELUS and Rogers, mobile wireless prices in Canada are higher in regions where Bell, TELUS and Rogers do not face competition from a strong regional competitor. Conversely, the Bureau concluded that where Bell, TELUS and Rogers face competition from a strong regional competitor, prices are substantially lower. The Bureau concluded that the lower prices are caused by the presence of a strong regional competitor who can disrupt the effects of coordination among Bell, TELUS and Rogers.”
To green-light the deal, the Bureau has asked Bell to sell six retail stores, 24,700 subscribers and 40 MHz of spectrum to Xplornet, a satellite internet provider. By doing so, another wireless carrier theoretically enters the market, so we can say hurrah to competition again.
But that’s not how it goes in reality. First, Xplornet has agreed to acquire only 30 MHz of spectrum, and you may already know that becoming a competitor of the Big 3 means much more than owning a bit of spectrum – you may remember what happened to Public Mobile. And to Mobilicity.
So when Geist says Bains was facing a sure thing, the same goes for the Competition Bureau, as they have concluded that “mobile wireless prices in Canada are higher in regions where the Big 3 don’t face competition from a strong regional competitor. Now let’s wait and see how many decades it takes for Xplornet to become that strong regional competitor.
