Telus Urges CRTC to Block Rogers-Shaw Deal, Merger Would Reduce Competition

At a CRTC hearing on Rogers Communications Inc. (RCI)’s proposed acquisition of Shaw Communications Inc. earlier today, a Telus Corp. executive urged the telecom watchdog to block the merger, saying it would harm competition across Canada — reports CP24.

The Canadian Radio-television and Telecommunications Commission’s hearings on the broadcasting implications of the Rogers-Shaw deal kicked off Monday, with both companies claiming the merger will improve competition and help lower-income Canadians.

RCI claimed it needs to acquire Shaw in order to grow and achieve the kind of scale that will allow it to compete against streaming giants like Netflix and Amazon for broadcasting rights to international content.

However, at Tuesday’s hearing, Telus’ Vice President of Telecom Policy and Chief Regulatory Counsel Stephen Schmidt argued that one Canadian broadcasting company achieving that scale would harm competition in the space by making it the go-to licensing authority for international content and giving it free rein over Canadian programming.

“This merger will greatly reduce competition and consumer choice, and will impoverish the diversity of voices in the broadcasting system,” said Schmidt.

“The unprecedented scale will also turn Rogers into a gatekeeper for Canadian programming services, because these services will depend on Rogers for their continued survival.”

The executive went on to say that the merger threatens to hand 47% of English-language broadcast subscribers to Rogers, with its network reaching 80% of Canadians.

Schmidt also called into question RCI’s claims of needing the merger to increase infrastructure investments across the country.

At Monday’s hearing, Rogers maintained that the deal would ultimately increase competition, especially in rural areas that are currently only served by Telus, but refused to guarantee that Shaw customers won’t see rate increases.

The CRTC hearings will evaluate the broadcasting side of the Rogers-Shaw merger, while the companies’ mobile wireless business and other issues will be reviewed by the Competition Bureau and Innovation, Science and Economic Development Canada.

Other opponents to the merger, including BCE Inc. and consumer advocacy groups like OpenMedia, are also scheduled to speak at the hearings, which will continue through the week. Rogers will get a chance to respond to comments on Friday, November 26.