Industry Minister François-Philippe Champagne says he is concerned about the $26-billion proposed takeover of Calgary-based Shaw by Toronto-based telecom giant Rogers. The federal government says it will block the wholesale transfer of wireless licences owned by Shaw Communications Inc. to Rogers Communications Inc. Minister Champagne says he won’t permit the transfer of all of Shaw’s wireless business to Rogers because it threatens competition and will make cellphone bills more expensive for Canadians.
Debate on what Rogers and Shaw merger would do to Canada’s Telecom Competition
The proposed deal was announced in 2021, and Rogers and Shaw expect the merger to close in the second quarter of this year.
While many believe that further merging Canada’s already sparse telecom industry will seek to hurt competition a joint statement released by Rogers and Shaw claims a marriage of the two immense service providers will “increase competition”. The following statement was released on Wednesday in a joint effort to plead their case.
We continue to work constructively with the government and regulators to close this transaction and deliver the benefits of the merger to all Canadians. We share the government’s view that affordable, high-quality services should be available to every Canadian and by coming together, Rogers and Shaw will make the generational investments in networks and technology that Canada needs to create new jobs, increase competition, and bridge connectivity gaps in rural and remote areas. We continue to expect the transaction to close in the first half of 2022.
Rogers & Shaw Communications
Rogers Communications Inc. told regulators last year that its proposed $26-billion takeover of Shaw Communications Inc. will enhance competition, but the cable and wireless company made no guarantees that Shaw customers won’t see rates rise if the deal goes through.
Edward Rogers, chair of the company, told the CRTC hearing in Gatineau, Que., the deal was needed to compete in the increasingly globalized market for content and rising expectations on digital offerings.
“Canada is no longer an island in an ocean alone,” Rogers said. “While our primary competitors are still Bell and Telus in the cable business, in this global world, our competitors are also increasingly global platforms and brands.”
Quebecor Federal government statement is a step in the right direction
Pierre Karl Péladeau, President and Chief Executive Officer of Quebecor, Videotron is Québec’s top Internet Service Provider (ISP), said as it stands, the proposed Rogers-Shaw transaction is contrary to the public interest. As Bell, Rogers and Telus already control 90% of Canada’s wireless market, it is imperative that we create the necessary conditions for real competition in order to give consumers more choice, better prices, better services and more innovation.
Quebecor went on to say that the pending Competition Bureau of Canada decision on the Rogers-Shaw transaction could also be an opportunity to create the dynamics for real, sustainable competition, for the benefit of Canadians.
