Canada focused on need for competition in telecoms: minister

Wed Aug 21, 2013 6:06pm EDT
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By Randall Palmer

OTTAWA (Reuters) - Canada is focused on boosting competition in the telecom sector and will examine any move by industry leader Rogers Communications Inc (RCIb.TO: Quote) to back a private equity bid for two small wireless carriers, Industry Minister James Moore said on Wednesday.

The deal would be a way to thwart the possible entry of U.S. giant Verizon Communications Inc (VZ.N: Quote) into a Canadian market where Rogers and two other players, BCE Inc (BCE.TO: Quote) and Telus Corp (T.TO: Quote), hold some 90 percent.

Reuters and other media reported on August 2 that Rogers, Canada's largest wireless carrier, wants to help Toronto's Birch Hill Equity Partners fund a purchase of controlling stakes in two small players who entered the Canadian market less than five years ago.

Neither Rogers nor Birch Hill have publicly acknowledged the plan.

Speaking in an interview with Reuters, Moore said he could not comment on the plan, but his focus was on competition.

"The large three already have 90 percent of the footprint, and we didn't develop our telecom have a larger and larger footprint of Canada's largest firms and thereby limiting the degree of competition in the Canadian marketplace. I don't think that serves consumers," he said.

"I'm not going to pre-judge a proposal. If a formal proposal is put to me, put to my department, we will examine it in good faith, objectively, about what it is they have in mind. But our goal is more competition."

Moore, who took up his portfolio last month, said the issue is not black and white. He pointed to an agreement between Telus and BCE's Bell to share infrastructure, and said the government would not stand in the way of that.   Continued...