BCE Buys MTS: Some Notable Quotes

Bell + MTS

It was a very big week in Canada’s carrier space. On Monday Bell’s parent company BCE announced a $3.1 billion dollar deal to acquire Manitoba Telecom Services, Inc. For those who don’t know, MTS is a small regional carrier directly responsible for a cheap data plan on another, national carrier called Koodo. By jumping through just a few hoops, any Koodo subscriber can enjoy the same reasonably-priced LTE data as Manitobans do.

In other words, the BCE-MTS deal has direct consequences for all wireless users in Canada.

I’ve collected some notable quotes from bloggers and news media to get you up to speed and maybe provide some more insight into the ramifications of this deal—which, by the way, has yet to be approved by regulatory bodies. Anyway, enjoy!

“With the four competitors in Manitoba – Bell, Telus, Rogers, and MTS – the province features some of the lowest wireless prices in Canada. The reason is obvious: the presence of a fourth carrier creates more competition and lower pricing. With MTS out of the way – and Bell and Telus sharing the same wireless network – prices are bound to increase to levels more commonly found in the rest of the country.”Michael Geist

“Having four wireless carriers in every province was Stephen Harper’s idea. When it comes to Justin Trudeau, he has so far shown more interest in cuddling pandas and explaining quantum computing. Telecommunications has yet to appear on his radar, or on that of Innovation, Science and Economic Development Minister Navdeep Bains.”Peter Nowak

“That there is no competition in the Canadian wireless market is a misnomer; carriers compete voraciously for customers, quarter after quarter. That competition, however, comes at the expense of price drops, instead of fuelling them, as is the case in so many other countries. Canada’s lack of a healthy MVNO market — or practically any MVNO market — exacerbates the problem.”Dan Bader

“By insisting on the benefits of a fourth wireless player, the previous federal government went against a worldwide trend of consolidation in the wireless sector and embraced a static view of competition, says the report. It adds that the prices Canadians pay for wireless services remain higher than in most European countries but lower than in the United States or Japan.”The Canadian Press

“Details of the risk assessment will be worked out by SaskTel’s management and board of directors. The report, which is expected within a few weeks, will lay out what, if any, risks the MTS-BCE deal entails for the Crown Corporation in a rapidly-evolving industry. It will also determine the next steps for SaskTel.”Jim Reiter, Minister Responsible for Saskatchewan Telecommunications

Sources: Michael Geist, AlphaBeatic, Android Central, CBC News, Saskatoon StarPhoenix

One comment:

  1. It is incorrect to assume the reason Manitoba has low wireless rates is due to the presence of MTS. Looking from outside the market it is easy to make that mistake. The true driver was actually Telus. The issue was that Telus had such a limited network in Manitoba you would lose signal as you crossed Winnipeg city limits and sometimes even sooner. To trade off for their lack of network coverage they offered a heavy discount compared to market rates. Rather than letting Telus dominate the market Rogers and MTS stepped up to match those rates.

    Having learned how to offset low wireless rates to compete with Telus, MTS has been resistant to moving to higher rate plans as their pricing of wireless and strong network coverage gives the a strong competitive edge against the wider rnager of handsets now offered by the national carriers.

    It is also worth noting that on any changes MTS is historically the slowest to move. Whether it is rate hikes, implementing the Wireless Code of Conduct or any other industry wide changes. Also for a small window in time when Canada moved from three year to two year wireless rates Telus and Rogers both offered their higher priced plans in Manitoba. It didn’t last long before they all raced back to the old price points to compete for the Christmas sales season.

    As for why I talk very little of Bell on the wireless side, they haven’t even been in the Manitoba market for four years yet. It is unconfirmed publicly why Bell had not offered wireless services in Manitoba but common speculation is there was a contractual restriction on competition in Manitoba that was part of the old cooperation agreement on services in Alberta.

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