Lights on an internet switch are lit up as with users in an office in Ottawa, on February 10, 2011. THE CANADIAN PRESS/Adrian Wyld

Lights on an internet switch are lit up as with users in an office in Ottawa, on February 10, 2011. THE CANADIAN PRESS/Adrian Wyld

Analysts say new CRTC limits on Big 3 help regional carriers with growth plans

One of Canada’s most outspoken consumer advocacy groups, OpenMedia, criticized the CRTC on Thursday

Canada’s regional wireless and internet carriers will benefit the most from this week’s landmark regulatory ruling by the CRTC, telecommunications analysts and consumer advocates say.

Financial analysts at RBC Capital Markets and Canaccord Genuity Capital Markets say Quebecor’s Videotron and Cogeco Communications will likely have more room to grow, given the CRTC’s new restrictions on BCE’s Bell Canada, Rogers Communications Inc. and Telus Corp.

But the analysts also say the three big national wireless carriers will likely be able to manage the new CRTC rules.

“We view this decision as ‘constructive-enough’ and manageable for national operators while at the same time ‘extending a helping hand’ to existing regional wireless operators,” RBC analyst Drew McReynolds wrote in an report for clients.

However, one of Canada’s most outspoken consumer advocacy groups, OpenMedia, criticized the CRTC on Thursday for putting too much emphasis on the regional carriers, doing too little to limit the market power of the Big Three and doing very little to help new entrants to the wireless markets.

OpenMedia executive director Laura Tribe said the CRTC had missed a chance to stimulate competition from smaller players.

“It really doubles down on the idea that a regional provider will be sufficient to correct the extreme market share that Bell, Telus and Rogers have,” Tribe said in an interview.

Tribe has told numerous government and regulatory hearings that Canada’s three biggest telecommunications companies — which collectively have more than 90 per cent of the country’s subscriber base — are too big and consumers have too few choices

The financial analysts took a more favourable view of the CRTC decision, noting that Videotron will have more options to strengthen its base in Quebec or buy assets in other provinces and Cogeco may be able to advance its strategic goal of adding wireless to its internet and cable TV networks.

“The CRTC’s decision essentially means that ‘eligible’ regional wireless carriers would be able to use incumbent networks to offer services until they build out their networks,” wrote Aravinda Galappatthige in a report from Canaccord Genuity.

Galappatthige said the decision is very favourable to regional wireless carriers.

“It does open the door for QBR (Quebecor) to extend beyond Quebec with wireless services whether they choose to do so in a limited fashion (i.e. parts of Ontario) or pick up the mantle as the fourth quasi-national player,” Galappatthige wrote.

Canada’s current “fourth quasi-national player” is the former Wind Mobile, which has about two million subscribers in Ontario, Alberta and British Columbia. About half of them were added after the formerly independent company was bought in 2016 by Shaw Communications Inc. and renamed Freedom Mobile.

Most observers, including the CRTC, say the future for Shaw and Freedom is more difficult to predict because of a proposed takeover by Rogers, which has the largest base of subscribers and a network that spans most of the country. The Rogers-Shaw deal is subject to three federal approvals, including the CRTC and the Competition Bureau.

Quebecor chief executive Pierre Karl Peladeau told a committee of MPs, who are studying the Rogers-Shaw deal, that Videotron had originally wanted to become a national wireless carrier, but it sold its licences outside Quebec after scaling back its ambitions due to the enormous expense of building a new network.

David Paddon, The Canadian Press

Like us on Facebook and follow us on Twitter.

Want to support local journalism? Make a donation here.

Just Posted

Kwalikum Secondary students are happy with the first edition of the ‘Kwalikum Observer’. (Submitted photo)
KSS students produce first issue of ‘Kwalikum Observer’ newspaper

Editor says the paper offers a good outlet for students

(PQB News file photo)
Parksville Fire Department reminds residents of backyard burning and fireworks bans

Beach fires are always prohibited by provincial legislation

Daily confirmed COVID-19 cases reported to B.C. public health, seven-day rolling average in white, to May 12, 2021. (B.C. Centre for Disease Control)
B.C. preparing ‘Restart 2.0’ from COVID-19 as June approaches

Daily infections fall below 500 Friday, down to 387 in hospital

A vial of AstraZeneca vaccine is seen at a mass COVID-19 vaccination clinic in Calgary, Alta., Thursday, April 22, 2021. Dr. Ben Chan remembers hearing the preliminary reports back in March of blood clots appearing in a handful of European recipients of the Oxford-AstraZeneca COVID-19 vaccine. THE CANADIAN PRESS/Jeff McIntosh
Science on COVID, VITT constantly changing: A look at how doctors keep up

While VITT can represent challenges as a novel disorder, blood clots themselves are not new

Poached trees that were taken recently on Vancouver Island in the Mount Prevost area near Cowichan, B.C. are shown on Sunday, May 10, 2021. Big trees, small trees, dead trees, softwoods and hardwoods have all become valuable targets of tree poachers in British Columbia as timber prices hit record levels. THE CANADIAN PRESS/Jen Osborne.
Tree poaching from public forests increasing in B.C. as lumber hits record prices

Prices for B.C. softwood lumber reached $1,600 for 1,000 board feet compared with about $300 a year ago

Crowds at English Bay were blasted with a large beam of light from an RCMP Air-1 helicopter on Friday, May 14. THE CANADIAN PRESS/Marc Grandmaison
Police enlist RCMP helicopter to disperse thousands crowded on Vancouver beach

On Friday night, police were witness to ‘several thousand people staying well into the evening’

Sinikka Gay Elliott was reported missing on Salt Spring Island on Wednesday, May 12. (Courtesty Salt Spring RCMP)
Body of UBC professor found on Salt Spring Island, no foul play suspected

Sinikka Elliott taught sociology at the university

The warm weather means time for a camping trip, or at least an excursion into nature. How much do you know about camps and camping-related facts? (John Arendt - Summerland Review)
QUIZ: Are you ready to go camping?

How many camp and camping-related questions can you answer?

The first Black judge named to the BC Supreme Court, Selwyn Romilly, was handcuffed at 9:15 a.m. May 14 while walking along the seawall. (YouTube/Screen grab)
Police apologize after wrongly arresting B.C.’s first Black Supreme Court Justice

At 81 years old, the retired judge was handcuffed in public while out for a walk Friday morning

Queen Elizabeth II and Clive Holland, deputy commonwealth president of the Royal Life Saving Society, top left, virtually present Dr. Steve Beerman, top right, with the King Edward VII Cup for his drowning-prevention work. Tanner Gorille and Sarah Downs were honoured with Russell Medals for their life-saving resuscitation. (Buckingham Palace photo)
Queen presents Vancouver Island doctor with award for global drowning prevention

Dr. Steve Beerman receives Royal Life Saving Society’s King Edward VII Cup at virtual ceremony

On Friday, May 14 at Meadow Gardens Golf Club in Pitt Meadows, Michael Caan joined a very elite club of golfers who have shot under 60 (Instagram)

Most Read