Minister Champagne must block the Rogers-Shaw merger and deny Vidéotron bid for Freedom Mobile

After Cabinet's decision on wholesale rates, TekSavvy warns federal merger approval will mean new rate-fixing and price hikes by Canada's telecom oligopoly

CHATHAM, ON, Jan. 10, 2023 /CNW/ - TekSavvy Solutions Inc. (TekSavvy) today called on Canada's Minister of Industry, Science and Technology, François-Philippe Champagne, to block Rogers proposed $26 billion merger with Shaw by denying the transfer of Shaw's wireless spectrum licenses and Freedom Mobile business to Vidéotron. The proposed merger was cleared by the Competition Tribunal on December 31^st. The Competition Bureau appealed the tribunal's decision to the Federal Court of Appeal, to be heard January 24^th. The proposed transaction remains subject to Minister Champagne's final approval.

At the recent Competition Tribunal hearing, the companies revealed for the first time that the entire transaction hinges on a side deal where Rogers will rent its broadband network to Vidéotron at special wholesale rates that aren't available to independent ISPs, such as TekSavvy. The CRTC sets wholesale rates paid by independent ISPs who lease access to the larger carrier networks. Those regulated rates indirectly determine what Canadian consumers pay for internet services. When the Competition Bureau argued that the CRTC's rates are so high that Vidéotron cannot use them to compete, Rogers confirmed that it will grant Vidéotron preferential rates that are below the regulated rates set by the CRTC.

"After successfully lobbying the Minister to impose ruinous regulated rates on smaller competitors, these massive companies now want to carve up the market and fix rates among themselves," said TekSavvy spokesman Peter Nowak. "Minister Champagne must block this anticompetitive deal - or they will soon squeeze out remaining ISPs and hike consumer prices even higher."

TekSavvy has said federal approval for the merger must be contingent upon first enacting the CRTC's 2019 decision to lower its regulated rates. However, in May of 2022, Minister Champagne declined to implement the CRTC decision and instead endorsed much higher regulated rates, as requested by Rogers and Bell. By September, three major independent ISPs —Ebox, Distributel, and V-Media—exited the market after being bought by their wholesale suppliers, Bell and Vidéotron. With competitors leaving the market, the federal government's own data confirms Canadian internet prices are skyrocketing during an unprecedented cost of living crisis.

About TekSavvy

Based in Chatham, Ontario, TekSavvy is Canada's largest independent telecom service company. TekSavvy has been proudly delivering award-winning services and fighting for consumers' rights for more than 20 years. TekSavvy is committed to providing quality competitive choice and closing Canada's digital divide.

SOURCE TekSavvy Solutions Inc.

Trevor Campbell, The iPR Group 647-201-5409; John Settino, The iPR Group 416-662-2955, [email protected]