Rogers and Shaw defend Videotron deal in new CRTC filings

Agreements struck between Rogers Communications Inc. RCI-B-T and Videotron Ltd. as a part of Rogers’s takeover of Shaw Communications Inc. SJR-B-T are supportive of competitors and don’t violate the Telecommunications Act, Rogers and Shaw argue in new filings with Canada’s telecom regulator.

In an effort to get hold of regulatory approval of its $20-billion takeover of Calgary-based Shaw, Rogers has struck a deal to promote Shaw’s Freedom Cellular wi-fi service to Quebecor Inc.’s QBR-B-T Videotron for $2.85-billion. The transfer is meant to stop the takeover from eliminating Freedom, which has been credited with serving to to scale back wi-fi costs.

The takeover, which has confronted many delays, nonetheless requires sign-off from Trade Minister François-Philippe Champagne, whose division is reviewing the switch of Shaw’s wi-fi licences to Videotron. The businesses are aiming to shut the two-step deal by March 31.

Toronto-based Rogers and Videotron have additionally entered into a variety of business agreements supposed to make sure that Freedom, which is Canada’s fourth-largest wi-fi service, stays aggressive underneath Videotron’s possession. These offers will give Videotron wholesale entry to Rogers’s community infrastructure on phrases that the events have described as being extremely beneficial to Videotron. The agreements will permit the Montreal-based telecom to supply wi-fi and web bundles in Alberta and British Columbia.

Impartial web service supplier TekSavvy Options Inc. has requested the Canadian Radio-television and Telecommunications Fee to overview whether or not the preparations are so preferential to Videotron that they may hurt different opponents by means of value discrimination.

Though firms are permitted to promote wholesale community entry at charges decrease than these set by the CRTC, the Telecommunications Act prohibits them from giving themselves or others an unreasonable benefit, which is called an “undue choice.”

The phrases of the agreements between Rogers and Videotron haven’t been made public. However Teksavvy has argued that they run afoul of the act, as a result of they weren’t arrived at by means of business negotiations, “however are as a substitute an effort by Rogers to take away regulatory hurdles to its acquisition of one other incumbent, Shaw.”

In paperwork filed with the CRTC late final week, Rogers says the charges have been commercially negotiated and “won’t lead to any undue choice.” Particulars of the agreements are redacted within the public model of the paperwork.

Shaw, in the meantime, notes in its personal CRTC submitting that there are dozens of agreements at the moment in place between wholesalers and resellers of web providers, at charges under these mandated by the CRTC. These agreements, that are generally known as “off-tariff” agreements, improve the competitiveness of the wholesale market and are due to this fact attaining the federal government’s coverage aims for the telecom sector, Shaw argues.

The CRTC continuing has attracted a variety of submissions from events, together with client advocacy teams and Globalive Inc., which is worried that the agreements may have a destructive impact on its deliberate re-entry into the wi-fi market. Globalive based the service that’s now referred to as Freedom Cellular again in 2008, and has not too long ago introduced that it hopes to re-enter the sector by buying airwaves from now-defunct Manitoba service Xplore Cellular Inc.

Videotron has promised to not promote Freedom’s wi-fi licences for 10 years, and to deliver down costs in its new markets to the identical ranges it at the moment provides in its dwelling market of Quebec – if its acquisition of Freedom is authorized. Mr. Champagne has requested Videotron to signal written pledges that impose penalties if the corporate breaks these guarantees.

A number of Conservative members of Parliament have urged Mr. Champagne to await the end result of the CRTC’s overview earlier than allowing the takeover to go ahead.

Requested whether or not he would achieve this, Mr. Champagne advised reporters on Friday that he takes the CRTC’s function “very critically,” however that his precedence is to scale back cellphone payments.

“I take heed to MPs, I take heed to Canadians, however nobody goes to get me off observe of bringing costs down for Canadians,” Mr. Champagne stated.