Canada Follows U.S. Lead On Mindless Consolidation With Rogers, Shaw Merger Approval
from the learning-nothing-from-experience dept
In both Canada and the U.S., there’s no shortage of evidence that consolidation in telecom and media hasn’t been great for telecom and media — or employers, competition, or consumers.
That’s not really stopping regulators in either country, who continue to approve massive harmful megadeals with only the pretense of meaningful review. Canada’s just approved the massive $16-$25 billion merger between two of its biggest telecom, wireless, and media behemoths: Shaw and Rogers.
The review took two years, with regulators particularly concerned about how the merger would impact wireless competition. Not so concerned that they’d be willing to block the merger, however. The deal was approved, but Shaw was required to offload its wireless arm, Freedom Mobile, to Videotron:
That final approval came from Canada’s Minister of Innovation, Science and Industry, which approved the transfer of Shaw’s spectrum licenses to Videotron. These license transfers are necessary because as part of the deal, Shaw was required to divest its Freedom Mobile wireless business. Shaw is selling Freedom Mobile to Videotron, which is a wholly-owned subsidiary of Quebecor.
Canadian regulators followed the lead of U.S. regulators, who recently approved the Sprint T-Mobile merger without actually reading studies on the deal’s impact. They then tried to pretend the consolidation wouldn’t be harmful by trying to create a new replacement competitor out of Dish Network, a process that’s…looking more and more doomed by the month.
The problem with megadeal conditions in both countries is several fold. One, regulators are comically captured, so accountability for when companies break their promises are fleeting at best. And two, the consolidation created by such deals further offsets an already muted incentive to meaningfully compete on price, expand access to broadband, or generally, you know, try.
Antitrust oversight now routinely fails to function in the U.S. and Canada. Softball mainstream media coverage provides cover for deal shortcomings, with any real criticism relegated to underfunded fringe outlets, while mainstream outlets push stories featuring quotes from industry officials claiming the deal will be an “exciting new chapter” and create a “rising star” in media and telecom.
The 5,000 to 10,000 lost jobs become an afterthought. The fact that Canadians already pay some of the highest prices in the world for wireless data (directly due to past consolidation) becomes an afterthought. Data showing looming price hikes become footnotes. And the regulators who approve such deals soon enter the revolving door, and the entire approval process gets memory holed.
Filed Under: canada, competition, consolidation, megamergers, regulatory capture, telecom
Comments on “Canada Follows U.S. Lead On Mindless Consolidation With Rogers, Shaw Merger Approval”
Yup. Bell Canada spams me with offers of like $60/month for 1.5 Gbps internet over fibre. To ensure competition, the regulator says they have to share those fibre lines with third-party ISPs. So, if a third party gives Bell something like $100/month (plus rackspace, data transfer fees, etc.) they can sell me service over my Bell fibre. Although, surprisingly, no third-party ISPs are offering this service—apparently, a profit of negative fifty dollars a month cannot create a “sustainable” business, and the 50 Mbps available over third-party DSL is “not competitive”. But rest assured, the regulators are investigating this situation while letting the incumbents buy up the remaining third-party ISPs.
(Third-party ISPs can still sell reasonable service over co-axial cables, where those exist—cable companies stopped installing them a decade or two ago. Honestly, I won’t be surprised to see Canada go the same direction as the USA here: create “fairness” between telephone and cable companies by relieving them all of the burden of third-party access.)
Rogers and Shaw, though, were “competitors” in name only. They might buy city cable infrastructure from each other occasionally, and that’s pretty much the only way anyone can switch from Rogers to Shaw or vice versa. And Videotron, to my knowledge, has basically no non-Quebec wireless infrastructure, with the notable exception of Ottawa and some smaller border cities. So, we’ll still have just 0 or 1 competitor to switch to.
It’s not mindless, it’s a very intentional thing because our government is owned by the telcos.
Re:
One could say it is intentionally mindless.
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Underfunded, But Not From a Lack of Effort
That hit a little close to home for me. While I can’t speak for every outlet out there, I can definitely speak from my own experience.
Been working on my site for more than a decade, trying to get this thing to break even levels. Been doing what I can to keep costs down with the only real costs being the server costs and DNS, I’ve been doing pretty much everything I can think of to get a larger audience. I don’t expect millions of views per month, but I have been hoping to get enough to start getting enough revenue to pay for the costs and building up for additional services to better the website further.
So far, that has not happened. I’ve built a Wiki, shot over 100 videos for YouTube, recorded over 50 podcasts, wrote nearly 2,000 reviews for different things, and a whole stack more. It’s well above and beyond what would be expected for a site run by a single individual.
Indeed, what I’ve created to this point has been attracting viewership. I’ve seen traffic that should be netting me more than enough to pay for costs. Unfortunately, the returns have been abysmal. For instance, over 48 hours at one point, I managed to net over 1,300 views which translated to quite a spike in ad impressions. About 15 or 20 years ago, that might net a site a few dollars (not filthy rich, but certainly enough to put a low cost website in decent footing for such a short period of time). Today, at least in that same time period for me, it wasn’t enough to net 20 cents.
I know I’m not just producing good quality content (especially in light of how few resources I have to work with), but also content that is reaching small levels of success. Yet, despite pulling miracles out of my rear end, I’ve been feeling like I have been getting stonewalled from obtaining even the most modest levels of success.
The problem is that although I can host honest assessments for things like the Rogers Shaw merger, it does feel like I’m forced to stay on the fringes where large portions of my efforts feels like an exercise in screaming into the void. Had I known when I started the website that the returns for such a huge amount of effort, I might have thought twice in even starting. However, I’ve taken things this far, so I might as well keep going. It’s really hard not to get discouraged with it all, but all I can do is keep trying. I just wished I could better contribute to the overall debate on critical issues like this instead of seeing honest messages getting lost in the void most of the time. :\
proves that corruption beats sense and public needs every time, especially if influence from the USA can be used!
Re:
Nah, you’ll know the American influence is here when we actually get competition in the form of U.S. telecos.