How much competition is too much?

Is there such thing as too much competition?

That question is currently in front of the CRTC and the still un-named Federal Cabinet in two separate applications.

CNOC raised the question in the form of a review and vary application to the CRTC challenging the Commission’s rejection of mandated MVNO arrangements. Bell has put the question before Cabinet in its challenge of a CRTC order to mandate access to fibre networks.

In both cases, the question of impact on investment was an issue. The apparent inconsistency in the conclusions reached between wireless and wireline investment was the subject of one of my posts last week.

Usually, the marketplace takes care of this kind of question. But in the heavily regulated world of telecommunications, various government agencies try to act as proxies for the market, not just in Canada, but around the world.

I have written in the past about my experiences with Golan Telecom, a rather maverick mobile operator in Israel. This morning, word comes that Golan is exploring options and may be acquired by Pelephone, one of Israel’s original mobile operators. Reuters writes “Israel wonders if too much competition a bad thing in mobile market” as “concerns grow that cut-throat competition is undermining firms’ ability to invest in infrastructure, leaving Israel trailing other nations despite its reputation as a high-tech leader”.

For wireless and wireline, how much competition is too much?

Can the market decide?

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