You can usually count on Ted Rogers to come up with an entertaining speech, especially when parts of the business are being put at risk by government intervention.
In today’s speech at The Canadian Club in Ottawa, Ted said that the handouts being sought by large, well financed companies seeking to become new entrants would make them “The all-time corporate welfare bums in Canadian History!”
Here is a sample:
Remember that Canada had a fourth national carrier called Microcell with the FIDO brand that became insolvent in 2002 and was refinanced at huge losses to its debt holders only to be headed in the same direction again until Rogers rescued it in 2004.
So there were four carriers in Canada and the fourth one couldn’t make a go of it. One of our most vocal critics in the current debate is Vidéotron. As I have said Vidéotron was a minority shareholder in Microcell. When the Canadian wireless industry was not profitable and Microcell was in trouble, what did Vidéotron do? Did they spend more money as Rogers did and double down on what many considered to be a risky bet? No, they sold out of the business and left Microcell to sink or swim.
Now that the wireless business is profitable, Vidéotron wants back in with a few handouts from their competitors and subsidies and patronage from the government.
Ted also took a shot at MTS Allstream:
Another company that is pointing the finger of blame is MTS, the phone company in Manitoba. But they have been providing wireless for 20 years in Manitoba. They were one of the original licensees. They say that Canadian prices are too high and they say that Canadian wireless networks are not advanced enough. But it is their own pricing they are complaining about and their own dated CDMA technology at which they are pointing their fingers.
They would have you believe that if they offered service across Canada that suddenly their prices will drop and their technology will improve. What a specious argument. Talk about sucking and blowing at the same time.
He concluded by saying that he doesn’t oppose new entry.
We just think that new entrants should buy the spectrum in an open auction like everyone else. They are large, well-financed companies and they should put their money up like every other wireless provider.
Pierre-Karl Peladeau is speaking at Toronto’s Empire Club tomorrow and his speech, entitled “Why pay more and get less? Taking on Canada’s Protected Wireless Market” will have lots of rebuttal.
I plan to provide a review of the Empire Club speech tomorrow.