Wireless competition coming even without Verizon, says minister

The conditions are right for a fourth competitor to emerge in the Canadian wireless market, despite Verizon Communications' decision not to enter Canada, Industry Minister James Moore says.

And Wind Mobile CEO Anthony Lacavera says his company is poised to become that fourth competitor with the auction of Canadian spectrum for broadband and wireless taking place this fall.

“I don’t think we ever did need a Verizon for Wind to achieve its business plan,” Lacavera said in an interview with CBC’s Lang & O’Leary Exchange.

He said Wind, which currently has 650,000 subscribers across Canada, is already a fourth alternative in the markets where it is operating — B.C., Alberta and Ontario. Wind is partly owned by Netherlands-based Vimpelcom Ltd., which has signalled an intention to sell its stake.

Lacavera said Wind has had a tough slog establishing itself in Canada, but now plans to fill in its networks, add more stores and roll out in new areas, after acquiring new spectrum.

“The demand for our products is clearly there. Prices have come down almost 18 per cent in the markets that we operate in,” he said.

“What’s key for us on spectrum side is government has put in place a policy framework now that ensures the availability of spectrum for new entrants, and that wasn’t so clear up until June of this year when the government announced the Telus and Mobilicity decision,” Lacavera said.

Ottawa blocked a Telus takeover of struggling Mobilicity and has set aside two blocks of spectrum in its fall auction for new entrants to the market.

“It’s now clear there will be four carriers in every market and all those carriers will have access to sufficient spectrum to roll out next generation wireless,” Lacavera said.

Moore said those who are closely following the wireless market may be surprised at the entrants who emerge in the fall auction of spectrum.

The industry minister has engaged in a very public debate this summer with the big three wireless carriers — Bell, Telus and Rogers, over the rules for the spectrum auction and the federal government’s decision to block any takeover of Wind or Mobilicity.

The big three feared U.S. giant Verizon would enter the market, but Moore said the talk about Verizon was always speculation.

“We’ve said all along that our policy is not dependent on whether Verizon comes or doesn’t come. We always knew that it was speculation whether Verizon decided to come to Canada,” Moore told TheLang & O’Leary Exchange.

“If [Verizon] had decided to come, it would have provided a different kind of competition and the incumbent firms would have to arrange their affairs differently.”

He said Ottawa would not rule out an foreign telecom bidding on Canadian spectrum, nor would it change any of the terms or timing of the auction because of Verizon’s announcement.

“It’s a highly valued asset that players will want to bid on,” he said. Moore said Ottawa expects the auction will expand the choices for Canadian consumers.

“Ottawa’s policy has always been the same — more choice for consumers, more competition for the marketplace,” he said.