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Verizon not giving up on Canada

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If at first you don’t succeed, hire a lobbyist. At least that seems to be the answer for Verizon Communications Inc.

The American telecom giant appears to be setting the stage for another possible run at the Canadian market, two months after it ended months of speculation over a potential move north with its decision instead to buy out the 45 per cent of Verizon Wireless that it didn’t already own.

In June, Verizon had offered US$700 million for Wind Mobile before deciding to scrap the deal in August, and was also reportedly considering a bid for Mobilicity. In announcing the US$130 billion megadeal that saw it buy out Vodafone’s stake in the Verizon Wireless joint venture, Verizon CEO Lowell McAdam, said at the time that his company was “not going to Canada”.

A hired gun takes aim

He may have spoken too soon, as Verizon has since hired a Canadian lobbyist in an apparent bid to shift the federal government’s position on foreign ownership in the Canadian telecom market.

Dentons Canada LLP consultant Peter Burn filed a request with the Commissioner of Lobbying of Canada last Tuesday to discuss Canada’s telecommunications policy framework with the federal government. The request specifically refers to “section 7 of the Telecommunications Act, subsection 5(1) of the Radiocommunications Act and the policies and rules promulgated by Industry Canada thereunder.”

According to the filing, Burn plans to approach both the Prime Minister’s Office and Industry Canada, and the specifics of the request make it clear that Verizon wants to discuss the rules that govern who has access to the Canadian wireless market, and what they can and cannot do once they’re here. The section of the Radiocommunications Act that Verizon apparently wants to talk about outlines the Industry Minister’s powers around issuing spectrum licenses, updating licensing terms, setting technical standards and virtually every other aspect of wireless operation.

As speculation over a possible Verizon move into Canada grew throughout the summer, BCE Inc., Rogers Communications and Telus Corp. launched a national “Consumers First” media campaign to sway consumer sentiment against the American company’s entry. The campaign specifically warned against granting sweet deals to foreign investors, and said unchecked foreign investment would result in job losses here.

Verizon’s lobbyist move comes as the government wrestles with its desire to boost competition in the wireless market with its fear of putting Canadian technology in foreign hands. Its refusal last month to allow an Egyptian firm to purchase Manitoba Telecom Service’s (MTS) Allstream unit and its reported turndown this week of Lenovo’s interest in buying into BlackBerry could cool foreign investment in the Canadian wireless market if the trend continues.

Nothing out of the ordinary

Despite the ramped-up dialog with the federal government, a Verizon spokesperson says the company has always advocated looser regulatory oversight in Canada, and warns against reading too much into the move.

“Our policy positions in Canada haven't changed,” Bob Varettoni wrote to Yahoo Canada Finance in an email. “We have a business there, and we have long espoused for removal of foreign ownership limits in Canada so that our enterprise business (Verizon Enterprise Solutions) can own its own network. We also have interests in cross-border spectrum coordination issues, global Internet governance issues and more.”

Varettoni says the latest filing is simply business as usual for his globally-focused company.

“We had our outside counsel set up meetings for us to meet with various folks to discuss these general policy issues,” he said. “This is nothing out of the ordinary; we serve customers in 150 countries, and we meet with governments around the world all the time.”

Carmi Levy is a London, Ont.-based independent technology analyst and journalist. The opinions expressed are his own.