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Rogers argues wholesale agreements with Vidéotron not unduly preferential in CRTC filing

Denise Paglinawan
·2 min read
FILE PHOTO: Rogers Communications' building in Toronto
FILE PHOTO: Rogers Communications' building in Toronto

Rogers Communications Inc.‘s wholesale agreements with Vidéotron are not unduly preferential and allegations that they are have no basis, the telecom giant said in a filing to the Canadian Radio-television and Telecommunications Commission in response to claims made by an independent internet service provider.

The filing came after TekSavvy Solutions Inc. made an application to the regulator on Jan. 19 alleging that a deal between Rogers and Vidéotron violates a section of the Telecommunications Act, as the discounted rates Rogers would offer Vidéotron to lease its broadband network aren’t available to independent ISPs.

Rogers made the arrangement with the Quebecor Inc. subsidiary as part of the divestiture of Freedom Mobile, a side deal that is key to Rogers’ proposed $26-billion merger transaction with Shaw Communications Inc.

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Requesting the regulator deny TekSavvy’s application to review their deal, Rogers argued the allegations of undue preference in its negotiations with Vidéotron do not have basis.

“TekSavvy admits that it has no knowledge of the actual terms of these agreements, but claims the negotiated rates must be unduly preferential,” Rogers said in the filing.

Rogers has confirmed it will grant Vidéotron access to its broadband network at rates that are below the CRTC’s regulated rates, TekSavvy said, arguing the arrangement contravenes the CRTC’s set wholesale rates for ISPs who lease access to large carrier networks.

The Competition Tribunal, which released a decision on Dec. 29 that allowed the Rogers-Shaw merger to proceed, described the arrangements as “further discounted from the CRTC tariffed wholesale rates.” TekSavvy said the CRTC should rule that this violates Section 27(2) of the Telecommunications Act.

The proposed merger of Rogers and Shaw, as well as the acquisition of Freedom Mobile by Vidéotron, still needs a sign-off from Innovation, Science and Economic Development Canada (ISED), led by industry minister François-Philippe Champagne, on the transfer of spectrum licences from Shaw to Vidéotron in order to close.

Champagne has signalled a willingness to approve the sale of Freedom to Quebecor/Vidéotron in October provided two conditions are met. First, Vidéotron would have to hold Freedom’s spectrum licences for at least 10 years and, second, bring competitive wireless offerings to Ontario and Western Canada that mirror those in Quebec, where prices were brought down by around 20 per cent.

• Email: dpaglinawan@postmedia.com | Twitter: