Yahoo Finance Shaw Mobile's competitive threat to Rogers questioned by former Competition Bureau chief economist
The launch of Shaw Mobile did not put substantial competitive pressure on Rogers Communications Inc., the former chief economist at the Competition Bureau suggested Tuesday at a hearing to decide the fate of Rogers’ $26-billion bid to acquire Shaw Communications Inc.
Paul Alan Johnson worked at the Bureau from 2016 to 2019 and was hired by Shaw as an expert in competition economics. Testifying before the tribunal on Tuesday, Johnson rebutted arguments provided by Nathan Miller, the expert hired by his former employer, which is trying to block the merger.
“We’re interested if Shaw Mobile is a substantial competitive threat…. Why don’t we have clear empirical evidence of that in the data?” Johnson told the tribunal.
He said there was no unusual increase in new subscriber sign-ups when Shaw Mobile launched, contrary to what Miller said before the tribunal weeks prior. On Nov. 15, Miller cited a fully redacted document on porting that he said shows how consumers switch between the two carriers, making for direct competition between Rogers and Shaw.
“When Shaw Mobile launched initiatives like ‘Big Gig’ plans, it impacted Rogers’s business,” Miller said at the time, adding that the proposed acquisition would eliminate the threat of Shaw as a strong fourth competitor.
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Andrew Harington, an expert hired by Rogers to look into the efficiencies of the merger, also took the stand Tuesday, although most of his testimony happened in confidential session. Harington was retained to give his opinion on the dollar value that will likely result from the Rogers transaction and Videotron‘s transaction of Shaw’s Freedom Mobile, as well as what would be lost in the event that the merger is blocked.
The hearing’s fourth and last week before oral arguments started Monday with testimony from William Webb, a U.K.-based telecommunications and wireless technologies expert hired by Shaw. The expert witness said Freedom and Videotron’s combined spectrum holdings will create a “more formidable” competitor to Canada’s “Big Three” telcos — Rogers, Bell and Telus.
“It is my opinion that if Freedom is sold to Videotron pursuant to the terms of the proposed transaction, Freedom would not be a less effective competitor from a technological perspective than Freedom under Shaw’s ownership today,” Webb said in his witness statement.
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