Yahoo Finance Vass Bednar: Why the Rogers takeover of Shaw could one day lead to greater competition
Sometimes history has a little bit of symmetry.
On the same day the federal consultation on the Future of Competition Policy in Canada concluded, Minister François-Philippe Champagne made a statement concerning competition in the telecommunications sector. This statement informed Canadians that the minister had secured “unprecedented and legally binding commitments from Rogers and Vidéotron.”
The novelty of this statement is dual. First, because it was a merger in the telecommunications space, the minister had final say regarding the potential transfer of spectrum licences from Freedom Mobile to Quebecor Inc.’s Vidéotron — the minister does not have such authority for other merger reviews — and second, because it introduced legitimate accountability for many of the claims that the merging parties made during the merger review. That level of accountability has not existed before.
The announcement has been derided online by industry experts that are exasperated that this agreement seems toothless. Much like Canada’s competition consultation, the minister will need our help to make these commitments truly meaningful. One of the greatest outcomes from the Rogers Communications Inc.-Shaw Communications Inc. saga is how it seems to have reset citizen expectations and spawned a litter of competition watchdogs that will continue to monitor the outcome of this merger.
At some point, March 31, 2023, should be commemorated in a split-screen Heritage Minute for Canada — a moment where our policy approach to fostering robust competition across the country deepened and became more of a consistent priority, while also blessing the most massive merger in the nation’s history.
Yet while there were glimmers of a competition focus in last month’s budget — namely, the tackling of junk fees (fantastic) and the commitment to the right to repair (promising, albeit overdue) — we remain far from the all-of-government approach to competition policy and enforcement that the Biden administration has successfully pioneered. We also continue to lack sustained political championship of competition in Canada.
Further, there is an opportunity for the Competition Bureau to become an even better communicator with the broader public. The commissioner, Matthew Boswell, surprised many observers by how aggressively he prosecuted the Rogers-Shaw merger. Even though he lost, Boswell stoked debate about competition to a level that we really hadn’t seen before.
Yet the consultation document released with the policy review is highly technical. Plus, there is the somewhat strange structural context where the bureau has published 50 policy ideas for reform as a contribution to the overall consultation. While this articulation is novel and brave, it risks positioning the bureau as being in opposition with the government that oversees it when (or if) certain changes are not delivered on. Indeed, the mechanics of the bureau being nested within the Department of Innovation, Science, and Economic Development have become further muddled throughout the various milestones of the Rogers-Shaw merger.
What will it mean for Canada to get more serious about competition, beyond this statement from the minister? In 2020, the bureau published a guide to competition assessment, which is essentially a process for competition rooted in gender-based analysis, and an exercise that can be incorporated into all policy decisions across the government. This could get Canada closer to that comprehensive, all-of-government approach and expand the public conversation beyond the bureau and the CRTC, as has been the case with Rogers-Shaw.
One imagines that policy people in other jurisdictions are googling “Canada” and “competition” to see what we are doing with the file. It’s been a slow ramp up, but progress seems promising. That said, we were left out entirely of the latest G7 compendium of approaches to improving competition in digital markets because we aren’t taking notable policy action.
Maybe the legislative review process will be the ying to the Rogers-Shaw yang. But it won’t just be an all-of-government approach that revitalizes competition in Canada. Doing so will require input, pressure, and attention from the rest of us — visible hands in the marketplace — to make that difference.
