Bell’s MTS purchase to boost competition: MEI

The $3.9-billion acquisition of Manitoba Telecom Services Inc. by BCE Inc. would increase competition in Manitoba’s wireless market, according to the authors of a new report from the Montreal Economic Institute (MEI). “Even though the number of wireless providers falls from four to three, the province will now have three large, well-established players instead of just two. Indeed, MTS and currently dominate this market with one half and one third of clients, respectively,” a press release issued Thursday said. “Bell and are two small providers with infrastructure that is not up to date. The transaction will make both of them major players, which will lead to increased competition.” It added that regulators shouldn’t block the merger, which must be approved by the CRTC, Innovation, Science and Economic Development Canada, and the Competition Bureau. In The State of Competition in Canada’s Telecommunications Industry report, compiled prior to Monday’s acquisition announcement, Martin Masse and Paul Beaudry also argue that it would be “irrelevant” for the CRTC to declare broadband an essential service and set new targets for Internet speeds, following the hearing on basic telecom services that wrapped up in April. The report said there “is no need to create new funding mechanisms or to impose more layers of distortionary regulation in order to duplicate what market players are already doing in an efficient manner.” It said that whenever a new technology emerges, it’s not “suddenly adopted universally in every socioeconomic group” as soon as it becomes available. In a country as large as Canada, “there is little likelihood that any new physical infrastructure will be deployed in all populated areas simultaneously,” the report added. “Critics who note that access to high-speed Internet is limited in some regions of Canada, or among less advantaged socioeconomic groups, invariably conclude that government intervention will be necessary to close the gap,” it said. “But what they consider a market failure is actually just the normal course of technology adoption.”

Bell’s MTS purchase to boost competition: MEI

Brief | May 4, 2016

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Bell’s MTS purchase to boost competition: MEI

Brief | May 4, 2016

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