Bell Canada hits out at ‘Verizon-friendly’ regulation

Canadian telecoms giant Bell Canada has issued a strongly worded statement in which it urges authorities to close loopholes in federal regulations that it claims hand a big advantage to US operators like Verizon Wireless.

According to the operator, legislation designed to aid smaller new entrants allows big US operators to gain access to spectrum denied the Canadian incumbents.

Canadian telecoms giant Bell Canada has issued a strongly worded statement in which it urges authorities to close loopholes in federal regulations that it claims hand a big advantage to US operators like Verizon Wireless.

According to the operator, legislation designed to aid smaller new entrants allows big US operators to gain access to spectrum denied the Canadian incumbents.

“Federal wireless policies intended to help small start-up competitors unintentionally give the same advantages to major US wireless companies that want to enter Canada – advantages paid for by Canadians and denied to the country’s major wireless carriers,” said George Cope, the chief executive of Bell Canada.

“We can succeed against US giants in a fair marketplace, because we’ll invest more in Canada,” he added. “But our federal government is unintentionally underwriting the success of US companies in Canada.”

Bell Canada (Montreal, Canada) claims the loopholes would allow Verizon to buy twice as much overall spectrum in the country’s forthcoming 700MHz auction as Canadian operators, and at a lower overall price.

It also insists that Verizon (New York City, NY, USA) would be able to buy smaller operators at “fire-sale prices” because of rules preventing such companies from being sold to Canadian incumbents.

“With the loopholes in the rules, Canadian companies cannot even try to acquire startup wireless companies at any price, but American companies can,” said Mirko Bibic, Bell’s chief legal and regulatory officer.

“These special rules were intended to help new competitive start-ups,” he said. “We ask how the federal government could now hand over Canadian spectrum, infrastructure and capital to US corporations – especially when Canadians do not have similar rights south of the border.”

The complaint comes with Verizon Communications reportedly considering a bid for Wind Mobile (Toronto, Canada) or Mobilicity (Vaughan, Canada), two smaller operators that have struggled to make headway in Canada’s mobile market.

Indeed, the entry of a major player like Verizon could help to shake up what many analysts perceive to be a moribund sector, with Canada’s ‘big three’ incumbents controlling the bulk of airwaves and stridently opposed to any changes designed to improve competition.

OECD studies have shown that telecoms prices in Canada are among the highest in the world, with mobile penetration lagging that of most developed-market peers.