Ashley Piotrowski and Shannon Kack -
On November 29, 2013, Canada’s Competition Bureau (the Bureau) issued a no-action letter in respect of the proposed acquisition by TELUS Communications Inc. (Telus) of Public Mobile Holdings Inc. and its operating subsidiary, Public Mobile Inc. (Public Mobile), giving Telus the green light to acquire Public Mobile’s four spectrum licenses. The Bureau’s review is noteworthy for several reasons: First, it resulted in a remedy. Second, the remedy is behavioural in nature. Third, there is no “consent agreement”, which is the usual way of formalizing a remedy. And, fourth, the precise form of the commitment made by Telus is not clear. A position statement accompanied the Bureau’s announcement.
In its position statement, the Bureau characterized the wireless telecommunications industry as having high barriers to entry and expansion, readily accessible information about competitor pricing, and the existence of industry organizations that could facilitate the dissemination of market and pricing information amongst competitors, all of which are factors the Bureau states could potentially raise concerns not only of unilateral, but coordinated conduct. The Bureau also characterized the industy as having a high concentration of market share, with the vast majority of wireless subscribers served by three national incumbents (Telus, Rogers and Bell). Following Industry Canada’s 2008 spectrum auction, the Bureau states that national incumbents responded to increased competition from new entrants (WIND Mobile, Public Mobile, Mobilicity and Videotron Mobile) by lowering prices, accelerating the introduction of new products, plans and services, and expanding the overall range and diversity of wireless products, plans and services available to customers.