OTTAWA – The Competition Tribunal hearing on the Competition Bureau’s application to block the merger of Rogers Communications and Shaw Communications continued today, although mostly in camera.
The tribunal heard from Blaik Kirby, group president, consumer and small and medium business at BCE, who also appeared yesterday. He spoke about the competitive environment and Bell’s response to the launch of Shaw Mobile.
“If there is a divestiture the resulting environment is actually going to better for Bell Mobility than the current environment,” Kirby told the tribunal panel, speaking about the divestiture of Shaw’s wireless assets.
“When we look at Shaw today, the Freedom portion is like a T-Mobile and the Shaw Mobile, Shaw Internet portion would be like a Bell Canada selling wireless and wireline. And if you were to take Shaw Mobile and Freedom and separate it from Shaw without the Shaw Internet assets you would be less competitive than you are today,” he continued.
Kirby indicated yesterday the combined Shaw and Freedom have not been as competitive in recent years as it was when it was launched.
Noting the global pandemic caused the entire market to decline in 2020 when there was less switching activity, Kirby said “when Shaw Mobile launched there was quite a bit of activity in the second half of 2020 and so we lost a lot of customers to Shaw.”
Questioned about the company’s competitive response to the launch, Kirby told the tribunal panel they did have a response – “we had to be much more aggressive with our pricing in the Western Canada market, not only for existing customers in trying to keep them but for customers we were trying to get to switch from Rogers or Telus to join Bell.”
This strategy “remains in place today,” he said. The launch of Shaw Mobile also had an impact on their business outside of the west. “Arguably both Rogers and ourselves did quite poorly in Western Canada as a result of the Shaw Mobile launch so both of us had to be more aggressive in the rest of the country to drive our growth,” Kirby said.
In 2021, after the proposed merger of Rogers and Shaw was announced, and still today, Bell has “not found the combined Shaw/Freedom business to be as competitive as it was pre-deal and we’ve been doing quite well against them from a market share perspective,” he said.
Yesterday, Kirby also explained to the tribunal Bell’s plans to migrate MTS customers to Bell’s systems after it acquired the company did not go as smoothly as planned.
“Originally we planned a fairly fast migration of the Manitoba customers to the Bell Mobility systems and it ended up not being so fast and we ended up actually migrating them over a period of six years,” he said. “And we’re going to complete that migration in March of 2023, so it did not go as quickly as we thought and we took a very slow approach there to minimize friction with customers and there just was not a business case to do it faster.”
On the wireline side, Bell has done little integration between billing systems but plans to do this across Bell Canada in 2024.
The tribunal also heard from Christopher Hickey, director of regulatory affairs at Distributel (which is in the process of being bought by Bell) today.
Hickey said Distributel was interested in buying Freedom and Shaw Mobile. A lawyer from Videotron will continue to question Hickey on Monday morning.
The hearing will continue Monday at 9:30 a.m. For instructions on how to watch online, please click here.
