Buying smaller ISPs “a strategy” for getting to 100% coverage, Rogers CEO says
By Ahmad Hathout
Note: This story has been updated with comments from Bell CEO Mirko Bibic.
TORONTO – Rogers president and CEO Tony Staffieri said Tuesday that the delay in getting approval for the company’s proposed acquisition of Shaw has allowed it to refine its strategy as a consolidated entity.
“While we’re disappointed with the delay…what the time has allowed us to do is solidify our integration plans while at the same time – over the last year and a bit – we went through a bit of our own transformation within each of our businesses, within wireless and cable and media,” Staffieri said during a one-on-one conversation with telecom analyst Maher Yaghi at the Scotiabank TMT conference.
“And so we’re entering the transaction from a stronger position then we would’ve been 16 months ago, so that’s been really helpful. So as we think about integration plans…in terms of the execution steps that we have, they are locked and loaded and ready to go since we’ve had more time to do it. So at a very structural level — more preparedness, the environment is better as well.”
Staffieri emphasized that the demographic situation has changed since the proposed transaction was announced in March 2021, including population growth in the western provinces, especially in British Columbia, which he said would allow Rogers to take additional market share and “fill in” areas that Shaw’s wireline didn’t reach.
Innovation Minister Francois-Philippe Champagne has yet to decide whether he would allow the transfer of Shaw’s Freedom Mobile to Videotron, which would trigger the Rogers acquisition of Shaw. Staffieri said there have been requests for information and dialogue between Rogers and the department and that the company is actively providing material to the minister.
The head of the largest cable company in the country also discussed the company’s strategy to get to full coverage, which he noted could consist of a mix of wireline and wireless technologies. Staffieri said fixed wireless access — cellular signals that provide internet to the home — where the company doesn’t have wires to the premises is an option to get that coverage. He also noted that another strategy is buying up other smaller third party internet service providers, as the industry has seen over the past several months.
“We’ll look at whatever is cost effective as we do that,” Staffieri said. “We believe we have a very good structural position to have close to 100 percent overlap between wireless and wireline and that’s important.”
Cogeco and Telus executives also appeared in morning sessions at the conference, but did not see the long-term viability of fixed wireless access.
Cogeco CEO Philippe Jette said the industry may be at an “inflection point” for the technology, as it is expensive to operate and as Canadians spend an increasing amount of data from their internet usage at home compared to their mobile phones.
Telus’s chief financial officer Doug French said fixed wireless can be a “filler,” but that it won’t compare to real fibre offerings over time.
Bell CEO Mirko Bibic said later in the conference that while the company has a strong fixed wireless presence, the technology is a rural play and he would not bank on it to compete in an urban market with a major fibre competitor.
AT&T’s CFO told a Deutsche Bank TMT conference last week that fixed wireless isn’t a great product.
Jette also emphasized his company’s commitment to launch mobile wireless service using the mobile virtual network operator framework of the CRTC. He noted that it would be a “capital light” step into the market, as the company has long said that the entrance would need to make financial sense above all.
