CHATHAM, Ont. – TekSavvy is calling on the Competition Bureau to “address rampant anti-competitive activity in Canada’s telecommunications industry,” according to a letter from the independent service provider to the bureau yesterday.
“Canada is suffering through a cost-of-living crisis,” the letter says. “Consumers should not continue to pay increasing, artificially inflated prices for an essential service while heavily subsidized large incumbent carriers reap record profits.”
TekSavvy’s letter references a February 2020 complaint it submitted to the bureau asking it to investigate what TekSavvy said was a pattern of anti-competitive activity in Canada’s wholesale and retail Internet markets.
As detailed in the 2020 complaint, “incumbents have engaged in a sustained strategy of predatory pricing in the retail market for internet services using their flanker brands Virgin (Bell), Fido (Rogers) and Fizz (Videotron),” TekSavvy’s letter says.
The letter goes on to explain “These flanker brands regularly offer retail prices for a given level of internet service at a price below the wholesale prices they inflated for competitors.”
TekSavvy said despite it having warned the Competition Bureau in 2020 that this could lead to wholesale-based competitors exiting the retail market and prices for consumers subsequently increasing, the bureau has done nothing and within the past few months EBox was bought by Bell and VMedia was bought by Quebecor.
“We understand that the Bureau is engaged on the pending merger of two incumbent carriers. However, the pattern of abuses of dominance in this market will continue to exist regardless of whether that merger proceeds,” the letter says. “The Bureau has taken no action to address the anti-competitive activities detailed in our complaint and has remained silent as incumbents acquired independent competitors and while prices continually rise for consumers.”
TekSavvy argues this trend will worsen if no enforcement action is taken.
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