Industry Minister complains of “dishonest attempts to skew debates via misleading campaigns” after being accused of “going through the motions” of listening to big carriers

For weeks the Harper government has been attacked by officials from BCE Inc.’s Bell Canada, Rogers Communications and Telus Corp. over its wireless policies now that Verizon Communications is looking to get into the cellular market here.

But now that the government has firmly stated none of policies are going to change its patience for the attacks is wearing out.

On Tuesday Industry Minister James Moore pushed back against a published letter in the Financial Post from BCE director Anthony Fell – originally sent to the Prime Minister – which accused Moore of being “disrespectful” in giving the CEOs of the big three carriers only a half hour each to argue their case recently.

Fell, who pointed out he’s “a long standing member of the Conservative Party,” said he is “dismayed” at Moore. “It’s as if he’s just going through the motions” in declaring so soon after he was appointed that government telecom policy won’t change.

Moore didn’t take long to reply. “Mr. Fell’s letter is filled with assumptions about the outcome of the upcoming spectrum auction, and misinformation about the intent of our Government’s policy,” he wrote. Canadians know “dishonest attempts to skew debates via misleading campaigns when they see them.”

“In his letter, Mr. Fell says our policies are merely ‘a political populist initiative to capitalize on a mis-informed public view’ of Canada’s telecommunications industry. I can assure Mr. Fell that our policies were quite deliberate, based on a great deal of consultation with all players – including Canada’s wireless companies – and will serve Canadians well.”

The letters are reproduced in full below.
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The battling letters come as the Globe and Mail reports that Verizon officials met with Industry Canada in May. Weeks later it gave the owners of Wind Mobile what has been described as a preliminary $700 million to take over the startup. It is also reportedly talking to Mobilicity.

There is no detail on what the government said to Verizon, but statements last week from Harper and Moore suggest the government will continue on its path and won’t alter what the incumbent carriers want most, changes to the rules for the upcoming 700 MHz spectrum auction which they say will favor Verizon should it gain control of Wind.

The Globe also reports that Industry Canada is having quiet discussions with officials from Birch Hill Equity Partners, which is pondering buying Wind in partnership with Rogers. The idea is Rogers would negotiate a network sharing agreement with Wind. However, it would have to be structured in a way that Rogers didn’t have control over Wind’s spectrum. There’s a ban on incumbent carriers getting control over spectrum of new entrants until 2014. Ottawa has said it won’t give any exceptions. In addition, it says that after the ban expires (the date is different for each carrier) it will review any transfers, giving the impression it won’t easily agree.

From Anthony Fell (via the Financial Post)

I have been a Director of BCE for the past 12 years. Accordingly, I understand my views on telecom policy will be deemed biased. Nevertheless, I am writing this letter as a Canadian citizen and a long standing member of the Conservative Party of Canada and a strong past and present supporter of you and your government.

I am dismayed by the way the telecom/Verizon file has been handled by the Ministry. George Cope, Darren Entwistle and Nadir Mohamed are three of the most capable Chief Executive Officers in Canada and for Minister Moore to allocate them a half hour to present their case, is disrespectful. It’s as if the Minister is just going through the motions. For Minister Moore, after less than a month in office, to suddenly become an expert on major telecom policy and make grand pronouncements on this decision without far more detailed analysis, discussion and understanding is quite unseemly. To be frank, there is an arrogance about both the Ministry and the Department which I believe is inappropriate.

The highly biased spectrum auction rules were designed for small, startup Canadian companies. At the time there was absolutely no thought or consideration given to the possibility that one of the world’s telecom giants would swoop in and take advantages of these very substantial subsidies and preferential treatment. Verizon should participate in the spectrum auction on the same basis as the Canadian telecoms and Verizon should build out its own network the same way as Rogers, Telus and Bell.

Bell, Telus and Rogers have all clearly stated many times that the Canadian industry has no issue with Verizon’s entry into Canada but they just want a level playing field. In an incredibly competitive world, is that too much to ask? I think not.

The biased spectrum auction and other major subsidies being proposed for Verizon have all the hallmarks of a political populist initiative to capitalize on a mis-informed public view that the Canadian cellular market is uncompetitive and Canadian cellphone charges are much higher in Canada than in the U.S.

If the Canadian market is so uncompetitive and if cellphone charges so high and Canadian telecos so profitable, why can’t Verizon enter the market with no subsidy just like everyone else? It’s a legitimate question worth thinking about and I believe the answer is self-evident.

 

From Industry Minister James Moore

I am pleased to respond to many of the issues raised in the letter printed in the Financial Post today (Tuesday) written by Anthony Fell, Bell Canada Enterprises board member.

I recognize that Canada’s largest wireless companies have responsibilities to their shareholders and their bottom line, and I also understand the need to pressure our government to design policies that serve the interests of their firms. However, Mr. Fell’s letter is filled with assumptions about the outcome of the upcoming spectrum auction, and misinformation about the intent of our Government’s policy.

Our policy is designed to benefit Canadian consumers, first and foremost – and our policy will achieve this goal. Since 2008, due to liberalized investment rules and a consumer-centered policy on roaming service, rural spectrum deployment, antenna tower and site sharing, our Government has delivered for Canadians.

At times, Canada’s telecommunications firms have agreed with our reforms, at other times they have disagreed, but at no point have their views not been understood by our Government or not been incorporated into our policy deliberations.

I have tremendous respect for the leaders of Canada’s telecommunications firms and their drive to do what is best for their shareholders. However, our responsibility is toward a broader public interest, and we are serving Canadians with our policy approach.

In his letter, Mr. Fell says our policies are merely “a political populist initiative to capitalize on a mis-informed public view” of Canada’s telecommunications industry. I can assure Mr. Fell that our policies were quite deliberate, based on a great deal of consultation with all players – including Canada’s wireless companies – and will serve Canadians well.

Unlike Mr. Fell, I do not believe the public is misinformed. I think Canadians know very well what is at stake and they know dishonest attempts to skew debates via misleading campaigns when they see them. Equally, Canadian consumers know instinctively that more competition will serve their families well through better service and lower prices.

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