Rogers expert witness tells tribunal Vidéotron will give Canada ‘near-national’ fourth carrier

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Having more national carriers means better consumer outcomes, an expert witness hired by Rogers Communications Inc. told the tribunal convened to determine the fate of the telecom giant’s $26-billion acquisition of its rival Shaw Communications Inc., on Friday.

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Previous witnesses over the first three weeks of the hearings have testified that Shaw’s potential merger with Rogers would result in the loss of a fourth competitor in Canada’s wireless business, especially in provinces such as British Columbia and Alberta. So when Rogers’ expert witness Kenneth Martin took the stand on Friday, counsel for the Competition Bureau, which is attempting to block the merger, asked Martin, about his statement.

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In his report, Martin said countries with four or more operators operators with at least 10 per cent market share tend to have higher 5G penetration of mobile subscriptions and lower average revenue per user, 27 per cent lower than those with three major wireless carriers.

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“On balance, markets with more national providers are more likely to compete on network and other fronts beneficial to consumers,” he said, adding that more competitors with greater scale generally leads to better outcomes.

Martin, who consults for telecom companies through the U.S.-based firm Altman Solon, said the proposed merger will improve competitiveness by creating a “near-national fourth” facilities-based wireless operator with over 11 per cent market share and 73 per cent coverage.

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He was referring to Quebecor Inc.’s Vidéotron, which is in the process of acquiring Shaw’s Freedom Mobile for $2.85 billion — a move that Rogers hopes will allay concerns about reduced competition from its purchase of Shaw. Currently, Rogers, BCE Inc.’s Bell and Telus Corp. — known as Canada’s Big Three — hold the majority of Canada’s wireless market share.

Rogers senior vice-president of finance, Marisa Fabiano, also testified before the tribunal on Friday, although mostly in a confidential session. The hearing’s fourth and final week of evidentiary proceedings will begin on Monday and close on Dec. 1. The tribunal will then reconvene on Dec. 13 and 14 for oral arguments.

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