And Then There Were Three: Rogers Shaw Merger Reportedly Complete

Reports indicate that the Rogers Shaw merger has now been completed. This makes it official that Canada now only has 3 major providers left.

The completion of the Rogers Shaw merger has represented a critical blow to Canadian competition law enforcement. Save for the Competition Bureau that at least challenged the merger in court, at every other level, competition law enforcement seems to only exist in name only after they basically rubber stamped the merger.

Over the weekend, we reported on the final rubber stamp being granted by Innovation Minister, François-Philippe Champagne. This after he basically spent months pretending to be considering the fallout, though we’ve known for a year that he was going to do whatever it was Rogers and Shaw asked in the end. After all, the government ultimately serves lobbyists and big corporations in the end, so it isn’t a surprise that the rich and powerful get everything they want.

Though the journey of this sorry saga started in March of 2021, it seems that the story of the merger itself more or less ends today. A report indicates that the merger has been finalized. From City News:

Rogers Communications Inc. has closed its $26-billion purchase of Shaw Communications Inc. after receiving final approval from Ottawa last week, bringing to an end two years of uncertainty as regulators scrutinized the deal.

“This is a momentous day for our customers, who will benefit from the latest services and network technology, and for our teams, who have worked so hard to get us here,” said Rogers CEO Tony Staffieri in a press release.

“We’re proud to bring together these two iconic companies to deliver more value, more connectivity, and more innovation for Canadians.”

One of the talking points by François-Philippe Champagne in all of this is that there is still four strong highly competitive companies. This after spinning off Freedom Mobile to Videotron. Of course, that is really stretching things quite a bit. After all, when it comes to internet access for the home, Freedom Mobile has to actually piggyback off of the existing three players. At best, you could argue that it is a kind of sort of independent service much like smaller operations like TekSavvy who also has to piggy back off of the larger players infrastructure. To call it a strong fourth player is, at best, a highly strained argument.

At the end of the day, competition just got reduced from four major players to three. Freedom Mobile was Wind Mobile. When it first came in, it was going to gradually build up to be a competitive fourth player. Unfortunately, lobbying by the legacy players ensured that there would be an endless supply of obstacles thrown in the companies way. Eventually, investors in this company finally backed out when the uncertainty became too much and Wind was forced to sell to one of the then four big telecom giant players. While infrastructure was set up, that infrastructure wound up being rather limited. Essentially, the big telecom giants drove that potential new competitor into the ground in the end.

While some might argue that there are lots of smaller players on the wireless sector, these are essentially fake competitors. Names that come up might include Koodo, Virgin Mobile, and several others. The problem is that they are all owned by the bigger telecom monopolies. Essentially, it is the largest players trying to pretend that there’s lots of competition even though there is none.

Though the government and telecom apologists try to spin this story as a story about how highly competitive the sector is, no amount of spin is going to deflect the fact that Canada now has only three monopolistic players left in the sector. As a result, Canadians will continue to pay some of the highest internet and cell phone rates in the developed world. This is a finding that was, ironically, recently confirmed by the government itself. With less competition, prices are only destined to go up. Further, as time wears on, layoffs will ensue as the new mega telecom giant finds “redundancies” within the work force.

In the world of telecommunications, Canadian will look more and more on this as a dark day. Even after a massive outage on Rogers part shut down large chunks of the Canadian economy, the merger went ahead as if this was no big deal. Canadians knew better and heavily protested the move, but, as usual, their voices were ignored in the end. As a result, affordability and accessibility will continue to take a back seat as this problem is only destined to get worse.

Drew Wilson on Twitter: @icecube85 and Facebook.

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