Thursday morning netted one of those surprising-but-not-really bits of news, with the announcement by Telus that it is acquiring small wireless carrier Mobilicity for $380 million. The deal is subject to government approval, which is in no way guaranteed. I wrote a piece over on Yahoo detailing why the acquisition is bad news for everyone, from consumers to the incumbent carriers themselves – and especially the government.
With additional funding unlikely to come from either within Canada or without, and other similarly cash-strapped new entrants Wind and Public Mobile unable or unwilling to buy the bleeding entity that is Mobilicity, there really doesn’t seem to be any other alternative. The deal has been rumoured for some time and was widely expected to become official ahead of the June 11 deadline for putting down deposits on the next wireless spectrum auction, which is scheduled for November.
With the wireless industry a giant mess of the government’s own creation, Industry Minister Christian Paradis and his colleagues are now under immense pressure to do something drastic. With Canadian bills already the highest in the world and edging higher, and the first of the low-cost competitors about to fall, there really is no delaying dramatic action any longer. What form that will take will be the fun thing to watch over the next few weeks. Read the rest of this entry »