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Rogers wants to help Globalive… by buying their spectrum licences
It’s well known that Globalive is one of the new wireless carriers to come into Canada and one of the most feared as new competition. During the Wireless Spectrum Auction Globalive shelled out $442 million and planned to offer their services in Toronto, Vancouver, Edmonton, Calgary, Ottawa and then national in 2010.
However, the CRTC squashed their plans stating that “Globalive does not meet Canadian ownership rules”. Where it stands now is with Industry Minister Tony Clement has stepped in to review the situation.
Yesterday, Nadir Mohamed, CEO of Rogers Communications stated that if Globalive is unable to launch they would be more than happy to eventually buy their spectrum licences. Mohamed said “Spectrum is a very valuable asset. It’s the real-estate of our business, so Rogers would be for sure interested in picking it up. I’m sure others would be.”
If this ever goes that far, they will have some competition on their hands. During the CRTC hearings last month, Bell stated if “the spectrum is to be forfeited and returned to industry Canada… Industry Canada will then re-auction the returned spectrum…. Bell Canada is prepared buy up to 50% of it for up to 50% of the price payed by Globalive”.
However, we believe Globalive will eventually launch their WIND brand and that it’s just a matter of when.
Discussion
17 comments for “Rogers wants to help Globalive… by buying their spectrum licences”
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The license cant be sold to the incumbents for 5 years.Its for new entrants only.
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TNSF Reply:
November 14th, 2009 at 1:13 pm
This is just Rogers way of telling the government not to be pressured by Globalive’s “we just spent 500 million” argument. There is an easy way to recover that money if it comes to that.
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Yes let’s allow a company that already have twice the AWS spectrum they aren’t already using to get more… that’s a great idea for Canadian consumers.
Never mind the silly Industry Canada rule that this spectrum is designated for new carriers only. I’m sure they’ll have enough dollar sign bags at the door of the CRTC to make this happen.
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Rogers should go to hell
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To be clear –
The CRTC didn’t “squash” Globalive’s plans (I think you meant quash…); Globalive failed to follow the guidelines for foreign ownership and control, which were clearly articulated to them prior to the spectrum auction. Videotron, DAVE, Public, and others didn’t seem to have a problem following the rules. Shame on Tony Lacavera and the team at Globalive for letting Orascom dictate the agenda, dictate the ownership structure, and ultimately deprive Canadians of choice…
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andyb Reply:
November 14th, 2009 at 5:18 pm
Actually the “others” to come online have to face a hearing now also to be able to start up thanks to the useless incumbents.As for “failing” they did not.They were approved by industry Canada to be in the spectrum sale.If that isnt good enough then then they should recheck the rules.
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DaveD Reply:
November 14th, 2009 at 7:26 pm
Buying spectrum and being granted a licence to operate a telecom company are two very different things; Globalive (Orascom) failed at the latter because they didn’t adhere to the rules.
To answer your question, No, it’s not good enough that Industry Canada allowed Orascom (fronting as Globalive) to buy spectrum; IC does not enforce the Telecom Act, they simply review the most basic elements of corporate structure and capacity to pay for the spectrum. In short, IC held the auction and collected the money.
It should come as absolutely no surprise to Globalive/Orascom that they are in this mess now… They tried to push the boundaries of the law and failed.
In terms of the other new entrants, if they meet the guidelines around foreign ownership they will have no problem getting licences to operate; to my knowledge, they all do.
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beavertail2 Reply:
November 14th, 2009 at 8:35 pm
So called approved behind closed door with Industry Canada. Who knows what went on? May be Harper pushed strings.
The rule is up to the bidder to declare that they are qualified.
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Travis b. Reply:
November 14th, 2009 at 7:46 pm
Exactly.
Globalive didn’t follow the law, that’s why they aren’t aloud to launch.
You can’t just come walking into Canada, buying spectrum, knowing well the forin ownership laws, and cry to the CRTC and expect them to let you go because you made the CRTC feel bad.
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beavertail2 Reply:
November 14th, 2009 at 8:32 pm
So very true about that Globalive Lasavera didn’t follow the rule. He thought he can play fast and loose, all in the name of competition. Well, his gamble is a loss.
According to the rule, the spectrum would be forfeited. Not sure if there is money back?
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DS Reply:
November 16th, 2009 at 11:32 am
“Guidelines” of foreign ownership and control. To provide basis for stopping malicious intent in business.
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I hope they sort this Wind mobile thing soon, I wanted to dump rogers like it’s hot for them. I don’t want rogers to get the spectrum because I doubt they’re going to roll out a AWS network anytime soon. ( my other option is to wait for a 850/1900Mhz Nokia N900
)
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joe Reply:
November 14th, 2009 at 6:31 pm
You 850/1900 N900 will never come. Nokia has stated that they won’t made another version… at least not in its current form. You’ll probably have to wait another year for a N910 or 920.
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this is very obvious they have a problem with global live
they try to stop global live then say well. can u sell us ur air space
rubbish man pure rubbish from rogers .
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This whole situation just seems crazy. I have friends who left great positions with Koodo and others who are now crying and asking for their jobs back. How could a company hire people without knowing they could operate? Management have no answers just dumb looks on their faces,the district managers are useless and have no info, everybody feels sick while everyone is figuring out that Canadians do not even want an Egyptian phone company. They have been blocked, Globalive money has been traced back to Yasser Arafat….what else could possibly go wrong here? I think they should make a movie about it to raise the money needed. Rogers will never get the spectrum. I think they guy in Egypt would rather hold it and do nothing with it then sell it to any of the big 3.
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Well, there were actually recommendations to get rid of stringent and archaic foreign ownership laws in Canada.
I’m not saying Globalive is correct, but it is high time that people realize the law is not an infallible document given to us by a higher power. Law is fallible and can become outdated.
Moreover, I cannot understand how people can let IC off the hook here. If they allow a company to buy spectrum it should be able to meet telecom rules from the get go. It’s a problem when to bodies of government essentially disagree over the issue.
How can IC, with a clear conscience, take money from a company only to say that IC messed up and now Globalive/Orascom has to foot the bill and likely lose a lot of money. This does not bode well for foreign competition when the rules finally change.
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This is wishful thinking… Sawiris is too smart for that – he would not sell the spectrum at a loss. IMHO he will try to find someone like Quebecor to dilute his share and that would be great because it will create a large 4th operator and this is what the big 3 fear the most. We have to thank them for this oligopoly that they gave us for all these years, high prices, crappy service and we became the laughing stock of countries (70% wireless penetration – give me a break!)
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