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TELUS to acquire 100% of Public Mobile (Update)

publicmobile

Update: Looks like this deal is working through the correct channels. We’ve been informed that the decision from the Competition Bureau on the sale of Public Mobile to TELUS is expected to be announced on Wednesday.


This is getting interesting now.

A press release was just issued that noted that “Industry Canada approved the proposed G-block spectrum licence transfer from Public Mobile to TELUS Communications Inc.”

Public Mobile invested $52 million during the 2008 wireless and gained the once-unwanted G-Band spectrum between Windsor to Quebec City. The carrier then launched their wireless service in Toronto and Montreal, giving “value conscious Canadian consumers” unlimited low-cost talk, text and data plans. Public Mobile currently has 280,000 wireless subscribers.

Of course, all the necessary approvals are needed from the Competition Bureau, but a green light by James Moore, Minister of Industry, is a good sign that this is a done deal. An internal doc we received indicated the transaction will “close within the next month or so.” In addition, the merger of the two wireless companies “has no immediate impact on anyone or our operations… it is business as usual.”

From an employee perspective, the doc notes, “TELUS has committed to keeping on all of our existing employees at close. While there will be a transition period, the longer term plan is to fully integrate the operations of Public Mobile into TELUS… While Public Mobile will not continue as a stand-alone entity, you will have an opportunity to find a place to grow and enhance your career within TELUS.”

From a business perspective, the doc and the press release are incredibly revealing. Alek Krstajic, Public Mobile CEO, stated, “this transaction is the best option to guarantee continued quality service for our customers and to maximize the opportunity for our employees and investors.”

However, according to the internal doc to its employees, TELUS might have scored Public at a decent price, noting “this is the ideal outcome for Public Mobile. As we have discussed over the past several years, we have looked for numerous opportunities to grow Public Mobile by evolving into a larger new entrant competitor. Unfortunately, none of those attempts came to fruition… After considerable review, this transaction is the best outcome for everyone.”

Finally, “Following a transition period, they will be migrated to the broader coverage provided by the CDMA network operated by TELUS. Over time, they will be offered opportunities to switch to a broader range of handsets and to take advantage of the capabilities of their HSPA and LTE networks.”

This makes complete sense to transition Public’s customer base out of CDMA and onto LTE. We reported last week that TELUS is aiming to shutter its CDMA network by 2015.

The Industry Minister noted that “Canadians have been clear that they want more choice, better service and lower prices in our wireless sector. Our government will continue to enforce the moratorium on the transfer of set-aside AWS spectrum to incumbents. We will not approve any spectrum transfer request that decreases competition in our wireless sector to the detriment of consumers.”

When the TELUS/Public deal closes it’ll make TELUS become the number 2 wireless carrier in Canada. The latest quarterly results stated:

Rogers: 9,418,000 wirless subscribers
Bell: 7,715,641
TELUS: 7,700,000

Adding Public’s 280,000 subs will boost TELUS to 7,980,000 wireless subs.

So there you have… more soon!

Source: CNW, MarketWired
(Thanks tipster!)

  • MrEeeaddict

    would public customers get to keep unlimited on telus?

    • Fire Man

      I’m going to guess no

    • sid32

      Probably to they upgrade their phones.

    • skullan

      You make me smile. Thank you for the humour you bring into my life. :)

    • MrEeeaddict

      the let the clearnet people keep their plans so I don’t see why not?

    • Blocknards

      I don’t recall the clearnet plans being that lucrative. Per second billing, unlimited incoming, and free caller ID was thought to be insane at the time.

    • skullan

      Are we talking original Clearnet, or the new Clearnet they brought out in the last couple years?

      The big 3 have systematically removed their unlimited offerings. There is money to be made in overages.

    • Roger Payne

      Probably be a grandfathered plan. As long as you keep that plan in it’s current state, most likely you could keep it. Want to upgrade? Get in on a new wireless plan feature? Bundle with some other product? Sure we can do that, but your plan needs to be upgraded…and oh…unlimited doesn’t come with that updated plan.

      BAU

    • thomas nguyen

      What’s the point of having unlimited on a cdma network? It’s like you get a pedal bike and allowed to go as fast as you want on a race course. Great when you hear unlimited but in theory it’s not practical.

    • Goran Mihajlović

      Depends on the CDMA network. Telus’s EV-DO? It is revision A, so I could get 1-1.5mbps before I switched to their hspa network. I could stream video at 480p no problem. Surfing wasn’t the fastest, but still went quick. Especially a few years ago when mobile sites were still very small. If you don’t consume the kind of media that requires hspa+ or more, it’s just fine. I loved true unlimited. I rarely go over 3, but there’s been a few times where I hit or was very close to 6, so it was a great piece of mind.

    • mola2alex

      Joking right? CDMA is not capable of doing anything these days.

    • kirilmatt

      EVDO Rev. A isn’t that slow, it has a max speed of 3.2mbps(?). While this is short of HSPA by a long shot, its what Verizon had to use before their massive LTE expansion to compete against TMO and ATT. Same goes for sprint. It is fine for general browsing. On my nexus 4 I only get 2-5mbps on Rogers HSPA+, though I normally run LTE. HSPA doesn’t feel too slow though.

    • Goran Mihajlović

      I didn’t realise that 3mbps EV-DO A or 14mbps EV-DO B is not capable of anything these days. And no, I’m not joking that I got 1-1.5mbps on CDMA.

    • DiabloFirefly

      It’s just a personal choice of man. It may not work for you, however I have no issues with my unlimited cdma plan or network. I use it for business and personal without a glitch, and thank goodness because I love streaming my show on that long commute.

    • Big Ang

      As a person who was a Fido client when Rogers bought them, let me answer that with a big fat NO. Back then, Rogers would add a little “love letter” to each monthly Fido bill saying that this charge will increase, or that charge will go up, or some charge will be added, etc etc., and within a few months my CityFido plan ended up costing me over $10 more per month than before the Rogers buyout. For the time being, Telus will run Public just like it was running before, but will probably cut down on any new locations/resellers, no more incentives for new clients, all the while bombarding Public clients with offers to switch to Telus. Either they will shut Public down at the same time as when they shut down their own CDMA network, or Public will no longer have a roaming partner and will be stuck with a smaller network. Then, after there are a lot fewer than the 280,000 subscribers left, they’ll shut it down.

    • Giordano Bruno

      Sounds pretty accurate from a former employee point of view

    • CADDMan71

      Those cheap unlimited data/voice plans will likely go the way of the dodo bird, just like the cheap fares from the new (now extinct, except Westjet) Canadian airlines back in the 90s. None of the new cellular carriers have the wherewithal to create a business that can make any money in a market as small as Canada using those rates when their operating costs are so astronomical. Public was my only hope of an independent new cellular carrier to make it in this market as their plan of attack was similar to that of WestJet in the 90s. Start small, build a loyal content customer base, and expand as economics dictate. Their buyout by Telus unfortunately squashes that idea.

    • thomas nguyen

      data is cheap per person, but when taking into account the amount in a small area (square density), we are looking at a high rate of usage that is not sustainable. if not for high data price, there would be rampant use of data for netflix, streaming music, downloading, and tethering, slowing down throughput for everyone and limiting the uptime of the site.

      as much as i hate to have a high price of data, it is there because it’s not feasible to give people data at the moment due to current technology and people’s usage expectation.

  • xj

    Just when they said they were gonna shut down their CDMA network lol

  • oyunited

    R.I.P. Competition. We are slowly going back to ROBELUS

    • Fire Man

      Small players had a go at it and failed. Wouldn’t really blame robelus for that though

    • TomsDisqusted

      You wouldn’t blame Robellus? Even though, when we finally had the possibility of the new entrants getting sufficient backing to really compete in a country practically owned by Robellus (i.e. Verizon), the incumbents went nuts and spent huge money spreading lies and lobbyists.

      The fact that the ads were outright lies was one of the few things the media and the government can agree on these days.

    • Davidyyz

      We were under the illusion that Verizon was coming. Verizon has made it quite clear that they were never serious about coming to Canada, and many financial analysts who have absolutely nothing to do with the Big 3 agreed that it simply would not be financially viable for Verizon to enter the Canadian market.

    • TomsDisqusted

      The idea that Verizon was never serious was a short lived theory that the Globe effectively debunked and which never made sense anyway. I highly doubt Robellus would have spent huge money and made themselves look so desparately scared of competition, w/o picking up the phone to every contact they had to verify Verizon’s intentions.

      Clearly Robellus thought the threat was very real.

    • Davidyyz

      If the threat of Verizon was real, they wouldn’t have been scared off by some ridiculous ads.

    • Rick Honeyford

      They weren’t scared off by the ads they decided to consolidate ownership of Verizon meaning they no longer had the resources and attention needed to expand into Canada.

    • Davidyyz

      I’m not saying they were scared off by the ads, but a lot of people seem to be alluding to the fact that Verizon did not enter the Canadian market due to pressures from the Big 3 and all the Big 3 did in reaction to the news stories was run ads.

      We will never know for sure if Verizon actually had serious intentions to enter the Canadian market. I’m simply of the opinion that they were not serious as it did not make financial sense for them, whether they spent the cash to buy out the vodafone stake or not, and all the media reports were based off a bunch of anonymous sources who pretty much turned out to be incorrect.

    • Delphus

      No, they were scarred off by a ridiculous goverment… one day this, next day that.

      Not the stable environment companies look for…

    • Tip O’niel

      Those lobbyists really paid off with the government down in the US begging any US carrier to come in and sacrificing our tax money to do so.

    • Fire Man

      No, I would not blame Robellus for the failure and bankruptcy of so many new entrants (ie. Mobilicity, Public Mobile). Their business models just didn’t pan out. Sure they went for super low ARPU with low cost plans, but they didn’t put in the investment for a decent network. And even with their low cost plans, they couldn’t get enough subscribers and were losing millions each month. I think this is the market speaking, not so much a scheme by the big 3. Verizon entering, on the other hand, is a different case. The big 3 actively and publicly fought this, but effectively did not make a difference. Verizon chose on their own not to enter Canada

    • Fire Man

      I was talking about the new entrants’ business models. They can’t find a balance between subscribers and ARPU to make a sustainable business case. Wind has expressed desire to find a buyer. This implies, in case you didn’t pick up on it, that they’re not doing so well. Mobilicity has already applied for CCAA and PM just got bought out.

    • Davidyyz

      I don’t believe Public Mobile was ever competition. They went after a niche market that the Big 3 never wanted anyways. The Big 3 never saw Public as a threat.

    • Jacob

      So why try to keep buying the new entrants then?

      Ouch…

    • Fire Man

      For the spectrum, I thought that was quite clear.

      Don’t think competition ever crossed anybody’s mind…

    • Me Ted

      Going back? When did we ever leave?

    • vn33

      Oops, wrong reply, sorry!

    • Me Ted

      Np. :)

    • Rio

      Sorry but who or what is Robelus.
      Thanks in advance,

    • Delphus

      ROgersBEllteLUS :-)

    • Rio

      Thanks.

    • vn33

      Guess you don’t hang around here (or on HoFo) often enough to catch on, eh? :-)
      Robelus = Rogers Bell Telus, combined word

    • Rio

      Thanks

  • Sweet

    My thoughts exactly.

  • me

    Spectrum. The Public spectrum isn’t nearly as useful as the Mobilicity spectrum.

    • RoboBonobo

      They set aside some blocks of AWS spectrum just for new entrants, to increase competition. The G-Band spectrum was open for anyone to bid on. The thing that stopped the Telus takeover of Mobilicity was the agreement they signed saying they wouldn’t transfer the spectrum to an incumbent for a certain amount of time. There was no such agreement for the G-Band spectrum. An incumbent could have won it at the auction if they wanted it.

    • ScooterinAB

      Pretty much what RoboBonobo said. I understand that the conditions for a successful bid in the AWS auction specifically restrict the “resale” of the spectrum for a certain time period (that had not passed when Telus made their offer). Public Mobile’s spectrum likely does not have such a restriction.
      Unfortunately, it isn’t as simple as saying spectrum is spectrum, since there are different restrictions and conditions depending on the frequency and the sale itself.
      That being said, I completely agree that it is hypocritical of Industry Canada to allow one company to be bought and shut down while restricting the sale of another.
      I can’t imagine this going very well for Telus in the short term. Solo’s pending shutdown by Bell (potentially similar situation) is taking forever and is tedious for everyone. I can’t imagine a PM-Telus migration is going to be any cleaner.

  • Max Fireman

    What does this mean??? *mind blown*

    • Fire Man

      Means another new entrant died, Mr Fireman!

  • HelloCDN

    I think Telus intends to make them their Chatr “alternative”, withc exact same pricing. And then they will feed us with crap like “We have a lot of competition!!”

    • Roger Payne

      Telus already has a Chatr alternative…Koodo. If anything, Public mobile subscribers will just be absorbed into that brand.

    • HelloCDN

      No, Koodo is more expensive than Chatr. Koodo is more like Fido – a subbrand with a somewhat cheaper, but more limited pricing.

    • Goran Mihajlović

      Chatr is meant specifically to counter wind and mobi. Outside of major city zones, you pay for roaming. And you don’t get unlimited data. Utterly useless.

    • Ren596

      Don’t Give Them Ideas

  • Derek Mercier

    so the Canadian market gets to be more dull with no competition and once again the consumer get screwed over! Unlimited plan are finally in Canada but they have been in states for over 8 yrs. Canadian consumers are get screwed!

    • thomas nguyen

      gotta stop comparing us with the states :/ population density alone makes us stand apart.

      then again, its what you get for living in Canada, good healthcare, but you pay a bit more for your commodity.

  • FunkyMonkey

    WHAT A TWISTTT!!!

  • Canadaboy

    That’s (a) One that is officially consumed by an incumbent (b) One that is bankrupt and has had incumbents try to buy it directly and through shills and (c) One that is on the ropes.

    Whoo wee the big three must be absolutely excited about this! Not only that – their whole “not verizon” and the moment a real, authentic competitor drops out, they’re all – “we want competition again” (just as long as it has no threat to their triopoly)

    • Fire Man

      Well to be fair, Wind/ Mobi/ Public had a go at it for a few years, but still nobody was flocking to them. Why? Because Canadians want a decent network where they don’t have to worry about zones and stuff. And with their cheap plans, they were still losing money. Imagine if they had a decent network and actually had a business model that was sustainable- oh wait, that’s just the big 3…

  • Roger Payne

    I read somewhere that it had something to do with the type of spectrum (AWS) that Mobilicity was giving up. That type of spectrum had greater restrictions on it when it was auctioned off.

    I think it’s the government’s way of trying to avoid the “I told you so” accusations. Everybody knew this day would come. They want to appear as if they are still “upholding” competition by saying “we told you then and we’re telling you now, the big guys can’t have this spectrum. Doesn’t matter who buys the smaller players out.”

  • RoboBonobo

    The G-Band spectrum wasn’t set aside solely for new entrants.

  • canuck07

    This is the beginning of the end for wireless subscribers in this country

  • rgl168

    Telus just want Public’s customer list. They have no use for Public’s network as they are shutting down CDMA themselves.

    • deltatux

      No, they want that PCS G band which they can deploy HSPA+ on. It’s always been about the spectrum.

    • Charles in Vancouver

      There are no devices which support HSPA on PCS G. On the other hand Sprint LTE devices do support that band for LTE.

    • RoboBonobo

      Guy at the public mobile store told me all the phones they sell are custom made specifically for their network. There’s nowhere else you can buy a phone to use on Public Mobile, except for directly from Public Mobile themselves.
      It’s not so hard to get support for your network baked in.
      Telus isn’t going to be forced to only use phone models that are already being used by someone else.
      I’m not saying they are going to use this or that, I’m just saying if Public Mobile can get phones made specifically for themselves, and Sprint can get phones made specifically for themselves, so can Telus.

    • Charles in Vancouver

      CDMA is not uncommon, it’s the PCS G band that’s uncommon. Sprint is the
      only other carrier in the world that owned such spectrum and it was
      left undeployed until now (for LTE). So yes the devices were customized
      out of necessity. Some of their hardware may have originally been
      designed for Sprint since CDMA PCS G was an option for them but they
      never took that direction.

      Telus is unlikely to seek out highly customized hardware just to squeeze in the use of PCS G. It is more likely that hardware designed for a broad range of USA carriers will start to include LTE PCS G alongside AT&T-type bands, which would then be usable by Telus.

    • RoboBonobo

      I think you’re probably right.

    • Who Needs Facts

      Reportedly Apple 5C work on G band. A whole bunch of cheap Apple phones just looking for some bandwidth.

    • Charles in Vancouver

      Yes the 5C and 5S versions that Telus already sells include LTE Band 25, which is the superset of PCS that includes G Block. There is no listed support for CDMA or HSPA in G Block. I had thought maybe only the Sprint version did, but apparently the AT&T/T-Mobile/Robelus/Verizon version does as well.

      I think the Nexus 5 rumours also have it supporting G Block LTE.

    • J-Ro

      “Cheap” and “Apple” cannot be in the same sentence. I doubt the customers at PM would be willing to dish out $500+ for a iPhone and a likely increase in monthly rates. Most of them will keep what they have.

    • Who Needs Facts

      Lol – good point. I was thinking more that Telus will be re-using the Public G-band for its premium brand. The existing customers will likely be migrated to Koodo.

    • J-Ro

      That is very possible. Since Koodo has strong enough coverage in all the areas.

    • thomas nguyen

      Public mobile in the previous post on Mobile Syrup stated that they will absorb PC mobile into their own brand, there would not be a separate company stemming from the purchase of PM.

    • RLC

      I expect that TELUS will reposition the PCS G band for LTE deployment. Since the new Iphones support LTE Bands 25, TELUS will have the ability to offer LTE support for new IPhones and other future products that support band 25.

    • TB

      You are correct sir. Bellus first 1900Mhz LTE frequencies deployed will likely be from this purchase of the G block.

      The phone comment is correct but they also have the standard 1900Mhz PCS and some have the 850Mhz as well. Telus could in theory with minimal effort immediately shut down the Public Mobile network and clients would switch over to the old Telus CDMA system

    • deltatux

      The PCS 1900 band covers the G block, so devices should work on the G band. However, it’s likely going to be used for LTE.

    • rgl168

      If they re-farm the G band to something else, that means they have no use for Public’s existing network.

    • rgl168

      I don’t think there will be any more significant expansion to HSPA network. If they want to re-farm the G band, most likely they’ll do it for LTE.

  • bob

    Telus has some great plan there days. $100 / mo for 2GB really fair price ..
    o.O

    • Guest

      Time to switch to Public Mobile and take advantage of their unlimited plans?? I wonder if they’re gonna upgrade their phone selection later on…

  • Thomas C. Riddell

    Oh no the Fed Robotellus beast

  • framewerk

    Time to switch to Public Mobile and take advantage of their unlimited plans?? I wonder if they’re gonna upgrade their phone selection later on…

    • skullan

      They are highly unlikely to be keeping these plans.

    • framewerk

      Yeah I realized how stupid that question was shortly after I posted…

  • DubbingHammer

    Public mobile was the weakest cell carrier but it is none the less sad to see it absorbed by Telus.

    I would hate to see same thing happening to Wind and Mobilicity.

    • HelloCDN

      Mobilicity will be absorbed by someone. It’s just stupid to have 2 basically same companies. It’s obvious by now that Canadian market cannot sustain 2 more nationwide networks. One big one is good enough, they can have more sales and invest a little bit into network improvements.

    • DubbingHammer

      I hope they can see the light and merge before it’s too late.

    • HelloCDN

      All depends on WIND’s inverstors. Unfortunately, company itself does not have enough capital to afford the merger.

  • framing god

    Who cares. Who is public mobile. Wind us hood.

  • Comrade Yeti

    PM is being acquired, its spectrum, customers, operations and all

    • beyond

      you forgot one….their soul
      R.I.P. PM :(

    • Comrade Yeti

      G block spectrum is not unused, it’s what PM uses today. And read the press release. The whole company is being acquired.

    • Comrade Yeti

      That’s correct and that’s currently in review.. You said “PM is not being acquired” which is wrong. Telus is buying 100% of it. The spectrum is approved and now it’s up to the competition bureau for their review. Your post makes it sound like Telus would walk away with just spectrum and leave PM and it’s customers behind. Which can’t happen as those customers won’t have any spectrum to run their phones on.

  • Big Ang

    Many people are downplaying Public as insignificant, but I credit them for how low prices in the industry have gotten. How? When Wind and Mobilicity first came out, their sweet spot was $65/mth, but then Public came out with their voice-only plans for a dirt cheap price, which caused Wind and Mobilicity to drop their prices. With Wind and Mobility prices at approx. $40/mth, people began to switch to Wind/Mobi and Robelus had to lower their prices, somewhat, to prevent Wind/Mobi from gaining traction.

    Although I was never interested in becoming a Public client, I always liked Public’s business strategy – minimal amount of debt, niche market (dumbphones, unlimited minutes), and an area that is small geographically, but that holds over 50% of Canada’s population. I think the main thing that did them in was that many people were switching to smartphones and the ones that were not, were stuck in the Robelus mindset.

    Just because Public didn’t hold any of the “special set-aside” spectrum, doesn’t mean this is a good deal for Canada. I think it should be stopped – Telus practically said they would shut Public down in a couple of years by shutting down its CDMA network.

  • Anthony G.

    The article mentions that the Public Mobile customers will slowly fade into the Telus family. The one thing that no one seems to see is that those customers are on a month to month service, no contract at all and no cancellation fees. They will pack up their bags and go to the competition the minute they are dissatisfied.

    • J-Ro

      Telus might make Public Mobile their 3rd lower tier brand. Like Chat-r. At least that is what I hope, because matching plans with Chat-r on the telus network would be great.

    • Anthony G.

      The article says :”the longer term plan is to fully integrate the operations of Public Mobile into TELUS”

      I think they just want the spectrum. They might not even get the go ahead to buy them from the gov or the crtc.

    • J-Ro

      If they take the customers, it is very likely. But for the spectrum, I don’t think it has been long enough for Telus to buy it from them. Then again, with all that has happened, you never know.

    • Anthony G.

      I’m pretty sure the authorities will not let them do this. Even if they do, as I said, customers that have not done a credit check, have no contract and pay a monthly bill that is less than half the one of Telus customers are worth…close to nothing.

    • Gabriel

      They will use PM yo replace their current prepaid services

  • Who Needs Facts

    Moore continues to impress. From the CBC.

    “Federal Industry Minister James Moore says he has approved the transfer of Public Mobile’s spectrum licence to Vancouver-based Telus and says the transaction doesn’t affect competition in the wireless industry.

    Moore says Public Mobile’s spectrum – radio waves needed to operate cellphone networks – isn’t used for the latest smartphones and data plans.”

    Umm. Except the two newest offerings from Apple.

    • MobileMonkey

      And oh the various Android SMARTPHONES that Public currently offers… someone clearly gave him the wrong talking notes.

  • frogstar42

    As I understand it, PUBLIC is/was CDMA, which Telus is dumping currently.

    • zaghy2zy

      Yes. It can either mean Telus will keep the CDMA networks longer, or move public subscribers to GSM.

  • Thomas C. Riddell

    Time for anyone who can get off this ship to run to wind

    • someppl dont think

      To a company that is drowning and can’t find a buyer? LOL are you nuts?
      Wind walking down the same path as Mobi.

  • Delphus

    No worries, Steven’s folks are clearly as confused as us… which is why foreign competition is staying well away from the Cdn market…

  • Delphus

    Not too mention that if they now think it’s useless spectrum vs 5 years ago when they were pocketing $$$$ millions for it…

    Oh wait, Steven and the boys are looking out for us!…. not

  • hoo dat

    This should come as absolutely no surprise. The only question is “What took you so long, Telus?”

  • Jacob

    Email Industry Canada Minister Jame Moore and ask him..

    james.moore.c1a@parl.gc.ca

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