Mobilicity may transition to an MVNO under new ownership

The founder of Mobilicity wants the company to continue running as an MVNO, or mobile virtual network operator, once it is acquired by one of Rogers or Telus.

On Friday, we reported that the government is easing up on its restrictions for incumbents to purchase spectrum from new entrants, insofar as the former plays nice with a few considerations. Rogers and Telus are reportedly gunning to purchase Mobilicity’s business, dealers, subscribers and most importantly, spectrum, but it must agree to transfer a portion of those airwaves to Wind Mobile upon completion.

In a public proposal by Obelysk Inc., a company controlled by Mobilicity founder and Sirius XM Canada majority shareholder John Bitove, Mobilicity would become an MVNO under its new owners, retaining the brand and current network infrastructure for the foreseeable future.

Noted in a release, Obelysk believes “it is important to continue to provide pricing competition in an industry that does not have enough low priced customer alternatives.”

Today, Mobilicity has 155,000 active subscribers in five markets and 150 “points of distribution,” which includes a dwindling number of dealer stores and mall kiosks. At its height, Mobilicity owned a couple of corporate stores, since closed, but mostly licensed its brand and sales infrastructure to existing businesses. It also employs 100 call centre representatives and 30 people in its Vaughn-based office.

Under the MVNO plan, Mobilicity would not own any spectrum, but would use a combination of domestic and international roaming plans, along with the acquiring company’s existing network. According to the release, such a move would “foster competition” in markets such as Toronto, Calgary, Edmonton and Vancouver that desperately need it.

According to the Globe and Mail, the government is setting time limits on approving a potential acquisition of Mobilicity by Rogers or Telus in the run-up to the federal election in October. If it doesn’t go through within the next week, says one of the Globe’s sources, it may have to wait until the end of the year.


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