Did you "enjoy" the rates you paid to the oligopoly of the “Three Incumbents”?

[hardy83]

Bit off topic, but does anyone know what the government did with the last auctions revenue?

Obviously the short answer is they wasted it on nothing, but wasn't there SUPPOSE to be funding to help make broadband/wireless more available to smaller communities?

[davyjones]

@ tendenzi The "fun" was in continuation of your "entertaining" theme. Hope you did not take offense.

I will stop with the multi-quoting since so much is being repeated anyways. Yes, I understand it is not a literal tax. What I am saying is that it has the exact same effect. This is not simply company profits being used to buy some additional assets. Instead, this is an attempt to hoard spectrum so that competition is virtually impossible. In an oligopoly market there is no "voting with wallets". You pay what they want to charge and you can be sure they will want to charge you for the spectrum they bought.

So while the Federal gov collects some money from this, not only do this lead to Canadian consumers paying more in the long run, it also leads to a less competitive market. It is almost sad to think about the alternatives possible if the government conditionally leased out spectrum instead of just selling it off in bulk.

As for Telus's suggestion, it would only limit the hoarding not prevent it. At the end of the day they still get to sit on more spectrum, of which they already have plenty. (It's easy to forget that each of the incumbents won almost twice as many bids as wind and six times as many as Mobilicity in the AWS auction.) Their motivation behind this suggestion is pretty clear, as this lowers their expenses since they wouldn't be bidding against Rogers for their 10 MHz. While this may be preferable to the complete open auction, it still relies on selling off the spectrum.

[Tendenzi]

Hope you did not take offense.

None taken.

That said... your recent post makes sense almost... if not for the way you're trying to bend the process' which are totally normal and making it sound sinister. For example

This is not simply company profits being used to buy some additional assets.

When it most definitely is. So I get your "spin" on the argument. But I think you're focusing on the wrong things here in my responses. Like you thought I was offended when in my first reply to you I clearly said it was all unserious to me.

You seem to be positioning me to defend the incumbents/oligopoly, and in the past I've fallen down this road here before, and I don't feel or care to defend them again. Removing the names or companies for a second I see nothing wrong with a successful company using their profits to expand their portfolios or licenses or real-estate, whatever it is more. It's growing their business.
I also see nothing wrong with an open auction, if foreign ownership is lifted. Or a closed auction if foreign ownership remains closed.

I also feel like, if we stop holding the new entrants hands, maybe some more aggressive decisions can be made on their own company levels to be more dynamic. Clearly they're not really doing what they wished to have had by now, considering the money spent and the fast network deployment. <- hinting at "evolving" the company by forcing more partnerships between mobilicity and WIND or merger/tower sharing agreements. It's disgusting to think we have to group the new entrants against the incumbents like the new-entrants are a model of leading service providers... when they can't even play nice with each other.

[DroogBC]

What in the jumping jesus is a "Touch-tone fee"? Where do these douchebags get the balls?

[Tendenzi]

What in the jumping jesus is a "Touch-tone fee"? Where do these douchebags get the balls?

I don't know but a quick google search found this story from last year http://www.cbc.ca/news/story/2010/02...vice-bell.html

"Due to an error on our part you have been receiving Touch Tone(TM) Service at no cost. Effective immediately, a $2.80/mo charge will appear on your billing. You will not be charged retroactively. We apologized [sic] for the inconvenience."

Imagine that! LOL

That being said, I've not owned a land-line in 2 years, and can't even find an old bill right now to see if I actually paid for this... I didn't even know it existed as a fee.

[Guest 268]

OK guys: Nice discussion, but not really why I made the original post.
To repeat:

If we believe in fair and open competition in the Wireless Service Providers’ industry, let’s not sit on our collective duffs, but present our views to the government – specifically Industry Minister Christian Paradis, the Prime Minister, and your local MP.

Can we bring this back to the original intention: Let's all get together, and make our concerns known to those who will decide this important item.

You might also consider signing this petition: http://stopthesqueeze.ca/
Thanks!

[Tendenzi]

OK guys: Nice discussion, but not really why I made the original post.
To repeat:


Can we bring this back to the original intention: Let's all get together, and make our concerns known to those who will decide this important item.

You might also consider signing this petition: http://stopthesqueeze.ca/
Thanks!

Hey Kitwatuser, what's the constant reference to longer term contracts? I'm confused by that, as there hasn't been any proof or rumour even indicating things would get worse than the 3 year term.

Needless to say, I've signed the petition because of it's intention.

[Guest 268]

Hey Kitwatuser, what's the constant reference to longer term contracts?

I'm not a lawyer - which is probably what it would take to read all the fine nuances in the article.
I just agree with the main gist: Let's get the government to do things in such a way that the three incumbents with the deep pockets will not get a chance to throttle (pun intended) the newcomers.

Needless to say, I've signed the petition because of it's intention.

Thank you! Hope many more will follow your good example!

[rockjock]

I'm not a lawyer - which is probably what it would take to read all the fine nuances in the article.
I just agree with the main gist: Let's get the government to do things in such a way that the three incumbents with the deep pockets will not get a chance to throttle (pun intended) the newcomers.


Thank you! Hope many more will follow your good example!

You would think a company with over 200 million subs would have the deep pockets? I agree with T why do we need to give handouts to such a huge company? Let those that can bid. Pretty simple. I think the government wants to sell the spectrum for as much as they can. Ar the end of the day the big 3 will just get bigger and the little guys will get deeper and deeper in debt.

[davyjones]

@ tendenzi Its hard to tell online if people are offended or not but I am glad that you were not. I suspected I would have been better off making my concerns into their own thread instead of diverting this one. To me, the question of whether companies should be able to invest in assets or whether the newcomers should be subsidized or given foreign-capital freedom is all besides the point. I simply believe that there shouldn't be an auction. Even if there is one then why so soon? Surely it makes sense to wait and see how the new-entrant situation sorts itself out before rushing into another auction.

I will say, though, that while what you say makes sense I don't think it is particularly desirable to: a) allow the incumbents to grow even further at the expensive of an open market b) have the newcomers get along instead of competing - which is what we really should want businesses in an "open" market to do. I don't buy the argument that they need to band together to compete. The incumbents need to stop banding together and compete.

[sirtate]

I agree that there shouldn't be an auction right now... it is way too soon for the newbies to have a stable financial footing, and the big 3 will use this as a chance to push them around while they are wobbly...

i understand that 700Mhz is a key spectrum to grab for LTE expansion et al, but there has got to be a better way to do than a straight-up auction...

perhaps the big 3 could trade in some other spectrum blocks to buy some 700, and the newbies can auction amongst themselves...

the newbies do indeed need to set up strategic partnerships to expand their buildouts since they have proven that they cant afford to do it alone...

lifting the foreign ownership rules, however, isn't the right plan for us... if DT or AT&T moved in and bought BCE for $33Billion, do you think life would be any better?

[Tendenzi]

I agree that there shouldn't be an auction right now... it is way too soon for the newbies to have a stable financial footing, and the big 3 will use this as a chance to push them around while they are wobbly...

That's fair. Clearly LTE seems to be starting to roll out now with out 700mhz so why not delay it and allow the continue network build outs.

i understand that 700Mhz is a key spectrum to grab for LTE expansion et al, but there has got to be a better way to do than a straight-up auction...

perhaps the big 3 could trade in some other spectrum blocks to buy some 700, and the newbies can auction amongst themselves...

Or even auction off their own spectrum back to the new entrants and profit off it even. They own it by now, so they should be entitled to some financial compensation. It's only fair. They shouldn't be penalized for their success.

lifting the foreign ownership rules, however, isn't the right plan for us... if DT or AT&T moved in and bought BCE for $33Billion, do you think life would be any better?

This is the exact fundamental question I always think about when debating ownership at all. We have very little proof if any that states orascom/vimplecom only came here to help our pockets... because I don't think they expected to pour millions in for nothing.

[SharpieFiend]

Amen to that. Those prices are just crazy unexplainable.

Gas prices are easy to explain. It's one part supply and demand, one part delivery and a hundred parts greed.

[Tendenzi]

Gas prices are easy to explain. It's one part supply and demand, one part delivery and a hundred parts greed.

LOL.
Correct, I guess "unacceptable", "unjustifiable", or simply just crazy, would have been better choice in words.

I guess the same formula applies to the incumbents?

[sirtate]

Or even auction off their own spectrum back to the new entrants and profit off it even. They own it by now, so they should be entitled to some financial compensation. It's only fair. They shouldn't be penalized for their success.

Not a bad idea... allow the big 3 to bid on a piece of the 700Mhz spectrum, but in order to do so, they must give up a corresponding block of AWS to the secondary market and allow other, non big 3, players to bid on it...

commodity products that are indistinguishable from each other based on supplier alone cause price wars when new entrants to the market appear... once the market has stabilized, you will end up with an oligopoly like we see with oil, telecom, even soft drinks... (I know, I know... Coke does taste different from Pepsi, but mixed with rye, can you really tell?)

When the cost of providing service is very close, you will have a similar price floor for all players. Anything below that is predatory pricing, which is illegal in Canada. A small player can claim that because they don't have market dominance, they are buying market share. But eventually they will run out of money and be forced to either raise prices or have their assets acquired by someone else (Clearnet, Microcell, anyone?)... If a large player predatory prices their product, it is anti-competitive...

We can't have Wind and Mobi out bare knuckling in the street, while the Mob-Bosses sit inside the bar looking out over their steaks remarking to each other about who will fall first, and which one of us will run to their 'aid'...

there needs to be a gentlemen's agreement between the scrappers about who the real competition is and form a unified front facing the same direction... whether that means "i'll take Ontario and you take out west", so be it...

Wobbly financials doesn't make a good competitor... it also makes worried financiers... worried financiers won't throw good money after bad for 700Mhz spectrum