Minister Champagne paves way for affordability-crushing Rogers-Shaw buyout

Canada’s Innovation Minister again fails Canadians, backs Big Telecom companies

OCTOBER 26, 2022 —  Yesterday Minister François-Phillipe Champagne re-announced his approval of the contentious telecommunications buyout by Rogers Communications of Shaw Communications, subject to Shaw’s wireless spectrum licenses being sold to Quebec-based Videotron. 

New in the announcement was a plan to require Videotron hold on to the acquired spectrum for 10 years, and a declaration that their prices across Canada should match their current prices in Quebec, which are cheaper than average prices in the rest of Canada; it remains unclear how this standard could be monitored and enforced. Minister Champagne’s position stands in stark contrast to the verdict of MPs from all parties on the Heritage and Industry committees, who concluded in separate reports that the deal was against the interest of Canadians and should not move forward.

“Minister Champagne just gave the Rogers-Shaw deal a rubber stamp, once again failing to take a stand for Canadians,” said OpenMedia Campaigns Director Matt Hatfield. “Any version of the Rogers-Shaw deal means higher prices and fewer choices for ordinary consumers. MPs from every party get that; two separate committees called it out as a bad deal and came out in opposition. In refusing to condemn the deal, Minister Champagne has once again confirmed that telecom affordability and competition are not his highest priorities. He has made it clear that kid gloves, voluntary targets, and soft words for telecom giants like Rogers remain the core of the government’s approach.”

“While the Minister sits on the fence, the limited competition we have is collapsing around us,” continued Hatfield. “Since the start of the year, a wave of buyouts of small Internet providers like EBOX, VMedia, and Distributel has swept the industry. These buyouts don’t come out of nowhere; Minister Champagne’s anti-competitive actions, sluggishness on key decisions, and failure to give binding teeth to pro-competition moves have all led the way. Conditions like those proposed on Tuesday that cannot be effectively enforced and are ridden with loopholes cannot defend Canadian consumers; only fully blocking the Rogers-Shaw deal would. Minister Champagne seems unwilling to actually defend Canadians and protect competition and affordability.” 

The planned transfer of Shaw’s wireless licenses to Quebecor-owned Videotron is a case in point for Canada’s persistent competition failures. Minister Champagne has said that he wants to see prices fall across the country to meet Quebec’s average rates, which are up to 20% lower than the rest of Canada. But if Videotron is unable or unwilling to meet that target, it is unclear how the government would enforce it. While the Competition Bureau can nominally reverse buyouts if conditions placed on them are not met, they have yet to exercise this power in their 132 year history.

A new campaign from OpenMedia launched this week dubbing Minister Champagne the “Minister of Collapse”. The campaign outlines the many decisions the Minister has made and failed to make since his appointment in 2021 which have worsened telecommunications competition and affordability in Canada. It calls for immediate concrete action by the Minister including revisions to the Competition Act, reinstating reasonable wholesale Internet rates that have been proven to lower prices for consumers, and opening Canada fully to Mobile Virtual Network Operator (MVNO) wireless services that have bolstered cell phone competition in other countries.

Since March 2021, community members from OpenMedia and other advocacy groups have spoken out over 83,000 times to the federal government calling on policymakers to block the Rogers-Shaw deal. A further 10,000 members of OpenMedia’s community have signed a new petition calling on Minister Champagne to take concrete action to curb the dominance of telecom giants like Rogers, Bell, Telus, and Quebecor.