Verizon is reportedly planning to place a bid during the upcoming federal auction of four blocks of 700 MHz spectrum that wireless providers use for mobile services. The New York-based giant is also planning to purchase struggling Canadian telecoms upstarts Mobilicity and Wind Mobile.
The Harper government has been actively wooing Verizon under the guise of promoting greater competition in Canada’s $19 billion wireless market.
“Instead of giving a slew of benefits to a gigantic US-based corporation that will take the jobs, expertise and profits out of the country, why not set up a Crown telecommunications company that will hire Canadians, build on this country’s impressive history in the sector and return the surplus to the public?” Asked CEP President Dave Coles in a statement issued last week.
Verizon’s entry into the Canadian market would unsettle Bell, Rogers and Telus, the big three domestic giants which control 90 per cent of Canada’s lucrative market.
Last week, Industry Minister James Moore lashed out at the companies. On Friday, the Conservatives launched the www.consumersfirst.ca website to promote Verizon’s advantages and push back against the companies’ publicity campaign.
“In its ideological crusade to open the telecommunications sector up to foreign ownership the Conservatives are ‘gaming the rules’ in favour of a major US-based multinational,” said Coles. “If the government is intent on providing consumers with a fourth major carrier in each market it should acquire one of the struggling small telcos, reserve some of the available 700 MHz spectrum for public use and establish ‘Canada Wireless’ as a Crown Corporation.”
A new Telecommunications Crown corporation would bump the number of federal Crown corporations to 50.
Coles pointed to SaskTel as a good example to emulate. SaskTel is a Crown Corporation and leading full service communications provider in Saskatchewan.
“If Industry Canada Minister James Moore doesn’t trust a union leader’s opinion on setting up a Crown Corporation he can call conservative Saskatchewan Premier Brad Wall to ask him about the many benefits of a public telecommunications operator,” said Coles.
A recent Treasury Board report describes Crown corporations as “instruments of public policy” and promoters of Canada’s “identity and connectedness.”
“Crown corporations have been part of the Canadian public sector for close to a century. They have played a vital role in key activities such as transportation, power generation, and communications where private enterprises were unwilling or unable to provide the necessary services,” the report says. “With their mixture of public policy and commercial objectives, Crown corporations, such as the Canadian Broadcasting Corporation and Canada Post Corporation, play critical roles promoting the country’s identity and connectedness.”
While Crown corporations operate at arm’s length from government, they are ultimately accountable to the government. Some are subject to various instruments of accountability and public scrutiny, including the Access to Information Act, Financial Administration Act and annual audits.
Over the years, the Canadian government has followed the late British Prime Minister Margaret Thatcher’s example and privatized iconic Crown corporations. Progressive Conservative PM Brian Mulroney privatized Air Canada and Petro-Canada.
CEP and other critics are also worried that Verizon’s entry in the Canadian wireless market would lead to greater National Security Agency (NSA)-style surveillance in Canada, and a loss of privacy for Canadians. Verizon was implicated in the recent NSA electronic spying scandal. According to documents leaked by former NSA contractor Edward Snowden, Verizon worked “intimately” with the NSA “to collect the personal information of millions of its US customers.”