Canada is known to be locked market for the telecommunication industry, but this is not for long now!
The Government is setting the stage for more wireless players and possibly lower rates for cellphones and other telecom services. It announced that it is opening up the satellite and telecommunications industries, to venture capital and investment from outside the country.
The government has overturned CRTC decision of not allowing into a new entrant – Globalive Wireless into Canadian wireless market, for being “too foreign owned”. Globalive, effectively controlled by an Egyptian company, has been selling its Wind Mobile wireless services since Christmas.
The Globalive precedent will no longer be an exception, but will be a rule. The government is opening Canada’s doors to venture capital and to foreign investment in key sectors, including the satellite and telecommunications industries, giving Canadian companies access to the funds and expertise they need.
This will bring great changes in Canada wireless market. Today Canadians pay significantly more for wireless services than Europe where the competition is high. Canada’s wireless market is currently dominated by three players: Bell, Rogers and Telus.
As of now, corporations operating as telecoms must meet the following requirements:
• At least 80 per cent of its board of directors must be individual Canadians.
• Canadians must own at least 80 per cent of its voting shares.
• The corporation must not be otherwise controlled in fact by non-Canadians.
• At least two-thirds of the voting shares of a carrier’s parent company must also be held by Canadians.