Calgary HQ part of federal conditions allowing Rogers to buy Shaw
Canadians’ options for phone, internet and TV services are changing with the federal government clearing the final hurdle for Rogers to take over Shaw, but it comes with conditions including some that specifically impact Calgary.
The $26 billion deal would create Canada's second-largest telecommunications company, as long as Rogers and Videotron meet 21 commitments outlined by Ottawa, including creating 3,000 jobs in Western Canada and a strong presence in Calgary.
“The establishment of a western headquarters in Calgary to be maintained for a minimum of 10 years” said François-Philippe Champagne, Canada’s minister of innovation, science and industry.
COULD BE GOOD FOR CITY: CED
Calgary Economic Development (CED) said the deal could be good for the city.
“To have that kind of a headquarters here, they (businesses) know that they can be really close to the mothership, and they have access to the technology that's being developed firsthand,” said Brad Parry, CEO of Calgary Economic Development.
Some people aren’t convinced it will be good for Calgary.
“Mergers often happen to find efficiencies, said Gregory Taylor an associate professor with University of Calgary’s communications, media and film department.
“So I have real concerns for job losses in the west.”
The $26 billion purchase has been two years in the making due to concerns over reducing competition.
The Rogers and Shaw deal was approved Thursday.
BUT WILL CONSUMERS PAY A PRICE?
Some consumers think they will pay a price.
“Not immediately, but in the long term, less competition is probably going to be increasing prices,” said one Calgarian biking along the Bow River.
“My Shaw is up for renewal soon so I don’t know how that will be affected,” said another Calgarian on the trail.
The federal government however says consumers will be protected.
If Rogers breaks the commitments it could face a fine of up to $1 billion.
“This is an industry that has messed with the regulator in the past. And so I don't think it's out of the question to think that they might do so again,” said Taylor.
The deal requires the sale of Shaw-owned Freedom Mobile to Quebec's Videotron.
While Ottawa says that creates a fourth major player, critics say Freedom Mobile was already that fourth option.
“This is really scary for the future of telecom in Canada, if a deal this big isn't big enough to block, I don't think anything is,” said Laurie Tribe.
Rogers must also spend $5.5 billion to expand 5G coverage and additional network services, as well as a furether $1 billion to connect rural, remote and Indigenous communities.
The take-over is expected to be complete by April 7.
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