Telus can acquire Public Mobile, Industry Canada decides

24 Oct 2013

Telus has entered into an agreement with smaller cellco Public Mobile to obtain 100% ownership of the company. Pending approval from the Competition Bureau, Telus announced that the transaction will ensure ‘continuity of service and enhanced functionality’ for Public Mobile’s 280,000 wireless customers. Industry Canada yesterday approved the transfer of 1900MHz ‘G-block’ mobile frequency licences from CDMA network operator Public Mobile to nationwide provider Telus, paving the way for a takeover. James Moore, Minister of Industry, issued the following statement explaining the government’s reasons for the decision: ‘Industry Canada approved the proposed G-block spectrum licence transfer from Public Mobile to Telus Communications Inc. G-block spectrum licences were acquired in the 2008 spectrum auction but were not part of the 2008 Advanced Wireless Services (AWS) set-aside [aimed at encouraging new entrants and subject to stricter controls on spectrum transfers]. G-block spectrum is not used for the latest data plans and smartphones in Canada and is of a significantly lesser value than other types of spectrum. This transaction does not materially change the spectrum concentration of incumbents in this country and therefore will not diminish competition in our wireless sector. Canadians have been clear that they want more choice, better service and lower prices in our wireless sector. Our government will continue to enforce the moratorium on the transfer of set-aside AWS spectrum to incumbents. We will not approve any spectrum transfer request that decreases competition in our wireless sector to the detriment of consumers.’

TeleGeography’s GlobalComms Database says that Public Mobile (the trading name of BMV Holdings) spent CAD52 million (USD51 million) on four 10MHz blocks of G-block PCS 1900MHz band frequencies in Canada’s July 2008 spectrum auction – covering southern Ontario and southern Quebec with a population of around 18 million. Public Mobile launched ‘no-frills’ mobile services over a CDMA-based network in Toronto and Montreal in Q2 2010, and in Q4 2011 rolled out a 3G CDMA2000 1xEV-DO network upgrade. By mid-2013 over nine million people could access Public’s on-net services in Ontario (where its network covers Toronto and cities in its environs from Hamilton up to Oshawa) and Quebec. Meanwhile, Public Mobile’s plans were given an additional boost by the news that US cellco Sprint would be utilising the same 1900MHz frequency block in its LTE rollout, with the Canadian minnow claiming that a major US provider developing 4G in the G-Block band would lead to much broader selection of available LTE devices. Public Mobile also underlined that its wireless network was based on software defined radio (SDR) technology, making it easier to upgrade existing equipment to support LTE. Public Mobile was sold in June 2013 to Canadian investment firm Thomvest Seed Capital and US private equity firm Cartesian Capital for an undisclosed price by a large consortium of US/Canadian private equity firms. Thomvest, which took the position of controlling shareholder of Public Mobile, is backed by Peter Thomson, chairman of Woodbridge Co – the Thomson family investment company which has a 55% stake in New York-based news group Thomson Reuters.

GlobalComms adds that in June 2013 Industry Canada published its new wireless spectrum licence transfer framework, aimed at improving competition by promoting at least four mobile network operators in every region of the country. Under the rules, all spectrum transfer requests will be reviewed, and those that would result in ‘undue spectrum concentration, and therefore diminish competition’ will not be permitted – this policy was applied by the ministry earlier that month to block an attempted takeover of cellco Mobilicity by Telus. Decisions on transfer requests will be made on a case-by-case basis under the policy. Full details of the spectrum licence transfer framework can be found at: