Verizon No Longer Going to Canada; Canadian Carriers Rally
September 3, 2013 11:28 AM
comment(s) - last by
Verizon says it has nothing to do with the Vodafone buyout
Verizon has decided not to pursue a place in
the Canadian wireless market
afterall, and Canada's major carriers are rallying as a result.
, Rogers Communications Inc., BCE Inc. and Telus Corp. -- which are Canada's three major wireless carriers -- rallied after Verizon announced that it would no longer try to make its way into Canada.
BCE shares rose 4.3 percent to C$45.03 at 9:01 a.m. on alternative exchanges in Toronto today while Telus rose 6 percent to C$34.75 and Rogers rose 3.5 percent at C$43.06 (from August 30).
Stocks had dropped back in June when Verizon said it would bid to buy Wind Mobile -- the largest of three new Ontario-based carriers. But on August 29, shares of Canada's existing wireless companies rallied in response to talks of Verizon buying out Vodafone.
Verizon Communications announced that it was
buying Vodafone's 45 percent stake
in Verizon Wireless for $130 billion USD yesterday. This means that Verizon now has full control of the wireless network, which happens to be the largest in the U.S. It also has full access to the profitable network's cash load, which will be used to improve the network and fend off competitors.
With this news rolling out, many suspected that Verizon would no longer try to
make a move into Canada
. However, Verizon CEO Lowell McAdam will tell you that the decision not to go into Canada has nothing to do with the Vodafone buyout.
“Verizon is not going to Canada,” said McAdam. “It has nothing to do with the Vodafone deal, it has to do with our view of what kind of value we could get for shareholders. If we thought it had great value creation we would do it.”
This was good news for BCE, Rogers and Telus, since all three together already claim 90 percent of Canadian mobile customers and can continue keeping a tight hold of the market.
Canada has been searching for a fourth major carrier to compete with its top tier carriers for greater consumer choice and competitive prices. Other smaller companies have come along in an attempt to be the fourth, such as Public Mobile, Wind and Mobilicity. However, none of them have been as profitable as the top three.
This article is over a month old, voting and posting comments is disabled
9/3/2013 12:40:15 PM
Also, a country with about 35 million inhabitants, give or take. Which makes it smaller than California...
It's probably a good bet that Verizon could do better by trying to capture more of the American market, than going into Canada and having to start from scratch against 3 entrenched incumbents.
9/3/2013 1:08:23 PM
Well, the problem is, the geography and number of potential users makes investing in Canada profitable, but not
profitable as raping Americans for over $100/month over 2 years. I only know two people with Verizon, and they both spend over $150 for 2 lines with non-premium plans (not unlimited)
Incredible ripoff. You could pay half that for virtually the same quality urban service with Sprint/T-mobile, and when you go rural, you roam on Verizon (or AT&T) anyway.
9/3/2013 4:24:02 PM
You don't know the Canadian cellular market. I worked there from 2007-2010. It was actually cheaper for me to add a $5 international roaming option to my US plan and pay 25 cent/min roaming, than it was for me to get a Canadian cell phone. The Canadian plans didn't become more cost-effective until I moved up past 1000 min/month.
"People Don't Respect Confidentiality in This Industry" -- Sony Computer Entertainment of America President and CEO Jack Tretton
Quick Note: Verizon May Become Canada's Fourth Major Carrier
June 18, 2013, 2:15 PM
AT&T Cuts Price of 2GB Shared Data Plan, T-Mobile Ups Cost of Unlimited Option
March 10, 2014, 2:51 PM
Vine Users No Longer Allowed to Post Pornographic Videos
March 7, 2014, 1:47 PM
Facebook Launches Slightly Tweaked News Feed
March 7, 2014, 9:03 AM
Target Chief Information Officer Resigns in Wake of Holiday Data Breach
March 6, 2014, 2:01 PM
Quick Note: Yahoo to Require Users of its Services to Have Yahoo IDs
March 5, 2014, 4:55 PM
Ellen DeGeneres' Star-studded "Selfie" Briefly Crashes Twitter During Oscar Broadcast
March 3, 2014, 8:27 AM
Most Popular Articles
Bitcoin King Pt. II: Mt. Gox's Dictator Karpelès Proves Tragically Flawed
March 7, 2014, 1:12 PM
Bitcoin King: Mt. Gox CEO Mark Karpelès' History of Arrests, Firings
March 5, 2014, 9:05 AM
USAF Moves Forward With Long Range Bomber Program Despite Budget Crunch
March 4, 2014, 9:44 AM
Windows 8.1 Update 1 Leaked Early
March 7, 2014, 9:30 AM
Apple Won't Let UK Sons Unlock Their Deceased Mother's iPad
March 6, 2014, 12:44 PM
Latest Blog Posts
Tesla vs. BMW: Who Has the Safer EV?
Feb 1, 2014, 2:56 PM
Justice Leaks Details of Next HTC One Two Flagship Phone
Dec 5, 2013, 4:04 PM
Global Cyber Espionage Concerns Reveal Growing Cyber Armies
Nov 29, 2013, 11:04 AM
Is The Period Becoming an Expression of Anger?
Nov 26, 2013, 2:02 PM
NSA and Congress -- You Will Never Kill the Constitution, It's an Idea
Nov 10, 2013, 2:00 PM
More Blog Posts
Copyright 2014 DailyTech LLC. -
Terms, Conditions & Privacy Information