DAVE Wireless becomes Mobilicity: Chairman John Bitove (left) and President Dave Dobbin unveil Mobilicity, the companys go-to-market consumer brand name, at a press conference in Toronto, Tuesday, February 2, 2010.Derek Oliver
New cellphone player Mobilicity formally filed a complaint with the Competition Bureau last week over what it alleges is "anti-competitive" behaviour from wireless giant Rogers Communications Inc.
The Toronto-based company, which launched service in May after bidding on new wireless licenses in 2008, has alleged that Rogers' creation of a new discount cellphone brand, Chatr Wireless Inc., is in "direct breach" of section 78 of the Competition Act.
That section of the act prohibits dominant players in any given industry from using "fighting brands," which are often called flanker brands in the telecom industry, to eradicate new competition by coming in with lower prices.
John Bitove, Mobilicity's chairman, said in July that he would file a complaint with the Competition Bureau, after Chatr pricing leaked onto the Internet and showed them to be nearly identical to those of the new wireless players, like Mobilicity and Wind Mobile.
On Wednesday, Mobilicity made good on that promise, sending an e-mail to reporters that "late last week Mobilicity's legal counsel filed complaints against Rogers with various government agencies, including the Competition Bureau." Mobilicity refused to divulge the documents it filed with the bureau, and would not elaborate on what government agencies to which it was referring.
"We will not be issuing any statements other than to say we are strong proponents of a healthy, fair and sustainable competitive environment in Canada's wireless sector, and we are confident that the Competition Bureau and federal government will ensure this remains the case," Stewart Lyons, Mobilicity chief operating officer, said in a release.
Several regulatory sources have said the complaint, even if it is accepted by the Competition Bureau, could take years to wind its way to a tribunal, and is unlikely to alter the telecom landscape in a way that would be meaningful for new wireless entrants. Others noted that the federal Conservatives, which organized a wireless spectrum license auction back in 2008 to enable new competitors, have wanted lower wireless pricing for a while now - and that Rogers' Chatr brand, despite lowering prices only for new Rogers customers, is unlikely to upset anyone politically.
Since Rogers launched Chatr, in addition to its existing Fido flanker brand, BCE Inc.'s Bell Mobility has repositioned its flanker brand Solo Mobile into an unlimited service with prices identical to Chatr's. Telus Corp. has so far refused to reposition its flanker brand Koodo Mobile, saying it has seen no meaningful impact from them in its subscriber additions in the last fiscal quarter.