MTS sale to Bell has some Manitobans worried about price hikes

The multibillion-dollar out-of-province acquisition of Manitoba Telecom Services announced Monday already has some internet, television and cellphone customers questioning whether a rate hike is on the way in Manitoba.

Montreal-based BCE agrees to buy Manitoba Telecom Services for $3.9B

CBC News Posted: May 02, 2016 10:16 AM EDT | Last Updated: May 3, 2016

Customers worry prices could rise with MTS sale

8 years ago

2:06

BCE Inc. has a friendly deal to buy Manitoba Telecom Services Inc. that they say is valued at $3.9 billion. Some local consumers are worried. CBC's Nelly Gonzalez reports.

The multibillion-dollarout-of-province acquisition of Manitoba Telecom Servicesannounced Monday already has some internet, television and cellphone customers questioning whether a rate hike is on the way for Manitoba.

Manitoba and Saskatchewan have long been touted for their competitively priced service plans compared to other provinces. The low prices havebeen attributed to strong regional competitors,withMTS, Bell and Rogers' fight to offer the most affordable services to customers driving prices down.

SomeManitobansare concerned pricescould rise in line with national rates now thatMontreal-basedBell Canada Enterpriseshas agreed to buy MTS for $3.9 billion.

According to Bell Canadapresident and CEO George Cope, theManitoba market stands to benefit from the deal.

In aseparate transaction,BCE has agreed to sell about one-third ofMTS'spost-paid subscriber base and retail outlets toTelustokeep competition at a healthy level.

"[In terms of] pricing in the market place, clearly Telus'sposition in the wireless industry is significantly enhanced by this transaction, as is Bell," Cope told reporters in ateleconference Monday morning.

"You would expect, I think, the market to continue to be as competitive as it [has been], and if not maybe even more as a result."

George Cope, president and CEO of BCE, says his company's acquisition of MTS will "bring scale to the province of Manitoba." (Canadian Press/Paul Chiasson)

Cope said he thinks the deal will take nine to 12 months to get through the regulatory process before it's complete. Agencies thatmust approve the deal include the Competition Bureau.

Jay Forbes, president and CEO of MTS,said he doesn't anticipate any big changes to market forces in Manitoba as a consequence of the deal.

"We've had a very competitive marketplace here in Manitoba, and I don't see that changing," he said.

Deal developed 'very quickly'

Forbes said while rumours have been swirling for some time about the purchase of his company,sale talks with Bell came up "very quickly" two weeks ago.

Prices are bound to increase to levels more commonly found in the rest of the country.- MichaelGeist

Consumers are likely to enjoy better-quality services once the deal is done, he said.

"What I do see changing is that level of technology that our customers are going to have access to," he said. "By virtue of being part of that larger Bell organization, they will enjoy access to better technologies, better internet access, better data."

Forbes added MTS has a devoted customer base that Bell will work to keep satisfied.

"I think they will be taking a long, hard look at what we have done well and looking to preserve as much of that as they can," Forbes said.

Prices 'bound to increase,' lawyer says

Now that Bell and Telushave divied up MTS between themselves, competition could be reduced further still, according to one expert.

"With MTS out of the way and Bell and Telus sharing the same wireless network prices are bound to increase to levels more commonly found in the rest of the country," lawyer Michael Geist wrote inhis blog.

As for whether specific rate changes are on the way, aspokesperson with Bell said "it's early to talk about pricing."

"We'll bring better broadband services to Manitobans, like Gigabit Fibe Internet, Fibe TV and mobile LTE Advanced, and we look forward to competinghead on with the other communications service providers in the province," the spokesperson said.

"We have a five-year, $1-billioninvestment planthat will bring new broadband coverage and services to Manitobans in cities, towns and rural locations alike."

The move will see 2,700 workers move from MTS to Bell's phone business. Bell's western workforce, headquartered in Winnipeg,will almost double in size to 6,900 employees.

Worry about price hikes

People on social media speculated about what the deal would mean for phone bills in Manitoba:

Ready for your cell bill jump by $$$ instantly with MTS @Bell sale? Just checked: mine hikes >$40/mo for same plan! https://t.co/epMSQWiCVo
—@gtheule

With files from CBC's Meaghan Ketcheson

With files from The Canadian Press

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