Canadian Telecom Oligopoly Provides Sustainable Dividend Growth
Entry 7
Chapter 2: National Decision making
The Canadian wireless market is dominated by the Big Three: BCE, Inc. (BCE), Rogers Communications, Inc. (RCI), and Telus (TU) controlling approximately 91% of the wireless market, with various other regional players filling in the rest.
For consumers, Canada is ranked among the 10 most expensive countries for wireless services. The Canadian conservative government has been trying to balance encouragement of competition and having a protectionist viewpoint roadblocking foreign ownership of local companies or downright blocking some from entering the market. Wind Mobile, a relatively new small player, has had a troubled past with foreign ownership and national security concerns regarding deals with Huawei. Earlier in 2013, Verizon Communications (VZ) and AT&T (T) decided not to enter the Canadian market after mulling it for months.
In the upcoming 2014 wireless spectrum auction, all the said roadblocks with added lobbying from the Big Three for good measure, has resulted in no new foreign telecom carriers planning on entering the market. While this may be bad news for the consumers, the status quo results in favorable conditions for the Big Three.
To read mre go to: http://seekingalpha.com/article/1936701-canadian-telecom-oligopoly-provides-sustainable-dividend-growth
13