(OTTAWA) A lawyer for Shaw Communications argued Wednesday that the Competition Bureau’s case against the company’s proposed merger with Rogers Communications was based on false assumptions, not reality.
Kent Thomson said in his closing argument at the Competition Tribunal hearing on Wednesday that the assumptions and evidence about the market share of Shaw’s mobile business put forward by the regulator and the prospects for future profitability of company did not pass the test of the facts.
“It is up to this court to take a step back and take stock of the reality,” he said.
He focused on the findings of Nathan Miller, a Georgetown University professor who wrote a report opposing the deal, which the Competition Bureau lawyer cited in his closing arguments.
Mr. Thomson pointed out that Mr. Miller significantly inflated the market share of Shaw’s mobile division in his report, which helped form the basis of his opposition.
“He’s just an economist playing with numbers […] Without this result, the Dr Miller would have been unable to discuss any anti-competitive effects associated with this transaction,” Mr. Thomson said.
Rather than paint a picture of a successful business, Mr. Thomson portrayed Shaw’s business as being squeezed by demands to expand its wireline and internet businesses, as well as those of its mobile division. He said Shaw had already spent heavily trying to compete with Telus on their wireline business, while its investments in the mobile business did not look promising.
“They were never close to recouping their investment and had no realistic prospect of doing so,” he said, noting that the evidence cited by the Bureau about the initial difficulties experienced by Rogers itself did not represent a fair comparison, since the market has matured considerably since 1987.
“There is no way ahead of Freedom. It is a mature industry. »
He said Shaw’s owners and executives had no choice but to sell its business, with the mobile division ultimately being offered to Quebecor’s Videotron to assuage competition concerns, and the rest to Rogers.
Videotron will not be burdened with the necessary investments in wireline, while Rogers has the money to make these expenses, he estimated.
On Tuesday, John Tyhurst, the lawyer for the Competition Bureau, argued that the agreement would create an unprecedented relationship of dependency between Rogers and Videotron, a regional player.
The absorption of Shaw’s “competitive” offerings by Rogers will also hurt the telecommunications industry, which will see the number of separate networks in Western Canada drop from three to two, he said.
The Competition Tribunal hearing, which has been ongoing for more than a month, is due to end on Wednesday.