Telus has said that they will take all of Mobilicity's customers and employees. Current plans will be grandfathered.

the *hope* is that Telus will be able to grant mobilicity users with better coverage while still paying $25 for an unlimited everything plan. that would be wicked.

There's a clause written specifically in the agreement at the time when the new entrants arrived that NO INCUMBENTS can acquire them BEFORE FEBRURARY 2014.

Just because Mobilicity is losing money and on the verge of declaring bankruptcy, that doesn't make it right for an oligopoly to come in and acquire it. There's a reason that the government opened up its industry in 2008 and why the Competition Bureau (of Canada) EXIST.

I am NOT suggesting that Mobilicity shouldn't be merged or acquired, but NOT to the fucking INCUMBENTS.

If you think all this is just a conspiracy between Telus and Industry Canada, Look no further than the AT&T vs T-Mobile merger fiasco in the States. The FCC is just as "corrupt" as Industry Canada.

https://en.wikipedia.org/wiki/Attemp..._USA_by_AT%26T

so if this goes thru is anyone going to grab a mobi plan in hopes it gets grandfathered?

Whenever government intervenes in the market, or whatever, people complain. And then when the government lets the market do its thing, people complain. Why should wireless communications be treated differently than other markets? Just so you can access YouTube while on the go? Should my tax dollars be used to bail out a wireless company? (because essentially, that is what would need to happen to Mobilicity if you don't allow one of the existing companies to acquire them.)

And honestly, quit thinking that Industry Canada is in some conspiracy with Telus and Rogers. Give me a break.

Oh, government should get the heck out of way and let us do we want.

...But wait, I want the government to save me and my cheap wireless communications company that is losing money because I'm entitled to cheap wireless service!

We got the internal telus memo at work about the acquisition once finalized and they definitely wouldn't send that around unless it was going down.

Bingo.

Wireless telecommunications is not a human right. People need to drop that mentality of self entitlement.

I honestly wished that mobile phone services cost double, if not, triple what we already pay. It would weed out those who actually need it and those who don't.

Off topic but I think the same thing about University. People think that getting a degree is a right. People say education should be free. It's pretty fucking close. Considering you can go to a library and learn anything you want, as long as you want, and almost when you want.

I also see flights and airlines in the same light. Don't want to pay high costs to fly across Canada? Fucking drive.

On Topic: I'm interested to see how other smaller carriers are doing in the Canadian market? Most of my family sticks with the 'big 3' because they feel more secure with an established presence.

ok lets go with your idea and let a non big 3 tele company acquire them, what happens then? they will still need to piggyback telus/rogers/bell, they will continue to lose money, and you think the govt doesnt know that? its a non-profitable company by itself

you really gotta stop thinking about yourself (consumer) and think about how the industry works, we're in canada, go read up canada's population/km and the big asian cities, and then you'll see why its much more expensive for tele companies to operate here, esp if you dont have the network towers set up already like the big 3 do

Firstly, interesting and interesting post OP.

Just thinking because I am very interested in business events:

1-
Wow. $380 million for 250,000 subscribers.

This is a substantial price to pay.

That is $1,520 per subscriber.

2-
This means that, at the forefront, the acquisition cost per customer, according to Telus is $1,520.

I had a hunch, from reading past articles a LONG time ago, that customer acquisition costs for mobile networks are around $300 to $400.

And, a quick search shows that that is true (bottom of the new page):
https://wirelessintelligence.com/ana...r-margins/275/

So, why would Telus pay such a high price for the small operator?

3-
When I first read this article, I thought Mobilicity was a virtual network operator, without any of the infrastructure (ex. cell phone towers, etc.) of the large network operators. But, I since found out that Mobilicity is NOT a virtual operator. It in fact owns and operates its own infrastructure, hence that is why it is bleeding money ( negative $30 million for quarter ended December 31, 2012), because it has to upgrade current infrastructure, pay high-cost engineers, upgrade software, etc.

Mobilicity reportedly can't find a buyer | MobileSyrup.com

4-
So, I think that Telus is buying Mobilicity because of the infrastructure it owns. I am unsure how much Mobilicity spent on infrastructure build-outs but it would seem Telus think it is at least $380 million worth of infrastructure.

5-
Also, Telus and Bell are neck-and-neck in the #2 and #3 spot in subscriber base.
TELUS to acquire Mobilicity and its 250,000 subs for $380 million | MobileSyrup.com
Perhaps, Telus wants to solidify its # 2 spot AND acquire some expensive infrastructure on the cheap.

6-
And, as another poster mentioned, there is the dangling hook of spectrum Mobilicity owns (because Mobilicity is NOT a virtual operator, thus it needs to buy spectrum previously) which is very expensive. As the years go by, spectrum becomes increasingly expensive.

This hunch, after a quick search, sounds intriguing:
http://en.wikipedia.org/wiki/MobilicityQuoting wiki: "DAVE [holding company of Mobilicity] spent $243 million on 10 MHz of AWS spectrum" and that was in 2008.

7-
Why would Telus buy now when Mobilicity is most likely going to go bankrupt anyway?

I think that Telus wants to acquire now, so that other competitors don't scoop up the assets (infrastructure, employees, customer base, spectrum) in bankruptcy proceedings, in a bidding war. The spectrum cost will be very appealing, especially in bankruptcy court.

The number crunchers felt it the return-on-assets and ROI and future net value was worth it

THIS will never happen.. they will keep mobi's customer on the same shitty and do nothing to the network until they all leave... Telus will still be honoring the unlimited plan and everything.. they just dont upgrade the network or even cripple it even more..

Otherwise all exisiting telus customer will migrate to Mobi instead for cheaper and so-so coverage... telus will never let this happen


Telus doesnt want Mobi for its customer base primarily... its for the AWS Spectrum first and foremost.. Mobi's infrastructure would the last thing telus wants from mobi...

IF telus/bell wants to compete with rogers, THEY need all the spectrum they can get.. Once the shaw-rogers goes through.. belus is in worse shape, spectrum wise as rogers already HAS more then both combined together...

Government of Canada treats the wireless industry like an essential service where it's heavily governed. Let go of that grip and allow the wireless industry to run like a free market. I guarantee you that the Big 3 will NOT have us by the balls and we will not be paying as much as we do now.

What conspiracy? It wasn't me that suggested that there's a conspiracy. dachinese dude mentioned it. I was trying to prove a point that he's talking shit out of his ass.

I want the government to relax its grip and allow a more even playing field. That's all. Let the market dictate itself. Most of the funding issues would've been resolved if they allowed foreign investment back in 2008, and not let it drag out until 2012. A little too late now.

When I read the highlighted statement, I know that you have completely no clue about what you're saying.

How is Mobilicity piggybacking off the big 3?
How will you know that the new merger/investor will allow the company to lose money in the long-run (particularly when you have absolutely NO CLUE who the new acquirer/merger is)?

Wireless telecommunication companies, on average, don't expect a ROI for AT LEAST 8 years.

All your words are based on speculation. None of it is factual.

Mobilicity has no real assets aside from it's 250,000 subscribers and AWS spectrum. They have no "infrastructure." They're a marketing and sales company.

Ericsson was hired to build and run their network. Go pay them a visit on Still Creek. Their sites are co-located along with the Big 3 if and when necessary. These are facts. They're publicly available on Industry Canada's website. Look at what happened to Fido/Microcell. And the investment money of $23 million dollars that "disappeared?" History will repeat itself.

Look, I'm not against Mobilicity being bought-out. Many, including myself, saw Mobilicity as being the odd-man out from the get-go. My only problem with this transaction is that it's one of the big 3 buying it. Hell, I'd be fine if China Telecom came in and scooped it up. That's all I'm saying and will leave it at that.

The reality of it is that the returns for any investor in the wireless business is a dangerous gamble, one that will likely end up in shambles.

If we take the theoretical 8 years for any provider to see gains, given the economic situation and outlook, that's a lot of time to see any kind of return. This isn't the heyday of telecom anymore. That was back in the 70s, 80s, and 90s. If you look at the financials and stock prices of any telecom provider, gains are minimal and only for a long term basis. 8 years to see gains is a hell of a long ass time.

Mobility was a business plan with the end result to be bought out.

What? Weed out those who actually need it? Its a phone service everyone needs a phone, it's a key part of this thing called communication. Also, compared other parts of the world it is completely overpriced. I'm not asking for a hand me out, I'm asking for a reasonable price.

People need a phone. You don't need mobile data. Guess where all of the infrastructure is invested? To meet people's need for mobile data so that they can watch YouTube, etc. on the go.

So even if we were to open our market to foreign competition, who is ready to make significant investments to serve our market? AT&T? T-Mobile? Sprint? Some company in Europe? Such companies would bleed money for years while they build towers and the infrastructure to serve a potential market of maybe 15 million city dwellers. (It makes no sense to go after the rural population.)

If you were a CEO of a major telelcommunications company, would you make that decision? Canadians are generally cheap (myself included) and aren't willing to pay much for wireless services.

wouldn't that be messed up for existing telus users who have similar plans but are paying double or more for a similar mobilicity plan? i wonder if they'll implement a catch to force users out of these plans if they do get grandfathered.

what would be the timeline before us mobilicity users have to bow down to our new telus overlords?

^look behind you :troll:

You can call and ask :troll:

In all seriousness, it would be at least a minimum of 6 months to a year before they start migrating their users. Just keep in mind, Mobilicity uses an Ericsson network and Bellus a Huawei network. They would need to work out the business side of things with Ericsson first and go from there. There's a lot of paperwork and money involved that needs to be settled before they can announce how/when this will affect the existing userbase.

You can sleep a little easier now and wait until a new and different overlord is going to bend you over with no lube.

Ottawa blocks Telus takeover of Mobilicity - Business - CBC News

I am not necessarily for or against the Telus buyout, but now that the purchase is blocked, it makes me wonder if Mobilicity will survive.

Perhaps when the bankruptcy protection papers are filed, Ottawa will change its mind.