Good day, and thank you. I'm Matt Stein and I'm appearing today as chair of the Competitive Network Operators of Canada, or CNOC. I'm joined by Geoff White, our director of legal and regulatory affairs. Geoff also teaches communications law at the University of Ottawa.
Unlike many of my co-panellists, I'm not an academic. I'm a business person. I'm the CEO of Distributel, one of the largest independent ISPs in the country. In other words, if you have questions about the state of telecom competition, I live it every day. CNOC is the industry association for the competitive side of the industry, the side of the industry that acts as a check on the market power of the large telephone and cable companies. Our more than 30 members use wholesale access to the large companies' wires to compete against them on price, innovation and customer service. It's called service-based competition, which is different from facilities-based competition. The difference is who owns the infrastructure. The infrastructure owners own the wires or the spectrum, and we lease part of it from them. That's all.
The Rogers-Shaw deal does not benefit Canadians. If it proceeds it will benefit only those two companies and Bell and Telus, unless our government and its regulators get on the same page about the need for service-based competition.
Simply put, there are only two ways this merger can go ahead. Freedom Mobile, originally Wind, was the competitive instigator in most of Canada's largest wireless markets. Eliminating that instigator is unacceptable. Without an adequate mandated MVNO regime that allows competition to flourish, Freedom Mobile, its customers, its network and, importantly, its spectrum must be divested to a party that is committed to service-based competition in all of its forms. Failing that, and only if we have an adequate, mandated MVNO regime that enables service-based competition to take hold in the wireless space, the Freedom brand and its customers would need to be divested, but still to a party committed to service-based competition.
Canadians need service-based competition. On the Internet side, with access to the big companies' wires, we offer innovation, better prices and better customer service. However, the incumbents have been trying to beat us down for years through lawyering and lobbying, because we threaten their world-leading returns.
Frankly, they're winning that fight, because small competitors, despite our innovations, lower prices and customer service, are a threat to those returns. We don't get a free ride, nor have we ever asked for one. We pay for what we use at the rates the CRTC designs to compensate the infrastructure owners for the use, plus a markup.
With the discussion of the business case challenges of building fibre and wireless networks, there's never going to be a business case for a new competitor to step in and build yet another wireless network.
I'll conclude. How do you preserve competition? The same way we did it for nearly 30 years, through service-based competition, just like in long distance, home phone and, as it was working, Internet.
Let me ask you this final question. If Canadians want more choice, better price and better customer service, have these large companies earned the benefit of the doubt?
Thank you.