Analyst Note| Matthew Dolgin, CFA |
The Canadian Radio-television and Telecommunications Commission, or CRTC, announced its long-awaited decision on mandated mobile virtual network operator, or MVNO, pricing on April 15, and it was in line with the preliminary view the commission put forth in 2019 when it took up the issue. The big 3 Canadian wireless providers, along with Sasktel, will be required to wholesale network capacity to new competitors for seven years. Given the CRTC’s prior statement, we expected this outcome and are not changing our view or fair value estimates for Rogers, BCE, or Telus. As part of the CRTC’s decision, it is also requiring the big 3 plus Sasktel to offer low-cost plans to certain groups. This component is the more likely one to influence our forecasts, but with few details and our existing assumption that Canadian wireless pricing will remain under pressure, we don’t expect a material impact from this provision either.