The president of telecom and media firm Québecor is calling on the federal government to intervene in a deal between Loblaw and a company owned by Rogers and Bell that would push his company and others out of 180 Loblaw-owned stores.
In a May 9 letter to Industry Minister François-Philippe Champagne, Pierre Karl Péladeau said Loblaw had decided to “prematurely terminate” Quebecor’s contract for wireless devices and services at telecommunications kiosks in Loblaw grocery stores. told. -It is anti-competitive and against the interests of consumers.
Loblaw’s supermarket kiosks are branded The Mobile Shop and there are 180 of them across the country. The kiosks currently sell cell phone plans from seven providers, including Telus and Québecor’s Freedom Mobile.
“We do not work for any operator, so we will never play favorites,” says The Mobile Shop on the brand’s “about us” page.
Péladeau says in his letter, obtained by CBC News, that The Mobile Shop will soon sell only Glentel products. Glentel is a retailer owned by Bell and Rogers.
Quebecor CEO Pierre-Karl Peladeau speaks to the media following the company’s annual meeting in Montreal on Thursday, May 9, 2024. (Ryan Remiorz/Canadian Press)
“(Loblaw) presents this decision as a simple supply option for its stores, but in our opinion this is an approach aimed at excluding some other mobile operators in order to benefit the Glentel company,” Péladeau says in his letter translated from French. .
“If Glentel gets such a compliment from Loblaw, it’s because it’s a joint venture of giants Bell and Rogers that is once again trying to stifle competition and hold Canadians hostage to consumers’ choices.”
In his letter, Péladeau asks Champagne to intervene “directly and decisively” against Loblaw, Rogers, Bell and Glentel.
In a statement, The Mobile Shop said its business “represents less than five per cent of mobile phone and plan sales in Canada.”
“Based on our limited presence in the mobile market, our decision as to which operator to sell to means absolutely nothing from a competitive perspective,” the statement says. “We are constantly reviewing our offerings and will continue to offer a range of options, including strong national low-cost options and full-service plans.”
In his letter, Péladeau also questions the existence of Glentel, which is jointly owned by Canada’s two largest telecommunications companies, Bell and Rogers.
In 2015, the Canadian Competition Bureau allowed a joint acquisition of the company to occur on the condition that the two telecommunications giants set up an “administrative firewall” to prevent the sharing of competitively sensitive information.
The bureau expressed concern that the acquisition would “significantly reduce competition in the wireless industry.”
In the letter, Péladeau says his company reached out to Loblaw headquarters about the deal with Glentel, “and they insisted they favored commercial interests over consumer interests.”
“It is imperative that measures be taken to maintain fair competition in the telecommunications and grocery industries in the interests of the Canadian people.”
Inspections for grocery stores and telecom companies have been increased
Péladeau’s letter comes as grocers and telecom companies face increasing pressure on prices.
The movement to boycott Loblaw continues after the grocery giant announced revenue of $13.58 billion in the first quarter of 2024.
Loblaw agreed last week to sign up to the government’s grocery code of conduct, but only if rivals also sign on. The rules aim to address long-standing problems such as arbitrary fees, cost increases imposed without notice and late payments.
The nearly empty produce section of Toronto Loblaws on Friday, May 3, 2024. A group of customers called ‘Loblaws is out of control’, with 62,000 members, launched a boycott throughout May to protest the company’s “decision”. high prices. (Chris Young/Canadian Press)
The federal government says it is trying to persuade international grocers to open stores in Canada in an effort to lower prices.
The federal NDP forced debate on a motion calling for an excess profits tax on Tuesday. The party has been demanding such a tax for a long time.
Similarly, the industry minister said earlier this year that Canadians were still paying too much for telecom services after Rogers said it would raise the cost of some wireless plans for non-contract customers.
“Let’s be clear. While there has been some progress in lowering prices, Canadians are still paying too much and seeing too little competition,” Champagne said in January.