OTTAWA – Bell Aliant has agreed to lease part of Ontera’s network to Eastlink in response to concerns by the Competition Bureau over the proposed sale of Ontera to Bell Aliant.
Following a recent investigation into the potential deal, the Bureau determined that the transaction would “likely substantially lessen and/or prevent competition in the sale of wireline telecommunications services in up to 16 Northern Ontario communities by providing Bell Aliant with the ability and incentive to exclude its competitors from access to high-bandwidth telecommunications transport services or raise the cost of those services”.
In light of the Bureau’s concerns, Bell Aliant will lease telecommunications strands of fibre to Eastlink under a 20-year Indefeasible Right of Use (IRU) on the entirety of Ontera’s fibre-optic telecommunications ring south of Kapuskasing, ON. According to the Bureau, the lease of those strands of fibre preserves the ability of Eastlink or other providers to compete effectively with Bell Aliant for the provision of wireline telecommunications services in Northern Ontario.
"This matter is another example of the Bureau’s ongoing vigilance when it comes to competition in Canada’s telecommunications sector”, said Commissioner of Competition John Pecman, in a statement. “It also demonstrates our commitment to the principled enforcement of any transaction, regardless of its size. I commend the parties for working effectively to resolve the Bureau’s concerns in this matter."
Ontera, a wholly-owned subsidiary of the Ontario Northland Transportation Commission, owns and operates a high-capacity fibre-optic telecommunications line (or ring) that provides voice, video and data connectivity to Southern Ontario for telecommunications companies operating in Northern Ontario.
Bell Aliant is the incumbent telecommunications provider in Atlantic Canada and much of rural Quebec and Ontario, including the vast majority of Northern Ontario. In Northern Ontario, it currently offers telephone and internet services and, in a number of localities, television services under the NorthernTel and Bell brands. It submitted a purchase proposal last April worth $6 million for Ontera.
