Bitove on Mobilicity’s failure: Government ‘just took the cheque and ran’

After purchasing struggling wireless carrier Mobilicity last year for $465 million CAD, Rogers is now planning to shut the brand down and shift its 150,000 wireless subscribers to Chatr mobile, returning to a three-pronged wireless strategy.

Mobilicity was started by famed Canadian entrepreneur John Bitove, who is also responsible for bringing Sirius XM and the Toronto Raptors to Canada. When Mobilicity and competing upstart carriers, including Wind Mobile and Public Mobile, acquired mobile phone spectrum during a 2008 auction, the government promised “assurances” to help increase competition and build a fourth national wireless carrier in Canada

“There’s a lot more the government could have done to sustain all the new operators,” said John Bitove during an interview with BNN.

“At the end of the day (the federal government) just took the check and ran… This was about raising proceeds of auctions and getting Bell, Telus, and Rogers to pay the most. It wasn’t about long-term competition.”

Bitove and Quadrangle, one of Mobilicity’s early backers, launched a $1.2 billion CAD lawsuit against Industry Canada for not following through on its commitment.

In 2010, when Rogers was on the cusp of unveiling its Chatr brand, Bitove stated the carrier was “launching a phone service basically trying to duplicate to ours… only in the markets we’re launching in.”

Mobilicity invested $243.1-million CAD in the 2008 spectrum auction and captured 10 licenses in Toronto, Vancouver, Calgary, Edmonton, and Ottawa.

Related reading: Rogers to shutter Mobilicity, will shift stores and customers to Chatr mobile