Tuesday, December 11, 2007
Is this the beginning of the end of utelcos?
Various media outlets (Ottawa Business Journal, Ottawa Citizen) are reporting that Ottawa's electric utility is selling Telecom Ottawa, its broadband network and wireless Internet business.
The sale of Telecom Ottawa is said to help Hydro Ottawa refocus its business on generating and distributing power, especially in the wake of disappointing financial returns to the city.
Who will be the most likely bidders?
Is the focus on core business going to be something to watch in other jurisdictions?
To what extent should utelcos address telecom services differently in major centres versus markets with fewer competitive alternatives? How should municipalities exercise political strategies through ownership of infrastructure?
Technorati Tags:
Telecom Ottawa, broadband, policy, utelco
The sale of Telecom Ottawa is said to help Hydro Ottawa refocus its business on generating and distributing power, especially in the wake of disappointing financial returns to the city.
Who will be the most likely bidders?
Is the focus on core business going to be something to watch in other jurisdictions?
To what extent should utelcos address telecom services differently in major centres versus markets with fewer competitive alternatives? How should municipalities exercise political strategies through ownership of infrastructure?
Technorati Tags:
Telecom Ottawa, broadband, policy, utelco
Posted by Mark Goldberg @ 12/11/2007 07:48:00 AM 
Comments:
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This is not the end of utelcos.
Simply put, the city of Ottawa wants money back from its under-performing utility Hydro Ottawa. The city has decided the best way to do this is by selling the fibre business.
Likely bidders are Bell (who would block Telus from gaining the asset), Telus who have a fairly skinny network beyond Ottawa's downtown, and Hydro One Telecom might want it too.
Realize this: whoever buys Telecom Ottawa is beholden to cooperate with Hydro Ottawa forever as the fibre network runs on Hydro Ottawa right of ways which include poles and duct structure. This should result in a discount in addtion to the $32 million of debt that Telecom Ottawa owes.
In fact Hydro Ottawa might find it difficult to unload this beast without a significant discount.
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Simply put, the city of Ottawa wants money back from its under-performing utility Hydro Ottawa. The city has decided the best way to do this is by selling the fibre business.
Likely bidders are Bell (who would block Telus from gaining the asset), Telus who have a fairly skinny network beyond Ottawa's downtown, and Hydro One Telecom might want it too.
Realize this: whoever buys Telecom Ottawa is beholden to cooperate with Hydro Ottawa forever as the fibre network runs on Hydro Ottawa right of ways which include poles and duct structure. This should result in a discount in addtion to the $32 million of debt that Telecom Ottawa owes.
In fact Hydro Ottawa might find it difficult to unload this beast without a significant discount.
Posted by 
Beaverbrook : 12:39 PM, December 11, 2007
Beaverbrook : 12:39 PM, December 11, 2007 << Home
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