Several telecom industry players and observers are still uncertain as to the government's plans and goals in regards to its announced plans to "open Canada's doors further to venture capital and to foreign investment in key sectors, including the satellite and telecommunications industries, giving Canadian firms access to the funds and expertise they need".
The plans were contained in a broad policy statement contained in the Speech from the Throne, delivered to the Parliament March 3.
As specifics from the 2010 federal budget were tabled the next day, however, it seemed that the easing of foriegn ownership rules would apply only to satellites, and the ownership status of private satellites licensed in Canada to deliver media services like satellite TV.
A spokeperson for the Ministry of Finance said following the budget it expects "to provide more clarity" on the topic and timing of anticipated changes to investment rules "in the next few weeks" adding that "the budget is referring to satellite providers - Canadian telecommunications companies offering services using satellites."
Current and existing restrictions on foreign ownership can be found at: http://laws.justice.gc.ca/eng/T-3.4/page-2.html#anchorbo-ga:l_II-gb:s_16
Commenting on the broad statements contained in the Throne Speech, Chris Peirce, Chief Corporate Officer, MTS Allstream, said "Elimination of the foreign investment restrictions is a key ingredient to building a truly competitive digital economy characterized by the early offer and adoption of new technology across the economy. We look forward to learning the details on how the government intends to move forward with this important initiative."
A Bell spokesperson stated that the company is "not opposed to a review of the regulations - increased possibility of investment in our company supports our focus on broadband innovation and investment" but added that "we would like to understand what the government is trying to achieve in its review - details are few, so we look forward to hearing more about the process".
A spokesperson for the Canadian Wireless Telecommunicationss Association (CWTA) told Mediacaster Magazine that "Foreign ownership is not a file that the Association has been working on on behalf of our various members."
Ottawa-based Telesat, one of the top five commercial satellite companies worldwide, said it was pleased to hear about the decision.
"Telesat strongly supports the government's decision to remove the foreign investment restrictions for our industry," Telesat Chief Executive Daniel S. Goldberg said in a release. "Although Telesat has invested billions of dollars in its satellite fleet to date, we need to continue to increase our scale in an industry where size confers key competitive advantages. By removing the investment restrictions, Telesat will be a more effective global competitor and able to invest in new and advanced technologies for the benefit of all Canadians."
Telesat operates 12 satellites, with two more under construction, and manages the operations of 13 additional satellites for third parties. Bsed in Ottawa, Telesat is privately held. Its principal shareholders are Canada's Public Sector Pension Investment Board and Loral Space & Communications Inc.
Loral and PSP Investments acquired 100 percent of the stock of Telesat Canada from BCE for $ 3.25 billion CDN in October 2007.
At the time, Loral and PSP Investments were to hold a 64 percent and 36 percent economic interest, respectively, in the new company. Consistent with Canadian law of the day, Loral's total voting equity will be 33.3 percent, with PSP Investments and other Canadian investors having 66.7 percent.
Telesat reported 787 million Canadian dollars ($748 million at Dec. 31 exchange rates) in revenue for 2009, an 11 percent increase over 2008. More than half the company's revenue came from broadcasting.
Bell TV plans to use all the capacity on the Nimiq 6 satellite, scheduled for launch in 2012.
U.S.-based EchoStar, with satellite TV provider Dish Network, has purchased 100 percent of the capacity of Telesat's Nimiq 5, now in operation, for the entirety of its anticipated 15-year service life.
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