The ugly demise of Bell Canada, June 26, 2007


I worked for Bell Canada for 30 years. The company was a people place, and I was able to move through many different job functions – storeroom, lineman, installation, and for the last 16 years as a cable repairman – a jack-of-all-trades type of function where everyday was different.

During the rush, senior BCE management embarked on a scheme to turn the company into a multi-media, converged entity. To do this they stripped Bell Canada – the telephone company – of people and used revenue formewrly used to upgrade the network, to buy the Globe and Mail and the CTV television network. They failed to support the infrastructure to compete with the cable companies. But the dazzle in their eyes was caused by the almost mythical idea of multi-media empires delivering content to homes throughout North America on phone lines. It was a great idea except they forgot they were still running a phone company and that the infrastructure needed to be upgraded FIRST. It was like putting a $50,000 bathroom in a house with old windows and a leaking roof.

Today, Bell has a patchwork network, with the best service in the major urban centres (high-speed internet and cell coverage), while smaller markets make do with less. De-regulation of the industry is also a factor in this since Bell officials had become pretty cosy with the CRTC and the governing Liberal Party.

Many employees were forced out (especially tragic was the Bell operators) or had their jobs spun off into separate companies. I was one of the lucky ones in 2004, who took a fairly lucrative voluntary retirement package.

Recently, Michael Sabia, CEO of BCE ( Bell Canada Enterprises; the parent company of Bell Aliant), initiated an auction to sell BCE. The stock prices have languished for years and shareholders wanted something done. Bell has been bleeding hundreds of thousands of customers for several years, service has fallen and, as I mentioned, it is patchwork quality, depending on where you live. I’m no expert on corporate deals of course, and from I have read, this auction is a panic action because BCE management is out of ideas on how to regain their customers and provide shareholder value.

Equity firms and pension funds are in the lead to take over the company. Telus – a BCE rival – was in a position to take over the company and thereby create a national telephone entity. At least it would have been another communication entity and the CRTC (Canada’s media regulatory agency – or what’s left of it) could have re-regulated the industry to make sure employees and customers were well served. Telus just dropped out of the bidding, there are many complaints about the bidding process and all reports I have read indicate a disaster in the making. Meanwhile the government ignores the fact another Canadian corporation is headed for trouble and with it, jobs.

In the corporate boardrooms incompetence seems to pay. Jean Monty, former CEO, raked in millions when he left in shame, and I can hardly wait to see Sabia’s nice little package when he turns the lights out.

Read the Globe and Mail article here


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Filed under BCE, Bell Canada, Globe and Mail, industry regulation

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