Business

Mobilicity backers make bid to remain operating as mobile virtual network

Amid reports that both Rogers Communications and Telus are making offers to Industry Canada for Mobilicity, some of its employees and founder John Bitove are making a new suggestion that could save jobs and leave it as a working wireless carrier.

Industry Canada mulling bids for struggling small carrier from Big 3 players

Amid reports that both Rogers Communications and Telus are making offers to Industry Canada for Mobilicity, some of its employees and founder John Bitove are making a new suggestion that could save jobs and leave it as a working wireless carrier.

In a news release Monday, Bitove and a group of Mobilicity employees said they had made an offer to Industry Canada to become a mobile virtual network operator (MVNO). The company itself is not involved in the bid.

The group said it is not blocking the sale or acquisition of Mobilicity spectrum, but would like to continue operating as a mobile virtual network piggybacking on the airwaves of whichever party acquires its network.

Operators such as Google Fi, Ring Plus and Ting in the U.S. operate as MVNOs and some analysts believe the conditions to create Canadian MVNOs may have been created by the federal broadcast regulator's new rules on the resale of roaming rights.

An MVNO enters into an agreement with a wireless carrier to obtain bulk access to network services at wholesale rates, then sets its retail prices independently.

That could mean more competitive pricing if it is able to get good prices from a parent wireless company.

If Mobilicity becomes an MVNO, it also could retain its 155,000 subscribers in Toronto, Vancouver, Edmonton, Calgary and Ottawa and maintain about 130 jobs in its call and service centres.

Capital funding for the transaction would be provided by Bitove's holding company Obelysk Inc.

Mobilicity has been in bankruptcy protection since September 2013 but the federal government has twice turned down offers by Telus to buy its network.

The Globe is reporting that Rogers and Telus are again bidding for the small wireless carrier.

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