MONTREAL — Bell Canada’s (TSX:BCE) independent retail outlets are suing Canada’s largest telecommunications company for $200 million in an interfamily squabble over reduced commissions.
The Independent Communications Dealer Association of Canada, claiming to represent four-fifths of Bell’s independently operated stores, said Tuesday it has begun litigation in Ontario and Quebec, alleging Bell has broken its contract in several ways.
The association, saying it represents 172 store locations under the Bell, Bell World, Bell Mobility, Espace Bell and Bell Mobilite banners, cites “a downward spiral in our relationship that has escalated under Bell’s current management over the last three years.”
Association president Doris Ronca, who owns two Bell World stores in Montreal, said the group has been trying to negotiate with Bell in good faith to resolve the various problems it faces.
“Unfortunately we’ve reached a dead end and have no other choice but to go to the courts,” she said in an interview.
The dealers have knocked heads with Bell before, and purused a $135 million lawsuit in 2006 against the phone giant over a failed move by the dealers to turn their network into an income trust.
They had hoped to combine their stores in one business and float it on the stock market, but the phone company vetoed the plan.
During much of 2005, income trusts were a hot Bay Street strategy that generated tax advantages for companies that turned themselves into trusts. In late 2006, the Conservative government imposed a tax on new trusts beginning in 2011 that curbed the sector.
At the time, Bell said it would vigorously defend itself in the lawsuit.
Ronca accused Bell of years of mismanagement that has resulted in losing customer and investor brand loyalty and falling from first to third place in the wireless marketplace.
Bell is now punishing its own exclusive dealer channel by not honouring agreements and systematically destroying the competitiveness, reputations and the value of businesses that have been built over 20 years, said Ronca.
“This didn’t just start yesterday. It’s been a problem for several years now.”
The litigation claims Bell has ignored a commitment in March to leave dealers’ fees and commissions untouched until mid-2009.
It alleges that Bell has eliminated until December the payment of commissions for customers that replace handsets and renew contracts. These commissions account for up to 70 per cent of an outlet’s revenues.
It also says commissions for new product sales have been cut by between 10 per cent and 20 per cent.
The impact will be the layoff of more than 300 employees at stores in Quebec and Ontario as they lose $17.5 million in commissions until December, Ronca said.
The association says Bell is providing more lucrative incentives to non-exclusive retailers such as Wireless Wave, Best Buy and Future Shop.
And it says Bell’s direct marketing is undercutting the dealer chain.
The lawsuits claim over $200 million in damages, demand that Bell honour its current agreements, and seek the right to sell products from competitors like Telus, Rogers and new entrants in the mobile-phone business.
Bell Canada couldn’t be immediately reached for comment, but is expected to respond to the lawsuit later Tuesday.
The company’s parent BCE Inc. (TSX:BCE) is in the final stages of completing its $52 billion takeover by an investment group led by the Ontario Teachers Pension Plan Board and its U.S. partners.
Bell Canada Inc.’s independent retailers are suing the company for years of “abusive, arbitrary” business practices that include changing their contracted commissions. The Independent Communications Dealer Association of Canada, which represents 172, or 80 per cent, of Bell’s independent stores, announced on Tuesday it had filed suit against the company for three years of “not honouring agreements and systematically destroying our competitiveness, reputations and the value of our businesses that we have built, some of us for over 20 years,” the group said in a statement. The retailers seek more than $200 million in damages against the company as well as a reversal of all competitive measures listed in its suit, and a commitment to honour its current contract. “Once we sign a contract, we expect that contract to be honoured, but instead, year over year, they make changes to it without our agreement,” said CDAC vice-president Rick Umbrio. “All we’re asking is for Bell to honour their commitments and agreements. We want to be able to negotiate with Bell, put something in writing and they honour it, not change it on the fly.” The final straw in the “downward spiral” of their relationship, Umbrio said, came recently when Bell decided to cut commissions dealers earn on upgrading customers to new phones. The retailers had signed a contract with Bell in March that would leave their commissions untouched until June, 2009. http://www.cbc.ca/consumer/story/2008/10/21/tech-bell.html
and I already have even been saying how bad Bell is now in regard to keeping contractual agreements even for a whole year now too on the net too.
This made one analyst wonder why they will invest in the overlay at all? This is just a basic cover up, smokescreen for the real fact that Bell’s own telephone line, DSL services are in terrible shape, cannot handle most peak loads.. it is an undeniably a poor, bad dinosaur system, and is why so many past and present Bell customers have been unhappy and why Bell has been capping their system, modifying users profiles too
Just read all of my posts about bad bad bell..
Obama on Medicare, bce-sympatico, maximum penalty cancel contract, How to Bypass Sympatico Bandwidth Throttle/Cap, liberal vs conservative views, free Christian graphics, what was Stephen Harper job before he became prime minister, independent churches, Calgary, Alberta, Canada, focus on the family, Sarah Palin, rage, Divorce, Lawyers , Stephen Harper’s religion, Stephen Harper a Christian?
And I used to think that Politicians were big liars.. till I had encountered BCE, Bell Sympatico .. by the way Cops, RCMP, Lawyers, realtors, Pastors, judges and their regulating societies too are some of the most immoral, biggest liars now that I have encountered in my lifetime!
While I clearly do write on a wide range of topics including now politics, religion, family, still many readers have their own interests and these are the most popular words that they had lately used to access my wordpress sites-
Todd Bentley, Bell Sympatico problems, throttling, Pentecostal, Christian Missionary Alliance court, Assemblies of God Pentecostals, Bible versed wallpapers, Free Christian Books, Toronto airport church critiques, Messianic Judaism, Conservative in and out scheme location : Canada, Shit disease – C. diff , Silent treatment, Verbal abuses, Alcoholic home, Changing yourself, Fret not, Control freaks, Riches people in Calgary,
>>There is only one ‘expert’ on church planting and that’s the Lord, and Zech. 4:6 warns us that it is not by might or power (and not by man’s wisdom- 1 Cor. chaps. 1-2). God told us to start a church in August of 2003 with no funds, no supporting churches, etc.- i.e., nothing other than God’s leading. A missionary and experienced administrator talked with us, and told us we were violating ‘every rule in the book’ and that we were headed to be another one of the failed plants in our area (of which there have been many). We obeyed, and God blessed, and here we are as Calvary Chapel Space Coast ready to send our first full time missionary, and start another church campus. All by God’s grace, and all for His glory!
I ran a home church for about 2 dozen poor persons for years, and I fed them every week freely too, and I never asked ANYONE FOR MONEY, never took one offering too, God supplied all I needed too.
( Ironically many of his present supporters beg for money, sell his Books also to make money, instead of praying.) http://chi.gospelcom.net/kids/glimpsesforkids/gfk008_2.php
I have sent many letters to the useless Minister of Industry, Consumer affairs, Jim Prentice MP CorrespondenceMinister@ic.gc.ca and when I next phoned them in Ottawa and I HAD RECENTLY asked about a decent reply to my many letters, they said they do not know where they are, and for me to mail them again TO THEM.. RATHER ask them to read them on the net too then for they are there as well!! Let them RE read this too..
This is not even a new issue but an old one. I firstly could not help but notice that a very significant AMOUNT OF YOUNG PEOPLE USE THE iPHONES AND COMPUTERS STILL, and that as a direct result we now have whole generation of users who clearly do strongly hate the federal government as well as the big corporations for allowing them to be abused again and again. A really Smart move?? for the Conservatives and big Corporations getting young customers too mad at them now even for life. Certainly not a good, or a great marketing practice for the Conservatives, the Corporations, even for Industry Minister Jim Prentice MP. The whole fiasco, poor past responses, inactions now still being poorly thought out ironically applies now even to to the Conservatives and the Industry Minister himself now as well.. It all clearly falls in the same category as the Conservative Stockwell Day MP and his past skidoo antics.
“Finally Industry Minister Jim Prentice is calling on the chief executive officers of Bell and Telus to meet with him and explain their decision to charge consumers for incoming text messages. Jim Prentice has sent letters to the heads of the two companies, has said the decision to charge consumers without text bundling packages will hurt consumers. The companies must meet with him before Aug. 8. “While I have no desire to interfere with the day-to-day business decisions of two private companies, I do have a duty as minister of industry to protect the interests of the consuming public when necessary,” Prentice said in a statement. “I believe this was a poorly thought out decision.” Under the Corporations new plans, customers will be charged 15 cents for each incoming text message, including uninvited spam messages. Previously, customers without text plans were only charged for outgoing messages. Customers with a text messaging rate plan or bundle will not be affected by the new charges.”
Cellphone users to be charged for incoming text messages
CBC.ca – Cellphone users with Bell and Telus are going to have to fork over a little more to receive incoming text messages, under new pricing plans slated to roll out in August.
Get ready to pay for incoming text messages Canada.com
Uproar over new Canadian texting fees United Press International
Mobile Magazine – Soonews.ca – QuicklyBored – The Province
all 40 news articles » En Français »
There is a public outrage on the part of Canadian consumers following the release of the local pricing plans. Apple the iPhone maker has watched nearly 50,000 of its loyal customers sign an anti-Rogers petition at ruinediphone.com, which has in turn sparked hundreds of potentially damaging reports on the matter by bloggers and members of the mainstream media.
The petition has attracted attention in Canada and abroad, but it won’t have any effect on Rogers unless consumers follow through with the old-fashioned but simple and reliable strategy for pulling down prices.
If you don’t like the price of an iPhone, don’t buy it. If Rogers finds it has priced itself out of the market, it won’t take a petition to ring in lower prices.
All that is just the beginning of the Customer reactions, war I had written about months ago too.
Prentice calls Bell, Telus to task for decision to charge clients without bundle The Canadian Press – Wed Jul 9, 4:05 PM
OTTAWA – Industry Minister Jim Prentice is taking Bell Mobility and Telus Mobility to task for their plans to charge some of their customers for each incoming text message and called both company CEOs to Ottawa to explain their “ill-thought out” decision.
and what about big bad Bell sympatico
Globe and Mail – 3 hours ago
Toronto — Re Google Raises Fuss Over Bell’s Speed Bumps (Report on Business, July 9): Bell Canada and other telecommunications companies have been slowing, shaping and restricting Internet traffic for some time.
Google slams “throttling” of internet traffic in Canada Digital Home
Google condemns Bell’s ‘throttling’ practice Toronto Star
Canada.com – Ars Technica – CBC.ca – BetaNews
all 51 news articles »