Departing SaskTel CEO makes case for Crown corporation
Styles credits government ownership for firm’s success, low consumer prices
When Ron Styles became chief executive of SaskTel seven years ago, the Crown corporation didn’t offer the latest mobile networks, fibre optic connections or information technology capabilities.
Now, as Styles prepared to retire on Canada Day after 38 years in Saskatchewan’s public service, the telecommunications company boasts fibre optics to more than 200,000 homes, 4G and LTE networks and a state-of-the-art data centre after investing $2 billion in infrastructure.
“Fifty per cent of our revenue today is from new products and services we’ve built through the time I was there,” Styles said in an interview. “We’re an Internet company where previously we were a telephone company.”
Styles’ departure comes at another turning point for SaskTel. Its future as a standalone, government entity is in question after Premier Brad Wall opened the door for a private partner to get involved, an eventuality that seems more likely after telecom giant BCE Inc. bought neighbouring Manitoba Telecom Services for $3.9 billion. While Wall spiked the proposal of full privatization — the province has been tempted to sell, as SaskTel’s billion-dollar price tag would reduce its debt — he said he’s open to a partner buying up to a 49 per cent stake.
Styles believes SaskTel should keep an open mind and look closely at any options that crop up that could help SaskTel expand its offerings or its geographical reach. But he made the case that its Crown corporation status helped it achieve business success and low consumer prices over the past seven years.
“I truly believe there’s something unique when you are owned by the government,” Styles said.
He argues a Crown corporation attracts the type of people that put the public interest at the front of their work, he said. “It sounds a little corny, it does, it’s just true.”
He also believes the public entity has a better ability than a private player to bring diverse groups to the table and land partnerships with corporations, different levels of government and First Nations.
“I also think you would lose the kind of co-operation that we get from communities, municipalities, probably from the business sector as well,” he said. “I don’t know of companies that have partnered with Bell, Telus, Rogers. They’ll make a capital contribution, but they won’t partner.”
He cited as an example the recent $40-million fibre optic build in the province’s far north. SaskPower ended up paying part of the bill because they needed to connect their facilities. Cameco Corp., a uranium company based in Saskatchewan, also contributed $8 million to the project, which will serve its mines.
“Projects that on our own would be completely uneconomic, we’re able to do in partnership,” he said. “It’s sort of that old co-op idea — you have to work together.”
He credited these factors for SaskTel’s low prices, which are tied with Manitoba for the lowest mobile prices in Canada. Bell MTS promised not to increase prices for a year after the acquisition.
“My guess is we’ll be lowest within a year or so,” Styles said, even though its coverage in rural Saskatchewan is “second to nobody.”
“That doesn’t help us financially, that’s obvious, but it’s great for the people of the province.”
He also pointed to SaskTel’s tendency to look for alternative approaches to keep costs down. For example, it put up equipment on wooden power poles when it rolled out its LTE network in order to do it faster. It was also the first in Canada to deploy LTE TDD technology, which works well to send signals across the Prairies.
As Styles wraps up this chapter of his career — he plans to do consulting after a few months of travel — he said he’s most proud of SaskTel’s fibre optic deployment.
“It’s a necessity for people in their personal life, it’s a necessity for economic development and the growth of businesses,” he said.
In the next decade, he believes fibre will be the backbone for all communications and copper lines will be obsolete.
“Given the amount of data people want to move, fibre optics is the only way to do it … we’re heading for a fibre optics world completely.”
As for SaskTel’s ownership structure, he expects it will morph in the next seven years. He can’t say for certain whether it will remain a traditional Crown corporation, but he thinks it will still be owned by the province.
“The government is obviously interested in seeing the corporation look at new directions, and I think it’s probably a good idea there be somebody else in place to do that,” Styles said.
“The bottom line is, it has to be a net benefit to Saskatchewan.”
I truly believe there’s something unique when you are owned by the government.