Canadian wireless bills remain well above norm in CRTC study
Canadians continue to pay more for wireless service than the majority of their peers in other G7 countries and Australia, says a report released by Canada’s telecom watchdog on Thursday.
Canada won gold for the most expensive low-end wireless telephone service and landed silver for premium mobile phone services that include more minutes and data, according to the ninthannual international telecom price comparison study commissioned by the Canadian Radio-television and Telecommunications Commission.
It also landed in the Top Three for the most expensive broadband Internet, bundled services and mobile data, which costs about three times as much here as it does in the U.K., Italy and Australia, according to the report by consultancy Nordicity Group Ltd. that compared prices for land lines, wireless telephone and broadband services, broadband Internet and bundled services.
The continuation of excessive prices when compared to foreign competitors comes despite a long mission by the previous federal government to encourage competition in a wireless market dominated by the Big Three — BCE Inc., Rogers Communications Inc. and Telus Corp. Attempts to foster a fourth national player with the 2008 spectrum auction faltered, with new entrants Mobilicity and Wind Mobile eventually acquired by Rogers and Shaw Communications Inc., another larger player.
The Liberals have yet to clearly outline their telecommunications policy, but early decisions indicate they’re picking up where they Conservatives left off. (The federal government rejected Bell’s attempt to stop selling wholesale access to its high-speed networks.)
The report compiled average February 2016 prices from major cities in the eight jurisdictions (in Canada, the study used Halifax, Montreal, Toronto, Winnipeg, Regina and Vancouver) and converted them into Canadian dollars for comparison. Prices were compared across different levels of service.
Canadians paid the most for 150 minutes of mobile wireless at $41.08, up from $37.29 in 2015 and more than double the low price of $17.15 in Germany. They pay the second-highest prices for more comprehensive wireless. It costs $74.67 for 1,200 minutes and one GB of data compared to a low of $30.13 in the U.K. — nearly twoand-a-half times more.
When it comes to land lines, however, Canada ranked among the least expensive. It had the thirdlowest cost for the cheapest telephone service and fourth-lowest for telephone service with more long-distance minutes.
Consumers who grumble about the cost of their monthly cellphone bills can also take solace in the fact that wireless prices for premium data plans and high-speed Internet dropped slightly in 2016.
Still, John Lawford of the Public Interest Advocacy Centre called the wireless prices a “train wreck,” especially for low-income people who use voice plans. He blames the loss or crippling of new entrants for a lack of competition in the wireless sector.
“We’re kind of virtually tied for the worst prices in every level,” he said. “The competition is not working quite as well as we thought.”
The report found new entrants such as Wind are on average 25 per cent to 36 per cent cheaper than incumbents (Bell, Rogers, Telus). Flanker brands such as Koodo and Fido are on average 14 per cent cheaper than incumbents and resellers such as PC Mobile 10 per cent cheaper.
“It’s still fuel for the argument that four, even five, is a better market than three,” Lawford said.
Incumbents argue their prices are needed to sustain spending on expensive infrastructure such as LTE 4G wireless networks and fibre Internet.
Lawford doesn’t buy the argument. Their profit margin is “stunning ” compared to the level in other countries, he said, so he questions whether the prices are excessive.
Next year’s prices will depend on how competitive Shaw is with Wind (so far, it’s taking a slow approach) and whether federal regulators approve Bell’s plan to buy Manitoba Telecom Services. If the deal goes through, Lawford predicts prices will be even worse next year, as Manitobans have some of the cheapest phone bills in Canada — and he doesn’t expect Bell would keep it that way.
We’re kind of virtually tied for the worst prices in every level. The competition is not working quite as well as we thought.