Carriers unlocked $37.7M in fees
Coalition of consumer groups pushed CRTC to disclose data on ‘toxic revenue’
Canadian wireless carriers pulled in $37.7 million last year from charging consumers to unlock their mobile devices for use on other networks, according to previously confidential data disclosed by the federal telecom regulator this week.
The Canadian Radio-television and Telecommunications Commission revealed the information as part of its review of the wireless code, a set of regulations that disrupted the wireless industry by eliminating three-year contracts when it was created in 2013.
The numbers from the past three years revealed that more Canadians are choosing to unlock their phones, leading to more revenue for wireless carriers.
Unlocking fees — the Big Three carriers Bell, Rogers and Telus all charge $50 to unlock devices to work on any network by inserting a new SIM card — were a major focus at a February public hearing on potential updates to the code.
Consumers have long hated the fees, defended by carriers as a way to ensure customers stay on their networks since most phones are heavily subsidized, yet their significance remained a mystery since carriers classified any details as “sensitive commercial information.”
But a coalition of consumer groups urged the CRTC to reveal how many devices wireless providers unlocked last year, how much money they made from it and how many devices were returned during the trial period. The coalition argued the public interest in disclosure outweighed any potential harm to the wireless providers.
Wireless providers uniformly opposed the release of companyspecific information, but were mixed on the disclosure of aggregated data — Telus opposed disclosure in any circumstances.
The CRTC decided to release aggregated data since the wireless providers “have not established that they would suffer specific and direct harm as a result.”
The regulator determined that releasing the data would provide an opportunity to comment on relevant trends in the wireless market. The data includes information from Bell, Rogers, Telus, Eastlink, Videotron and SaskTel, but the CRTC cautioned that not every carrier filed information for each year and for each category.
The number of devices unlocked by wireless carriers increased to 943,363 in 2016, up 2.2 per cent from 922,931 in 2015 and up 28.4 per cent from 734,595 in 2014.
Revenue from unlocking increased to $37.7 million, up 32.5 per cent from $28.5 million in 2015 — Telus raised its fee to $50 from $35 that year — and up 75 per cent from $21.6 million in 2014.
The number of devices returned during a trial period fell 8.3 per cent to 218,675 in 2016 from 238,456 in 2015. But the number of devices returned increased 40 per cent from 156,070 in 2014.
Freedom Mobile, the Shawowned carrier formerly known as Wind, charges a $30 unlocking fee, but said customers hate paying it.
“We consider unlocking fees to be ‘toxic revenue.’ It’s revenue that we earn that basically angers and displeases customers,” said Ed Antecol, Freedom’s regulatory vice-president, at a public hearing in February.
In its final submission, Freedom proposed the CRTC should eliminate unlocking fees and mandate all phones be sold unlocked within six months of its decision.
“In addition to the direct consumer benefits, unlocking fees essentially trap customers in their existing plans, stifle competition, and have a dampening effect on the dynamism of the wireless market,” it stated.