Canada’s wireless market has long been dominated by three major players: Rogers, Bell and TELUS, which control roughly 94% of the market, according to Open Media’s latest report to fix our cellphone market. The Federal government recently promised it would increase further increase wireless competition to offer Canadians more choice and lower prices–but will that ever materialize?
Canadian law professor Michael Geist breaks down 10 reasons why our wireless market remains ‘woefully uncompetitive’, in part a response to debunk a questionable Scotia Capital report that claimed to identify 10 common myths about the state of our wireless industry.
We won’t go into the extreme details, but here are the 10 reasons we still have an uncompetitive wireless market, according to Dr. Geist:
- Canadian Carriers Enjoy the Highest ARPU in the World
- Higher Consumer Prices than Peer Countries
- Still Gouging, Part One: Enhanced 9-1-1 Costs
- Still Gouging, Part Two: High Roaming Costs
- Still Gouging, Part Three: Regulatory Recovery Fees
- Three Year Contracts Are Not Correlated to Smartphone Adoption
- Mandatory Unlocking of Phones Does Not Delay Market Entry of New Devices
- Actual Canadian Mobile Speeds Are Slower than Peer Countries
- Fewer Subscribers Per Capita in Canada Than Peer Countries
- Canadian Carriers are Inefficient Users of Spectrum
Of the reasons listed, here is one of interest to iPhone users. Bell told the CRTC at a recent hearing over the wireless draft code why mandatory unlocked handsets might have delayed an iPhone launch in Canada:
I don’t know because I’m not Apple but we were discussing, for example, would Apple have allowed — if Canada had a rule that mandated unlocking, would we be one of the first countries to get the latest iPhone? I don’t think so. I think they would want to launch it in other countries. I’m not saying that it wouldn’t come to Canada. So I don’t want to overexaggerate to say they wouldn’t ever. What I’m saying is if we had a rule like that, I think it’s going to put Canadians getting iPhones, the next generation iPhone later if it was a mandated requirement.
Geist notes there is zero evidence to support the notion Apple would delay an iPhone launch in Canada due to an unlocked phone requirement. He refers us to the final CRTC submission by JF Mezei of Vaxination Informatique, which debunks what Bell had to say:
The incumbents argued that Apple’s iPhone would not be available as quickly in Canada if a requirement it be sold unlocked were made. For the iPhone5 launch, Hong Kong (which requires unlocked handsets) was part of the original list of locations (including Canada and USA) which got the iPhone5 on launch day (Sept 21). Italy and Finland [which also require unlocked handsets] got the iPhone a week later on the same date (Sept 28th) as the other western European countries.
The evidence speaks for itself. In Hong Kong, law requires handsets to be sold unlocked and they received the iPhone 5 on launch day. So are carriers just trying to spread FUD (fear, uncertainty, doubt) when they argue for locked handsets in our country?
Another interesting point was the case over 9-1-1 fees, which has been in the spotlight as one $6 million dollar class-action is underway against Bell. WIND Mobile revealed (para 10084) to the CRTC the cost price for 9-1-1 services is roughly 7-10 cents per user, which the company absorbs as a cost of doing business. For our incumbent carriers to charge $0.75 to about 25 million subscribers, that equates to an additional $180 million in annual revenue after costs are endured.
Go read the entire article here, then let us know what you think is the top reason why our wireless market remains ‘woefully uncompetitive.’