Independent internet service provider (ISP) oxio is setting out to do something unheard of in the Canadian telecommunications scene: be transparent with consumers and justify its pricing.
“The internet in Canada isn’t exactly known for its transparency. Or its fair prices. Or its healthy competition,” the company said in a Tuesday press release.
The federal Cabinet last week rejected appeals from TekSavvy and other independent ISPs to lower wholesale internet rates. Canada has some of the highest internet prices in the world.
The service providers had petitioned the government to reverse a 2021 decision from the Canadian Radio-television and Telecommunications Commission (CRTC) that hiked wholesale internet prices paid to the country’s Bell-Rogers-Telus oligopoly by smaller ISPs.
Oxio aims to be Canada’s most transparent ISP and relies on a cloud-based operating system and total transparency to lower prices. The company responded to Ottawa’s decision by sharing a breakdown detailing why its internet service costs as much as it does, and how its pricing compares to other players. It says it’s doing this because it is “tired of all the big telco bullsh*t.”
“Breaking down our prices is our way of educating people on how the internet business works. We want people to know and understand where their money is going and why their internet costs so, so, so, so, so much. The murky world of telecommunications has always kept us in the dark. We’ve decided to do something about it,” said oxio CEO and co-founder Marc-André Campagna.
According to the breakdown, oxio makes $3 in profit from a 60 Mbps internet subscription that it charges $53 for. A whopping $40 pays for network usage, with the rest being operations overhead. In comparison, the average market price for a 60 Mbps connection is $64.70, noted oxio.
The one good thing to come out of the federal Cabinet’s decision was a policy direction to encourage innovation and competition in the long term.
“We are an innovative player in the industry, we are probably the only independent that is growing at the moment […] We have a flexibility that the others do not have,” added Marc-André.