What the iPhone means to stakeholders in Canada

The Telus Mobility and Bell Mobility announcements related to their SMS price changes and the release of the Apple iPhone 3G has provided me with the opportunity to comment on the numerous published articles across Canada over the last couple of weeks.

Many of the journalists had not considered the various viewpoints and what these announcements mean to various stakeholders. Here are the potential perspectives to help you understand all sides.

SMS Rate changes – the government responds

We found it interesting to read the press release from the office of Ministry of Industry, Jim Prentice and his comments on the SMS rate changes and invitation to meet with carriers.

“While I have no desire to interfere with the day-to-day business decisions of two private companies, I do have a duty as Minister of Industry to protect the interests of the consuming public when necessary. I believe this was a poorly thought-out decision.

Therefore, I have sent letters to the chief executive officers of Bell Mobility and Telus asking that they meet with me in Ottawa before August 8, 2008, to explain this aspect of their text messaging pricing structure with a view to finding a solution that provides the best service to consumers at the best price”.

This is not a common action of the government. By getting involved in this particular action by these two wireless carriers, it shows us that they are obviously forced to respond to the public feedback that this announcement has caused.

iPhone 3G Canadian release – Canadians comment loudly using the Internet

July the 11th is the first day you will be able to purchase the new Apple iPhone 3G released from Rogers within Canada. Many Canadians felt that the pricing plans announced from Rogers were too high and used the Internet to make their opinions known by registering their protests at www.ruinediphone.com.

Two things that make this action interesting; the first is the volume of potential customers who commented on their dissatisfaction of the Rogers price plans. (62,772). This item is interesting when you consider that we as Canadians typically don’t get enraged or complain that often.

The second interesting action is that Rogers actually responded to the feedback and have put a ‘special offer’ together with lowered prices for the iPhone (only available until August 31st, 2008). I can’t remember another situation where Rogers’ caved to user pressure on price plans in the past.

On the one hand the use and revenue obtained from traditional telco land lines and long distance is decreasing over time.

On the other hand, the use of cellular, wireless data and SMS traffic in increasing substantially.

This increased usage by customers causes increased traffic on the wireless networks which means the wireless carriers have to continuously upgrade and expanding their networks.

We, as business customers, want the wireless networks to work reliably wherever we are, and with whatever wireless technologies we may be using. This takes money. The telecom shareholders expect the companies to be profitable so they get a reasonable return on their investments.

Consumer customers want the best telecom service at little or no cost.

Unfortunately, all of the parties can’t get what they want.

Consumers are also learning to use their voices through emails, blogs and protests using various Internet technologies to express their concerns and in this case, dissatisfaction of their cellular providers actions.

It also appears to us, that the bureaucrats and telecom providers are actually starting to listen to, and respond to these comments in ways that they have not done in the past.

What does the future hold? Are there alternatives?

If we, as business customers, need and expect reliable, availably anywhere wireless networks within Canada, then we all have to pay for it. We also need sustainable competitors who have the money to invest in the continuously changing wireless technologies with our growing use and dependence on various wired and wireless technologies.

For those Canadians who cannot afford to pay for these services, perhaps, as Mark Goldberg and Michael Sone suggested on their recent Telecom Summit video, some of the higher than expected proceeds from the wireless auctions could go to a Telecom Disbursement fund that could be used to help provide telecom tax credits or some type of assistance for those who need it.

Or alternatively, as suggested in 1993 during my CBTA Regulatory tenure, if affordable or ‘cheap’ telecom services are an expectations by Canadians, then perhaps social assistance plans or programs similar to subsidized health care should be developed to provide services for those who need it, but cannot afford to pay the necessary rates. This could be something like telephone ‘food coupons’ that could be provided and cashed in with your phone bill payments.

We believe that this type of thinking should be part of broader public social policy, and not telecom regulatory policies. Low cost pricing that could hinder sustainable and profitable telecom suppliers will not benefit us as Canadians as a whole over the long-term.

I hope you have found our thoughts of value, educational, enlightening or at least humorous, and feel free me at Roberta J. Fox at [email protected] or 905.473.3369 x 1001 to discuss further.

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Jim Love, Chief Content Officer, IT World Canada

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