Canada’s telecommunication companies gloated as StatsCan reported a 17 per cent drop in wireless services prices. But do our bills tell a different story?
That was the key debate during a panel at the 22nd annual Canadian Telecom Summit.
For Navdeep Bains, Rogers’ newly minted chief corporate affairs officer and former federal Industry minister, “facts do matter.”
Prices have gone down, he maintained, not only 17 per cent year over year, as reported by Statistics Canada, but close to 50 per cent since 2017.
He explained that there’s a perception issue that prevents customers from seeing that.
“Because of broader affordability challenges, people are struggling, they’re anxious, they’re talking about housing, their mortgage, they’re talking about groceries and putting food on the table. So even though those costs are coming down, it’s not fast enough, because people’s disposable income has shrunk. It’s a real challenge that people are facing.”
Communicating the drop in prices, he noted, “is a tough sell in this environment.”
But he asserted that it’s real as he presented Rogers’ new Connected for Success 5G Mobile Plan offering low-income Canadians a 5G wireless plan for C$25/month and a no-cost 5G smartphone.
“We’re deeply committed to making 5G technology more affordable and accessible for all Canadians,” said Rogers in a release. “Today’s announcement builds on a number of investments we have made to help connect all Canadians across the country.”
Bains gave it his best shot to promote the discounted plan, but Telus’ Jill Schnarr admitted that there’s a public relations gap that prevents people from seeing the dip in prices, adding that competition has never been robust as it is today.
“We need a customer perception metric that basically measures whether you [consumers] do not have access because of cost of service or because you don’t have access to discounted services.”
However, for Jacques Leduc, president of satellite company TerreStar, the issue is that Canadians simply do not understand what they are actually paying for.
“Consumers don’t understand what’s behind providing the service. They don’t understand that building a tower today costs about twice what it cost in the past.
He continued, “People don’t know, they just grab the phone, and they assume it works. And when they go somewhere, it doesn’t work. They call and say why my phone is not working. I mean, they don’t understand that there’s no infrastructure in such a place.”
Schnarr concurred that Canadians do not understand what it takes to deliver service in Canada.
“The cost of serving Canada is so high because of our geography, because of how distributed our population is, because of labour rates, tax rates and spectrum costs, which all factor into how much phones cost, and I don’t think we’ve done a good job, from a PR perspective, in getting that message out.”
PwC’s new report on the telecom industry, accordingly, details the large investments that telcos have had to make because of Canada-specific factors.
The report says, for instance, that the historic wildfires in Eastern provinces “damaged TELUS’ fibre optic network in several spots, and Bell’s infrastructure was damaged, with expected costs in the several million dollars.”
Prices have declined and telcos have splurged on their networks, but the CRTC, unplacated, mandated that they share their fibre-to-the-home networks with independent competitors in Ontario and Quebec. Bell subsequently slashed its planned network investments.
In a separate panel at the summit, Telus’ vice president, telecom policy, Stephen Schmidt, called out the CRTC’s move, arguing that it’s not focusing on more important issues.
“It’s part of a 25 year trajectory now of the CRTC doing things that no other regulator on Earth is left doing. Time has moved on for peer regulators, and they’re focusing on privacy, 6G, AI, digital markets, etc. But the Commission is a quarter century in to doing something that’s a quarter century old. And the big worry on that is the extent to which it crowds out other meritorious issues and other meritorious groups from sitting at the center of its focus.”
He added, “Climate policy, Indigenous people and reconciliation would be examples that ought to move to the center of its focus, but that will never be possible if we have another 25 years of wireline proceedings.”
Bell went on to state in a release that the CRTC decision compromises access to high-speed fibre internet for millions of rural Canadians.
But those billions of dollars that telcos say they spend on connecting Indigenous people are just “flying through the waves,” contended chief executive of Iristel, Samer Bishay, adding that Bell “threw a hissy fit, just to make some noise, show their discontent.”
“It’s almost like they [Indigenous People] are being given a favour by putting a tower that they have to pay for, a government subsidy, that once again, there is no return for any generational or any type of income that could come on a monthly recurring for them.”
Telcos should be able to “carve out some spectrum for Indigenous communities and allow them to build networks independent and agnostic from everything else”, he noted.
Christian S. Tacit, external counsel to Competitive Network Operators of Canada (CNOC), concluded that if large telecommunication companies are gobbling up smaller competitors, there is no competition.
“The people you need to make happy are Canadian consumers. That’s obvious. At the end of the day, that’s the Commission’s job. And if competitors are exiting in droves, being bought up by incumbents and are failing, that degree of concentration can’t be in the interest of consumers. To me, that’s the acid test.”