The stupidity of Canadian Telcos with their exorbitant data rates

In the same the theme as my posting Rogers: 1.124 mb? That will be $57.55 please, my friend Thomas Purves just posted the above stark graphic contrasting the rates people living in Canada pay compared to others around the world. In the following I summarize an investigation of my own and what I think are some of the more interesting comments to date. In a brief moment of hope I thought the CRTC was going to fix things, only to find that it is out of their hands…

More countries

There’s been some debate and furore on Digg as to the validity of comparing to more densely packed countries as the costs are supposedly higher in sparsely populated Canada, but this was refuted using the comparison with Australia. I look forward to seeing this table Canada’s ranking in fuller context of more countries: I’m sure Tom will give us an update in due course.

What can the CRTC do? Nothing.

Roger Martin, (Dean of the Rotman School of Management) has long been pushing Canada’s government to address Canada’s competitive conditions. Even the CRTC knows Telecom Deregulation is long overdue and pledges to fix it:

Mr. von Finckenstein, [on his first day of chairman of the CRTC on February 23, 2007], says that the question is no longer whether telecom deregulation will continue, but how fast it will occur.

“Make no mistake – less regulation in telecom has been and will continue to be the commission’s prime objective,” von Finckenstein said, while noting that “excessive and untimely deregulation can end up stifling rather than stimulating competition.”

Though Michael Newton (comment #33 on Tom’s posting) reported said

The CRTC does not regulate the cellular phone industry.

You may not be aware that the CRTC does not regulate the rates, quality of service or business practices of cellular (wireless) service providers and cannot pursue complaints on these matters on your behalf.

If not the CRTC, does anyone regulate it? The Globe and Mail’s Catherine Mclean did report on 26 Feb 06:

The market is abuzz with speculation the federal government may recommend creating a fourth national wireless carrier. It’s seen as a way for Ottawa to stimulate competition – the percentage of Canadians with cellphone service lags the United States and other countries.

It’s in the Telco’s interests, dammit!

It’s the nature of oligopolies that the Telcos here will only voluntarily drop their prices if they thought that they’d make more money by doing so. Their duty is to please their shareholders, not the public though they could stand to make much more if they can get usage up:

“That’s because [...] Rogers/Fido and Bell Mobility do not understand the idea of a mass consumer commerce model. They would rather have 50 pissed off customers and charge them $1000 a month each, rather than have 1000 happier customers and charge them $50 a month each.

Also, since all the wireless cel-sites across Canada are owned exclusively by Bell and Rogers (and bandwidth leased to other wireless providers), and since they self regulate the price – there is no price competition in Canada, since all the powers that be agree to charge the same basic highly overinflated prices.”

The MNVOs can’t cut it for early adopter services

I’ve posted before about Virgin mobile here in Canada, well one respondent alerted Tom to a bunch of other such “Mobile Virtual Network Operators (MVNOs)” that layer their service upon the main carriers:

The smaller guys that not as many people know about offer much nicer rates though, although they don’t offer the data plans you would use with a blackberry. Virgin Mobile is rising fast (no data plans yet, but their normal plans are a fraction of the price, and no extra fees or contracts). We also have 7-11 Wireless [on the Rogers network], President’s Choice Mobile [on the Bell network] where you get unlimited internet access for $5 a month [I have yet to validate that], and Petro Canada Wireless [on the Rogers network]. I’m a happy Virgin customer myself :) Just don’t fall for the shiny “free” phones from rip-off Rogers and Bell.”

Apparently, the others in this category are 7-Eleven Wireless · Amp’d Mobile · DCI Telecom · MoreMobility · Ontera · PC Mobile · · Primus Canada · SearsConnect · Solo Mobile · Videotron · Virgin Mobile, but data users tend to be cutting-edge users, who are not going to be satisfied by the cut down services provided by the MVNOs.

So, if the early majority of cutting-edge users cancel their data plans then where is the demand for advanced services going to come from? Nowhere. This country’s innovation will continue to stagnate, putting would-be mobile users at a loss.

Absurd, but a US plan might just work in the interim

The only decent work around I’ve seen so far was provided by Lee Wipper (comment #20)

For data I hear T-Mobile is the way to go for around $70 US / Month you can get unlimited data worldwide. It is a sad commentary on the state of Canada’s wireless providers that for robust mobile services the answer is to obtain an account from a carrier in the United States that has a deal to use Bell’s or Rogers’ networks at a price you could not come close to with one of those carriers native Canadian plans.

What a state to be in

Again, I am left observing what I’ve seen over and over again as a classic sad state of Canadian industry. You can make a difference. Here’s how.

Call to Action

We, TorCamp, Toronto’s Startup Tech Community, call on you, people of Canada to exert pressure.

1) Ring your Telco. Now.

Ask to speak to the supervisor. Then a) get the fax number for your telco’s board of directors b) get the supervisor’s opinion c). Fax the board of directors.

Tell the board of directors, or investment relations that 1) it is in the Telco’s interests to lower their rates as you would then use their data services – demand to know what calculations your telco is using to make them think they would lose money by continuing to charge high rates.

2) Blog and Digg Tom’s article and those that follow. Cross-post them on Facebook. Print out the articles.

3) Tell and email your friends. Let 1000 blooms blossom.

At 12:37am, 7h16min after posting, Tom’s article had gotten 948 diggs and 151 digg comments. This is just the start.

Mad about these ridiculous data rates? What else should people should do to compel change?

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11 Responses to The stupidity of Canadian Telcos with their exorbitant data rates

  1. Ok. People. Once you have pestered customer support, ask investor relations. If you read my posting you'll realise why the Telcos would make more money by charging less.

    So not charging less is nothing short of bad strategy. Complain to investor relations:

    - ROGERS: http://www.shoprogers.com/investorrelations/share
    - BELL: http://www.bce.ca/en/contact/#investor_relatio
    - TELUS: http://about.telus.com/investors/en/

  2. scruss says:

    Hmm, I get unlimited data from Telus for about $80 a month. It could be that I'm on some neato corporate plan, though.

  3. Chris says:

    I am glad to see someone is finally making a fuss about this. Nothing pisses me off more then having to pay inflated prices for a service.

    Now if we could only get this this kind of attention for the second most important cash grab, bank ATM fee’s.

  4. Derrick says:

    Sent Telus an email in disgust of these Data rates. Here’s the response:

    “Thank you for your e-mail and feedback regarding our data plans. We are happy to assist you.

    TELUS is continually developing and changing our rate plans and data plans. We cannot advise if the plan prices will be changed, but can confirm that our plans are comparable in the competitive Canadian market.

    We appreciate your taking the time to contact us. ”

    Lame.

  5. Here’s the letter I emailed to Rogers investor relations:

    Dear Rogers Investor Relations:

    As an investor and customer at Rogers, I am concerned that the opportunity to serve the Canadian mobile data market is hugely under exploited. Rogers could make a lot more money by serving a larger market at a lower price than fewer customers at a high price.

    Like many I know, I turned off the data on my wireless account rather than feel swindled by today’s pricing.

    Also, there is a risk that this issue could get the attention of the Canadian Government – regulatory control is not in investor’s interests.

    There is a discussion about http://www.thomaspurves.com/2007/04/09/canada-worse-than-3rd-world-countries-when-it-comes-to-mobile-data-access/
    at this location:
    http://digg.com/tech_news/Canada_Worse_than_3rd_World_Countries_when_it_comes_to_Mobile_Data_Access

    Regards,
    Martin

    Martin@Cleaver.org M.Sc. MBA

  6. Dan Coombes @ Rogers replied:

    Martin … I have forwarded your feedback on … Thanks, Dan

  7. Pingback: Martin Cleaver, masterfully. » Blog Archive » Would you be happier on a Mobile Virtual Operator’s network?

  8. Martin, you say:

    “Virgin Mobile is rising fast (no data plans yet, but their normal plans are a fraction of the price, and no extra fees or contracts)”.

    New information: Virgin now has two data plans, Pro Surfer and Big Kahuna, providing 2 MB and 5 MB at $5 and $10 respectively, with overages at $10/MB. Read more here: http://virginmobile.ca/site/en/pricesAndFeatures/html/data_paks.html

    Still, these rates are only moderately usurious instead of the outrageously usurious rates charged by Rogers & Fido.

    BTW, Virgin is indeed the cheapest phone provider out there. You can get a basic prepaid plan with 100 minutes a month for $10 with no other fees.

  9. Pingback: Wirelessnorth.ca launches with news of the Opening of the Canadian Telco Market. » Martin Cleaver, masterfully.

  10. angryman says:

    I just got a SMS from Rogers which says that they going to apply long-distance rates on top of my current air time rate to all long-distance incoming calls.
    This is just ridicules.
    In Canada we have worse mobile service in the world and this is not a joke. Most developing countries have lower price rate for much better quality mobile service. I will vote for anyone on next election who can promise that we will have the mobile service provider that can deliver high quality service with a reasonable price rate. There is no one country in Europe has so high price rate and so poor quality!!!

  11. angryman says:

    I just got a SMS from Rogers which says that they going to apply long-distance rates on top of my current air time rate to all long-distance incoming calls.
    This is just ridicules.
    In Canada we have worse mobile service in the world and this is not a joke. Most developing countries have lower price rate for much better quality mobile service. I will vote for anyone on next election who can promise that we will have the mobile service provider that can deliver high quality service with a reasonable price rate. There is no one country in Europe has so high price rate and so poor quality service!!!

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