Canadians Pay The Highest Rates For Wireless Data, And The US Is About To Follow Suit

from the ill-communication dept

However bad American broadband and wireless service can be, generally speaking Canadians have it worse. Plagued by the same sort of revolving door regulator approach taken in the US, Canada pretty routinely makes an even poorer showing than the United States when it comes to broadband pricing, availability, and service quality. And, just like the United States, Canada's solution is often to appoint industry lobbyists to positions of power, who immediately get to work making things worse for their entrenched incumbent pals. Here in the States that's Ajit Pai; in Canada it's Ian Scott.

Needless to say, installing revolving door industry sycophants to solve problems the industry refuses to even acknowledge doesn't work out particularly well for consumers, competition, startups, or innovation in general -- as consumers and small businesses run face first into entirely unnecessary usage constraints. Constraints made worse if you've, say, killed off net neutrality protections, or have net neutrality protections nobody actually wants to enforce.

As Canadian Law Professor Michael Geist explores this week, data illustrates how Canadian telcos make some of the biggest profits on the planet thanks to limited competition. That, in turn, results in carriers implementing arbitrary usage caps and charging an arm and a leg per gigabyte, which in turn results in less actual usage by folks afraid of running afoul of arbitrary network restrictions specifically designed to nickel and dime users:

"The total revenue per gigabyte here is roughly 70 times higher than in India and 23 times higher than in Finland. And consequently, mobile usage is lower than average...The charts show where Canada stands relative to other countries with carriers generating more revenue per GB than anywhere else in the world and consequently Canada lagging behind many other countries in wireless usage."

Not too surprisingly, that's courtesy of the fact that Canada has just three major wireless providers, who don't try very hard to actually compete. And, like Ajit Pai, Scott has fostered a reputation for not giving much of a damn, since his primary objective (ensuring entrenched carriers are ultra-profitable) has been met.

Another recent study out of Canada, unsurprisingly, shows that Canada has some of the most expensive wireless data plans in the entire developed world:

"Report after report, year after year, has confirmed that cellphone services cost more in Canada than almost anywhere else in the world – on average, more than $90 a month. Canada’s Big Three telecom companies – Rogers, Bell and Telus – operate in a market with scant real competition and enjoy some of the highest profit margins per customer.

The US doesn't fare much better, though having four major carriers instead of three has mitigated some of that impact. But that's all about to change thanks to T-Mobile's looming merger with Sprint, which will only further reduce any incentive to seriously compete on price. Combined with the death of net neutrality and the FCC's eagerness to effectively neuter itself at carrier lobbyist request, and it's not hard to see how the door is being opened wide to higher prices, worse service, and even more annoying network limitations specifically built to make wireless service more expensive and annoying to use. And no, 5G won't save you.

Filed Under: canada, competition, fcc, mobile data, mobile phone rates, us


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  • identicon
    Anonymous Coward, 28 Jan 2019 @ 7:02am

    Canadians Pay The Highest Rates?

    You mean the US isn't number one? That's unacceptable! Dear leader will fix that!

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 28 Jan 2019 @ 7:17am

    Three Major Carriers Is Only A Little Correct

    Most of Telus' wireless signals are broadcast from Bell cell towers here in Canada. Realistically we only have two major carriers.

    reply to this | link to this | view in chronology ]

    • icon
      Chris-Mouse (profile), 28 Jan 2019 @ 8:26am

      Re: Three Major Carriers Is Only A Little Correct

      Not quite. Bell and Telus have a tower sharing agreement. Where there is no Bell service, Bell customers will get service via a Telus tower. Similarly where there is no Telus service, Telus customers get service via Bell towers. It means both companies can offer service everywhere in Canada without having to build two separate networks that both cover the whole country.

      reply to this | link to this | view in chronology ]

  • icon
    Mason Wheeler (profile), 28 Jan 2019 @ 7:19am

    And, just like the United States, Canada's solution is often to appoint industry lobbyists to positions of power, who immediately get to work making things worse for their entrenched incumbent pals.

    They're not making things worse for them; they're making things better for them, at the expense of everyone else. Maybe it would be better to say "making things worse on behalf of their entrenched incumbent pals"?

    reply to this | link to this | view in chronology ]

    • identicon
      Painted, 28 Jan 2019 @ 7:26am

      Re:

      I stumbled on that sentence too- I think the author meant "immediately get to work making things worse (for consumers) for their entrenched incumbent pals (benefit)."

      reply to this | link to this | view in chronology ]

  • icon
    James Burkhardt (profile), 28 Jan 2019 @ 7:47am

    Profit =/= Revenue

    While I do not believe anything I am about to say justifies Canadian mobile data pricing, and support the conclusion that a lack of providers has hurt the market, Karl makes a great misstatement that can be used to dismiss the entire piece if I were an actor operating in bad faith.

    The data in the first report relates to revenue, which I can only assume is being used correctly to refer to gross revenue, money taken in before expenses. But Karl refers to this as profit, revenue less expenses.

    In a low population density region, as Techdirt has noted in the past, providing and maintaining wireless installations is less profitable. I don't think this justifies the pricing disparity, but an analysis of profit on that revenue would be necessary to make the determination that "Canadian telcos make some of the biggest profits on the planet"

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 28 Jan 2019 @ 8:05am

    as per usual, this is because of politicians who take 'incentives' from the telcos, thinking more of lining their own pockets than of the people they are supposed to represent! just as in the USA, any attempt at legislation designed to increase competition, in particular by any new startup telco coming on to the scene, is immediately kicked into touch by the fucking lobbyists who are only interested in themselves and their pockets. this happened not long ago with, if i remember correctly, Virgin (or was it Vodafone?) getting royally screwed! but, as stated, nothing is more important than ripping off customers for as much as possible while giving the piss-poorest service possible!!

    reply to this | link to this | view in chronology ]

  • icon
    JoeCool (profile), 28 Jan 2019 @ 9:50am

    Caps

    Look at the chart - the US uses an average of about 4GB per SIM per month... because that is the average cap for data in the US on most "reasonably" priced plans. Above that, you either pay per GB, or pay twice (or more) as much per month for a plan with more data.

    reply to this | link to this | view in chronology ]

  • icon
    ECA (profile), 28 Jan 2019 @ 9:55am

    Off with their heads..

    I do like China's ideal solution..it really works to dissuade Manager, owners, boss's from Doing the wrong thing.

    Much of our problems tend to be, Proving it. yes we can show the paperwork and most of the data comes from the corps themselves.

    As in this country, What Else do they own. Internet, cellphones, Cable/sat TV??

    What has happened to real innovations, and not selling A stupid idea.. Do we REALLY need 5g? whatever that Is/will be/might be/could be??

    I could see, all of the above services combined into 1 at 1 price for all.. 90% of the services they give NOW is just bill collecting. I would love them to add Electrical power service and a mini Cell service to every house.. Never have to worry about Bars, except to drink. Converting Fiber to power is also possible.. and anyone with an old wired service KNOWS the price it going thru the roof.

    If the Corps could have Their wish, there would be 1 giant antenna in the middle of the country, and we would be paying double.. or per call(like we used to)

    reply to this | link to this | view in chronology ]

  • icon
    Ninja (profile), 28 Jan 2019 @ 11:24am

    There was some major split up because they were abusing their monopolistic powers a while back anbd they've been slowly gathering together into less and less companies. What could go wrong?

    reply to this | link to this | view in chronology ]

  • identicon
    Anon E Mouse, 28 Jan 2019 @ 1:41pm

    I'm a bit surprised that Finland's GB per SIM per month isn't higher, given how common uncapped wireless connections are there. Is a bit over 14GB per month the average what people use when there is no cap to worry about? Do finns prefer landlines over mobile? Does nordic Netflix's catalogue suck so much it shows in data usage?

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 30 Jan 2019 @ 8:06am

    If everyone here put as much effort here to actually do something in the real world something might get done ....
    but hey cowboy keyboardists yall know........

    reply to this | link to this | view in chronology ]


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