It’s no secret: The costs of cellphone plans and data packages in Canada are extremely high, and nobody in power seems interested in fixing the problem. As for the quality of the service Canadians get for such high prices? Look no further than the annual report from the Commission for Complaints for Telecom-Television Services, showing a 57-per-cent surge in complaints over the past year.
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. While a new federal report found that wireless prices have declined year over year, prices are dropping much faster for our international peers.
And yet, unlike so many other pocketbook issues, we have yet to see any political party of the day claim this issue as their own. Despite big talk, inaction from Innovation Minister Navdeep Bains has only fuelled frustration.
But the issue can’t remain apolitical. Given the ubiquity of outrage and disappointment over ever-rising telecom costs – and the deep mistrust of the companies that provide these services – the political appeal of promising to rein in these costs is obvious. And with a federal election less than a year away, Ontario Proud – a right-wing online group with ties to the Conservative Party and a habit of being a bellwether for Tory campaign tactics and government policy – has started calling for action on telecom affordability, with a one-minute, straight-to-camera video featuring a young man denouncing “rip-off phone bills” and calling for more competition.
It’s a call that will resonate with many – and one the Liberal Party ignores at its peril.
What we’ve learned about political populism, after all, is that it involves a breadth of issues but one common theme: people who feel they aren’t being heard. “Ordered populism is characterized by a sense of economic pessimism, anger at elites, deep mistrust of mainstream media, science and professionals; allergy to globalization, trade, and especially immigration, which has become a proxy for a range of issues,” wrote EKOS pollster Frank Graves and University of Toronto senior fellow Michael Valpy, who also note that as of 2017, about 30 per cent to 40 per cent of adult Canadians held parochial attitudes that make such appeals alluring. The high price of telecom services affects almost all Canadians, so the issue fits neatly among the personal, widely felt ones that victory-hungry political strategists feast upon.
Even though the frustration has been focused on the three major companies, phone bills are definitely an issue for the political arena. Calls to create more competition are a common refrain, and civil society and telecom-policy experts across the political spectrum have been banging this drum for decades. The big providers, however, haven’t taken kindly to competitors: When new entrants do appear, providing a brief glimmer of hope, they are quickly gobbled up by this gluttonous trio. Microcell, Public Mobile and Mobilicity were all subject to mergers with little protest from the federal Competition Bureau. And don’t be fooled by the other so-called “competitors”: Fido is owned by Rogers, MTS and Virgin Mobile are owned by Bell, and Koodo is owned by Telus. Around and around we go.
Stephen Harper’s Conservative government tried to tackle the issue of ballooning telecommunications costs in 2013, sparking an all-out war with the telcos and appointing pro-consumer Jean-Pierre Blais as chair of the Canadian Radio-television and Telecommunications Commission (CRTC). Mr. Blais went on to declare internet access a basic service for all Canadians.
A full-court press from the companies’ powerful lobbying arm eventually constrained the government’s efforts. The CEOs of the three companies collaborated on a publicity campaign about “the dangers of Harper’s policy,” with executives and staffers meeting weekly to discuss tactics and strategy, as top Rogers lieutenant Phil Lind wrote in his memoir. And the Conservatives’ approach – offering incentives to lure U.S. giant Verizon into the market – was also questionable. But it was, at least, a clear sign that telecom affordability was high on the agenda for that government and that a genuinely competitive market is possible, but only if there is serious political will.
Under Justin Trudeau and the Liberal government, we’ve seen Mr. Harper’s positive start fizzle out. To replace Mr. Blais, the Liberals chose Ian Scott, a former Telus executive whose appointment elicited dismay from consumer advocates and heralded a return to the bad old days of regulatory capture. Under Mr. Scott, the CRTC has refused to mandate network access for more affordable wireless providers, known as mobile virtual network operators (MVNOs),
which are common among G7 countries. In comparable countries, MVNOs play a crucial role in boosting competition and lowering prices. In fact, Mr. Blais referred to MVNO access as the most critical measure left undone in his term as chair.
Mr. Bains somewhat hesitantly waded into this issue, asking the CRTC to reconsider a 2017 decision that blocked hybrid WiFi-MVNO operators from operating in Canada. The commission ultimately denied the government’s request, reasserting its belief that opening the door to MVNOs is not a priority – a decision that places the affordability ball squarely back in the government’s court.
The fact that Ontario Proud is testing the waters on telecom affordability to see how it resonates among swing voters should make politicians of all stripes sit up and pay attention. With costs rising and the election looming, now is the time for decisive action. And for the governing Liberals, who are already facing Conservative opposition over the carbon tax, what they need more than anything is a pocketbook issue to drive home a message about affordability and the middle class – starting with enabling MVNOs to enter the market.