The Trudeau government says it and repeats it at every opportunity it is given: it is doing everything possible to improve competition in the Canadian telecommunications market, more specifically in the Internet and wireless. But either he’s not very diligent, or his directives are surprisingly easy to outwit.
In 2017, the CRTC asked wireless service providers to stop charging their customers fees of up to $50 to “unlock” their phones, should those same customers wish to switch to a competitor. Five years later, those fees have not gone away. They just changed their name.
These days, wireless devices sold in Canada are all unlocked. You can therefore buy a phone, a connected watch, a tablet or even a personal computer equipped with a cellular connection and activate it on the network of your choice. The telecommunications giants have obviously made this digital shift which makes it possible to proceed with this activation without speaking to an agent, through the online counter that they all offer, either on their website or by through a mobile application.
Depending on the nature of the device, the provider will automatically charge a fee that ranges from $10 to $50. These fees do not have the same name everywhere. Account management fees on one side, new device activation fees on the other, the important thing is to distinguish these fees from those that were charged five years ago when a customer threatened to change vendor.
The problem is that these fees are superfluous. In no event is there a cost associated with adding a device to a customer’s account that is not already absorbed by the billing of a subsequent monthly plan. Like overage charges and roaming charges, these are charges that are disproportionate to what the customer gets in return.
A customer who transfers more than one line from one provider to another would see his bill inflated by an activation cost for each of the devices he transfers. A couple or a family with two or three numbers to activate would have to spend $150 or even $200 to switch providers.
In the automotive sector, the cost of opening or managing the customer’s file is downright illegal. Could we do the same in telecoms?
More competition?
When asked about these case management fees, a customer service agent from one of the big three national carriers explained that these fees had simply replaced the unlocking fees.
These unlocking fees, it will be remembered, were abolished by Ottawa, which described them as a tool to prevent the free movement of consumers from one supplier to another. In other words, it was a measure to limit competition in the market.
At the time, it was impossible to use a phone purchased from a vendor on a competitor’s network without having it unlocked. You can now switch from one network to another as you wish, but you still have to pay $50 dollars to do so. The only thing that has changed is who charges this amount. Before, it was the old supplier. Now it’s the one who greets the customer.
Asked about this, the CRTC says it has done its job and does not intend to question the existence of these other fees. “The Wireless Code was created by the Commission to help Canadians understand their wireless service contract, avoid surprise bills and switch service providers. Providers are responsible for setting their own retail prices for wireless services, without interference from the CRTC. »
A user, how much is it worth?
The acquisition of Shaw by Rogers is obviously the big file that interests the federal government these days. But other somewhat more modest acquisitions in recent months give an idea of what the giants of this industry are willing to pay to limit competition in their market.
In publishing its financial results for the third quarter of 2022, Bell revealed that it had offered $335 million to buy the supplier Distributel. In the previous quarter, Bell said it paid $135 million for internet provider Ebox. It was then one of the largest independent suppliers in Canada. We now know that he had approximately 70,000 subscribers in certain regions of Quebec and Ontario. Bell paid, so to speak, the equivalent of $2,000 per Ebox customer to absorb it. That’s the equivalent of nearly two years of home Internet service!
To pay such sums, the major suppliers must find substantial sources of financing. It’s not surprising then that all sorts of fees are imposed on customers.
In Ottawa, we seem to be running out of solutions to open up the market for digital services. However, there should be a way to better control these completely outlandish costs. It would reduce the money available to swallow the competition and it would make it more difficult for this industry to concentrate. The consumer would come out a winner.