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And I wonder where these dreams go, when the world gets in your way, what’s the point in all this screaming, no-one’s listening anyway — Goo Goo Dolls

Posts Tagged ‘crtc’

CRTC’s new wireless rules don’t go far enough

We Canadians pay the highest mobile rates in the world, thanks to the entrenched Bell-Rogers-Telus oligopoly that for years has been gouging customers with impunity. The CRTC, the regulatory body that has generally been in the pocket of the wireless companies, has been taking some baby steps towards actually protecting consumers in recent years, thanks to a huge backlash and an acknowledgement that the current situation is hurting business and innovation. But these baby steps haven’t done much to stem the tide.

Now, the long-awaited new Wireless Code announced by the CRTC after months of public hearings promises to address a few of the most egregious issues. Among them:

  • Canadians will be able to cancel their plans after two years with no penalty, even if they signed a deal for longer.
    This is all well and nice, considering that the three-year plan cycle was stifling innovation. But considering that there really aren’t any better options out there, cancelling and going to a competitor is illusionary freedom at best.
  • Caps on extra data and roaming charges to $50 and $100 respectively within a given billing cycle.
    This is perhaps the biggest win for consumers; stories of $22,000 phone bills or other ridiculous overage charges have abounded in the media lately, embarrassing providers and frustrating consumers. Even smaller amounts are ridiculous: A friend recently returned from a trip to the UK to discover a $1,287 phone bill, all for committing the cardinal sin of having forgotten to purchase a data plan, and having accessed Google Maps a few times while abroad. Such charges far exceed any reasonable costs that the providers have, and amount to a punitive tax on the unsuspecting for no reason other than they’ve been allowed to get away with it for far too long.
  • Canadians will be able to unlock their devices after 90 days, or immediately if they didn’t purchase a phone on contract.
    Anyone who wanted an unlocked device was already doing so on the grey market for a few dollars. It’s useful for people moving out of the country or for those of us who travel a lot; Canada remains one of the only countries in the world where you can’t get off a plane and pick up a local SIM card for a matter of a few dollars to use during your stay. (I do this all the time with my unlocked phone; it’d saved me thousands in roaming charges in countries from France to Israel to Vietnam.) But for most Canadians, with no competition to speak of in the market, unlocking your device will only allow you to switch to an equally bad provider, which is really no choice at all. All this means in practice is that providers will raise the prices of the phones in the first place, arguing that they can no longer subsidize them to as great a degree.
  • Contracts must be in plain language, with wording explained clearly and with the option to opt out of all changes.
    This ought to have been the price of entry and a given for anyone doing business. The fact that it needed to be said was sad. A step in the right direction, to be sure. But the Code doesn’t set out any restrictions on what the wireless providers can and cannot put in the contracts, as long as it’s spelled out in plain language.

What’s missing from this Code? Quite a lot.

  • There’s no mention of the fundamental unfairness of charging for incoming calls and text messages — a particularly egregious issue considering how much spam and how often my phone rings with unsolicited telemarketing calls. When I complained recently to Rogers about the dozens of robo-calls I’ve been receiving lately (“Congratulations! You’ve won a trip!”), I was basically told that I had no choice but to pay for the calls. There’s also the fact that we take the double-charging (paying for both outgoing and incoming minutes) as a given here in Canada, when most people from other countries would find that shocking.
  • There’s next to nothing being done to address the lack of competition in the marketplace. Bell, Telus and Rogers collectively own the vast majority of the wireless spectrum. Efforts in recent years to open up parts of the spectrum to bidding from smaller players are failing, since the small players are being sold one by one to the big ones. Virgin Mobile is owned by Bell; Fido is long owned by Rogers; Telus is in talks to buy Mobilicity; Public and Wind are both up for sale. Only Videotron here in Quebec is making a go of it, since as a larger cable company it can afford to compete, but its service and offerings aren’t exactly advantageous compared to the Big Three. And anyway, Rogers and Videotron have a network sharing agreement that will effectively prevent them from actually competing. With so few choices, we all lose, regardless of market regulation or consumer codes. Since, after all, the Big Three can charge whatever they want, as long as they spell it out in plain English.

Ultimately, this Wireless Code is Too Little, Too Late. It will get us to where we needed to be as a country five years ago, but it does very little to address the future. And we will continue to fall behind the rest of the world in terms of mobile adoption rates and technical innovation.

But, it’s a step in the right direction.

Bell’s purchase of Astral: CRTC says Non

The CRTC has actually momentarily remembered that its job isn’t to rubber-stamp requests from the big telecoms: It has squashed Bell’s plan to buy Astral and thus control a massive share of the telecom market:

“BCE failed to persuade us the deal would benefit Canadians,” said chairman Jean-Pierre Blais, who took over the post earlier this year and has quickly put a populist stamp on the regulator. “It would have placed significant market power in the hands of one of the country’s largest media companies. We could not have ensured a robust Canadian broadcasting system without imposing extensive and intrusive safeguards, which would have been to the detriment of the entire industry.”

Anglos are breathing a sign of relief because this will save TSN 690, Montreal’s English-language sports radio station (and official home of the Habs, when the NHL isn’t on lockout). Rival media conglomerate Quebecor is breathing a sigh of relief, because its dominance in the francophone market won’t be challenged by a Bell/Astral giant.

But there’s a bigger issue here, and one that should be of interest to all Canadians who are concerned about the extreme amount of media consolidation that we’ve witnessed in our country over the past couple of decades. When two or three companies are allowed to control both the media and the messaging via television, radio, newspapers, digital and mobile channels, we all suffer. Just about every Canadian has a nightmare story about one of the telecom giants (and Bell figures at the top of most of those nightmare story lists). Canadians already pay the highest cell phone rates in the world, and that’s only getting worse due to the lack of competition in the marketplace. The telecoms are all working hard to produce exclusive content, and are licensing it to their rivals for high costs. The limited choice in television service offerings is leading many Canadians to simply pull the plug rather than put up with poor service and content offerings for high prices.

Canadians are fed up. And plenty of them spoke up at the CRTC hearings. There were 9,700 interventions filed, and while many of them were from rival media conglomerates such as Rogers, plenty of others were from the general public. They were standing up to say that having one company in charge of nearly half of what we see, hear, read and watch isn’t in anyone’s best interest.

I’ve been really hard on the CRTC in the past for being in the pockets of the telecom companies and shirking its mandate to protect the consumer. Thanks to this decision, I have to issue this blog’s first-ever kudos to the CRTC. It’s a step in the right direction.  Keep it up.

Time to pull the plug on cable?

I have been a Videotron customer for more than eight years.  I have my home phone, internet and TV service with them.

In that time period, they have increased the price of my bill 14 times, for a total increase of more than $24 a month more for the same services. That’s more than a 30% price increase, for those who aren’t counting. During that same time period, they’ve made serious billing errors five times, one of which cost me several months of follow-up calls, and they’ve had countless service outages. I’ve phoned up their retentions department as a matter of rote for these past few years, each time wasting my time in order to go through the motions to negotiate the discount that I know they’re going to give me anyway, like a dance where everyone knows the steps but we still have to suffer through the music.

But none of that is why I’m on the verge of finally pulling the plug (pun intended) on my cable service.

No, the simple reason is as follows: None of the TV that I want to watch is available through my cable.

Quick quiz: What are the five best shows on TV right now? The answers may vary, but in my opinion, no such list is complete without the inclusion of Mad Men, Breaking Bad, The Big C, Sons of Anarchy, and maybe the Colbert Report thrown in for good measure. With the exception of the last one, which airs on the Comedy Network here in Canada, I can’t actually watch any of those shows on TV.

Mad Men and Breaking Bad air on AMC, Sons of Anarchy airs on FX, and The Big C, which airs in the States on Showtime, airs on a delayed schedule on Superchannel. Guess which of those channels is carried by Videotron? That’s right, zero.

In contrast, our friends in Ontario who are slaves to the dreaded Rogers, or even the folks here who are signed up with Bell-Hell via satellite, can access almost all of these shows as they air, and be part of the Facebook and water-cooler conversations that ensue. Meanwhile, law-abiding Videotron subscribers are left waiting for the DVD release, while the less law-abiding resort to illegal downloads to get their fix of whatever show strikes their fancy. And the channels I pay for languish unwatched.

The trouble is, Videotron doesn’t care about me. I’m anglophone, and as such, I represent only a tiny segment of their customer base. For every one customer who wants to watch Mad Men, Videotron figures there are a few dozen who would rather watch Star Académie. The company has been extremely slow to add English channels to its lineup, and I don’t expect this to change anytime soon.

I’ve resisted taking the step of cancelling cable for one reason: Hockey. The one channel I watch regularly is RDS, just because it has exclusive rights to the Habs’ games, and really, there’s no point in watching a hockey game if it’s not live. RDS still doesn’t offer a streaming package, so I’ve been paying out the nose for a bunch of channels I never watch, just for the privilege of having hockey on TV. But as the price of cable keeps climbing, it’s getting harder and harder to justify this expense, especially when I could just as easily watch at my favourite pub around the corner and spend the money on a beer or chicken wings.

Hundreds of thousands of Canadians are cutting the cord on cable. Will 2012 be the year when I finally follow suit? Well, let’s just say that the next time I contact the retentions department over at Videotron won’t just be a rote request for a discount.

Musings on the US-Canada price gap

A new BMO report suggests that on average, Canadians pay about 20% more for the same goods and services as our American neighbours do — even though the loonie is above par:

BMO’s survey compared 11 items, including golf balls, Blu-ray movies, running shoes and cars.

There is no denying Canada is smaller and that means less competition, which in turn means higher prices.

But Michael Mulvey, marketing professor at the University of Ottawa’s Telfer School of Management, also noted some of the biggest difference in prices between the U.S. and Canada are in the areas where there isn’t free trade, such as telecomunications.

I’ve ranted about the higher telecommunications prices before. Those are due to price-fixing by the corrupt CRTC — something not mentioned in this study.

But for consumer goods where actual competition exists, how do we explain the price gap?

Taxes, for one thing. The study is comparing pre-tax prices, so you might think that’s not a factor. But there are taxes all the way down the chain of distribution, not just at the end-consumer point. That 15% you pay in combined GST and QST is merely the tip of the iceberg. The higher taxes down the line help pay for our essential social programs, like medicare, but they do make things more expensive.

Another factor that is mentioned by the study is the size of the country, and the fact that distribution and shipping is more expensive when you have a sparser population in a less concentrated area. This helps explain why prices would be more in, say, Yellowknife. It doesn’t explain why something retails in downtown Toronto for 20% more than it does across the border in Buffalo, NY.

The rapid rise of the dollar is another factor. When the Canadian dollar was worth 60 cents US, we understood the price gap. Now that it’s above par, it’s frustrating to see this gap. But the price adjustment period takes longer to catch up than the loonie takes to rise in the first place. The gap is closing somewhat — just more slowly than we might like.

But the main reason is merely supply and demand. In a market economy, prices are less about what something costs to produce and more about what the market will bear. We pay more because we pay more because we pay more. It’s circular. If people stopped buying things that were too expensive, the prices on them would drop. They would have to.

Lots of people would like to complain, protest or mobilize to correct this. What they don’t understand is that these prices aren’t being fixed by the government, and the economy cannot – and should not – be centrally managed in order to make people happy.

We do have choices. We can drive down to Burlington or Plattsburgh, shop in lower US dollars, and come back across the border — and pay duty (or not, as every good Canadian knows the tricks of how to avoid that at some point. Not that I’m endorsing that, mind you.) We can order online and pay the extra shipping charges, though the vast majority of US online retailers won’t ship to Canada, frustratingly enough.

Finally, a little perspective: Prices are higher in Canada than they are in the USA, but they’re lower here than they are in a lot of other places in the world, including South America, most of Europe, some places in Asia, or Australia. We constantly compare to the Americans because we’re so close; it’s hard not to get jealous and feel like the outsider with our face pressed to the glass when we get American ads on TV, radio or digital media splashing prices around that are inaccessible to us. But if you saw what people were paying elsewhere for the same items, you might appreciate our prices a bit more.

Federal government to CRTC: you’ve gone too far

You can tell it’s an election year when the government actually bothers to do something useful. Harper, seeing the writing on the wall after massive petitions and public outcry, has issued an ultimatum to the CRTC about its recent usage-based internet billing ruling: back down, or we’ll overrule you:

Last week, the CRTC ruled that usage-based billing, the model used by large Internet providers such as Bell Canada and Rogers Communications to charge customers extra for exceeding monthly download limits, will apply to smaller providers, too. Until now, those smaller providers could offer unlimited Internet packages; the ruling means they no longer can.

There have been hints already from Industry Minister Tony Clement that the federal government may quash the controversial ruling, and the prime minister has asked for a review of it. But the government’s blunt ultimatum to the CRTC suggests any review would be pro forma.

This was a terrible decision by the CRTC – yet another in a long line of them that have backed Big Telecom’s demands over the rights of the consumer and the marketplace. Usage-based billing would have stifled innovation and choked off advancement, it’s true. But let’s not forget that, thanks to the CRTC, Canadians pay the most in the world for cell phone plans, pay for incoming text messages (despite another Harper campaign promise… anyone remember that?), and enjoy tons of lovely censorship of TV and radio. All because the CRTC is supposed to protect the interests of all Canadians, but only protects the interests of three: Bell, Telus and Rogers.

As for the government, let’s not forget that this is one decision, taken under overwhelming public pressure, in the face of hundreds of other decisions that have gone against consumer interests. The real solution isn’t to review this one decision; the real solution is to review the CRTC’s overall mandate and existence.

Gouge, gouge, gouge

Coming on the heels of the news-that-will-shock-nobody that Canadians pay the highest cell phone bills in the world, someone’s taking notice… and it ain’t the CRTC:

Unlimited wireless data plans are almost unknown in Canada, and that’s a strategy telecom carriers elsewhere are starting to emulate as they look for ways to cope with booming demand and capacity limits.

BCE’s Bell Canada, Rogers Communications and Telus Corp  – Canada’s “Big Three” telecoms – command profit margins that are the envy of the industry. They have an historical advantage over their peers because Canadians accept that they have to pay for as much capacity as they use.

Or, maybe it’s because the CRTC is more interested in protecting those profit margins that are the “envy of the industry” than in protecting consumers, in our price-fixed, oligopolistic market.

And it’s got consequences. Less affordability translates to lower smartphone penetration, which means companies have less incentive to stay ahead of the curve on wireless development, which means Canada will – as usual – continue to lag behind the rest of the world when it comes to innovation. That’s bad news for everyone… unless, of course, you happen to be an executive at Bell, Rogers or Telus.

We’ve lagged behind the rest of the world long enough. We’re supposed to “accept” things that are unheard-of in the rest of the world, like punative three-year contracts with ridiculous cancellation fees, “system access fees” of $8.95 a month, being charged for incoming voice minutes and even text messages, and ridiculously high data plan pricing. Us Canadians don’t “accept” that we have to pay as much for data as we do; we’re forced into it because we have no choice. That is, no choice other than opting out of owning a smartphone entirely, which is the choice I’ve made.

Instead of admiring our market, the world should be mocking it. And instead of protecting the anachronistic, anti-competitive marketplace, the government should scrap the CRTC and throw the doors open to real competition. Until then, consumers and businesses will be the big losers.

CRTC approves Al-Jazeera application

The CRTC has approved a broadcasting license for English Al-Jazeera in Canada:

I first blogged about this back in 2003, when media monitoring organisations were sounding the alarm about the virulent antisemitic content being broadcast on Qatar-based Al-Jazeera’s Arabic-language station on a daily basis, under the guise of news. The English affiliate doesn’t have quite the same level of bias – certainly, not that much worse than we see regularly from, say, the CBC or the Guardian, or on the other side, from the likes of FOX news. If there’s a demand for the service, and the content doesn’t cross the line, then I have to stand in support of freedom of information.

Besides, this is 2009. Anyone who wants content can get it, regardless of the CRTC’s decision. This decision is really only about whether satellite providers can charge for it, or whether people will have to access it online or through other methods.

I still haven’t forgiven the CRTC for all those years without HBO, though. Segacs to CRTC: this ain’t over, bitch!

Harper promises crackdown on text message fees

In a very un-Conservative move, Stephen Harper made a campaign promise today to regulate businesses more, cracking down on such unfair business practices as price-fixing, deceptive marketing, and incoming text message fees.

While my usual philosophy is to tell government to stay out of business, in this case, I think Harper has the right idea. A free market is one thing; illegal business practices are another. The telecom companies are among the chief violators of fair competition, and they have long hid behind the CRTC to gouge consumers at every turn. This is not a big money issue for most Canadians, but it’s one that gets us up in arms pretty quickly, so it’s actually smart of Harper to latch onto the issue in his campaign.

I just wonder if it will be easier for me to sue Bell for charging me hundreds of dollars of bogus fees, after I cancelled my service with them? Yeah, I doubt it too.

Price-gouging: The cell phone market in Canada

Two related stories in today’s Gazette, referring to all three major players in Canada’s mobile phone market:

First, a story about how Bell and Telus are both going to start charging for incoming text messages. Considering most of the spam I receive is actually from Bell, that shows some nerve. Coupled with my recent notice that Bell’s plan prices are going up yet again, for me, this is finally the last straw. I’ve had it with Bell. Enough. Fini. C’est tout.

Unfortunately, the competition isn’t much better. Rogers, which recently signed a highly-touted exclusivity contract with Apple to bring the iPhone to Canada, is charging ridiculously high rates for data, basically pricing the iPhone out of reach of the average consumer. And don’t try to get an iPhone from a competitor, either; there aren’t any.

The competition bureau, of course, doesn’t see a problem here:

“Where consumers are concerned about the plans being offered with the iPhones, we don’t consider this to be a competition issue,” said bureau spokesperson Marilyn Nahum. “We don’t consider the iPhone to be a distinct market.

“It’s a cellphone that competes with other cellphones in the market. If consumers don’t like the plans being offered with the iPhone they can go to the competitors.”

This is nothing new. With only three major carriers in the marketplace, Canadians have been gouged on cell phone prices forever. We pay twice what Americans pay for similar voice or data plans, and several times what Europeans or people in the rest of the world pay. Most of us pay a bogus “system access fee” of $6.95 to $8.95 per month, and virtually everyone pays for incoming voice minutes – a practice almost unheard of outside of North America. Our phones are “locked” to our carriers, we are locked into 2- and 3-year contracts with hefty cancellation penalties, and until last year, we couldn’t even keep our phone numbers when switching carriers.

Don’t expect things to get better anytime soon, either. As long as the major telecommunications companies are in bed with the CRTC, and virtual monopolies are allowed to exist, things are only gonna get worse.

Meanwhile, Bell and I are history. Anyone have an old Rogers phone they want to donate / sell to me at a reasonable price?

The last straw

All right, that’s it: It was one thing when it was just getting Google to censor search results or other such “minor” infringements on freedom of speech. But now China has gone too far: It’s restricted the Simpsons:

D’oh! China has banished Homer Simpson, Pokemon and Mickey Mouse from prime time. Beginning Sept. 1, regulators have barred foreign cartoons from TV from 5 to 8 p.m. in an effort to protect China’s struggling animation studios, news reports said Sunday. The move allows the Monkey King and his Chinese pals to get the top TV viewing hours to themselves.

Foreign cartoons, especially from Japan, are hugely popular with China’s 250 million children and the country’s own animation studios have struggled to compete. Communist leaders are said to be frustrated that so many cartoons are foreign-made, especially after efforts to build up Chinese animation studios.

The most ironic part of this news story? That China, a Communist nation, is really doing nothing worse than what the CRTC does here in Canada. Ain’t it great living in such a free country?

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