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Why talk ain't cheap, especially in Canada

CATHERINE MCLEAN

Globe and Mail Update

Latest comment posted at 8:31 PM EDT 23/11/06

Sarah Alger spends about $240 a month on her cellphone, which was supposed to cost $40. Her money would go further in the U.S., where competition is much more fierce ...Read the full article

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  1. Chris M from Canada writes: Moved here from the UK over 2 years ago. Mobile service is poorer, costs are way higher. I can't believe we have to pay to RECEIVE calls, and what about those pay and go cards that EXPIRE after 30 days - daylight robbery! Cry me a river about the population density - the coverage is proportional to population. Lack of competition is what's keeping the prices high - so long as the big companies are making a profit they have no incentive to reduce prices. They are helped by the huge start-up costs that prevent other companies getting in on the act. Now, open up the market to the big US suppliers, and that would be interesting..........
  2. D Scheerer from Waterloo, Canada writes: Extremely true. I feel my wireless bill is far too high for the service that i get. When living in Australia, the equivalent bill would amount to 25$ compared to the 60$ you pay here with Rogers or Bell. WE need more competition in Canada to drive the prices down.

    PS Why G & M does my name and where i am from continue to be in brackets with a 'You' in front of it. ie 'YOU (D Scheerer from Waterloo, Canada) wrote:'
  3. Timothy Nessus from Somewhere..., Canada writes: Ohhh...geee... so we have NO effective competition in Canada... what a surprise!!!

    Actually, this is GOOD. Microwave radiation (i.e. all those little waves coming out from phones and towers) are NOT exactly healty. SO, if the ONLY way to curtail microwave radiation poisoning is to have innefective competition, I AM ALL FOR IT!
  4. Gronck the realist from Aurora, Canada writes: The telephone compoanies are using the same 'bs' arguments they used to try and protect their long distance marketplace in the early nineties; get this one - similar sized country with 1/10th the population. that is simply BS; very little of Canada is covered and its almost linear as opposed to the mesh in the US - give me a break!
  5. maryam moghbel from Montreal, Canada writes: Thank you Ms. McLean! A discussion such as this was long overdue! I think most of those of us who work in big corporations know what happens in those Monday morning meetings and feel we as consumers are being taken advantage of, simply because we can not do anything about it! What I wonder about is why CRTC allows that - why did they let Fido be acquired by Rogers for instance?
  6. I Wish I Was In Dixie- In Dixie Land the Folks are Grand!! from Willowdale, Canada writes: ...Sarah Alger, all I can say is: if you are spending $240.oo a month using your phone (whether it be cell phone or landline), something is wrong...and not necessarily with the phone company. It is hard to determine in this news article whether your are bragging or complaining. In short, get a life, dearie and stop moaning the blues over a self-created problem. As for me, I wish I was in Dixie-in Dixieland the folks are grand!!
  7. luke martyn from Toronto, Canada writes: This article clearly looks like a Press Release with a few key edits by Ms. Mclean.

    No opinions of regular users were noted and the only real reference to cell users in Canada was the final 2 paragraphs that mentionned a survey by the CWTA. To me, this seems like a Press Release from the CWTA.

    Why not find out from real customers what they think? No numbers from Europe or Japan were given and no real comparisons were made.

    Rates in Japan and Europe are very close to the same as Canada, but the main difference is that users aren't locked-in to 2 or 3 year contracts like they are here. 2-3 year contracts do two things for Canadian carriers: Inflates prices of handsets (which are ridiculously high) and keep their user churn rate low. In Japan, you can get a handset for free while only committing to 1 month of use. In Europe, phones that are $500 here, are free with a 1 or 2 year contract that is much easier to get out of. In Canada, we get approximately $50 off the price of a handset for every year of service we agree to. If we cancel early, we have to pay a $200 cancellation fee.

    Another misleading statement is, 'They must build their networks across a similarly sized territory, but with only a 10th of the population to serve.' Misleading because over 90% of Canada's population is along the southern strip of our country. In BC, Ontario and Quebec we have a very densly populated area that should be comparable to the US.

    This article focused on phone companies and investors and not the people that really matter in this equation: The people who use the service. Do a bit more work and really research this area. Cell phone users deserve this voice!
  8. Nick Charters from Canada writes: Some of the information in this article seems somewhat contradictory, notably:

    'On the key benchmark of average revenue per minute, Canadian carriers make 11 cents (U.S.), according to Merrill Lynch. In the U.S., it's 6 cents.'

    'Not only is Canada in the No. 3 spot for average revenue per user (ARPU) among 50 countries, just behind leader Japan and the United States.'

    So, on average, we pay more per minute of talk than those in the states, but less overall? If this is true, what are the Americans paying so much for?
  9. instant karma from burlington, Canada writes: It strikes me as funny that 1/3 of consumers don't think that they are getting their money's worth and most likely will switch carriers when portable wireless numbers become available. Isn't part of the point of this article that there is very little price difference between the Canadian carriers? If price is the issue, where will the 1/3 turn to?

    As for the reluctance to cannibalize the land-line businesses, this wouldn't be Rogers' concern, and they don't seem to be creating any price distinction.

    The difference between the American and Canadian market is partially based upon population and population density in: a) providing service to a certain % of the Canadian population at a profitable margin and b) overall market size. A bigger market means less cost per user = lower price

    In many countries in Europe, they have local measured service for landlines. Here a consumer or business would pay for their local landline based upon the number of minutes they use, not a flat rate as in Canada. If you are already paying per minute for landline, why wouldn't you just get a mobile phone instead? Clearly, a big difference with the Canadian market and part of the explanation for a quicker European adoption of cell phones.
  10. J McElligott from Calgary, Canada writes: I believe that I am being gouged by Telus and am hoping that number portability will engender some genuine competition on service and pricing next year.

    D Scheerer, I have the same issue and I suspect it's caused by my Safari (Mac) browser.
  11. Two Cents from Toronto, Canada writes: There's really not much competition in the mobile phone industry in Canada just like in most other industries here including aviation, cable/satellite TV, banking and so on.

    This is a fact of life in Canada and will never change unless our federal government opens the doors to foreign competitors.
  12. Jimmy VanDino from Western, writes: #7...Hear hear! This read like a shill piece for the 'Poor Telecom' industry. Give me a break...the pathetic attempt at balance was shameful for this publication. These corporations got big tax breaks to help finance the build out of their networks yet they still complain of the costs. Evening *starts* at 9pm??? OK Mr. Telecom CEO whatever you say. Oh, the Poor Telecoms have an extra hard time competing because of they have to span the huge wastelands of Canada you say? Have you tried to get cell reception in BFN New Brunswick or Ontario? When I lived in NB I had a difficult time keeping reception an hour outside of Fredericton. Obviously the Poor Telecoms haven't gone broke to ensure connectivity for their customers. If the industry here can't/won't provide a fair price in this artificial market perhaps it would be best to allow some competition from carriers in the US. If US providers service is as poor as this article let's on I suppose customers won't fall for their lower prices but I wonder.
  13. can I vote again from around-Kingston, Canada writes: hmmm according tho the article 'Decima Research, conducted on behalf of the CWTA, found a third of respondents don't think they're getting their money's worth from cellphones' ... probably the 2/3 that are satisfied have their service paid for by their employer, mom or dad or more likely they are 'pay as you go' subscribers.
  14. John Akermanis from Aurora, Canada writes: We pay more because as Canadians, we are use to get reamed up the butt from all fronts. Why would the telco's be any different.

    Also goes to show you, the CRTC is a useless group that don't really regulate jack.

    This all smells more of price fixing, just like the oil companies.

    Am I surprised? Not in the least.
  15. david coates from toronto, Canada writes: Why is it that some people are addicted to telephone use and then complain about the high cost of it? Are they too dim to make the connection (pardon the pun)? Oh, wait, that's why they are on the telephone all the time, yakking away instead of communicating.
  16. Tim Robinson from Hoylake, United Kingdom writes: I'm from Canada, but here in the UK, I pay £30 ($62 a month for calls anywhere to any network - 500 minutes per month, plus unlimited texts and a small internet download amount for my phone, AND they throw in free broadband for your house (this is a wireless hub so I can run two laptops and my main computer with broadband - 100 MBps) all included. They also throw in a free Sony Ericson 800i phone for a 12 month contract. Even calls to Canada on my cellphone only cost a bit more than a landline.
  17. Ramesh Fernando from Canada writes: This is all the CRTC's and foreign competition laws which don't allow American and European competition to come in. In the US T-Mobile is one of the biggest networks because the FCC allows foreign compeitition to come in. If we allowed T-Mobile, Verizon or Orange to come in. They will destroy the happy club of Canadian cozy olgipolyists. My recommendation, ABOLISH THE CRTC AND LIMITS ON FOREIGN INVESTMENT in Canadian telecommunications.
    As usual this shows that government regulation hurts not helps consumer.
  18. D K from Canada writes: Don't like the costs, don't get a cell phone. It's not a necessity. Stop your whining!
  19. Martin Renters from Hamilton, Canada writes: Those poor cell phone providers must have really had their costs rise lately. As a FIDO subscriber I've seen my long distance rates rise from $0.10/min to $0.20/min (perhaps someone in the cell business can enlighten me as to why long distance everywhere is is going down to pennies a minute but cell long distance needs to go up). I've seen my US and international roaming double from about $1.00 to $2.00 a minute (I'm sure there is a reasonable explanation for this this as well). My voicemail fee has also increased (I'm sure that infrastructure costs must account for that - after all, electronics and computer related components have skyrocketed in price lately)

    Perhaps those same cell phone executives can explain to me why they charge double for a handset locked to their network than what I can buy the same handset for unlocked from other retailers. Does the little FIDO logo really cost that much to put on?

    No - this is just gouging of the consumer.
  20. Freddy Sanon from Ottawa, Canada writes: #2 and #10, the 'You' in front of your username is there because you are logged in. It lets you know where your post (if any) appears on the page.
  21. dirk dirk from Canada writes: D Scheerer from Waterloo, Canada and
    J McElligott from Calgary, Canada.

    That's what everybody sees when you come across your own post.

    It's so you can recognizse your own post easier I guess.
  22. Mike Davey from Victoria, Canada writes: I urge everyone who is unsatisfied with the pay structure of cellphones to contact their MP and complain. Tell them you want regulations to prohibit outragous gouging by telecom companies. Remember that as Canadians, WE own the airwaves and license them to these communication companies. If they cannot provide service at reasonable prices, then the leases can be taken away and given to those companies who can give decent service at reasonable prices.

    It is totally outragous that pay as you go customers give their money up front, pay the most and if they don't use the minutes the time expires. Talk about rip-off. The companies get interest on your money, they get four to five times the cost per minute and then take the money if you don't use it up in sixty days. Why? Because they can.

    It's time for a change. The real shame is the sheep take it. If you just said 'screw you' and put your phone aside for a month, the phone companies would change their stripes, and their prices.

    I purchased my pay as you go phone for the purpose of emergencies and while on vacations. Eventually, I stopped buying cards because they were simply too expesive for a service I rarely use, especially when the card expires for no real reason other than to enhance the bottom line of a billion dollar company.

    I have stopped giving my money to the telus, sprint and bell investors.
    They make enough already.

    Reach out and touch your MP.
  23. Toby Smith from Burlington, Canada writes: #9 - instant karma, I am one of the 1/3 who will be leaving my current carrier (Rogers) when portability laws come in effect because of their blindingly terrible customer service. For my 11 cents a minute, I expect more (it's the least they could do)!

    I also hope that phone number portability (and the switching that will ensue) will increase cell suppliers desire to offer better customer service to encourage loyalty.

    Right now, I have been 'loyal' (read 'prevented from switching because so many people out there have my cell # that I don't want to lose touch with') to Rogers since 1999. Do you think they would give up one little penny to appease me in a disagreement I had with them (and much less the $20 admin fee I was trying to get back because it was never disclosed at time of purchase)? Nope. I pay them about $120 a month between my wife's phone and mine - they can afford it.

    The others probably do this too, but Rogers also sends their 'valued customers' SPAM text messages and 'straight to voicemail' advertising. And no matter how often I send in the required 'stop' text message to opt out, they keep on coming. I can't stand Rogers!! Cheap, cheap, cheap!
  24. H J from westcoast, Canada writes: My pet peeve with the cellular providers is the long distance charge. Seems to me that Canada/USA are the only countries where the recipient of a LD call gets to pay the toll for a call he does not want. It was only a few years ago when you had to activate follow me roaming when away from your home area, now all calls automaticaly follow me and I have the (privilage) of paying the telcos my .25 cents. With todays automatic switching/billing, it would be just as easy to let the call originator know that LD charges will apply if he proceeds with the call.
  25. Chris Kastein from Georgetown, writes: On the subject of expiring pre-paid airtime...the Provincial Government of Ontario just passed a law banning retail gift cards with an expiry date...the same rationale should be applied to Cellular Airtime...why should carriers be allowed to take our money without giving the service we've paid for??

    Drives me nuts that all the telcos will give new customers all kinds of bonuses and discounts to sign up...but if you're already a customer they could care less, because they know they've got you.

    I'm a VERY high volume user with Bell - over 1000 minutes a month, avg bills are $250 or more. And I'm willing to sign another 3 year term with them, if they'd only treat me in the same way they treat new customers by giving me the same offer! What brain-trust is willing to throw money at a new user but yet refuses to reward existing, highly profitable customers????

    I'm still using a 5 year old phone (one of the best ever made, works like a charm). Why? because I'm not willing to pay $400 for the newest phone. If I were to switch to another carrier I'd get it almost for free.

    I can't wait for number portability......
  26. Malcolm Ferguson from Canada writes: I'll tell you what's really help back wireless here compared especially with Europe (which also help back the US for many many years): the technology! The rest of the world standardised on GSM. Here it was ignorantly left to the markets. You can't switch from Bell to Rogers without getting a new phone. How dumb is that? Talk about vendor lock-in. Even Rogers and Fido don't do the same GSM as the rest of the world, forcing customers to be savvy about their phone purchases or not be able to use it when they're overseas. Why can't I go in to any shop in the street or on the internet and buy any phone I like and have it just work?

    As for billing - why do we let them get away with charging us by the minute? That means we pay on average for an extra 30 seconds every call! In addition, Rogers billing plans force light users to spend more than they need, and they'll rip you off and take away the time you've paid for if you don't use it.

    Gotta say I like the caller pays approach elsewhere - cuts telemarker's calls significantly! Finally: the rest of the world has free incoming calls, even if you're out of money on your account. Surely that's good just from a safety perspective - you can still be contacted.

    Tip for travellers: get an unlocked quad- or tri-band GSM phone and use it with a GSM phone company like Rogers (unfortunately). When you're travelling buy a local pay-as-you-go account, switch the SIM cards, and save money. Couple that with a local international calling card and you can bypass the ridiculous costs calling home. I accidentally answered my phone in the US recently - $2.50/minute to Rogers. Ouch. If you're a Bell customer and travel: too bad, you were screwed over again.
  27. Joel Remis from Canada writes: I cannot understand how cell users have accepted the change to per minute billing. We are being charged for something that is not even being used. Rounding up call times to the next minute must increase 'used' minutes by 50%. From a technology standpoint there is no reason why cell phone companies cannot offer per second billing. In fact 'grandfathered' plans still benefit from per second billing.
    With all the 'add-ons' that have become necessary (call display, call waiting, voice mail, text messaging etc.), the $25.00 plan quickly becomes $50-$60 per month.
  28. Bill . from Calgary, Canada writes: Some of the US plans seem too cheap. However, the Canadian plans are way over the other end of the spectrum. Rather than fairly price services, the cell companies seem to want to make extra from the long distance and the data plans. One can get an unlimited data plan in the US for $29 US, but a 250 megabyte plan in Canada for $100. Roaming in the US is absurd and there is no way to bring it down to a reasonable level. They shouldn't need 25 cents a minute and more for long distance within North America when it is supplied for 2 cents by other providers. I want to use my cell phone more, but I don't because I don't like to be ripped off. Price these things fairly and I will pay for them. There's no reason I should have to use a prepaid landline long distance card on my cell phone or have to pretty much threaten people to not call me unless it is a dire emergency when I'm in the United States.
  29. J McElligott from Calgary, Canada writes: #20 Thanks. I am sure that if computers catch on they will change the way we do business and perhaps I'll catch on too.
  30. Ken Olshaski from Calgary, Canada writes: Timothy (#3), why don't you try not standing in front of the microwave transmission cones. Now back to bed and your med's.
  31. Will Snodgrass from Calgary, Canada writes: Only a few more months to go for WNP - Wireless Number Portability. I work in the industry and even I can't wait for number portability. I have worked for all three and nothing changes. I swear they have no clue as to what customer service means. It's all about policy and not about the consumer anymore.

    I think we need to allow US and Foreign Inestors in change this market place.
  32. Eric Hindson from Calgary, Canada writes: It's interesting how competition (or lack thereof) drives pricing. I was in Hong Kong recently - where everyone, it seems, has at least one cell phone and was discussing cell costs with a shop owner who had only cell cervice. He was able, for example, to call his brother in Buffalo, NY for 10 cents HK, or about 2 cents CDN per minute. With more service providers comes more competition and lower prices. I expect (hope) that with the transferability of cell numbers from one carrier to another, due sometime in 2007, will come a frantic push by Bell, Telus, et al, to gain new and maintain existing customers by offering more reasonable pricing regimes. I found it curious that the CRTC at first said thgere was no need to offer number portability. Wonder what planet they were on at the time? And i sure as hell agree that expiration of cell minutes at the end of each month, not allowing rollover is nothing short of theft.
  33. Pretty Much from Toronto, Canada writes: I was actually excited about Virgin Mobile being launged in Canada. But whaddya know- Rogers is too big of a monopoly for any effective competition to be created. Its really very sickening.

    I remember Branson trying to launch his airline in Canada for domestic travel and even that landed with a thud.

    I dont understand why we are so protectionist. I know we cant be too loose, but at the cost of cheaper travel and communication?
  34. Malcolm Ferguson from Canada writes: HJ: your talk of roaming reminds me of another pet peeve. Why do we have regional area codes on cell phones? The rest of the world calls them 'mobile' phones for good reason. What sense is there in having a regional area code for something that isn't necessarily regional? Why when I go from Toronto to Ottawa do I suddenly have to pay long distance charges when I'm still using the same phone company? It's not costing them any more. It's a con. Companies like Vonage and Skype show how underlying technology renders long distance irrelevant. I can go to China with my Vonage phone, pay local internet access fees and my 416 phone will ring there, callers non the wiser. Rogers has the infrastructure in place: it doesn't cost them any more or less for me to connect to a cell tower in Windsor or Ottawa - so why do I get charged to do so?
  35. Misty Blue from Kelowna, Canada writes: Yes we have the same size country, with less of a population, but that's about it. Canadian carriers will never have to service the whole landbase of Canada, just various sized slivers here and there and some travel routes, but the investors want the same return? The landbase in the states is fully populated and ours isn't. Few in the tundra will ever have cell phone coverage, so the comparison lacks legs. Can anyone spell, 'gouged'? The other figures point in that direction for sure. I had a cell, pay as you go, and even gave that up along with my landline for VOIP. I used to use it like a pager and call back on a land line if it was important. Now I don't even do that. Thank the gods I had a choice that is workable. Tired of being gouged I am. I find no need to have my ears wired up to never miss a call. Messages and call backs work just fine and I never have to worry about turning my cell phone off or going off the road because I'm gossiping when I should be driving. If I had a vehicle I'd have pay and talk simply for emergencies when I drive, but other than that, don't need it. I've told many friends about my system and most have either changed or are waiting until their contracts are done.
  36. Iain Scott from Calgary, Canada writes: Couldn't wait to get to a land line? A bill this size would seem to indicate some kind of addiction problem. Alternatively, tech support might categorize the issue as Eye Dee Ten Tee.
  37. Tony Wanless from Canada writes: #18 and others. Thank you for the 1980s consumer view. We're not all babbling on our cell phones about last night's party. Many of us have to use cell phones because we're mobile business people and it's the only way to run a business today.

    Let me see: top-down controlled market, cushy collusion between big suppliers, government interference in the marketplace; contracts that enslave customers; result: users gouged. Gee, sounds awfully Canadian to me. Been the same for 100 years.
  38. Guillaume Afleck from Ottawa, Canada writes: 'They must build their networks across a similarly sized territory, but with only a 10th of the population to serve' Not true. Get out a map of the US and slice a piece about 100 km north to south all the way from the Atlantic to the Pacific. That's pretty much what the Canadian cell companies cover, so 1/10 the population and 1/10th the land mass. I switched to pay-as-you go some years back and still can't believe how the companies ream their regular 'contract' customers! System access fee - what a complete rip off! I really miss Clearnet too, they offered better deals than any of the old monopolists, no wonder Telus bought them to shut them up. I have a separate phone (cost $19 new) for when I am in the the US: 10 cents a minute, anywhere in the country including long distance, money in the account never expires. Someone here in Canada is guilty of a huge rip-off. Don't give them your money!
  39. rediscover truth from Mississauga, Canada writes: Check out the Rogers Financials. They have 40% margins on wireless. If you think that is bad - check out what their margins are on the Extreme High Speed Internet.
  40. D. Clearwater from Lethbridge, AB, Canada writes: MAryam (#5), wondering about the lack of competition writes: 'What I wonder about is why CRTC allows that - why did they let Fido be acquired by Rogers for instance?' The reason why the CRTC does nothing is because many idiots in this country are constantly crying foul when it comes to the CRTC... calling it a communist organization or something that should be disbanded. I just wish that these people would actually take the time to learn about the complex media landscape that is out there and why media monopolies (or oligopolies) MIGHT ACTUALLY BE BAD THINGS!!!! A lack of competition is not capitalism, people.
  41. Mike - from Waterloo, Canada writes: #7 has hit the nail on the head. So many pieces in the media are just regurgitation of the 'company line' ... and I love that they give Rogers, Telus and Bell the chance to make a point or two ... whereas the angry consumer is relegated to the lame comments section (like this one and the ones above!).
  42. Mike - from Waterloo, Canada writes: On a related note, in the U.S. it has just been reported (by AP) that the U.S. copyright will be modified so that cell phone owners will be allowed to break software locks on their handsets in order to use them with competing carriers.
  43. Tom Fry from Calgary, Canada writes: The question was, "why did they let Fido be acquired by Rogers for instance?" That assumes that Rigers and Fido were both robust, healthy competitors. In fact, Fido was dying. It had a loyal base in the cities, especially when they announced deals like their landline replacement package (1500 minutes for $40, incoming calls free). However, coverage in rural areas and smaller towns was non-existant. Even communities the size of Lethbridge and Kelowna (insert appropriate 100,000 pop. communities in your area if you don't live in the west) were not served. They needed capital in order to expand, but their margins were pretty finely shaved, and they were hammered pretty hard in some markets by temporary predatory pricing from Bell, Telus, etc. If Rogers had not bought them, someone else would have had to, or they would have gone under.

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