“In the end Bell always wins”


So said Peter Menzies, a former CRTC Commissioner, summing up many critics’ feelings in a recent tweet. He could have added ‘as do Rogers and Telus’ who, together with Bell, corner about 80 percent of the Canadian internet market which justifies describing them as an ‘oligopoly.’ He was responding to the decision by the CRTC announced on May 25 that it was giving back to the big three what it had taken away from them in a 2019 ruling.

The earlier ruling required them to reduce the charges which smaller internet operators have to pay to the oligopoly to piggyback on their broadband networks. This had the effect of reducing the rates those players charge their retail customers. The CRTC justified the reduction in 2019 by saying that wholesale rates had been too high for years.

According to a study conducted by Picoli in December 2019, Canada was in the top five of the most expensive internet plans in the world. We were paying $0.62 USD per 1 Mbps, in contrast to Americans who were paying $0.50 USD, Mexicans who were paying $0.35 USD, and Finns who were paying $0.18 USD. Canadian consumers who are forced to rely on cellular data through living in rural and remote communities are victimised by having to pay much higher charges to the oligopoly.

Andy Kaplan-Myrth, Vice-President of Regulatory Affairs at TekSavvy, one of the piggybackers, said, “Canada’s largest and most profitable telecom companies have successfully gamed a system with impunity.” He added, “The CRTC decision is a tombstone on the grave of telecom competition in Canada” and predicted that smaller players will begin to exit the market. TekSavvy followed this up by announcing that it will not participate in this summer’s wireless auction and that it has petitioned the federal cabinet to reinstate the 2019 decision.

The extensive lobbying that the oligopoly has engaged in over the past two years to restore the status quo has borne fruit for them, but not the Canadian consumer. How many times have we seen this movie before?

image MobileSyrup

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