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In the aftermath of the CRTC's hearing on a consumer wireless code and
the government's announcement of its plan for future spectrum auctions, a
debate has raged over the competitiveness and health of the Canadian
wireless market. Scotia Capital released a report last week titled "Canadian wireless myths and facts"
that argued the Canadian market is healthy and that "it is time for the
regulators to declare victory on the policies they adopted five years
ago". Meanwhile, Open Media issued a report titled Time for an Upgrade: Demanding Choice in Canada's Cell Phone Market
that places on the spotlight on many of the ongoing problems in the
market, with a particular focus on consumer complaints. The report
includes many recommendations for regulatory and policy reform.
The reality is that both the regulators and politicians have either
expressly or impliedly acknowledged that the Canadian wireless market is
uncompetitive. Last week, Industry Minister Christian Paradis promoted
the government's past moves on wireless competition, but admitted that "there is much more to do." Meanwhile, the Competition Bureau told the CRTC in its submission on the wireless code of conduct that:
certain impediments continue to diminish the effect of competitive
forces in this industry. First, certain industry practices have tended
to impose costs on consumers who wish to avail themselves of competitive
alternatives. Second, consumers are not always provided with sufficient
information in an adequately clear manner to make informed purchase
decisions.
This post seeks to extend the debate and respond to some of Scotia
Capital's claims. It identifies ten reasons why there is ample evidence
that the Canadian wireless market remains woefully uncompetitive when
compared with peer countries around the world with higher costs, price
gouging, and restrictive terms.
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