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Debating the State of Canadian Wireless Competition: The Present Isn't So Friendly

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Thursday March 21, 2013

Last week, I posted what I thought was a lengthy post on the state of Canadian wireless competition (and followed that with a condensed version in a column). This week, Telus' Craig McTaggart showed what a long post actually looks like as he issued a 42 page response to my post as well as recent posts by Peter Nowak (here and here) and Open Media. While I won't address everything in McTaggart's post - Nowak responds here and Open Media can address the issues focused on their writing if they wish - a few responses are in order.

McTaggart is clearly passionate about these issues, going so far as to suggest that claims that Canada's wireless market is uncompetitive is an "insult to TELUS' team members." Yet while he decries the use of older data, confusion of different issues, and cherry picking some statistics, he proceeds to do exactly that in his response. In fact, the oldest data I've seen in the myriad of recent posts on these issues can be found in McTaggart's response as he relies 2005 data to argue that Canadians use their wireless devices more than most people in the world (page 16).

McTaggart starts his commentary on my post on page 11, going through each of my ten points. I'll follow the same format:


1.     Canada's High ARPU Rates

My post began by arguing that Canada is the most carrier-friendly market in the world as the carriers extract higher revenues from their users than any other country as measured by ARPU, average revenue per user (Peter Nowak extended that analysis in his post). McTaggart says this is simply a function of Canadians using their wireless services more than other countries and therefore generating higher revenues. Yet the best evidence he can muster for that claim is a Comscore report that talks about Internet video (but not wireless access), data from 2005 on Canadian voice usage of wireless, and a Cisco report that lumps North America together.

The reality is that the Bank of America Merrill Lynch Global Wireless Matrix indicates that Canadian smartphone penetration is below the developed world average as measured by smartphones per capita. There is little to suggest that Canadians are the biggest users of wireless data. In fact, OFCOM, the British regulator, reported in December 2012 that the UK was the leading country in mobile traffic volume per connection and that France and China are the fastest growing countries (Figure 6.3).  Despite the UK's leadership in mobile use, its ARPU is $29.11, less than half of Canada's world leading $60.79. 

Moreover, McTaggart's effort to minimize the importance of ARPU runs contrary to each quarterly call from company executives. At the most recent Telus quarterly call in February, ARPU was referenced 22 times. That is typical for all the carriers, who are judged by business analysts based on their ability to maintain or grow revenue per user.  That creates a significant disincentive to reduce pricing and - as further discussed below - without sufficient competitive discipline to reduce pricing, leads to world leading ARPU.

2.     Canada's High Wireless Prices

My post cited data from the CRTC and FCC to support the claim that Canadians face higher wireless prices than those found in peer countries.  McTaggart doesn't dispute the figures, but argues that Canadian carrier costs are higher given our geography and so therefore higher costs should be expected. Yet it is not clear that Canadian costs are higher. McTaggart provides a chart on wireless revenue per km, in which Israel is the global leader and Canada ranks among the lowest revenue earners. However, the Bank of America Merrill Lynch Global Wireless Matrix indicates that Israeli wireless companies have far higher capital expenditures on a per capita basis than the Canadian carriers, despite the much smaller geographic footprint. In 2011 (the latest year of actual data), the three Canadian incumbents capex was 2.3 billion or about $66 per person. By comparison, the three Israeli carriers spent 1.05 billion or about $141 per person.

In fact, both Telus and Bell regularly tout how low their costs are given the shared network the two companies built. In 2011, their combined capital expenditure was less than Rogers, showing the value of splitting the costs. But their customers don't seem to benefit from those greatly reduced expenditures. In February, Telus CEO Darren Entwistle told business analysts:

To have a network sharing partnership that allows us to invest very effectively in coverage, reliability, cell densification, deployment of new technologies to address the data and consumption appetites of our clients - that's a big differentiating factor for us to make sure that we stay ahead of the curve on technology but we do it on a very client-friendly and very cost-efficient fashion.

That's a big benefit for the company, but there is not the price differentiation one might otherwise expect from a market where two competitors have sharply lower network costs. Indeed, in February Bell executive Wade Oosterman told analysts that not only does Bell have "a fairly significant cost advantage due to our network sharing agreement" but that he sees the prospect of increasing wireless data prices as "there should be some pricing power there to come." Later in the same call,  Oosterman notes that the move to LTE provides another cost advantage stating that "LTE is a lower cost infrastructure, lower cost to operate and carry traffic than alternatives." Despite the cost advantages, Oosterman boasts that the company does not need to reduce prices.

In recent months, all three incumbent carriers have focused on the shift to smartphones and prospect of 100% smartphone usage in the years ahead.  The message is clear: we can grow revenues from within as our customer base shifts to more expensive data plans. That is good for shareholders, but reduces the need to entice consumers away from other providers, which ultimately results in a market that looks uncompetitive to Canadians seeking better pricing.

3.    911 Carrier Fees

My post noted that carriers charge 75 cents per month for E-911 service that carries a tariff of ten cents. That is true for both Rogers and Bell, but I mistakenly included Telus in that group. McTaggart is right. 17 million Canadian subscribers pay an additional 75 cents per month for E-911, not 24 million.

4.    High Roaming Fees

My post cited the 2011 OECD study that found that Canadian roaming fees are among the highest in the world. McTaggart says the report is no longer accurate with respect to Telus, since it has since reduced its roaming fees. In fact, McTaggart says Telus seeks the lowest rates it can get and passes the saving on to its customers. But that isn't exactly what Telus executives tell analysts during the quarterly earnings calls. Over the past few calls, higher data roaming revenues have been consistently referenced by executives as one of the reasons for increased wireless earnings (this includes both customers roaming outside the country and non-Canadians roaming in Canada). For example, in the Q1 call held on May 9, 2012, analysts specifically asked about increased roaming revenue. Robert McFarlane, Telus' EVP and CFO responded:

What is changing, as you know, is the international roaming revenues for us as a result of the HSPA network build. And sometimes we kind of -- oh, yes, we built that a few years ago, so that's in the past. What we have to remember is that it enabled us for the first time to enjoy participation in non-US international roaming in a meaningful way. It wasn't instantaneous with respect to whole market, because it was with respect to people had HSPA handsets as opposed to GSM, and GSM was the dominant side of the base. So as time has marched on, more and more of the traveling base has HSPA phones, whether they're our clients going overseas, or whether they are oversea clients coming here. So there is a built-in inflator in volume, if you will, that is a multi-year dynamic that we are really only in year two of, so to speak. So I think that's a positive contributor -- it is a positive contributor to our ARPU growth year-over-year, and it would expected to be so on a go-forward basis.

Roaming revenues have continued to grow, with Telus citing it again during its most recent  quarterly report in February.

5.    System Access/Government Regulatory Fees

McTaggart doesn't claim error here - there is no disputing that Rogers charges a government regulatory recovery fee - only that Telus does not.  As I argued in my post, these costs would be a cost of doing business in just about any other sector, but for Rogers it is a chance to charge for spectrum licensing, CRTC contributions, and local number portability.  Other carriers (including Telus) have dropped the system access fee, but maintain an assortment of other fees for device setup, unlocking, and rate plan changes. 

6.    Smartphone Adoption

I raised the smartphone adoption issue in response to the unfounded Scotia Capital claim that three-year contracts may be responsible for high smartphone penetration. I noted that other countries are ahead of Canada in smartphone adoption and have banned three year contracts.  McTaggart says he will let Scotia Capital defend its claim.

7.    Unlocking Phones

McTaggart distances himself from Bell's claim that companies such as Apple might not sell immediately into the Canadian market if there was a mandatory unlocking requirement, though he argues that Canadian carriers have relatively weak bargaining power in negotiations with device manufacturers. He does note that Telus' fee is $35 rather than the $75 charged by Bell. That's obviously a better price, though it is worth asking why a consumer should be forced to pay anything to remove a lock they didn't want in the first place, particularly once their phone is not subsidized.

8.    Wireless Speeds

My post noted that recent data from Akamai still indicates that Canadian mobile data speeds are far slower than many peer countries. McTaggart trashes the Akamai data, calling it wrong, meaningless, and suggesting that even the company distanced itself from the Canadian numbers. But if you read the full quote from Akamai, you find that they stood by the report:

I believe that the listed mobile carrier would be considered one of the incumbents, and it appears that they do offer LTE service as well...Having said that, the observed speeds do look surprisingly low, especially compared to the US carriers (But they are relatively in line with the speeds we've seen for that provider in the other 2013 reports).

It is a surprise to see Canada ranked that poorly, but that doesn't mean that data is meaningless, particularly since many users are not on the faster LTE networks. In fact, the 2012 OFCOM study shows LTE revenues (as of the end 2011) with Canadian revenues and subscribers little more than a rounding error.  That may pick up over time, but pointing to LTE speeds today means little when most Canadians face slower speeds.

9.    Canada's Lower Wireless Penetration Rates

My post notes that Canadians may love their cellphones, but there are far fewer subscribers in Canada on per capita basis than in other countries.  McTaggart dismisses this criticism, pointing to differences in the European market and arguing that the difference with the U.S. can be attributed to wireline penetration and a six year delay in launching wireless services. Yet the Bank of America Merrill Lynch Wireless Matrix says that South Korea has the same wireline penetration, but wireless penetration of 106.7% compared to Canada's 78.2% (and South Korea started wireless services at the same time as Canada).

Moreover, the U.S. comparison is still relevant, with 107.6% wireless penetration in a market that shares many of the same characteristics as Canada (and claims that the wireless industry, now in Canada for nearly 20 years, is still behind due to a late entry seems fanciful). McTaggart maintains that smartphone penetration is the more telling figure, but given that Canadian wireless penetration ranks below every country in the Wireless Matrix with the exception of India, Pakistan, and Bangladesh, it is hard to see why (as noted above, the Wireless Matrix also reports that Canada is below the developed world average in smartphone adoption).

10.    Spectrum Inefficiency

McTaggart response does not dispute the issue of Canadian spectrum inefficiency, only that Telus should not be included in the list of the inefficient. He notes that Telus has less spectrum than Bell or Rogers, implying that the hoarding problem may be real issue with their competitors.
Comments (47)add comment

Bo said:

Retired
I use Telus in Kitchener but it is really subcontracted to Bell. I noticed both my LTE smartphone and 4G hotspot service deteriorate over the past couple months. I used inSSIDer and Speed Test to optimize my channel settings and room positioning ... to only minor improvement. I submitted a tech request for help. Their response was that I needed two phones to allow tech support to test. We got rid of our land line from Bell and moved to a single smartphone with Telus because we were upset with Bell service. So what do we get? Bell as a subcontractor and the requirement to have two phones to get tech support. Whatever happened to something like VPN tunnels etc. to digitally test the system without the hassel of long distance calls. So much for real customer service.
March 21, 2013

m.b. said:

Unlocking Phones
Funny that mctaggart can claim vendors won't sell to a canadian market if phones are unlocked, when any Canadian can buy an unlocked iphone directly from Apple's website or for 1/2 the price one can also get an unlocked Nexus directly from the Google. Telus may be the lesser of two weevils, but it is still a parasitic grub.
March 21, 2013

Jim R said:

...
I would think that "wireless revenue per km" is a rather pointless metric. What would be more interesting is "wireless revenue per number of base stations, antenna stations, etc".
March 21, 2013

Cynic said:

...
@m.b.

Can you show us where on the Apple website they are selling iPhones for half what carriers charge? The cheapest iPhone 5 (64GB) I could find on Apple's webstore was $899.
March 21, 2013

Jim R said:

Unlocking Phones
The phone unlocking excuse is incredibly lame. The carrier cripples the phone, and then makes us pay to have it de-crippled. There is absolutely no justification for this. And the distinction between on-contract (subsidized) vs off-contract (unsubsidized) phones is contrived. In either case the phone is yours - it's just a matter of how you're paying for it. And just because a subsidized phone is unlocked, it does not mean that you're magically off the hook for contract termination costs.

Phone locking *only* benefits the carrier's unjustifiable business model of making it as difficult as possible for you to pop in a "foreign" SIM when you're visiting a country outside of Canada, and thus avoid your carrier's outrageous roaming charges.
March 21, 2013

ENO said:

...
I own my phone thus I charge a sim cards. This is the defacto standard in Europe (buy the phone you like and choose the carrier you like buying their SIM card).
In Canada, if I charge my sim with 10$ and use only 5$, at the end of the month the card expires and if I do not recharge it I lost my unused 5$. This is totally illegal in Europe because the unused money are your money and not the carrier money (in Europe they also have to transfer your unused money to a new carrier if you change it).
In Europe you can charge a SIM as low as 5$ without any expiration date. Why here is not possible? Why is not possible to just pay for what you use without the carrier stealing the unused money at the end of the month?
March 21, 2013

m.b. said:

...
@cynic. You misread me. For 1/2 the price of an iphone you can get a google nexus. (A better phone anyway, IMHO.)
March 21, 2013

Ramblin Rose said:

How many people actually use the air time they pay for?
I had two three year contracts with Bell Mobility before I left and went to pay as you go (and not with them), which is costing me $7.00 a month and I'm still accruing time, because it's largely an emergency/occasional use phone. How many people if they sat down and did a spread sheet of their usage would find out they are not using anywhere near what they paid for and it's the fear of the penalty costs that has then over paying and it is the three year bundled contracts for Internet and TV that prevents them from leaving without a severe penalty?

I will never again have a contract with any of them, not even for a year. I have unlimited Internet and hopefully by summer over the air HDTV supplemented by Netflix and other streaming services.

Leaving them in droves is the quickest way they will change their tune!
March 21, 2013

Cynic said:

...
@m.b.

You're right, sorry I misread your comment. It would be interesting to see how Apple's sales of $899 iPhones compares to Rogers who sells the same phone for $199 with a three year term. I don't have any data but I suspect a lot of folks would still opt for the $199 iPhone rather than the $899 iPhone to save themselves $600 on their initial cash outlay. The folks who select the $199 iPhone are exercising their choice as consumers to take the discount in exchange for a term commitment, and I strongly believe having a choice is a good thing. I wonder if there would be fewer iPhones in Canada if everyone had to pay $899 to buy one ...
March 21, 2013

Grump said:

@Cynic
"I wonder if there would be fewer iPhones in Canada if everyone had to pay $899 to buy one ..."

Perhaps there would just be fewer *$899* dollar iPhones (since Apple would be under more pressure to compete on price).
March 21, 2013

Codegen said:

They try to have it both ways
I'll believe the geographic argument when I see coverage in the more remote areas, or even in the less remote areas. I live in Eastern Ontario, and there are a significant number of places here where there is no coverage (I use Rogers). There is coverage on the main highways, but get much off the main highways and it is a crap shoot. So it seems to me that they are charging more because it is "geographically challenging" but they don't seem to follow through with the coverage.
March 21, 2013

Cynic said:

...
Mr. Geists hypothesis that Canadian roaming rates are high warrants a deeper look at the OECD data he uses to build his argument. The 2011 OECD report states that Canada has the highest roaming rates for 1 MB of data transmitted in one session. But the report also ranks Canada as the 6th cheapest of the 35 OECD countries for 20 MB of data transmitted over a one month period. Any conclusions about relative rankings need to consider usage - cherry picking the data to draw broad conclusions is definitely a no-no with OECD reports.
March 21, 2013

Grump said:

@Cynic
The 2011 OECD report itself notes (on page 15) that "charging patterns
vary greatly depending on whether this data is used on a single day (for
which daily plans are especially well suited) or over different days."

If you look at the graph for 20MB/month (Figure 10, page 19), you will
see that Canada is part of the long tail to the left and sits near the
mean height (price) within that local subset, while a clear minority
(6 or 7 out of 35, or 17% to 20%) of the highest priced countries (for
the case of 20MB/month) sit to the right. These are the exception, not
Canada, since they contribute disproportionately to raising the average,
while Canada sits in the middle of the rest of the pack, at least for
the 20MB/month use-case; while Canadian carriers are undoubtedly better
than these clearly-worse countries (who contribute more than others to
a high average price), for 20MB/month, it's also not as simple as your
statement that "the report also ranks Canada as the 6th cheapest of the
35 OECD countries for 20 MB of data transmitted over a one month period."

Further to that point, Canada is also in the 6 *most* expensive for 20MB
in a single session (Figure 11).
March 22, 2013

Grump said:

...
In a different direction, I have to wonder: why are 1, 5, and 20MB
costs should even be considered relevant? Are (were) Canadians really
expecting/using so little on their smartphones (even) in 2011 (which is
either an eternity ago from Telus' perspective, or still relevant enough
to today's plans to be used as a reference billing model, depending
on the bite of the axe being ground)? For comparison, 20MB per month
is approximately 61.73 *baud* (bits, not *bytes*, per second). (I'm
not noting this for your sake, Cynic, but for everyone else's.) For
comparison, that's 0.0001% (one ten-thousandth of one percent) of a
dial-up account from 20 years ago, and 0.64% (6.4 tenths of one percent)
of the speed of a 22-year-old (in 2011) fax machine (9600 baud), or
approximately 1% of the usable analog cellular data rates from 15 years
ago ( http://connectwirelessweb.com/...ternet.htm
). 20MB is approximately 30 or 40 webpage views, which is about how many
tabs I have open on my laptop now. While no one expected to use their
cellphone 24/7 for data 15 years ago (the screens were text only, and
just a few lines), in a sense, we do seem to be going backwards: today
we are expected to use a lower and lower percentage of the actual link
capacity available, and to use our devices for proportionally less than
they are capable. Speeds have increased dramatically, but prices have
not gone down proportionally.

As I said elsewhere, we are being marketed a service we are largely
expected not to use - but we are still expected to pay a premium for
the privilege. The pressure is increasing because people want to use
their tablets and smartphones to stream music and video too - and not
unreasonably since its what they were sold on when they signed up. If WiFi
and cellular services were inherently complementary (mutually exclusive),
this situation would be be fine, but data is data regardless of location,
so we need to bridge the cellular/Internet gap...

https://www.engineeringforchange.org/news/2010/06/21/ open_source_cell_phone_network_could_cut_costs_to_2_per
_month.html
March 22, 2013

Grump said:

link
The link at the end of my comment got mangled, but hopefully this one will work:
http://bit.ly/jP0P8C
March 22, 2013

Cynic said:

...
@Grump
If we were to ignore the outliers in the 20 MB table, your logic would suggest that we should also ignore the outliers in the 1 MB table,of which Canada is one of the outliers.

The 2011 OECD Report says the OECD average data roaming rate is $9.48/MB. I'm a Telus customer so I checked their website and found they charge $5/MB for roaming to the US and Europe (about 50% lower than the OECD average). With a travel pass, the cost comes down to $1/MB (about 90% lower than the OECD average).

I don't think anyone would disagree that the cost of data roaming off-net from your service provider's home network can be expensive. But that is the norm anywhere you go in the world. Fortunately it is very easy to avoid data roaming costs by purchasing a local SIM and becoming a local subscriber in the country you are visiting instead of paying foreign visitor rates.

A few years ago I was visiting Costa Rica. The cost of renting a car was $45 per day for foreigners and $15 per day for locals. The idea of charging foreigners a premium for services isn't unique to mobile data roaming.
March 22, 2013

Darryl said:

...
LOL. 42 Pages eh?. Well I guess if they can't baffle you with bulls#*t they will certainly bury you in it.
March 22, 2013

Stifel said:

...
@Cynic

I just looked at the OECD Roaming report and it says Canadian pay the most for mobile data roaming ($24.61 USD) when travelling abroad. But you say Telus only charges $5 per MB, or $1 per MB on a pass so I checked Telus's website and sure enough your numbers for Telus are correct. There's a huge discrepancy between what the OECD says Canadians pay and what Telus charges. Someone's not telling the truth ...
March 22, 2013

Cynic said:

...
@Stifel

If you look in the footnotes of the 2011 OECD report you will see that they collected the roaming price data back in 2009. It's also important to recall that there was a big international roaming shakedown between the Canadian carriers around that same time. In 2009, Rogers had a virtual monopoly in Canada for European and Asian roaming with their GSM network. Prior to that, Bell and Telus both operated on the CDMA standard which was pretty much limited to North America. They both started up GSM compatible HSPA networks at the end of 2009 which finally broke Rogers monopoly for roaming outside of North America.

As a result, the OECD roaming report and its conclusions are actually based on 4 year old data that predates the overthrow of Rogers Canadian roaming monopoly. But hey, if we were using current/relevant pricing data we wouldn't be able to have this awesome debate about awful things are in Canada.

March 22, 2013

Grump said:

@Cynic
"If we were to ignore the outliers in the 20 MB table, your logic would
suggest that we should also ignore the outliers in the 1 MB table,of
which Canada is one of the outliers."

I would partially agree there (to spare myself and others a proof
by contraposition), but with Canada in the outlier set, my question
changes from "how far off base are we?" to "how the heck did we get way
out there?"

(If we did throw out the highest rates in the 1MB Figures, as you mock,
presumably to show that Canada was not over-priced, we would have to throw
away more than 1/2 of the lower values to paint Canada in a positive
light, and throwing away higher vales, even if they are outliers, only
makes Canada move higher in the ranks... Assuming it's even still in
the set, because in this case it was the one that was way off base.)

Your quoted rates are obviously better than the OECD's rates (from
2011). Maybe the OECD had trouble finding it on the website before
booking the flight. :)
March 22, 2013

Joah Moat said:

...
I just want to take a moment to say, thank you Mr. Geist. Your consistency in reporting the facts regarding our Canadian broadband industry is very much appreciated. I hope that all of our knowledge may someday avail us a healthy return. For now, I wish you enjoy your weekend and love your family like you love your work.

Cheers,
March 23, 2013

Grump said:

...
I have to say, I was (pleasantly) surprised to see Telus' roaming price
drop (at least compared to the 2011 OECD report). For a moment there,
I was tempted to think roaming rates may have been starting to shape up
within Canada... My hopes were quickly dashed.

I dare say the US is a few orders of magnitude ahead of us, even with
Telus' (noteworthy) roaming drop. Here's just one option for US travellers
with prices of 0.04 to 0.01 USD/MB (with the purchase of a SIM card):

http://www.roammobility.com/compare/telus

We're talking cents, not dollars. Even if the 2011 OECD should be
questioned due to it's age, I see no reason to think we are leaders. It
looks like roaming rates are coming down elsewhere, and perhaps across
the board.

I was unsuccessful finding more thorough and recent international
comparisons, but I did find the following gem...

From the mouths of Wall Communications, Inc on behalf of CRTC less than
1 year ago, from their report entitled "Price Comparisons of Wireline,
Wireless and Internet Services in Canada and with Foreign Jurisdictions":

"Roaming charges are also not included in any of the wireless service
baskets [in the report] as the complexity of including them would
make obtaining reasonably straight-forward comparable measurements
impossible." ... "We recognize that roaming charges can be an important
component of some users? bills, in Canada, the U.S. and in other
countries. A separate examination focused solely on roaming charges
would be the best way of providing useful comparisons."

( http://www.crtc.gc.ca/eng/publ....htm#ftn13 )

I'm looking forward to those numbers, and appreciate the corroboration
that the plans are practically incomprehensible, even to industry analysts
(imagine how hard it is for those of us who are just trying to go about
our lives...).

Of course, charging by the megabyte at all - on per-handset links with
speeds on the order of megabytes per *second* (making it possible to transfer
over 8GB per day, even on very slow networks) - still feels like an
anachronism to me...
March 23, 2013

Grump said:

...
OK, my head is officially spinning... As a testament to my own (admitted) confusion (over roaming prices), I have to correct myself: roammobility.com looks like it's *for* Canadians travelling to the US (so, Canadian pennies per MB to roam), which make's Telus' $1/MB look high in comparison.
March 23, 2013

Cynic said:

...
@Grump

The best way to avoid roaming charges is to become a local subscriber in the country you are visiting. That's exactly what Roam Mobility is doing - they are reselling US local SIMs to Canadians. So you get a US phone number to use while you are visiting in the US.

You can save even more money by dealing directly with a US cell phone company and buying your SIM directly from them instead of going through Roam. They are just a middle man.
March 23, 2013

Cynic said:

...
@Grump

Verizon (US) charges its customers $2.05/MB for data roaming into Canada. Telus charges its customer $1.00/MB for data roaming into the US.

My experience is that you have to do your homework before travelling to any country, even the US. The laws for renting a car in the US will make your head spin as well - in Florida you need an international drivers licese and in Nevada you have to insure for the rental company's loss of income if you damage the car, the added facility fees usually exceed the rental cost of the vehicle. Legal blood alcohol limits and drinking ages differ by state, the list goes on and on .... Just because your cell phone works when you turn it on in a foreign country doesn't mean the rates and fees will be the same as you get back in Canada.
March 23, 2013

Grump said:

@Cynic
Thanks for the tip! It wasn't apparent (to me) that Roammobility was
reselling a US subscription (and phone number) to Canadians.

It still makes me dizzy...

OK, so, as I understand it Verizon charges it's US customers who travel
to Canada more (2.05 USD/MB) than Telus charges customers who travel to
the US. Does that not suggest that the true price to the subscriber's
carrier for using the networks in the other (in this case Canada)
country is higher? Verizon would have to charge at *least* the true
cost of roaming in Canada and Telus would have to charge at *least*
the true cost of roaming in the US. The US dollar is worth more than
the Canadian dollar presently, compounding that difference (Canada's $1
CAD/MB is actually more like 98 cents US). Now, if competitive pressure
were moderate to high I would expect those rates to reliably reflect
(with a fair margin) the minimum of the true cost to the subscriber's
local carrier. If it weren't, wouldn't that imply that either competition
was low in the US (Verizon can get just away with charging more, which
I have not reason to believe) or that the real price of that roaming
(what carriers in Canada charge Verizon) is actually that high, implying
competition in Canada was (still) low?
March 24, 2013

Grump said:

typo
"is actually that high" should just be "is actually higher"
March 24, 2013

Cynic said:

...
@Grump

Ok, then let's look at another example. Verizon's price for roaming into Europe is $20.48/MB, Telus charges $5/MB. Presumably the European carriers would be charging Verizon and Telus similar prices for providing data roaming, although it would be reasonable to expect Verizon, with its 12x larger subscriber base and call volumes, could negotiate a better price than Telus. Yet Verizon charges 400% more than Telus for data roaming to the same countries. In addition to their stronger negotiating leverage, Verizon also has the currency advantage. Perhaps the Canadian market really is more competitive than we realize ...
March 24, 2013

Cynic said:

...
@Grump

Let's look at the cost of data roaming to Asia. Telus charges $10/MB, Rogers charges $30/MB and Verizon splits it down the middle at $20.48/MB. Let's not forget that the OECD says the average data roaming price is $9.48/MB.

It is worth noting that Rogers charges 300% more for data roaming to Asia than Telus does. Verizon charges 200% more than the OECD average and Telus is roughly in line with the OECD average.

If the Canadian market was truly as uncompetitive as you suggest then you would expect all the service providers to have prices that are clustered together at the higher end of the scale.
March 25, 2013

Cynic said:

...
@Grump

How about a couple more examples. Roger charges $30/MB for data roaming to Asia, Verizon charges $20.48/MB and Telus charges $10/MB.

If the US market were more competive than Canada you would expect Verizon to be the price leader, but they aren't. If the Canadian market was as uncompetitive as you suggest, you would expect the Canadian carriers would be clustered together at the high end of the scale, but they aren't. Rogers charges 300% more for the same data roaming offered by Telus.
March 25, 2013

Yuval Levy said:

Set Them Free To Compete
(1) force operators of cell phone towers to offer service to *any* cell phone that is technically capable to connect with them. Today they only offer service to cell phones bearing their SIMs or to the few roaming foreign cell phones.
(2) let prices float freely. let operators set the price they want. let them discriminate price-wise between their own SIM cards, the SIM cards of other Canadian operators, and the SIM cards of foreign operators. Let them discriminate freely based on geography and time of the day. Let the free market work.
(3) force operators to publish real time prices, per antenna, and to quote them to customer by SMS within 60 seconds on request.
(4) This will work similar to today's roaming: a phone user in downtown Toronto is in reception range for at least three operators. Instead of being forced to use the one operator with whom he has a contract, the user (or his smartphone, automatically) can send an SMS to a pre-defined number and ask all operators for a quote. Operators must return, within 60 seconds, a price per minute and a price per MB in a format that is easily parsed by a cell phone app. The operator can discriminate at will and offer better prices to its subscribers than to the subscribers of other operators. The user (or the smartphone) can choose which operator to place the call with, based on criteria such as price or signal strength. This is free market.
March 25, 2013

Grump said:

@Cynic
"Presumably the European carriers would be charging Verizon and Telus
similar prices for providing data roaming" I don't think I can accept
that at face value. It doesn't fit my intuition, and I don't have enough
evidence for it.

My intuition is that US carriers are just able to get away with a form
of highway robbery that would make Canadian carriers drool and wish
they had as much leverage as US carriers have over their subscribers
(to say nothing of their influence over their roaming partners). The
US isn't necessarily a paragon of competition. It's conceivable that
they have more leverage over their roaming partners and also less
reason to pass it on to subscribers (with 12x our subscriber base,
they have 12x the reasons to charge and extra penny of margins). As
I recall the US just made cellphone unlocking illegal (creating an
uproar), something that Canada seems to be moving away from on one hand
( http://www.parl.gc.ca/LegisInf...Id=5218290 )
and towards on the other (C-11's TPM stuff), proving companies (and US
carriers specifically) will take as much line as they can get. The US is
far from perfect, but not being *clearly* the worst doesn't automatically
make us the best.

There are many factors that affect the real cost of roaming (pricing
norms/subscriber complacency, government incentives, peering agreements,
trade dependancies, etc).

It is quite conceivable that roaming prices to the US are encouraged more
by the US' economic position than industry-specific or country-specific
leverage and competition. The US is an economic hub, so it's to be
expected that inbound transit will be less costly (the rich get richer);
all roads lead to Rome... Highly-competitive countries (not just in
the mobile space) have a reason (not always an overwhelming reason)
to discourage (charge more for) outward travel and roaming though (for
example, Verizon's price, even if they have more leverage), if they can
get away with it, since it generally comes at the expense of domestic
activity - except, to a large and interestingly degree, Canada, since
we have a huge trade dependency. There is pressure for Canada to operate
more like a part of the US than to offer strong international competition
(substantially discouraging roaming) - even if it's something Canadian's
are asking for. If that is affecting roaming prices, in addition to
not competing effectively domestically, I might argue that we are not
competing effectively internationally either.

An Orange (UK) subscriber roaming to Canada pays 15 GBP/30 MB/day
http://oran.ge/Yu8iTy

For roaming to the US 6 GBP/30 MB/day http://oran.ge/YdUmIH

This is by no means exhaustive but (we really need something like the
OECD report), by my original arguement, Canada likely "costs" (taking
everything into account) more to UK-originating roamers than does the US,
assuming adequate competition. That's really the big assumption though, as
we seem to be able to argue both sides. We need a more recent study (and
it would be nice if our carriers were more transparent about those costs).

For whatever reason, it seems more attractive to Canadians to roam to the
US than the UK, and more attractive to Brits to visit the US than Canada,
and more attractive to US citizens to come to Canada than the UK. That
really seems to reflect trade relationships more than just domestic cell
carrier leverage, competition, or lack thereof.
March 25, 2013

Grump said:

@Cynic
One would think that both sides of the same wire would cost as much
to transmit the same signal, but clearly they don't and, as you say,
"the idea of charging foreigners a premium for services isn't unique to
mobile data roaming."

Your observation that Telus is cheaper than Rogers (and Verizon)
for roaming to Asia, again, seems to reflect larger relationships and
might have something specifically to do with Telus and Bell collusion
in order to "compete" with Rogers (for example, the Rogers price looks
like what you would expect if they had to detour through a US carrier
to ), though I do not really view that as competition. Those numbers
that say Telus, Bell, and Rogers each hold approximately 30% of the
market should actually say Telus-Bell has ~60% and Rogers has ~30%. Any
comparisons between Telus, Bell, and Rogers' activity and prices as
examples of competition begs the question (assumes, circularly, that
they are really in competition), when they still form a very small club
with very high control. http://natpo.st/KBNw6S

Whatever the cause, Canadians are trying to understand their bills but
can't: http://huff.to/WAwKM2

From yesterday: http://bit.ly/11CgcqR

Yuval Levy has touched one one approach that I would add to. We have local
number portability for PSTN numbers, but it needs to be streamlined and
expanded. LNP to VoIP carriers should be possible in ALL areas to any VoIP
provider without delay, using the Internet. With a thriving VoIP market of
Internet back-hauls, cellphones would have to compete with soft phones,
forcing them to become efficient data carriers. Phone numbers, like IP
addresses, are just routing numbers. An IP address can be re-routed
almost instantly, and a DNS name within minutes. This should not be
the privilege of any carrier. *I* should control my phone number or DNS name,
and I should be able to use it where ever I am in the world by simply
telling my carrier where I am. This would eliminate roaming altogether
(meaning it will destroy a cash cow), and make everyone a local subscriber
wherever they go.
March 25, 2013

Cynic said:

...
@Grump

I checked the Orange UK website for their data roaming prices (pay as you go) to the US and it is approximately $12/MB. Orange's price to most Asian countries is also $12/MB. I think this still demonstrates that Telus's pay as you go roaming rates to the US of $5/MB and $10/MB to Asia are still favorable for Canadians. Your allegation that Bell and Telus are colluding rather than competing would require that they offer similar prices - I just checked Bell's website and their international roaming prices are higher than Telus but lower than Rogers so the basic facts don't support your hypothesis.

I'm not sure where you got the impression that you can't port your phone number over to VOIP providers. You most certainly can. The VOIP market never really took off as some people expected it might. I admit I tried Vonage a few years ago but I didn't find any compelling reason to keep using it - call quality was completely unpredictable (somedays excellent but most days poor), and by the time you added up all the costs there really wasn't a meaningful savings. My belief is that consumers simply didn't see enough of a value proposition from VOIP providers so the market flopped. I also believe it would be hugely inppropriate for governments to step in to try to artificially prop up failing business models. Let consumers (i.e. the market) decide which service providers will thrive or fail.

I also think the majority of consumers want simplicity. We have all seen the backlash against carriers that put too many line items on the bill (e.g. 911, regulatory fees, etc.) so I seriously doubt consumers would appreciate more details on their bills such as per tower billing as suggested by Yuval Levy. Many consumers already struggle with the complexity of wireless services per your example of the guy who let his kid watch YouTube vids while on vacation in Mexico. That's a great example of a fellow who didn't put enough effort into understanding the technology and the cost of the service he was using. Had he understood what he was doing he would have picked up a local SIM from Telcel when he got to Mexico and saved himself a lot of trouble.

March 26, 2013

Grump said:

@Cynic
Telus' $10 is more than Oranges $9.25 (1 GBP = 1.54 CAD) for Asia, which
is consistent, merely reflecting local subscriber's geographic location,
travel expectations, and their country's global economic relationships
(imports v exports). Roaming rates are still a black box.

Our discussion seems to be moving across the pond, but if I can return to
the US: http://bit.ly/14sfDEt (FCC Still Won't Declare Whether Wireless
is Competitive)

Without more transparency the customer has no way of knowing why they are
being charged that $10/MB for potentially less than 1 second of network
traffic. (That's only 25 or 26 million dollars a month for a lost phone
and an eager thief; nothing to worry about, really...)

"I also believe it would be hugely inappropriate for governments to step
in to try to artificially prop up failing business models. Let consumers
(i.e. the market) decide which service providers will thrive or fail."

I typically agree with this sentiment, however, it is also my belief
that 1) VoIP is obviously the future, simply by definition of being
dependent only on the general data network, and 2) VoIP has not yet
even had a fair playing field and is still at an unfair disadvantage
because of the PSTN operators' roles as non-neutral intermediaries
(if we want VoIP, we will have to do something about that), and 3)
Vonage can't even port my local number, none of the VoIP providers can,
and the present LNP is an obstacle to that. (From Wikipedia: "Not all
exchanges support LNP, typically there needs to exist competition within
an exchange before an ILEC will enable portability, and then only by
request." http://bit.ly/10beOc3 ) I can still use VoIP if I give up
my number, which everyone I know has in their address books. As I said
in a comment on another page, I am convinced that at this time and with
today's technology, VoIP providers are at the mercy of the old PSTN guard
(for example, Vonage's prices - as you yourself observe - are not very
attractive). VoIP is just data. Surely data costs less today than 10
years ago. Current prices would have me believe otherwise. Something is
wrong when every entree smells like old seafood.

If government and commercial forms didn't require a PSTN telephone
contact number, I'd say just get a new IP number, but that is not an
option for all of us. Telephone numbers should not be controlled by
telephone companies. The old telephone network, in this case, is the
failing business model and should have failed by now, were it not for such
monopoly claws as LNP (among others). Mandating low-cost control of fixed
(mobile) IPv6 addresses, for example, would also be a solution since
at the moment static IP addresses are considered a "business feature"
(cost prohibitive), and even then they are not ultimately controlled by
the subscriber. Again though, it's just routing, so I don't agree with
your "hugely inappropriate" claim. Today's telephone companies thrive on
far more of the government's inappropriate intervention (spectrum rules,
subsidized networks, etc).

Fixing LNP would revolutionize telecommunications. I do not own telco
stock, so that seems like a good idea to me, but I can only speak
for myself.

"Your allegation that Bell and Telus are colluding rather than competing
would require that they offer similar prices"

No, I can imagine an agreement to simply stay out of each other's
waters. You're right though, it's just a hunch, and I can't possibly go
to every mobility website to find every permutation of cost to simply
make a stronger hypothesis. That's the problem with monopolies: a pure
lack of accountability. (Case in point, with banks, the recent LIBOR
rate-fixing scandal.) I would support a breakup of mobile providers from
Internet provider from PSTN and cable incumbents, if consumers and the
current players can't find more common ground.

"I seriously doubt consumers would appreciate more details on their
bills such as per tower billing as suggested by Yuval Levy."

I do (yes, things would look even stranger for a while, but at least it
would be easier to pinpoint the rot), though I was actually thinking more
along the lines of transparency and accountability reporting so people
know the real costs and can easily compare services. Perhaps something
like a national carrier price matrix that allows people to see and sort
by feature and limits on one page, that way we don't have to wonder if
our data are out of date. As it stands, I would almost rather my phone
simply not work (or worked for only basic/emergency features, like 911)
without a SIM from a local carrier than have to wonder what my bill will
be when I get home.
March 26, 2013

Grump said:

@Cynic
"Telus' $10 is more than Oranges $9.25 (1 GBP = 1.54 CAD)" is obviously wrong. I did the currency exchange backwards. Ignore that nonsense. But, http://www.vodafone.co.uk/shop...ng-abroad/ shows roaming rates from the UK to Asia (for example Taiwan) for 5 GBP/25 MB/day. 5 GBP/25MB is 7.70 CAD/25 MB, which works out to 9.24 CAD/30 MB, which fits nicely there instead.
March 26, 2013

Cynic said:

...
@Grump

It's good to know there are some carriers that offer lower roaming rates in the UK that are on a similar scale with the low rates offered by Telus. I think the key lesson here for everyone is that you should shop around because there are lots of choices in both the UK and Canada.

I know you would like the market to give the VOIP companies another chance but I really think that ship has sailed. They gave it their best shot but failed to deliver a sufficient value proposition to consumers. I think there will always be a niche for some VOIP operators and those consumers who don't mind the extra complexity/effort to make calls using VOIP. I don't know if Telus still does this but a while back they partnered with Skype http://ow.ly/jsLer to makes it easier for Telus customers to use Skype on their mobile phones.
March 27, 2013

Grump said:

@Cynic
"They gave it their best shot but failed to deliver a sufficient
value proposition to consumers. I think there will always be a niche
for some VOIP operators and those consumers who don't mind the extra
complexity/effort to make calls using VOIP. "

In your admirably-vigilant defense of Telus, you've hit the nail on the
head. The extra complexity/effort of VoIP is a direct result of its
second-class status in the plutocratic phone network. Early adopters
hoped it might go away with greater access to the PSTN, as the Internet
grew and gained critical mass (and Google continues to hope will, by not
charging for Google Voice calls), but it hasn't. That's not an example
of the market rejecting a technology, as you suggest and then dust your
hands of. The sorry state of phone and mobile competition in Canada,
prohibitively high data rates that do not reflect the real costs, and
legislative failures like the broken state of LNP, have all stopped VoIP
cold on the runway, where it still sits today.

Let's be honest. Cellphones are VoIP, only on a network controlled
end-to-end by carriers. Voice calls are an application of data and a
minuscule - yet highly profitable - one at that, compared to other data
applications. The simple voice interface for that data on a cellphone
is simpler than other VoIP applications because telco incumbents
have undue leverage over the telephone network. The government can
fix that by encouraging competition in the data side to break those
glacial monopolies. That change is coming, despite Telus' token Skype
ribbon-cutting.

The commenters on your CBC link aren't fooled: "Skype is already available
for most smartphones. All this announcement means is that Skype is paying
Telus to bake Skype into some phones."

Most smartphone owners didn't need Telus' permission for Skype, nor
should they.

All my earlier comments still apply. LNP is not necessarily available so
user's still have to give up their home phone number (if not their area
code) for Skype, and get doubly-hit since the have to pay for a Telus
voice plan, pay Telus' data rates, and finally Skype's termination rates,
making the savings nil. Of course noone's biting.

Free markets are one half of a growth curve - the bottom half. The top
half is that of a stagnant market that precludes further innovation to
preserve existing interests. As such, a "free" market requires constant
attention (intervention, of a disruptive nature, with the same vigilance
Jefferson alluded to in respect of governments) to break monopolies and
to give other solutions the same chance to grow that was available to
the present incumbents when they were opening shop. VoIP has not failed
by any means - nor does it show any sign of giving up, despite having to
run on only one leg with Telus rollerskating gaily around, shouting back
"Hey buddy! Why the long face?!".

With Microsoft's purchase of Skype, people are hoping things will heat
up, but even Microsoft can't force regulatory change, so most of us are
still, for all intents and purposes, stuck with Telus: where the future
will continue to be touchtone for at least the next 15 years.
March 27, 2013

westjack said:

...
There is an easy answer to overcharging that has been around since day 1 - quit buying. I would love to have access to a smartphone especially when I have mechanical breakdown on a highway but I refuse to pay what the carriers are asking so I stick with my $27.00 per month land line. Unfortunately the carriers have you by the b**ls when it comes to internet which I choose not to live without.
March 27, 2013

Grump said:

@Cynic
(I posted a response yesterday that hasn't appeared, so maybe this
will wind up a duplicate, but this is based on what I had left on the
clipboard...)

"They gave it their best shot but failed to deliver a sufficient
value proposition to consumers. I think there will always be a niche
for some VOIP operators and those consumers who don't mind the extra
complexity/effort to make calls using VOIP. "

In your admirably-vigilant defense of Telus, you've hit the nail on the
head. The extra complexity/effort of VoIP is a direct result of their
second-class status in the plutocratic phone network. Early adopters
hoped it might go away with greater access to the PSTN as the Internet
grew and gained critical mass (and Google continues to hope will, by not
charging for Google Voice calls), but it hasn't. That's not an example
of the market rejecting a technology, as you suggest and then dust your
hands of. The sorry state of phone and mobile competition in Canada,
prohibitively high data rates that do not reflect the real costs, and
legislative failures like the broken state of LNP, have all stopped VoIP
cold on the runway, where it still sits today.

Let's be honest. Cellphones are VoIP, only on a network controlled
end-to-end by carriers. Voice calls are just another application of
data - a minuscule, but highly profitable one at that - compared to
other data applications. The simple voice interface for data on a
cellphone is able to be simpler than other VoIP applications because
telco incumbents have undue leverage over the telephone network. The
government can fix that by encouraging competition on the data side,
to break those glacial monopolies. That change is coming, despite Telus'
token Skype ribbon-cutting.

The commenters on your CBC link aren't fooled: "Skype is already available
for most smartphones. All this announcement means is that Skype is paying
Telus to bake Skype into some phones."

Most smartphone owners didn't need Telus' permission to run Skype anyways,
nor should they.

All my prior comments still apply. LNP is not necessarily available so
user's can still expect to have to give up their home phone number (if
not also their area code) for Skype, and get doubly-hit since they not
only have to pay for a Telus voice plan and data rates, but also Skype's
termination rates, making the savings nil. Of course no one's biting.

Free markets are one half of a growth curve - the bottom half. The top
half is that of a stagnant market that precludes further innovation to
preserve existing interests. As such, a "free" market requires constant
attention (intervention, of a disruptive nature, with the same vigilance
Jefferson alluded to in respect of governments) to break monopolies and
to give other solutions the same chance to grow that was available to
the present incumbents when they were opening shop. VoIP has not failed
by any means - in fact, it shows no signs of giving up - despite having
to run a race on one leg while Telus rollerskates gaily around, shouting
back "Hey buddy! Why the long face?!".

With Microsoft's purchase of Skype, people are hoping things will heat up,
but even Microsoft can't force regulatory change, so we are stuck with
Telus - where the future will continue to be touchtone for at least the
next 15 years.

(I had also never heard of the ow.ly shortener/click tracker before yesterday,
but Telus has used it recently.
http://openmedia.ca/sites/openmedia.ca/files/MarlowTelus_130311.png )
March 28, 2013

Cynic said:

...
@Grump

You have produced a few examples of Canadian carriers charging rates that are higher than some of their international peers and I have produced some examples of Canadian carriers charging rates that are lower than their international peers. In fairness, I think you need to acknowledge that your beef is with the competitive framework of the entire global telecommunications framework, not just Canada's.

Perhaps you have the desire to build and operate your own telecom network but I truly believe you are over-estimating the desire of the average consumer to do the same. I could make my own pizza from scratch but sometimes I just prefer to buy one already made. Looking at the number of pizza places out there I suspect a lot of consumers feel the same way I do. I could also go out and drill my own oil well and refine my own gasoline for my car, it's not as hard as people think, but sometimes it's just more convenient to fill up at the local gas station.

A couple of years ago a young guy from Toronto decided to start a cell phone company. That company, Wind Mobile, is now operates across Canada. Will they survive? Maybe, but it depends entirely on whether they can convince enough consumers they have a better product at a better price.

It sounds like you have figured out what consumers really want for cell phone service. I would strongly encourage you to put your plan into action - if you are right, you will enjoy wealth beyond your wildest dreams. If you are wrong, you will suffer the same fate as all those VOIP companies that tried to woo consumers a decade ago and no longer exist.

BTW, the link shortener I used was on Hootsuite. You should give it a try. It's free, fast and easy to access on an iPhone or iPad.

Best wishes to you and your family for a Happy Easter!
March 29, 2013

Grump said:

@Cynic
Hope you had a pleasant Easter too.

"In fairness, I think you need to acknowledge that your beef is with the competitive framework of the entire global telecommunications framework, not just Canada's."

In fairness, I will continue to push for improvement in my own back yard before I try to improve my neighbors'.

While I do have a desire to build and operate my own network, I don't expect everyone to share that goal. However, I do think they should be able to if they want to. As such, we need to lower the barriers for those who do. The current regulations do more to protect the big carriers than get small businesses started or to encourage competition. As such, VoIP will likely continue to not be viable on phones until the end-to-end black-box telephone network is replaced with open, general purpose technology.

In the grander scheme of things, keeping copyright in its place, beneath human rights, and pushing back against our government's shameful lust for surveillance, are probably the more important issues of the day.

For readers who are interested, this has been going around this week:
http://www.dslreports.com/shownews/The-First-Honest-Cable-Commercial-123712
April 03, 2013

Cynic said:

...
I respectfully disagree with your assertion that regulations protect larger enterprises. We need only look at the 2008 AWS spectrum auction that to see the extreme measures the government took to protect and encourage new players to get into the cell phone business - a spectrum set-aside that reserved key blocks of spectrum at a huge discount for the new guys, plus access to their towers and networks for roaming. That's like Walmart building a shiny new store and the government coming along to tell them they have to give their competitors access to their shelf space and provide access to their supply/distribution chain. It's an obscene perversion of competition that will only create a class of competitors that are dependent on government imposed corporate welfare.
April 03, 2013

Grump said:

@Cynic
I actually don't like subsidies and forced sharing either, so I can
sympathize. (I'm for cooperation through standardization though.) Sadly,
the hardware for a cell station can be had for a few hundred dollars
(as can a cellphone or a wireless router), but the spectrum rights still
cost millions and the interoperability simply does not exist given
the level of control the incumbents have over the existing telephone
infrastructure. The government could have encouraged small-scale network
providers by simply making licenses more accessible, or promoting open
standards and software in handsets, or fixing LNP, or separating the data
from the phone network (telephone numbers), or... You get the picture.

In the example you gave, the government basically kept a cash cow for
itself under the guise of a few token gestures to the moderate capital
entries. I see no need to go from high capital players to moderate,
to small, after another 100 years. I would rather jump straight to
small because that's where the hardware prices are. Again, I can buy the
equipment for a few hundred dollars - I could do it all on my phone with
the built in radios, if the software were legal to actually use -- but I
can't legally run a cell site, let alone force myself into the telephone
termination network (as only one example). The government could fix that
pretty easily with $10000 worth of equipment, a range of IPv6 addresses to
represent all telephone numbers, and anycast (to suggest only one method),
in the same way the root DNS servers handle connection set up. I'd happily
write the software myself if I had to. Most programmers could. It's not
the technical but the legal barriers that stop everyone but the highest
capital players from providing service, and that's what's wrong.

Telephone numbers shouldn't be telco property. At this point in history,
telcos should be providing very low-cost termination of calls at
reasonable rates, through SIP or IAX. They do provide termination,
but it's only competitive for office buildings, not residential
users. There are other services that provide IAX but then LNP stabs you
in the eyes with it's stabby little tines. It should be worth it to use
VoIP termination over a residential landline. It isn't. Why? Stagnant
competition. You have given examples that attempt to suggest otherwise,
but skirt any solution to the lack of this basic comparability. You will
always be able to come up with a one-faceted example that ignores the
larger picture.

The fact remains it is not worth it to cut the landline - be it mobile or
VoIP - but that is exactly what is necessary for further convergence. So,
as you can see, I don't really care anymore why the incumbents don't
want to do it. The government (taxpayers) can fund a crown corporation,
for example (assuming it actually operates independently and doesn't
just give away everyone's privacy) - anything - to address that service
if the incumbents don't want to, but it needs to happen. Those precious
analog-only handsets in Canada and around the world need to be accessible
to individuals, not just service providers, from the Internet without
undue barriers (spectrum, LNP, and uncooperative incumbents with control
over branch-trunk pricing), at costs that actually reflect the reality
of the underlying data transmission costs.

I could make a similar argument for Internet delivery in general: we
know it is necessary to be the best economically, socially, politically,
scientifically - and on and on and on to the point that I am tiring
myself out repeating myself - but we don't prioritize convergence. That
would actually be a digital strategy...

Unfortunately convergence also means simplicity, which naturally lends
itself to monopoly control if we don't do something to prevent it. That's
why we need to permit and promote access to individuals. It doesn't matter
if no one wants to make their own pizza... It is still necessary in a
democracy (or "free market") that it be readily possible, without undue
barriers. Unfortunately governments and oligopolies have never been first
to give away power to individuals, and I believe this is the source of
our government's complicity. Distributed communication can't be intercepted.

As I have said elsewhere, the answer is also not as simple as foreign
investment. We need to empower ourselves before we can afford to step
into a global game of tug of war, but first, we have to think past our
stock options.

Am I ranting? Yup. Am I giving you more fuel for the fire? Yup. Have
at `er. Will I stop pointing out how dysfunctional the whole scenario
is? Nope.
April 04, 2013

Grump said:

...
Boing Boing has a discussion going on ("American oligopolies are the new monopolies" http://boingboing.net/2013/04/...the-n.html ) relevant to this, and in reference to a New Yorker Blarticle ("The Olipoloy Problem":
http://www.newyorker.com/online/blogs/elements/2013/04/tmobile-verizon-monopoly-oligopoly-business-practices.html )


April 16, 2013

Brian H said:

Not on topic sorry. Why can't we have local Skype numbers in Canada?
The service is available in many many countries. I read somewhere it is because of our government regulations over 911 service. Is this true? WTF are we to live and die by red tape?
October 11, 2013

Emergency Exchange Support said:

Emergency Exchange Support
By far essentially the most succinct and also up-to-date information I found about this topic matter.

January 01, 2014

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