By Josh Tabish
March 4, 2016
OpenMedia original article
Why is Rogers trying to kill a brand new $19 per month cell provider?
In January, an innovative new startup called Sugar Mobile launched and began offering wireless plans from just $19 a month – a price that customers of the Big Three (Bell, Rogers, and Telus) can only dream of.
The CBC reported that Sugar Mobile could finally “shake up the cellphone oligopoly” with its innovative model. The company operates a hybrid WiFi and cellular network that is a drastic departure from how the wireless industry operates in Canada. Their model is similar to Republic Wireless, a new cell provider that’s set up shop in the U.S. to much fanfare, and helped create a low-cost alternative for mobile phone users.
In many parts of the country, it is becoming possible to stay connected to a Wi-Fi network almost all the time – especially if you’re someone like a university student or if you work in a dense urban centre. By making extensive use of WiFi networks Sugar Mobile’s wireless plans can be much cheaper than Canada’s incumbent providers who control 90% of the mobile market (see Display 5.5.0 here), while forcing us to pay the highest bills in the industrialized world.
This type of innovation – and lower-cost plans that result – are not a great sign for companies such as Bell, Rogers, and Telus. However, it’s a sign the giants appear to have noticed.
About two weeks ago, both CBC News and The Globe and Mail reported that telecom giant Rogers was trying to block Sugar Mobile from their wireless networks, in an attempt to paralyze the company. To make matters worse, Canada’s most aggressive telecom company, Bell, piled on to support Rogers’ anti-competitive move.
Rogers says that Sugar is violating the terms of its roaming agreement. But this is nonsense. Innovative services like Sugar, also known as “mobile virtual network operators” or “MVNOs” in policy-wonk-speak, are allowed in part under the CRTC’s Regulatory framework for wholesale mobile wireless services.
As we mentioned in our comments to the Commission regarding a recent attempt to ensure fair open access rules for MVNOs, the CRTC’s framework prohibits wholesale roaming arrangements from containing clauses that restrict MVNOs who operate on the roaming partners, which, in this case, is Rogers. So, what does this mean?
Put simply: Sugar is operating within the rules and this move from Rogers and Bell is nothing more than an underhanded attempt to kill their competitors, and harm innovation.
Since Rogers announced it was going to cut the new company off, Sugar Mobile’s parent company, ICE Wireless, has launched a complaint at the CRTC and is asking them to intervene and ensure Sugar isn’t unfairly cut off from Rogers network. The CRTC is now investigating, and we have less than two weeks to convince them not to cave to Big Telecom’s demands.
In response, OpenMedia is taking action in two ways. First, we’ve been speaking with dozens of Canada’s top telecommunications experts on this, and we’ll be putting a hard-hitting, expert submission on the CRTC’s public record. Second, we’ve launched a new campaign called Stop Blocking New Providers and are asking Canadians to sign on in order to show how many of us support greater wireless choice.
Please, sign now and tell the CRTC: "Do not cave to Big Telecom’s demands. Stop these giants from blocking innovative and affordable MVNO providers." You can sign the petition at https://act.openmedia.org/blocked.
While the CRTC is on the case, we only have two weeks to stop this before the final deadline. Since our last indie provider, Wind Mobile, was just swallowed up by Shaw, this case will be a litmus test for how the CRTC plans to handle the lack of competition in our wireless market.
The stakes here are pretty high: if we can convince the CRTC to tell Rogers to take a hike, innovative new entrants like Sugar Mobile will be able to operate on a level playing field. And that could lead to lower prices for all of us.
If you haven’t already, be sure to sign the petition today.
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