The government must not buckle in the face of unprecedented pressure from coddled cell phone giants, says OpenMedia.ca

Big Telecom is using legal action against the government and an expensive PR campaign to prevent startup Canadian wireless providers from operating on a level playing field

Independent Canadian providers are struggling due to years of regulatory protection of the Big Three cell phone providers and delayed promises from policy-makers to provide access to the infrastructure required to deliver services. Three giant providers control 85% of the existing available wireless spectrum infrastructure required to reach customers, resulting in those same three providers dominating 93% of cell phone revenues.

Canada has strict foreign investment rules stipulating that investors must organically grow new telecom services, starting with investments in operations with 10% or less of market penetration. The government also chose to set aside less spectrum for new entrants in the upcoming auction than policy experts recommended and in contrast to previous spectrum allocations. As a result, new entrants and investors have more restricted access to spectrum than in previous auctions. OpenMedia.ca and Canadians across the country are calling on the government to open up more of the spectrum to new entrants in order to level the playing field with the big three providers.

The giant cell phone providers’ current multi-pronged campaign against Canadians includes:

• Taking the government to court to prevent the enforcement of spectrum rules that ensure Canadians have access to independent cell phone options.
• Going to federal court to undermine and delay new cell phone contract rules.
• Increasing their already high monthly cell phone rates and using the new CRTC rules as an excuse.
• Unleashing an expensive and misleading PR campaign, including full-page ads in newspapers across the country - Canadians took to the Internet to debunk the ad’s claims.

Recent positive measures taken by the government have only begun to fix Canada’s broken cell phone market and were the result of over 57,000 Canadians speaking out in the DemandChoice.ca campaign, thousands helping craft a policy roadmap for cell phone service, and Canadians from across the country writing op-eds that appeared in local papers.

“Canadians are expecting Industry Minister James Moore to move forward and open up wireless networks to new Canadian telecom startups” says OpenMedia.ca Executive Director Steve Anderson. “It’s not lost on Canadians that Big Telecom’s expensive PR campaign to mislead citizens and pressure our government is being paid for on the backs of price-gouged cell phone customers. Canadians have been on the receiving end of systematic mistreatment from these providers and this disrespectful PR campaign shows more than ever how critical it is for the government to rein in these telecom bureaucracies.”

Mr Anderson continued: “I’m hopeful that the government will not cave to Big Telecom lobbyists after their recent firm and unambiguous promises to rein in giant cell phone providers. What Big Telecom is really afraid of are new rules that would enable independent, Canadian startups to offer the choice Canadians deserve. That’s Big Telecom’s worst nightmare - Canadian innovators finally having an equal platform to provide affordable services against their tired, bloated bureaucracies.”

“We know for example that Toronto’s Tucows runs an affordable mobile service in the U.S. called Ting - a service which could easily be brought to Canada once our networks are further opened up to new providers with fair spectrum rules.”

OpenMedia.ca has worked with thousands of Canadians to create a clear road map forward for the future of our wireless market. The recommendations include:

• Ensuring that independent Canadian providers have access to sufficient wireless spectrum. The government must enforce its existing rules to prevent Big Telecom from taking over even more of this public resource.
• Enforcing rules to ensure that independent providers have equal access to Canadian cell phone towers and spectrum on the same basis, and at the same cost, as the Big Three.
• Ensuring that independent Canadian providers have fair and equal access to Canada’s wireless networks, which are currently locked down by the Big Three. This would allow new providers to enter the market without the need to create a new Canada-wide wireless system. Opening wireless networks to new providers is an idea that has worked successfully in the U.K., Australia, and New Zealand.

Over 57,900 Canadians have called on the government to stand up for telecom choice and affordability - and more are speaking out every day at DemandChoice.ca

About OpenMedia.ca

OpenMedia.ca is a network of people and organizations working to safeguard the possibilities of the open Internet. We work toward informed and participatory digital policy.

Through campaigns such as StopTheMeter.ca and StopSpying.ca, OpenMedia.ca has engaged over half-a-million Canadians, and has influenced public policy and federal law.

About the Demand Choice campaign

Early in 2012 OpenMedia.ca launched a campaign decrying the price-gouging poor customer service and lack of choice in the cell phone market at http://StopTheSqueeze.ca, and the CRTC responded by inviting comments on whether the Commission should develop national rules for wireless service in Canada. OpenMedia.ca mobilized Canadians to write in and request that the CRTC do just that. The CRTC held a hearing on cell phone service in February 2013.

OpenMedia.ca then highlighted Canadians’ stories in a crowdsourced submission to the CRTC, and released a report detailing their findings and recommendations.

This resulted in a broadly positive new CRTC Code of Conduct for wireless companies – national rules that reign in punitive three-year contracts, make it easier to switch to a new affordable provider, and imposed caps on data roaming fees.

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Contact

David Christopher
Communications Coordinator, OpenMedia.ca
1-778-232-1858
[email protected]

More Information

• In 2007 the Conservative government made a promise to reserve key spectrum assets for new entrants. Source: Reuters
• The Conservative government’s 2011 platform promised “to increase competition and choice and to lower costs for wireless consumers”. Source: Conservative Party 2011 Platform, page 15
• For an explanation of why your high cell phone bill has nothing to do with Canada's size, see this article by OpenMedia.ca's Catherine Hart.
• Industry Canada clearly stated that only "new entrants" were eligible for the AWS wireless spectrum set aside in 2008. Industry Canada further stated that “changes made after the application deadline which create an Association with another applicant are not permitted, and any applicant who has formed such an Association will be disqualified from participating in the auction.” Source: Industry Canada
• Canada’s wireless industry is overwhelmingly dominated by Bell, Telus, and Rogers. Source: The Globe and Mail
• Recent independent reports confirm that Canadians pay some of the highest prices in the world for cell phone service. Source: OECD 2013 Communications Outlook