Switch carriers? How? Ottawa gives mixed messages over rising mobile prices

Even as the minister responsible admitted there aren’t enough competitive options for mobile service in Canada, another federal official said consumers can and should search for other service providers when faced with price increases.

That message — from Innovation, Science and Economic Development (ISED) Canada — came just hours after the Industry Minister François-Philippe Champagne said Canadians “still pay too much and see too little competition” for cellular services.

“Customers could consider switching service providers,” an ISED Canada representative wrote Thursday, when asked for a response to price increases at Rogers Communications and reported hikes at Bell. 

Rogers said earlier this week some of its wireless customers will see increases of less than $7 to $9 per month in the coming weeks. On Friday, it said the average increase will be $5.

Some customers have reported that Bell is raising the monthly cost of their existing wireless plans in February. This was first reported by tech news outlet MobileSyrup.

• Have you noticed your phone bill going up? Email ask@cbc.ca

The idea that Canadians should bear the burden of searching out cheaper prices doesn’t sit well with one competition expert.

“That should not be the consumer’s responsibility,” said Keldon Bester, executive director of the research and advocacy group Canadian Anti-Monopoly Project, who spoke out against Rogers’s recent merger with Shaw Communications.

“As opposed to companies fighting for customers, it’s customers hunting around for the best deal in a not-that-great marketplace.”

According to Bester, part of the problem is the high cost in time and effort it takes to find savings.

“Of course it’s possible to switch. But what we need to realize is, I think, the people that need these affordable services the most are not the folks who can sort of leisurely be on the phone with Bell for an hour trying to negotiate a better contract,” he said. 

Neither Bell nor Telus responded to repeated requests for comment. 

Quebecor, owner of the cable and mobile provider Videotron, said on Thursday that a price freeze is in place for customers with its Freedom Mobile, Videotron and Fizz brands. 

Quebecor bought Freedom Mobile from Shaw, as part of the Calgary-based telecom’s merger with Rogers. Under that agreement, Videotron was obliged to lower prices, but the lowest price the government can enforce is $68 per month. 

Rogers was not subject to similar price controls in its purchase of Shaw. Federal officials say the coming increases are permitted.

“At this time, there is no indication Rogers is contravening their transaction agreement. However, Rogers is subject to binding reporting requirements and significant damages of up to $1 billion for noncompliance,” the ISED Canada representative said in an email. 

When that merger finally cleared every hurdle back in April, Rogers’s CEO pledged to lower costs for consumers.

“Prices are going to come down,” said Tony Staffieri.

Rogers pointed out this week that it offfers a no-cost smartphone and $25 per month plan to eligible Canadians; however, the plan is not universally available. To qualify, consumers must be in specific groups, including (but not limited to) receiving provincial income support, disability benefits or the Guaranteed Income Supplement for senior citizens.

Rogers also noted the price per gigabyte of data has gone down on some of its plans.

Statistics Canada reported on that same trend late last year, but noted that a bigger “data allowance” can actually make cellular prices appear to be falling due to how they are calculated as part of the inflation rate — even if the total dollar amount consumers pay hasn’t gone down

The Canadian Telecommunications Association says the cost of investing in networks remains high for the Canadian telecom companies it represents.

The sector “has been investing billions each year in expanding and enhancing its networks so that subscribers enjoy faster speeds, wider coverage, and larger data allotments,” wrote Eric Smith, the group’s senior vice president.

But studies comparing phone and internet prices around the world continue to detail the expensive prices in Canada.

One such report, produced last February by Wall Communications for ISED Canada, found the country still had among the highest prices anywhere for cellphone and broadband service in 2022.