A new industry commissioned report agrees that Canadians pay some of the highest prices in the industrialized world for cellphone plans but argues that the high prices are justified – likening Canadian wireless access to driving a luxury car.
The report, published by the Montreal Economic Institute (MEI), a pro-free-market think-tank, takes issue with a 2017 wireless price-comparison study commissioned by the federal government and completed by consulting firm Nordicity. MEI claims that the government study is “simplistic and misleading” because it ignores factors that can inflate prices, such as Canada's geographical barriers and the investments that Canadian telecommunications companies have made to provide “superior wireless services.”
“We have some of the best networks in the world,” reads the MEI report. “We're paying for a Lexus, but it's worth a Lexus.” MEI also points out that Canada grapples with a small population spread out over a large region, which makes it more expensive to develop and maintain wireless networks.
The Nordicity study compared wireless rates in Canada, the U.K., Germany, Italy, France, Japan, the U.S. and Australia – and concluded that Canadians pay the most for cellphone service. The annual price-comparison report has been commissioned since 2008 by the federal government or the CRTC, Canada's telecommunications regulator. Nordicity says it has always used the same criteria, which excludes factors such as geography and telco investments.
The MEI report also argues against continued government intervention in the wireless industry, claiming that the country has already shifted from a monopoly to a competitive market. “Canada's telecommunications industry has a regulation problem, not a pricing problem,” reads the report.
The CRTC recently found that Bell, Rogers and Telus collectively had 91% of all Canadian wireless service revenues in 2016.
