It's Good To Be A Monopoly: Rogers Prices iPhone Service At 2 Arms And 2 Legs

from the what-else-are-you-gonna-do? dept

Mon, Jun 30th 2008 11:28am — Mike Masnick

There's been a fair amount of complaining about the pricing of the new iPhone 3G over the last few weeks. While plenty of people were initially enamored by the cheaper price for the actual phone in the US (and in some other countries), this subsidized low price often hid higher service fees (with a locked contract) that came with it. However, it appears that the folks at Rogers Communication up in Canada really went overboard in its service pricing: offering very expensive service fees that have excessively limited data amounts (and no unlimited data offering). Users also get less talk time. Basically, these service plans make the iPhone a hell of a lot less appealing -- but since Rogers is the only carrier offering the iPhone in Canada, it feels it can get away with such high prices. But, the impressive thing is that people are trying to fight back, putting together a petition against Rogers' decision. While online petitions are notorious for their ineffectiveness, this one seems to be getting an awful lot of attention -- creating a ton of negative publicity for Rogers. If the company has any sense of the harm negative publicity can do, perhaps it will rethink its pricing strategy.

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Filed Under: canada, expensive, iphone, service
Companies: apple, rogers communications

34 Comments

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Erik, 30 Jun 2008 @ 11:59am

I doubt Apple is going to sit back and let Rogers destroy an entire market for the iPhone. Either Rogers will have to reduce costs or Apple will move to another, less obnoxious carrier.
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Anonymous Coward, 30 Jun 2008 @ 12:10pm

wow, they are worse than AT&T even! unbelievable !
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Anonymous Coward, 30 Jun 2008 @ 12:14pm

Re:
There are ALWAYS worse places than America...

Just like there are ALWAYS worse things than American things...

The only difference is in America we get all of them at once, rather than handfuls of crap we get the whole truck load.
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Hidden Force, 30 Jun 2008 @ 12:33pm

Rogers' Thinking
What's even more shocking is the "You'll take it and you'll like it" attitude of the Rogers spokeswoman:

“Unlimited plans could end up costing customers more for what they don’t use,” argues a spokeswoman. “Our iPhone plans more than accommodate the vast majority of customers.”

Unlimited plans end up costing customers more for what they don't use only if the service provider overcharges, madam.

Additionally, since most of your potential (and potentially lost) iPhone customers are tech savvy and make liberal use of the internet, they don't fit into the "majority of customers" pigeonhole you seem to want to put them, so your plan hardly accommodates them at all, much less "more than accommodate[s]" them.

Wake up and take notice of your bad publicity, rather than giving your potential (and likely lost) customers a big fat middle digit.
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Jon, 30 Jun 2008 @ 12:33pm

It is a Monopoly
The trouble is, Apple has no choice in Canada currently. Rogers/Fido is the only carrier capable of working with the iPhone, as I understand it. This is why Rogers likely will not move much on their pricing/service plan. They'll probably drop the price by a few bucks if there's enough outrage, but I seriously doubt they'll create an unlimited data plan, even if Apple throws a fit.
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Panaqqa, 30 Jun 2008 @ 12:34pm

Rogers has always had excessively high prices...
...and they have also always played games with billing. For many years they required that cable TV be paid for three months in advance. A typical Rogers bill will generally have some kind of additional charge on it every so often that is completely unexplained.

Until quite recently, pricing on data plans for the previous generation of mobile devices was more expensive than Rwanda. Half a gig in Rwanda at that time would have cost about $77 USD, but in Canada through Rogers the same would cost about $1,600 USD. Unbelievable.

Rogers has already been on the receiving end of a large upswelling of grassroots consumer rebellion before. A few years back they added a bunch of channels that almost nobody wanted to their standard cable package and put in place "negative option billing", that is you had to inform them that you did not want them or you would be billed automatically. They then set up a "customer service" number for people to cancel which was always busy/never answered. What Rogers did not anticipate was thousands of angry people returning their cable TV equipment and cancelling their Rogers service as a result.

Hopefully, Rogers is due for another similar lesson. They are a nasty arrogant money grubbing company which makes the worst players in the United States' market look like angels. I don't think there are too many Canadians (except those employed by Rogers) who would shed a tear if the entire corporation collapsed tomorrow. That is how much Rogers is despised in Canada.

Most of my friends who want an iPhone have decided that until there is another option to Rogers, they will not have one, and my friends are all techs who are normally early adopters. Perhaps Steve Jobs should be made aware of this.
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colin, 30 Jun 2008 @ 12:38pm

pricing
quote Eric "I doubt Apple is going to sit back and let Rogers destroy an entire market for the iPhone."
I doubt that the pricing Rogers came up with was without Apple and Rogers working on this together.
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James, 30 Jun 2008 @ 12:39pm

Pfffft
This isn't news... let the sheep buy their overpriced phone w/limited features whilst I chuckle. Perhaps if the crap-phone loses enough market share, arrogant providers will get their act in order.
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wirelessman, 30 Jun 2008 @ 12:44pm

rogered by Rogers
Unfortunately Rogers is the only GSM operator in Canada (they bought out the other GSM carrier, FIDO, a few years ago). Bell and Telus are both CDMA so no iPhone from them. The funny thing is I'm actually surprised that Rogers is, um, rogering us as mildly as they are.

My current voice plan with Rogers, which is comparable to their cheapest iPhone plan, costs $30, plus $15 for voice mail and call display, plus a $7 "system access fee" (I like to call it the "there's no real wireless competition in Canada so go fuck yourself" fee). All told, you're looking at about $55. With the cheapest iPhone plan, it's $85 (i.e. $60 plus the ancillary bullshit. That gets you 400 Mbytes of data per month on top of the voice.

I know we need a 3 year contract to get the $200 iPhone but with Rogers, you need a 3 year contract to get the maximum subsidy on any phone (a Nokia N95 costs $400...with a 3 yr contract). I was fully expecting Rogers to charge $400 for the iPhone and have plans starting at $100/mo. I guess things just always look better when you start of with low expectations
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Nelsormensch, 30 Jun 2008 @ 12:49pm

" ... Apple will move to another, less obnoxious carrier."

When Rogers bought Fido back in 2004, they became the only GSM carrier in Canada. The other two big carriers, Telus and Bell, have CDMA networks (and they're equally terrible). Since the iPhone only has a GSM version, Rogers is the only carrier in Canada. Which means they can and will abuse their monopoly.

Honestly, I can't wait for the spectrum auction to end and for Shaw to setup a competing GSM network.
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Aaron, 30 Jun 2008 @ 12:50pm

I've always wondered...
...how much exorbitant data rates have affected the rest of the economy. It seems to me that having cheap, plentiful mobile Internet available in a nation must create other markets and innovation. Don't they have TV on their phone's in Korea? So there's an additional market, plus the advertising market that emerges making/selling ads for mobile TV, plus a few million more people buying highend phones pushes the price down there, making components like LCDs, flash memory, and digital ink displays cheaper and more plentiful.

Innovation is pushed as more companies are able to enter the phone market, selling niche devices. Small companies can afford to equip employees with smartphones, and med/large companies can use the savings from cheap data rates/smartphones to acheive in their own markets. Tax revenue is up as spending increases on high tech equipment, etc. More powerful devices can be used as content delivery ecosystems by the music industry, GPS providers, etc, expanding their potential markets.

Or...

Rogers sees a modest increase in 2nd quearter earnings as we all stay the course...
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Vern Baker, 30 Jun 2008 @ 1:09pm

iPhone
Then.... vote by not buying one!! Check out the Samsung equivalent... or wait until the open source phones start hitting the market. Android may well be worth the wait too.
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Tanya (aka NetChick), 30 Jun 2008 @ 1:11pm

Rogers will not rape this chick
I'm paying my ECF and recovering it through a cheaper, unlimited data plan with one of the other two price-gouging Canadian providers. Screw 'em. I was so excited about the iPhone 3g that I sold my first gen in anticipation of reasonable contracts.

There's nothing at all reasonable about these plans.
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Slatemass, 30 Jun 2008 @ 1:18pm

Unlimited is unlimited!
I am a long-time Canadian Mac user (paid to work on a PC) and have been waiting since last year to get an iPhone. About 6 months ago, I reluctantly got a Blackberry and it works ok, but I pay through the nose for even more outrageous data costs $25 for only 4 MBs per month. However, I never use it for browsing because it sucks at that and was going to get an iPhone on July 11th, but now I won't just on principle.

Two main reasons:
1. No unlimited data. the cool thing about the iPhone is the ubiquitous access to the internet. Who wants to worry about extra data charges? Especially with a ton of Internet app coming out. Who can predict what kind of always on app I will want that will sucks away my 750 MB per month. Rogers already makes a fortune of roaming data fees.

2. Three year contract! Apple will release at least 1 if not 2 versions of the iPhone in a three year period. Yes, I know that Rogers will allow me to upgrade, but I'll be locked in for another three years from the date of renewal.

http://www.ruinediphone.com/
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Jim, 30 Jun 2008 @ 1:31pm

Rogers
The lack of choice is one of the driving feature. The other is the Canadian Government has call the cell-phone industry in Canada un-competitive and new laws are coming in next year and several new cell phone provides are coming. It is in Roger's best interest to make it money now and lock customers into 3-year contracts just to hinder the coming competition.
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David, 30 Jun 2008 @ 1:35pm

Re:
Not unless apple is getting a kick back from rogers. They aren't going to only make $23 off the phone and not elsewhere.
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Gracey, 30 Jun 2008 @ 2:21pm

Not sure I really understand the "gouging" complaints on services...we have home phone, cell phone, high speed internet (no limit), and cable TV with Rogers. Our bill is about $175 a month for all of it...all on plans.

You forget to mention that you can call all other Rogers home phone and cell phone users within your area without using any minutes, and without additional charges (long distance charges apply if it's long distance). Our 2 cell phones cost us $40 a month (for 2, not each, the phones were free) and we've never needed all our minutes (thanks to the rogers to rogers freebies), nor paid additional charges.

Sure beats some of the cell phone bills we've had from Telus and and other carriers in the past (+200 a month for 1 cell phone).

As for the iPhone...guess I don't really care much, but I suppose they will eventually come down, like everything else that starts high.
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DCX2, 30 Jun 2008 @ 2:29pm

Android
Vern Baker has it right. An open-source cell phone platform is going to change the way things are done. I have high hopes for Android.
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Anonymous Coward, 30 Jun 2008 @ 2:52pm

What I'd like to know is why Apple went with the GSM platform instead of the high-speed EVDO connections on CDMA networks. If they would come out with a CDMA version of the iPhone, I might actually consider getting one. But there's no way I'm switching to a GSM network (AT&T or T-Mobile) because those networks are just plain lousy.
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Anonymous Coward, 30 Jun 2008 @ 3:26pm

Re:
unless things changed rogers IS AT&T
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amalyn, 30 Jun 2008 @ 3:28pm

Re:
Rogers to Rogers minutes are no help when calling business landlines that aren't with Rogers. Or homes that don't have Rogers home Phone. Or any of the cell users who aren't with Rogers. Or transportation / city services / government offices, etc.

Inter-company minutes are useful if you call a circle of friends/family who are within the company -- but for everyone else, it isn't terribly likely to be able to corral them into switching providers.

Rogers really turned me off last fall, while observing users who had switched providers, and optioned to keep their number with the new cell number portability. Trying to call from a Rogers phone to a previously Bell number that was now with Rogers -- wouldn't go through. It would state that the number was not in service. Rogers would blame Bell, Bell would say that it was Rogers -- the problem ultimately ended up being on Rogers' end: but their support representatives would swear up and down that the other users must be dialing the number wrong, or that it was "all Bell's fault, they're trying to get their customers back, evil monopoly of a company," etc. Their solution? Tell us that we had to have everyone who was having problems phoning the number to switch to Rogers -- even the landline users, and users in other countries.
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Erik, 30 Jun 2008 @ 3:59pm

Re: pricing
That's probably true. Maybe Steve Jobs has the same sentiment about Canada that Peter Griffin has (i.e. Canada sucks)?

I wasn't aware that there's just one GSM provider in Canada and that one being Rogers. Kind of sucks but that makes sense that they can set monopoly style pricing.
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mobiGeek, 30 Jun 2008 @ 5:07pm

Re: Unlimited is unlimited!
I spent quite some time last week on the phone with this Rogers company working out devices for some new hires in our Toronto office.
Three different sales agents asked if I really wanted the $40mth/7MB plan instead of the $30mth/300MB plan (yes, $10 less gets you 293MB more). However, those newer "iPhone competitor plans" do not give users that ability to connect to a BES (BlackBerry Enterprise Server).
So for the benefit of paying $10 MORE per month, we get the privilege of administrating our own devices as well as a 97.6% reduction in bandwidth.
I'd certainly switch elsewhere, but that would leave us with non-GPRS and either Telus or (shudder) Bell Canada...
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mobiGeek, 30 Jun 2008 @ 5:10pm

Re: Re:
What is the "America" thing of which you speak?
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mobiGeek, 30 Jun 2008 @ 5:17pm

403 Forbidden
Wonder why the petition website is down right now....
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Devil's Advocate, 30 Jun 2008 @ 5:20pm

iPod Touch...
...you know, you could just save yourself the headache and get an iPod touch.
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ScytheNoire, 30 Jun 2008 @ 6:05pm

Canada allows corruption
Canada is notorious for allowing monopolies and corruption, especially when it comes to cable and telephone companies. It's horrible here in Canada, mostly because the government is paid off by these big corp's to sit back and allow the people to get screwed over repeatedly. Rogers and Bell are the worst, but they are all bad up here. It's horrible. Need to start executing executives until they make change.
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You Sheeple will never learn..., 30 Jun 2008 @ 6:15pm

iPhone, shmyPhone. Don't have one, want one, need one and won't buy one. It's crap. Apple is crap.

You kiddies up north are all dufuses.

Grow a pair and quit whining.
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nein, 30 Jun 2008 @ 7:34pm

screw rogers
I have in my family 3 cell phones , cable tv with viewing bundles , cable internet, home phone all from rogers.....if they screw me on the iphone goodbye rogers....and i may do it anyway i hate what they are planning....and to #28 blow it out your ass. there will be 100x more people in the U.S. of A with it then here.
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Lisa Westveld, 1 Jul 2008 @ 4:06am

They happen to have a monopoly on these services for the iPhone, so what kind of damage would this negative publicity cost them anyway? People want an iPhone because others have them too and tend to be too dumb to realize these rediculous high prices.
If people were really smart, they wouldn't subscribe to all those expensive ringtone services or SMS text messaging services. Considering the amount of profit in those market areas I cannot but conclude that customers are dumb.
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John Wil, 1 Jul 2008 @ 9:17am

Re: And Shaw is any better?
The sad reality about the Canadian wireless "industry" is that it's dominated by an entrenced set of carriers who are all equally bad and equally interested in maintaining the status quo of foul servies and expensive plans.

Shaw is no better than Bell, Telus or Rogers.

That said Rogers attitude is easily the worst.

Is it any wonder that cell penetration and usage in Canada is the lowest of any G-8 country?

ttfn

John
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Trev, 1 Jul 2008 @ 9:31am

No Monopoly Here
They don't have a monopoly. A monopoly situation only exists when there are no available substitutes or alternatives. For example, although Chevy is the only manufacturer that is allowed to produce a car called "Corvette", they do not have a monopoly because you can still purchase a different car. The iPhone is one of many devices in the marketplace, all competing with each other.

When someone doesn't know the definition of 'monopoly', it's difficult to take anything they have to say about economics seriously. Please, go get a basic understanding of economics before you throw that 4-letter word at someone again.
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Blaise Alleyne (profile), 1 Jul 2008 @ 3:15pm

Re: No Monopoly Here
Uh, it's not Apple that has a monopoly, it's Rogers. Rogers is the only GSM provider in Canada.
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David, 22 Oct 2008 @ 8:59pm

Roger's rape
I am keeping my iPod Touch until I can get a reasonable plan for an iPhone.

Numerous overseas visitors from modern GSM networked countries, can't believe that they only see "Rogers" on their mobile phones. They ask if we have any other carriers in Canada. I have used SIM cards in Europe, the Far East, even in India and the prices are nothing compared to Canada.

My UK "Virgin" SIM card is valid every time I go there, sometimes with a years break between trips. (Last time I checked, the Rogers card was valid for 30 days). My wife is currently in the UK and uses the "Virgin" card in her unlocked phone every day to call home for less than $1.00 per call. Heck I was recently in Amsterdam where I purchased a Lebara SIM card for 10 EURO and still have 2 EURO left after a weeks stay there, including 3 or 4 calls home to Canada.

Rogers is being Rogers, but where is the CRTC?
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