Canadians Pay The Highest Rates For Wireless Data, And The US Is About To Follow Suit

from the ill-communication dept

However bad American broadband and wireless service can be, generally speaking Canadians have it worse. Plagued by the same sort of revolving door regulator approach taken in the US, Canada pretty routinely makes an even poorer showing than the United States when it comes to broadband pricing, availability, and service quality. And, just like the United States, Canada's solution is often to appoint industry lobbyists to positions of power, who immediately get to work making things worse for their entrenched incumbent pals. Here in the States that's Ajit Pai; in Canada it's Ian Scott.

Needless to say, installing revolving door industry sycophants to solve problems the industry refuses to even acknowledge doesn't work out particularly well for consumers, competition, startups, or innovation in general -- as consumers and small businesses run face first into entirely unnecessary usage constraints. Constraints made worse if you've, say, killed off net neutrality protections, or have net neutrality protections nobody actually wants to enforce.

As Canadian Law Professor Michael Geist explores this week, data illustrates how Canadian telcos make some of the biggest profits on the planet thanks to limited competition. That, in turn, results in carriers implementing arbitrary usage caps and charging an arm and a leg per gigabyte, which in turn results in less actual usage by folks afraid of running afoul of arbitrary network restrictions specifically designed to nickel and dime users:

"The total revenue per gigabyte here is roughly 70 times higher than in India and 23 times higher than in Finland. And consequently, mobile usage is lower than average...The charts show where Canada stands relative to other countries with carriers generating more revenue per GB than anywhere else in the world and consequently Canada lagging behind many other countries in wireless usage."

Not too surprisingly, that's courtesy of the fact that Canada has just three major wireless providers, who don't try very hard to actually compete. And, like Ajit Pai, Scott has fostered a reputation for not giving much of a damn, since his primary objective (ensuring entrenched carriers are ultra-profitable) has been met.

Another recent study out of Canada, unsurprisingly, shows that Canada has some of the most expensive wireless data plans in the entire developed world:

"Report after report, year after year, has confirmed that cellphone services cost more in Canada than almost anywhere else in the world – on average, more than $90 a month. Canada’s Big Three telecom companies – Rogers, Bell and Telus – operate in a market with scant real competition and enjoy some of the highest profit margins per customer.

The US doesn't fare much better, though having four major carriers instead of three has mitigated some of that impact. But that's all about to change thanks to T-Mobile's looming merger with Sprint, which will only further reduce any incentive to seriously compete on price. Combined with the death of net neutrality and the FCC's eagerness to effectively neuter itself at carrier lobbyist request, and it's not hard to see how the door is being opened wide to higher prices, worse service, and even more annoying network limitations specifically built to make wireless service more expensive and annoying to use. And no, 5G won't save you.

Filed Under: canada, competition, fcc, mobile data, mobile phone rates, us