Yahoo Finance Canada’s wireless industry isn’t as rosy as it seems
It's an optimistic picture of Canada's wireless market that I wish were true.
J.D. Power’s 2014 Canadian Wireless Total Ownership Experience Study suggests, among other things, that average monthly bills for customers have dropped by $7, that customer satisfaction with carriers increased from 691 on a 1,000-point scale to 705, and that customers on two-year contracts are happier than those still waiting for their now-obsolete three-year contracts to end.
I’ll apologize now if I seem unconvinced. As much as I trust the source of the information - J.D. Power has long been my go-to source for data covering a wide range of industries, including tech and automotive - I just can't buy the suggestion in its latest study that Canadians are this pleased with the state of wireless. Here’s why:
Because when I talk to friends and colleagues, I hear an entirely different story, with enough vitriol that it may not be publishable on a reputable website.
Because I hear similar rumblings from companies frustrated that the fundamental tools of their increasingly mobile businesses cost too much, limit what they can get done, and leave them well behind competitors across the border.
Because twice in the last year Canada's major wireless carriers have hiked their monthly rates, first last August and again an across-the-board $5-per-month increase in March.
Because of the smaller carriers that joined the market following the 2008 AWS spectrum auction, almost no one is left standing after Telus swallowed Public Mobile and Mobilicity, and after Wind Mobile failed to gain funding from its parent company for the just-completed 700 MHz spectrum auction and was subsequently deemed a valueless asset.
Granted, the company's research was conducted last October and this March, before the bulk of respondents would have been touched by the new, higher rates. But even then, it's an example of asking certain questions and only getting certain answers.
Like every survey, this latest one can't be expected to paint a complete picture of an entire industry. That would be unfair to the company and misleading to consumers looking to better understand the big picture. Of course Canadians prefer two- to three-year contracts. And of course the additional protections introduced by the Wireless Code last December would be welcomed by consumers tired of paying more and getting less. But it’s still far too early to declare victory.
“The problem is so far we’ve seen all this talk, but not much action from the federal government,” said David Christopher, spokesperson with OpenMedia.ca. “They’ve spent some $9 million on an ad campaign to convince Canadians they’re working for lower prices and more choice, but we’ve yet to see any action to match all that talk. This survey in many ways says we’re still stuck in the status quo where we’re paying some of the highest prices in the industrialized world.”
J.D. Power account director Adrian Chung tells Yahoo Canada Finance that the survey must be viewed in its proper context.
“We’re covering a pretty broad spectrum, where there’s a lot of different components that feed into the overall,” he said in an interview. “Certainly there’s still significant room for improvement in a number of those areas beyond those customer touchpoint areas amongst the incumbents.”
In the end, it’s just one survey, a limited-scope view of a sector long marked by concerns over pricing (too high), competition (not enough) and value (less than most other developed nations.) While shareholders might enjoy the Big 3’s strong share values and consistent dividends, Canadian businesses and consumers deserve far better than we're currently getting. To expect that one dataset makes all that darkness go away is laughable. To assume otherwise condemns us all to continued backwater status as a wireless have-not nation.
