In a move that signals the Canadian regulatory agency’s move toward greater intervention in the wireless space, the Canadian Radio-television and Telecommunications Commission yesterday announced it was investigating how the incumbent carriers charge smaller, independent carriers for network access within Canada.
The CRTC is expressing concern over what the country’s largest carriers, Bell, Rogers and Telus, are currently charging – and planning to charge – smaller players for wholesale access to their networks. The smaller companies, typically regional carriers and new entrants into the space, lack national networks of their own, and their customers must fall back to the incumbents’ networks when they roam beyond their more focused areas of coverage. The smaller players have long contended punitive rates and terms place them at a competitive disadvantage by squeezing margins and limiting their ability to respond to customer demand.
Capping a busy year
It’s the latest in a string of announcements by the CRTC this year dealing with the contentious issue of voice and data roaming rates. For much of the past year, the regulator has been soliciting public input to better understand the issue and determine next steps. In August, the CRTC asked 35 Canadian wireless carriers to submit detailed information on their roaming rates and terms, and by September had fielded enough complaints from customers to justify a closer review of the issue. In October, the regulator launched its Wireless Task Force to take an even more detailed look.
CRTC Chairman Jean-Pierre Blais didn’t mince words in outlining what’s at stake. In a possible foreshadowing of increased oversight in wireless – an area the traditionally broadcast-centric regulator has avoided to-date – he said the commission is more than ready to step in if its investigation identifies unfairness or market imbalance.
“We are concerned that some wireless companies may be making it unfairly difficult for Canadian providers that do not operate a national network to compete in the marketplace,” Blais said in a statement. “We have the authority to ensure that companies do not give themselves an unfair competitive advantage. This includes charging wholesale wireless roaming rates that are unjustly discriminatory or by insisting on unduly restrictive terms and conditions. If we find that this is happening in the market, we will act to rectify the situation.”
On December 2, Canada’s new Wireless Code went into effect. In addition to easing the rules governing unlocking, termination and product returns and requiring simplified language in customer contracts, the code capped international roaming fees at $100 per month.
Roaming on both sides of the border
The latest move on Canadian wholesale roaming rates hints strongly the new code is only a starting point for additional regulatory engagement. It also echoes the debate on international roaming fees for Canadian consumers who use their devices when they travel. The incumbent carriers have made a number of moves in recent months to prepare for the possibility of tighter rules. Bell cut some international roaming package prices in half in September, while Rogers partnered with AT&T to launch lower-cost daily roaming rates for 4G LTE devices.
The government continues to push the industry for more change, with its More Choices campaign calling for greater competition and transparency – and ultimately lower costs and greater value. The CRTC says the current wholesale landscape could be limiting competition, a situation that can’t be allowed to continue as Canadians become increasingly reliant on mobile devices.
As part of this week’s announcement, the CRTC is looking for input from stakeholders, including possible suggestions for resolution if it finds the incumbent carriers are using their position to unfairly compete against the smaller players. Its deadline for submission is January 29, 2014.
Carmi Levy is a London, Ont.-based independent technology analyst and journalist. The opinions expressed are his own. email@example.com