The IT Nerd

The Canadian Government appears to be going the brute force approach to deal with the fact that wireless carrier bills are insanely high. They’ve put out the following this afternoon. You can find out more via this link to the CBC but here’s the highlights:

• Canada’s big three national wireless providers have two years to cut their 2-6 GB plans for cellphone services by 25 per cent. This would apply only to post-paid plans where consumers already own their devices or purchase a new one at full price.
• If the “big three” don’t do this, the government will introduce regulatory measures to bring about those price cuts.

Here’s my thoughts on this and they can be summed up in four words: Good luck with that.

The Canadian Government has come up with a plan that would only help a handful of people. As in most people get their phones via finance plans with their carrier. I am one of the few people who buy their phones outright. Not only that, I would very surprised if the “big three” obeys the government. Seeing as one of the big three, namely Telus, has threatened a form of retaliation if the Canadian Government tries to mess with with wireless prices. And if the Canadian Government does impose some sort of change, expect that to go to court and be tied up there for years.

Are wireless prices high? Yes. Insanely so. And this needs to be addressed. But this isn’t the way to do it as it really doesn’t solve the core issue. Which is that there’s an oligopoly in the Canadian wireless industry. And this is how you solve it:

The only way to lower cell phone prices for Canadians is to have the Canadian government let in a very large foreign telco or telcos such as Deutsche Telekom or Vodafone, and have them set up shop in Canada. And by set up shop, I mean build their own infrastructure. Now to be clear, I am NOT advocating that the government should bankroll these companies. What I am advocating is that they simply have to open the door and let them walk in and set up shop. The simple act of doing that will see wireless prices drop in this country to levels Canadians have never seen before. Why? Because for the first time there will be real competition in the wireless space. If you don’t believe that this would happen, look at the panic that Verizon caused the “big three” telcos when they were rumored to be expanding into Canada a few years ago. Face it, the “big three” telcos would lose their minds if a big international player were to move in and set up shop in Canada because they know that there is no way on God’s green earth that they could get away with charging Canadians what they currently charge in such an environment.

If the Canadian Government really wants to solve this issue, they should take my advice as that would actually solve the issue. After all, it benefits the many and not the few. And isn’t that what they want?

The CRTC are currently holding public hearings into the state of the mobile wireless market and whether further action is needed to improve choice and affordability for Canadians. And if you’re interested in watching, a live stream is available here. And during these hearings, Bell, Telus, Rogers, and Videotron have argued against MNVO’s being forced upon them. MNVO or Mobile virtual network operator is a wireless communications services provider that does not own the wireless network infrastructure over which it provides services to its customers. An MVNO enters into a business agreement with a mobile network operator to obtain bulk access to network services at wholesale rates, then sets retail prices independently. In this case, it has been suggested by many that this is the way to lower prices for consumers. 

Now, it is no secret that Canadians pay the highest prices in the world for cell phone service. After all, if you can get four bars of fast 4G LTE on your iPhone in a field of goats in rural India for $12 CDN for three months, or you can get almost unlimited LTE wireless service for $2 CDN a day in Australia, then something is seriously wrong with what Canadians pay. But MNVO’s aren’t the way to go to solve that. I say that because we’ve seen a version of this play out with Internet access. While we do have lower prices with providers like Teksavvy, we also have the incumbents and upstart providers like Teksavvy constantly fighting each other with the customer being caught in the middle. For example, Teksavvy recently filed a complaint accusing Bell and Rogers of anti-competitive behavior. Plus Teksavvy in the past has accused incumbents of trying to, for the lack of a better description, screw them over by punting repair requests from them to the back of the line. If you go to the Teksavvy form on DSLReports.com you can see for yourself how open they’ve been in terms of bringing this to light. Take this thread for example where this is mentioned:

At TekSavvy we pride ourselves on delivering excellent customer service and so we are very concerned about the impact that any outages and service delays have on our customers, especially lengthy ones. We want to assure our customers that we have not been taking the situation lightly and have been working diligently to restore service. Since the 15th of August we have been working both directly and through counsel with the network operator to address the service affecting issues and we have also been employing the alternate dispute resolution services of the CRTC, all with a view to reaching the speediest resolution possible for the benefit of our customers. The details of the discussions must remain confidential in order for the various processes to be pursued in the most effective manner, but please rest assured that TekSavvy is fully and proactively engaged in seeking a resolution to the current problems.

The net result of this is that only die hard customers stick with upstart providers like Teksavvy. Some like yours truly switch from upstarts like Teksavvy to incumbents like Rogers (in my case) or Bell just to avoid this. Which is good for the incumbents I suppose. The bottom line is that for an MNVO model to work, everybody has to play nice in the sandbox. Something that I don’t see happening here in Canada. And that’s even before going down the road of whether an MNVO model would actually lower prices or not.

The only way to lower cell phone prices for Canadians is to have the Canadian government let in a very large foreign telco or telcos such as Deutsche Telekom or Vodafone, and have them set up shop in Canada. And by set up shop, I mean build their own infrastructure. Now to be clear, I am NOT advocating that the government should bankroll these companies. What I am advocating is that they simply have to open the door and let them walk in and set up shop. The simple act of doing that will see wireless prices drop in this country to levels Canadians have never seen before. Why? Because for the first time there will be real competition in the wireless space. If you don’t believe that this would happen, look at the panic that Verizon caused the “big three” telcos when they were rumored to be expanding into Canada a few years ago. Face it, the “big three” telcos would lose their minds if a big international player were to move in and set up shop in Canada because they know that there is no way on God’s green earth that they could get away with charging Canadians what they currently charge in such an environment.

So I have a message for Prime Minister Justin Trudeau and his Industry Minister Navdeep Bains. If you’re truly interested in lowering wireless prices for Canadians by the 25% that you promised in the last federal election, dial up the CEO of Deutsche Telekom or dial up the CEO Vodafone. Tell them that Canada is a great place for them to set up shop. Tell them that if they come in and run their own infrastructure, and set their prices at levels that are below what the “big three” telcos charge that they will make truckloads of money because Canadians are crying out for an alternative to the “big three” telcos. Make it clear that you won’t bankroll them, but you will make the business environment favorable to their success. And be very public about it. Then sit back and see what happens next from the “big three” telcos. I think you’ll get the 25% cut that you want, and perhaps more.

If you’re a customer of Bell, Rogers, and Telus, and you get a phone from them directly, You are almost certainly paying them what is called a “device subsidy”. In short. you are paying off the cost of the phone via monthly payments that may be combined with a nominal up front cost. That way you don’t have to shell out $1500 up front for the latest iPhone or Galaxy Phone.

Now as soon as the phone is paid off, that “device subsidy” should come off your bill. Except that it doesn’t come off your bill. Global News has a story that shows that these “device subsidies” are remaining on their bills long after their phones have been paid for. In other words, if you got your phone in this manner, you’re being ripped off by the big thee telcos. And if you call them on it, you may find it is easier to switch carriers rather than to fight. Which is not how things should work. On top of that there is nothing in the wireless code that stops the big three telcos from doing this, which is also not how things should work.

So, how can you avoid being a victim of this? It’s simple really. Never, ever buy a phone at a subsidized price from a big three telco or an authorized agent of a big three telco. That way you never fall into this trap. I will freely admit that you are going to pay way more than a cell phone than you might be used to because you are paying for the full value of the phone up front. But by biting that bullet, you get the following in return:

• You get to pick the carrier that you want and get a plan, usually called a BYOD or “bring your own device” plan at a lower rate, often with no contract.
• If the carrier in question does something to make you mad, you can switch carriers easily.
• You can take the phone overseas and use a local SIM card and avoid the insane roaming fees that the big three telcos charge. Sure you lose your Canadian number while you are overseas, but you will save a ton of cash so it is totally worth it.

The fact is that this illustrates that the big three telcos in Canada really do not have your best interests in mind. If they did, they wouldn’t be doing this. But since they don’t, and the CRTC nor the federal government show no interest in fixing this, consumers have to protect themselves from becoming victims of this trap that the big three telcos have set for their customers.

Now I am aware that in Canada we have an oligopoly when it comes to cell phone carriers in Canada as I’ve written extensively on the subject for years. But over the weekend I was reminded of that fact when my wife wanted to switch carriers in preparation for getting the Apple Watch Series 4 or whatever Apple is going to call the next Apple Watch. Now my wife is with Rogers, and Rogers doesn’t offer Apple Watch support because they don’t support the eSIM standard. Nor is there a timetable for that support other than to say that it’s coming in 2018. Thus tired of not having any clarity on that front from Rogers, my wife tried to switch from Rogers to Telus as I have my business cell phone and Apple Watch with Telus.

That’s where the fun began.

Now the easiest part of this exercise was to get her iPhone 6 which was locked to Rogers unlocked. So she backed up the device to iCloud and called Rogers. After they asked her why she was unlocking the phone which according to the agent was a requirement for them to ask (she said that she wanted an Apple Watch) and for her IMEI number, it was unlocked. I was able to confirm that by trying my Telus SIM in it which worked. Total time invested: 10 minutes.

She then walked into a Telus store with her newly unlocked iPhone 6 and gave them the use case. Then she made life difficult for them by saying that Rogers had her on a retention plan that had her paying $65 for 5GB. This was a plan that was offered up a Christmas time a couple of years ago which my wife took advantage of. All the people in the store could do when they heard that was to show her a photocopied sheet with their in-market plans. The same ones on their website. When she pressed them on any other options, they didn’t have any. That meant that if she wanted to join Telus, her costs for her cell phone would skyrocket. Needless to say that didn’t appeal to her because why would she want to pay more for her cell phone bill seeing as Canada’s cell phone costs are among the most expensive in the world?

That’s when I got involved and Tweeted Telus:

Hey @TELUS my wife wants to move to you because of all the good things that I have said about you. The thing is that she is on a $65 for 5GB plan with @Rogers and your in market plans don’t match up. Can you help?

— The IT Nerd (@The_IT_Nerd) August 18, 2018

A few direct messages back and forth and Telus got my wife in touch with a text chat agent who she explained the situation to. But the text chat agent was no better than the people in the store at offering up a plan to come close to or ideally match what Rogers was giving her. That wasn’t possible. Now, one of the things that Telus told me to do was to ask for retentions. My wife didn’t do that as she was really discouraged at this point. Thus she ended the chat session. And as I type this, she’s still a Rogers customer. Though she still wants to leave them if the right deal comes around.

Here’s the bizarre part of all this. Over the last couple of years, Telus, Bell, and Rogers have participated in short lived price wars where they all settled on a price for a certain amount of GB. Say $65 a month for 10GB which was a big deal last Christmas. My guess is that this was a defensive position to ensure that their customers didn’t leave for the other guys. But it does illustrate that if these companies really did want to compete with each other, they’re capable of doing so. They are just choosing not to. That’s a shame as in this case, all my wife wants is for a cell phone company that offers support for the Apple Watch to either match or come close to what she’s paying now.

Now this story sounds like I am bashing Telus. To be clear, I’m not doing that. Because you could substitute Telus for one of the other two of the “big three” being Bell and Rogers and we’d likely still be here talking about this. That illustrates that despite Freedom Mobile and some other entrants, Canada’s wireless industry still lacks real competition. That has to change as Canadians deserve better.

You might recall that I brought you a story about LocationSmart yesterday and the fact that not only four US carriers were sharing data with them, but they had a bug that allowed anyone to see any cell phone’s location. Well it seems that the “Big Three” cell phone carriers in Canada, as in Rogers, Bell, and Telus may be sharing data with this company according to Global News:

Privacy officials in Canada plan to look into reports over the past week that Canadian telecom companies share location data on subscribers with third-parties, a practice that, in at least one case, appears to have allowed similar data on Americans to be accessed by police without a warrant.

Bell, Rogers and Telus were named in an article on ZDNet.com, a technology website owned by a subsidiary of CBS Corp., as among the North American telecom companies selling real-time location data on subscribers to a company called LocationSmart.

If that’s true, then that’s very troubling. I expect better from the “Big Three” carriers in Canada. I would expect that all of the big three to explain whatever relationship that they have with this company and do it now. Because all three of these companies aren’t exactly loved by the public. And this isn’t going to help their public image.

Canada has some of the highest cell phone costs in the world. And pretty much everyone in Canada with the exception of those who work for Bell, Rogers, and Telus would agree with that. The CRTC saw that as well and asked for submissions for lower cost data only wireless plans back in March. The “big three” telcos responded with the following:

• Both Bell and Telus came up with a monthly plan offering 500 megabytes of data for $30.
• Telus also came up with a prepaid plan offering 600 megabytes for $30 a month
• Rogers came up with 400 megabytes for $25 a month

The CRTC then posted the proposals online and got more than 230 comments which all said that same thing. These plans are a total joke. Let me give you a couple of examples as to why these plans are a total joke by illustrating my experience with wireless plans in other parts of the world:

• During a business trip to India I used a Vodafone SIM for the week that I was where. It gave me unlimited voice and texting along with 1.4GB of data for 675 Indian Rupees which works out to about $13 Canadian. And that was considered expensive as I was apparently paying the “tourist rate”.
• On a business trip to Australia, I used a SIM from Optus which gave me unlimited voice and text. But it limited me to 500 MB a day. Total cost was $2 AUD a day which in Canadian funds is about $2 CDN a day. Keep in mind that things are insanely expensive down under with cheap beer being about $9 CDN a bottle. But somehow this doesn’t seem to apply to the cost of their wireless services which are pretty reasonable by Canadian standards.
• The first time I went to the UK on business, I paid one pound for a T-Mobile SIM card and ten pounds for 100 minutes of talk time, 400 texts, and 1GB of data. That’s $18 CDN. And the UK is an expensive place with burgers costing about $17 CDN.

The fact is that the “big three” telcos have zero interest in providing Canadians wireless plans that are a good value for Canadians hard earned money. Largely because they don’t see the need to. I’ve argued for a very long time that the only way to solve this is to have the Canadian government let in a very large foreign telco such as Deutsche Telekom, Vodafone, or Orange, and have them set up shop in Canada. Now to be clear, I am not advocating that the government should bankroll these companies. What I am advocating is that they simply have to open the door and let them walk in and set up shop. If they did that, the cost of your cell phone bill will plummet almost instantly because the “big three” would then have to seriously complete to keep you as a customer. And if you don’t believe that this would happen, look at the panic that Verizon caused the “big three” when they were rumored to be expanding into Canada a few years ago.

The bottom line is that these low cost proposals by the “big three” are a joke. In fact, I’ll also say that they’re insulting to hard working Canadians who only want cell phone service at a reasonable price that is in line with what the rest of the planet gets. These three telcos need to understand how out of step with reality they are and adjust accordingly. Alternately, the CRTC or the Canadian government need to take action so that Canadians get the service that they deserve at a price point that is within the bounds of reality.

Over the last few days, Canadian cell phone users have been overwheming phone lines and filling the retail stores of cell phone carriers in Canada to score a 10GB data plans for $60 a month. The response to this plan has been off the charts. I even got involved in letting people know about this:

#PSA: @Rogers & @Fidomobile have extended their $60/10GB deal until EOB tomorrow. @Telus, @koodo has their version of this deal expiring tomorrow. Take advantage of this while you can. https://t.co/0MdmEhwDmQ

— The IT Nerd (@The_IT_Nerd) December 19, 2017

But the question is why is the response to this so huge? The reason is twofold.

First, Canadian telcos charge Canadians the highest prices for cell phone service on planet Earth as evidenced by this study [Warning: PDF]. While there have been declines in pricing for plans such as low-use mobile plans,  they are still higher than most places on the planet. This of course is not new as Canadians have known that for a while now. But it makes a plan like this $60 a month for 10GB of data appealing to consumers as it’s way better than what most Canadians pay for their cell service. It also highlights that Canadian telcos need to do a much better job in terms of providing value for money as clearly this is not happening.

Another factor is the fact that the CRTC forced teclos to unlock phones for free starting December 1st. So, if you ignore the fact that Canadian telcos won’t be making tons of cash from unlocking phones, and from roaming charges when customers travel overseas, it opens up the possibility that a customer will simply dump one telco for another because with an unlocked phone, they can move at any time. Thus this sort of plan is a defensive move to try and retain customers.

So, which one of these is responsible for the sort of response that we’ve been seeing over the last few days? I think it’s a bit of both actually. Regardless, my advice is that if you’re a cell phone user in Canada, I suggest you take advantage of this offer today as it will send a clear message that Canadians are not happy about what they pay for cell service and are willing to do something about it. Thus telcos have to step up their game if they want to retain customers.

As of today, cellphone unlocking is now free in Canada. Prior to this, carriers such as Rogers, Telus and Bell could charge you $50 to unlock your phone. That’s no longer the case. On top of that, devices must also be sold unlocked as well.

So, why should you care? It’s simple. If your device is unlocked, you can take it to any carrier and get service for it. Which means if your current carrier isn’t meeting your needs or has horrible customer service for example, you can go elsewhere easier. On top of that, you can switch phones at will without being forced into a new plan. Something that really irked my wife when she got her iPhone 6 as she was forced to dump a really good plan for a crappy one. Finally it means that when you go overseas, you can use a local SIM card at a much lower price point rather than be charged the rather than be hosed by cell phone carriers for roaming. All of this is great for the consumer, but likely bad news for cell phone providers as they will now have to up their game if they want to retain customers.

That’s all good. But it does get better. There are other changes that go into effect today that should make life easier for Canadian cell phone users. You can find out about those changes here.

I’m thinking that Rogers, Telus and Bell are flooded with calls from people asking for their phones to be unlocked. If you tried to get your phone unlocked today, I’d appreciate a comment below describing what your experience was like.

A CBC news report is making the rounds today, and it should give you a reason to think twice about how secure your cell phone is. In short, the report demonstrates how easy it is for hackers to track and monitor someone via their cell phone. And they only need their cell phone number to do it:

This is all possible because of vulnerability in the international telecommunication network. It involves what’s known as Signalling System No. 7— or SS7.

SS7 is the way cellphone networks around the world communicate with one another. It’s a hidden layer of messages about setting up and tearing down connections for a phone call, exchanging billing information or allowing a phone to roam. But hackers can gain access to SS7, too.

And:

That can go beyond spying on phone conversations or geolocating a phone. SS7 attacks can also be used to alter, add or delete content.

For example, Nohl said he could set up a person’s cellphone voicemail so all messages went directly to him. The user might never know the messages were missing.

“The technology is built with good intentions to make a very useful phone network and good user experience but it lacks any kind of security and it’s open to abuse.”.

The report then illustrates how easy it is to leverage this flaw to track someone. I would suggest reading the report as it is quite frightening. But what’s more frightening is how Canadian telcos responded to this report:

Bell, Rogers and the Canadian Wireless Telecommunications Association declined to sit down with CBC/Radio-Canada and speak about the test results.

Via email, CBC/Radio-Canada sent a series of questions about what the networks were doing to prevent SS7 attacks and why customers weren’t being told conversations could be compromised. Both networks responded with general statements about their security efforts.

Rogers Communications said security is a top priority and that it has a cybersecurity team monitoring threats and is introducing new measure to protect customers.

“On SS7, we have already introduced and continue to implement the most advanced technologies but we are unable to share specific details for security reasons.”

Bell sent a two-line response.

“Bell works with international industry groups such as the GSMA [an international mobile phone operators association] to identify and address emerging security risks, including those relating to SS7.”

A spokesperson added that Bell is “an active participant” in the Canadian Security Telecommunications Advisory Committee.

The group that represents Canadian telecoms was also fairly tight-lipped. The Canadian Wireless Telecommunications Association said it works with domestic and international bodies on security standards. It also said it works with law enforcement to “actively monitor and address risks.”

I’m sorry, but they need to do way better than that. While the threat is a problem for any telco almost anywhere on Earth, you have to know and see that the telco that you use has your back when it comes to security. What I am hearing from these companies doesn’t meet that bar. It’s actually not even close to that bar. That’s a problem. So is the fact that “Big three” member Telus is missing from this conversation. So are second tier companies like Public Mobile, Freedom Mobile, and the like. All of these companies need to step up and tell Canadians how they are going to ensure that their customers are protected.

Speaking of protection, here’s how you can protect yourself:

“If you’re using Signal, WhatsApp, Skype, you’re certainly protected from SS7 attacks…. But there’s other types of attacks that could happen against you, your computer, your phone. So you’re never fully safe.”

When it comes to having your movements tracked, Nohl said the only protection is to turn your phone off — something that’s not always practical.

That’s another reason why Canadian telcos need to step up and tell Canadians how they are going to be protected from this. And they need to do it now.

You have to believe that the corner offices in Bell, Rogers, and Telus are not happy places to be right now. I say that because a number of media outlets including The Toronto Star and Global News are reporting that the demands to renegotiate the NAFTA trade agreement between Canada, USA, and Mexico includes demands to allow US telcos to do business in Canada. If that’s the case the result would likely be cheaper cell phone plans for Canadians. After all, Canadians because of the oligopoly of Rogers, Bell, and Telus pay the highest prices for cell phones in the G7. A fact that is highlighted by the Global News article that I linked to.

So, what do I think of this? If you take all of the hysteria that surrounds this out of the mix, I am all for it. Long time readers of this blog know that I have said that Canadians pay way too much for their cell phones which is impossible to escape every time I travel on business to places that have much cheaper prices for cell service. Long time readers will also know that I’ve been saying that we have to let in foreign competition to solve this problem as no “made in Canada” solution exists. It would have to be on the scale of a Verizon or Deutsche Telekom as they’d have to build their own infrastructure from scratch which isn’t cheap. But if they did do that, your wireless bill would nosedive instantly as for the first time, the trio of Bell, Rogers, and Telus would have real competition. If those three carriers were smart, they’d get ahead of this by quickly adjusting the prices of their plans to get into the same universe of what is being offered in the USA and apply it to new and existing customers. But chances are that won’t happen and they’ll likely only do something after changes to NAFTA take place, and when US carriers set up shop in Canada to start scooping up customers by the truckload.

This should be fun to watch.