The IT Nerd

The battle between the big three wireless companies and the Canadian Government took another turn with the news that domestic roaming rates, as in the rates that that Wind Mobile, Public Mobile, and Mobilicity have to pay the big three to use their networks are about to get regulated:

In the coming weeks, the Government will introduce an amendment to the Telecommunications Act that will put a cap on domestic wireless roaming rates, preventing wireless providers from charging other companies more than they charge their own customers for mobile voice, data and text services. Currently, high domestic roaming rates hold back many providers, especially new entrants, from offering more choice, lower prices and better service to Canadians. This measure will be in place until such time as the Canadian Radio-television and Telecommunications Commission (CRTC), which is now investigating the issue, makes a decision on roaming rates.

In addition, Minister [JAMES] Moore also announced new enforcement measures that will increase consumer protection in the telecommunications sector. These new measures will provide Canada’s regulatory bodies with the tools needed to ensure that companies comply with the rules. The Government will amend both the Telecommunications Act and the Radiocommunication Act to give the CRTC and Industry Canada the option to impose monetary penalties on companies that violate established rules such as the Wireless Code and those related to the deployment of spectrum, services to rural areas and tower sharing. The penalties will encourage compliance and allow for more effective remedies should violations occur. The Telecommunications Act will also be amended to enhance information sharing between the CRTC and the Competition Bureau so that consumers benefit from greater cooperation.

The argument that the Canadian makes is that customers of the smaller carriers pay 10 times what they charge their own customers and that has to stop. But it should also be noted that this will only be in place until the CRTC decides what to do about roaming. But it sends the message that the Canadian Government wants lower telecommunications prices sooner rather than later.

The CBC is reporting that recent attacks via ads on various media by the Canadian Government on the big three wireless companies have cost the taxpayer $9 million:

Industry Canada is spending $8 million on the ads, while Public Works is providing an additional $1 million.

I have to admit that I am kind of stunned by this dollar amount. Now don’t get me wrong. I am no fan of the way the wireless industry is right now. It’s broken and is in desperate need of competition. But to spend this type of cash to advocate an agenda seeing as the Canadian Government has many, many other priorities seems a bit wrong to me. In my mind, instead of spending money to tell Canadians what they are all too aware of every time they open a bill from Rogers, Bell, or Telus, how about actually solving the problem? Perhaps that might be a better strategy?

For those of you who were wondering what the status was on the upcoming 700 MHz auction, here’s an update. Industry Canada has released a list of the final qualified bidders and they are:

• Bell Mobility Inc.
• Bragg Communications Incorporated
• Feenix Wireless Inc.
• Globalive Wireless Management Corp.
• MTS Inc.
• Novus Wireless Inc.
• Rogers Communications Partnership
• Saskatchewan Telecommunications
• TBayTel
• TELUS Communications Company
• The Catalyst Capital Group Inc.
• Vidéotron

Now if anyone drops out, I’ll update it here. The  700 MHz auction starts on January 14th, 2014. Tune in to see who can grab the spectrum that’s up for grabs.

Canada’s Commissioner for Complaints for Telecommunications Services (CCTS) put out its annual report this morning with some interesting facts in it. I’ll hit the highlights for you:

• 90% Of complaints received by the office were successfully resolved. That’s a good thing.
• CCTS handled 14,036 customer complaints in 2012-2013 which is an increase. That’s a bad thing.
• Wireless roaming issues increased by over 240% compared to 2011-2012. That is an #epicfail.
• Consumer concerns about credit reporting by telecommunications providers increased by almost 165%. That is another #epicfail.
• In terms of which of the big three generates the most complaints, Bell is the big winner (or loser in this case) with 3,911 complaints. Close behind is Rogers which had 3,803 complaints. But what stands out for me is that Telus had only 883 complaints which is a fraction of the other two. Not only that, it was a 27% drop year over year. One has to wonder what Telus is doing that Rogers and Bell isn’t doing. I’ll be asking my contact at Telus for a comment and I’ll update this story when I get one.

I have to admit that there were some things in this report (which I really encourage that you read) that got my attention. But what do you think? Post a comment and share your thoughts.

UPDATE: I reached out to Telus as promised and they were very accommodating in terms of getting me a reply. Here’s what my contact had to say:

First of all, we’re really excited about the outstanding results in this year’s report. this is the second consecutive year that TELUS has experienced a substantial decline in the number of complaints submitted; our complaints decreased by 27 per cent year-over-year while overall industry complaints rose by 26 per cent.

In terms of your question on why we’ve scored as well as we have, we can certainly attribute that to our ongoing commitment to delivering upon our Clear and Simple philosophy which has seen the company embrace a keen focus on listening to customers and making real changes to its services based on their input over the last number of years. For example we have introduced roaming notifications, data use notifications, and data use caps for customers roaming internationally and reduced some international roaming rates by more than half. We also eliminated the $35 activation and $25 renewal fees plus launched new SharePlus plans with unlimited nationwide calling and shared data.

In addition, I’d add that we have been working hard over the last number of years to introduce a number of new customer-friendly policies that improve the level of service we provide. As a result, our customers are generally very happy with their service. We know this because we have consistently seen a lower number of customer complaints since the inception of the CCTS, and have experienced lower wireless churn rates as well. These are key indicators that customers are actually quite happy with our service.

This could be a bad thing, or it could be a good thing. First, here’s the news as it’s breaking at the moment via Reuters. A private equity fund by the name of Birch Hill has dropped out of the spectrum auction according to Industry Canada:

Birch Hill, a private equity firm, had previously been tipped as a possible bidder for small wireless providers Wind Mobile and Mobilicity, with sources saying in August that market leader Rogers Communications Inc would help fund the push in return for a network-sharing deal.

Withdrawing from the auction frees Birch Hill to talk to any of the remaining auction participants about an acquisition. Bidders are forbidden from such talk under Industry Canada rules.

That’s where things get interesting. Mobilicity is looking for a buyer. So maybe they’re going after them. Or they could be going after someone else. Or (and this is the bad thing) they’ve decided to pack it in. Take it from me. You want to keep an eye on this as I suspect that we are going to see their name surface again really soon.

It seems that there’s now proof that the Fair For Canada campaign launched by the big three telcos failed to resonate with consumers. Canada.com is reporting that the CRTC got letters from consumers who were less than thrilled with the big three’s attempts to win hearts and minds:

Several letters to the CRTC obtained by Postmedia News under access-to-information law show the public’s displeasure with the “Fair for Canada” campaign by Bell, Rogers and Telus, which attempted to rally public opinion against the possible entry of a fourth major wireless carrier such as U.S. giant Verizon into Canada.

The letters expressed little sympathy for the incumbents, citing a lack of competition in an industry where the largest three companies control about 85 per cent of all wireless airwaves and consumers pay some of the world’s highest wireless rates.

“I totally completely, 100% support Verizon and any other companies. I’m sick and tired of Bell, Rogers and Telus having the entire market share,” one person wrote to the CRTC, echoing several other similar submissions. “Please keep things open to outside/foreign companies because that’s the only way we consumers can get lower prices and better service.”

I am not at all shocked by this. In fact, I wrote on several occasions that this campaign was not resonating and was doomed to fail. The article quotes Rogers response to this:

“It was about our ask of the government for a fair and level playing field that treats large foreign carriers the same as established Canadian carriers,” spokesperson Jennifer Kett said in an email.

“The campaign generated significant debate and discussion among Canadians — something that we see as a good thing. We believe it’s important that consumers are engaged about how best to ensure that both Canada and Canadians benefit from a strong, sustainable and competitive wireless sector.”

Other than the fact that it seemed to have fallen on deaf ears, this ad campaign worked out well for them. Though the article does have one suggestion as to what the big three could do to win hearts and minds:

But John-Kurt Pliniussen, associate professor of eMarketing, sales and innovation at the Queen’s School of Business in Kingston, Ont., said he wasn’t surprised that Canadians responded negatively to the campaign, calling it a waste of money that had no bearing on the auction.

“Essentially what they’re saying is look, we’re going to spend a lot of money to try to change the government’s mind and to hopefully get consumers on our side,” he said.

“Why not take that 10 or 15 million you’re spending and come up with an incentive to thank your loyal customers and lower their rates, or give them a deal? But that’s not what they did. They just took money and tried to change opinion. It was a total waste of money.”

Hmmm…. That sounds familiar. But I digress. Even if no foreign competition comes into Canada, it seems that the big three have really damaged their credibility. Thus they should consider taking my advice, John-Kurt Pliniussen’s advice, and the advice of every Canadian and bring their pricing more in line with the rest of the planet as well as providing good customer service.

Really. How hard is that?

Now that all the parties have put down their deposits to bid in the upcoming auction for the 700 MHz spectrum, all the parties involved cannot comment about their strategies or anything to do with wireless policy. All the parties but the Canadian government it seems. That’s because I note that there’s this new site that popped up that spells out why the government is right and the big three are wrong when it comes to wireless policy. Not only that, but there’s now a Twitter feed dedicated to attacking the big three as well. Plus my wife pointed out that ads have appeared in local papers such as Metro as well as The Toronto Star.

Clearly it’s an all out attack on the big three to win hearts and minds while the big three are not in a position to fight back. Sneaky.

I will be reaching out to my contacts at Rogers and Telus to see if they can comment at all on this development. If they can, I’ll update this story.

UPDATE: I heard back from Telus who said that they were unable to comment on this, which is the response I was expecting. This of course illustrates why the Canadian Government picked now to launch this latest attack on the big three.