Are you skeptical when the Trudeau government announces that it has reduced cellular plans by 25%, while your bill keeps increasing? You are right…and wrong. Because if the prices do indeed cease to fall for a few years, Canadians are more and more greedy in data and minutes of calls. And they have the misfortune to live in one of the countries where wireless services are the most expensive. Explanations.

$69

This is the average revenue per subscriber in Canada earned by mobile service providers in 2019, according to the most recent statistics compiled by the Canadian Radio-television and Telecommunications Commission (CRTC). It is in Quebec that this income is the lowest in the country, at $58.72, a situation that is essentially attributed to competition from a fourth player, Videotron. In 2015, the average revenue per user in Canada was $64.07.

Statistics Canada clearly establishes it: Canadians and Quebecers have been spending a lot more on wireless services over the past six years.

And yet they go down...

The great paradox is that this rising bill comes as cell phone prices continue to fall. At the end of July, Minister François-Philippe Champagne, in Ottawa, announced reductions of 9% to 25% on the most popular packages, data compiled by Wall Communications, which is an authority on the subject. The federal Minister of Innovation, Science and Industry said he was on track to fulfill Justin Trudeau's 2017 election promise by March 2022.

"We are close to achieving the government's objectives, including in Quebec, and we expect to meet the March 2022 deadline," Bell spokesperson Vanessa Damha told La Presse. “Wireless service prices in Canada have declined in recent years: numerous reports […] show that wireless service prices have been declining for some time, including a 21.5% drop between June 2020 and June 2021,” said Stéphanie Dussault, spokesperson at Telus.

According to Statistics Canada, prices have fallen by 34 percentage points since 2017.

“Prices are indeed falling,” confirms Nadir Marcos, founder and president of PlanHub, a price comparison tool. An example: plans offering 3 GB for less than $40 were exceptional a few years ago. Today, even the three major providers, Telus, Rogers and Bell, offer them, at least in Quebec.

Exploding Data

The paradox is only apparent. Marcos saw a shift in PlanHub users from looking for plans that offered 1.8GB on average in 2016 to 5.9GB in August 2021.

It's like taking advantage of lower gas prices to switch from a Smart to a Ford F-150: your fuel costs will skyrocket. This is basically what happened with cell phones. In 2019, Canadians consumed 2.9 GB of data per month on average, according to the CRTC, and almost all had unlimited calling plans. In 2015, consumption was only 1.4 GB and unlimited calls were not yet the norm.

2nd ⁱⁿ the world

Despite the price cuts, one fact remains inescapable: Canada is one of the places where people pay the most for their wireless service, and has done so for years.

According to the firms Wall Communications and Nordicity, only in Japan do we find higher prices, at least for packages under 4 GB.

For the most generous data plans, Canada is in 3rd place, behind Japan ^and Germany. Pierre Larouche, professor of law and expert in competition law at the University of Montreal, saw closely the examples of Europe and the United States, where he lived for a few years at the turn of the 2000s.

“I always had the impression that we paid too much in Canada. And all the studies behind the recent CRTC decision on mobile virtual operators (MVNOs) support my conclusion well: prices are more expensive in Canada than elsewhere. »

four actors

According to Mr. Larouche, “there are not 500 recipes” if we want to force greater price reductions: we must promote competition. However, most of the Canadian market is dominated by three major players, Rogers, Telus and Bell, which controlled with their affiliated companies Fido, Koodo and Virgin 90.2% of the market in 2019, according to the CRTC. The example of the impact of a fourth player like Videotron in Quebec confirms an empirical rule in terms of competition, believes the professor: “Statistics show us that the difference between three and four major players is quite significant […] three players, these are high-sounding markets. I'd rather have four companies that are fighting than three that are comfortable. »

28 billion

Mobile sector revenues in Canada in 2019, up 16% from 2017, according to the CRTC.

34.4 million

Number of Canadian wireless subscribers in 2019; 90% have data plans. Rogers holds 32.5% of the market, followed by Bell (29.2%) and Telus (28.6%). The "others" collect 9.8% of the shares. Quebec is distinct in this regard, with an estimated market share of 15% for Videotron.