Yes, cell phone plans in Canada are ridiculously expensive. Here’s why.

(Sarah Piche / The McGill Policy Association)

(Sarah Piche / The McGill Policy Association)

When Vancouver journalist Douglas Todd travelled to Denmark, he found that a Danish cell phone plan cost only a third of what he was paying for cell service at home. In Denmark, a typical plan for 110 kroner (22 CAD) per month allowed for 20 gigabytes of data and 20 hours of no-restriction phone time, while in Vancouver, Todd was paying $70 per month for three hours of daytime phone time and one gigabyte of data. And yet, he isn’t the only mobile user to be frustrated with his phone bill: Across Canada, consumers have been complaining about the country’s telecommunications sector.

On Feb. 20, a report released by the Canadian Radio-television and Telecommunications Commission (CRTC) agreed that telecommunications service-providers across Canada are engaging in “misleading or aggressive” sales practices. Though the CRTC’s report was recently released, the expensiveness of Canada’s phone plans comes as no surprise. Canadians currently pay some of the highest cell phone bills in the world, with the average plan of unlimited talk-and-text and two gigabytes of data costing 138 per cent more than equivalent plans in the UK and 156 per cent more than those in France. Consumers have been misled by salespersons who misrepresent the costs of services and add services to accounts without the owner’s permission. In 2017, the federal government commissioned a consulting firm, Nordicity, to study the prices of telecommunications services offered by network providers in Canada. It compared the prices of these services across six Canadian cities—Halifax, Montreal, Toronto, Winnipeg, Regina, and Vancouver—with those of equivalent plans offered in seven other countries: Australia, the UK, France, the U.S., Italy, Japan, and Germany. A variety of providers were studied in Canada, including Telus, Rogers, Bell Canada, Videotron, and PC Mobile.

For cell phone services, Nordicity found that Canada’s prices for the most basic-level plans were more expensive than any of the other seven countries. For example, the most basic data plan in Canada, with one gigabyte of data, 1,200 minutes, and 300 text messages, costs about $70 while the same plan in France costs only $30. At every other level, except for one, Canada’s prices were the second most expensive. In some categories, Canadian prices were almost double the price of the third most expensive country. Between Canadian cities, Vancouver, Halifax, and Toronto were the most costly in every category while Regina, Montreal, and Winnipeg were the least.

The study confirmed what Canadians already knew: Cell phone plans are ridiculously expensive in Canada. There’s even a flourishing black market which helps Canadian mobile phone users  from other provinces purchase plans in Manitoba and Saskatchewan, where prices are cheaper. Competing studies have made the claim that Canada’s geography presents a challenge to providers and therefore the high cost is justified, but if vast territory and a highly dispersed population is a challenge, how can Australia offer cheaper cell phone plans with a seemingly equivalent quality of coverage?

Furthermore, following allegations of misleading or aggressive sales practices by telecommunications service providers, the government tasked the CRTC with examining the issue in depth. The study included six weeks of public consultation, public opinion research, and a five-day public hearing in October, and it concluded that many Canadians have experienced misleading or aggressive sales practices, with 40 per cent who responded to an online survey echoing these sentiments.

These practices take place in various settings, including in stores, online, on the phone, and during door-to-door campaigns. Some of the issues which were reported to the CRTC include call centre employees adding services to a customer’s account without their permission, and door-to-door salespersons misrepresenting contract prices, with consumer groups such as seniors being particularly vulnerable.

Consumer protections are government regulations built to protect the rights of consumers, rights to fair trade, competition, and accurate information in the marketplace. There are currently consumer protections in place to aid customers, but the study claims that many Canadians are not aware of them, or that the measures are ineffective.

On both the issue of expensive cell phone plans and harmful practices by telecommunications service providers, the federal government has been largely silent. Going forward, local and provincial governments should place more pressure on Ottawa for increased regulation. The B.C. government took the first step recently when it focused on consumer protections during its throne speech, stating that it would “encourage the federal government to deliver more affordable cell-phone options for people.” Similarly, if local advocacy groups and grassroots movements continue to push for increased consumer protection, Ottawa might listen. The CRTC report might not have happened had groups such as the Public Interest Advocacy Centre not pushed for it. It’s clear that Canada’s telecommunications sector needs attention, and the way to solve its current problems is by pressuring the federal government for greater consumer protections.