If there’s one thing that unites Canadians, it’s their disdain for cellphone companies. Whether it’s unexpected charges, terrible customer service or that unauthorized contract renewal (surprise!), everybody’s got their own horror story to tell.
Things did get marginally better in 2012, with new competitors further forcing the hands of incumbents to lower or eliminate fees and behaviours not found in other parts of the world, but big problems still remain. To that end, a number of provinces either enacted or were in the process of working out rules that would rein in the worst abuses, including high early-termination charges and one-sided contract terms.
Into this breach stepped the Canadian Radio-television and Telecommunications Commission, which in October launched a public process that will ultimately result in a new code of conduct to govern wireless companies. The regulator opened the floor to Canadians and got an earful as a result, with hearings continuing on in the new year.
The industry has put on a brave face and suggests it supports the CRTC’s effort – it is, after all, preferable to 10 or 13 different sets of rules across the land – but at the same time, it’s also pushing a set of disingenuous talking points through its various levels of lobbyists.
Many can be found in CARTT’s recent interview with Bernard Lord, the head of the Canadian Wireless Telecommunications Association, the industry’s main lobby group (it is worth pointing out that the group doesn’t always speak for all of its members, with Telus and some of the new players being notably prickly with some of its positions). One of the best is the misrepresentation of Canadians’ need for wireless services as love for wireless services:
I find with the world of Twitter and Facebook and social media, it’s easy to get confused by what one individual says, against whether it really reflects everybody else? When you look at how people act and behave in Canada, Canadians are buying more cell phones than before… and cell phones and cell phone services is on top of the Christmas list for a lot of Canadians.
Yes indeed, Canadians do in fact love their phones, and the fact that they deliver the world to them, so they’re buying them in droves. It’s pretty evident that Canadians will pay anything for them, but that doesn’t mean they like it. In fact, it probably means the opposite; nobody likes to be held hostage over something they absolutely need.
That sort of need shouldn’t be mistaken for the sort of enthusiastic love one might have, for say, bunny rabbits or a warm, sunny day. Canadians love food too, but they can’t live without it and would be pretty upset if grocery stores locked them into contracts and consistently gave them poor customer service.
The main beef heard by the CRTC about wireless services so far relates to three-year contracts. Canadians were loud and clear in urging the regulator to ban them. Why, many wondered in their submissions, is Canada the only country in the world where such long deals are prevalent?
Lord, who spent seven years as premier of New Brunswick, counters this with the industry’s free-marketeer talking point, which has been parroted by other industry lobbyists:
I was in New Brunswick, so this gentleman recognized me, comes up to talk to me and he said, ‘Look, what’s the deal with three-year contracts? Why can’t I get a phone without a three-year contract?’ I said to him, ‘You can.’ To paraphrase the ad on TV, if you don’t want a three-year contract, don’t take a three-year contract. But there’s this perception with some that the only way to get cell phone service in Canada is through a three-year contract. It isn’t. It’s just the most popular choice.
Alas, that’s just a hair width away from being true. Since Lord is talking about “the most popular choice,” how would he answer that same man’s question if one letter – “i” – were put in front of the word “phone?” As in, “How can I get the most popular phone, the iPhone, without a three-year contract?”
The answer is simple: shell out at least $700 up front for the latest model. Other than that, tough noogies, because every Canadian carrier that sells the iPhone does so on a three-year contract, with no options in between.
Only the rich and the fanboys who line up on launch day buy their devices up front, which means the rest of the population is happy to sign onto a contract in exchange for a discount on the phone. What they want to know is, why are they being locked in for longer than anyone else in the world for the same exact thing?
That’s the fact that the industry is trying to steer around through its Obama-esque “yes you can” talking point. Previously, providers have tried the “we’re a small market with different market conditions” argument, but with even smaller countries making things work with two-year contracts, the jig is up on that one. “More customer choice” is the new slogan, designed to appeal to Canadians’ sense of populism and distract from the real issue – that other, freer markets aren’t doing this.
If the industry genuinely believed this rather ridiculous line of thinking, why not offer really cheap monthly plans in exchange for signing on to a five-year contract? Heck, why stop there – why not 10-year contracts? Under such a deal, your monthly cellphone bill would be only 50 cents.
Make no mistake: three-year contracts are not about different market conditions or giving customers more choices. They’re very clearly about locking people in for longer, thereby preventing them from getting a better deal elsewhere.