OTTAWA-GATINEAU – The cost of using a payphone (remember those?) will remain at 50 cents for now, as the CRTC denied requests for an increase in local payphone rates to $1 for cash calls and up to $2 for calls charged to a credit card or other forms of payment.
In today’s decision, the Commission denied an application by Bell Canada, Bell Aliant Regional Communications and Télébec to raise payphone rates. The telcos argued that the increases were necessary to help recover the costs associated with upgrading their payphones to accept the new one dollar coin issued by the Royal Canadian Mint in 2012.
The Commission didn’t buy that argument, noting in its analysis that the costs for the currency changes are not unique to the telecommunications industry, and as such don’t qualify the companies for recovery of costs.
The companies also submitted that the payphone business is declining as a result of increased wireless phone usage, and that declining profitability related to less payphone usage has left them with no choice but to remove payphones from service.
On that point, the Commission countered with the fact that Bell Canada et al. made the same “increase rates/increase revenues” argument for payphone rate increases in 2006, which were later approved – however, demand for payphone service and revenues generated by the service still dropped considerably, and a number payphones were removed from service.
“This trend is likely to continue regardless of the rate charged for payphone services, and highlights the need to reassess the role of payphones,” said Jean-Pierre Blais, CRTC Chair, of today's decision.
To that end, the CRTC also issued a consultation alongside today’s decision inviting Canadians to share their views on the role of payphones in the Canadian communication system. The CRTC is also seeking comments on whether it would be appropriate to prohibit telephone companies from removing the last payphone in a community until the conclusion of this fact-finding process and, if required, any related follow-up process.
“This consultation will give us a clearer picture of how payphones are being used and by whom,” said Blais. “It will also help us assess how possible rate increases and the removal of payphones may affect Canadians, and whether any regulatory action is necessary.”
Comments on the removal of the last payphone in a community are due August 13, 2013 while those for the fact-finding process are due October 22, 2013.
