OTTAWA — As part of the federal government’s stated commitment to help reduce the cost of some wireless plans by 25% over the next two years, Minister of Innovation, Science and Economic Development Canada Navdeep Bains today released data showing how prices have not yet declined for the data plans the department has chosen to study.
Over the next two years, the federal government expects the three major wireless providers and their flanker brands, which together represent 90% of the national market, to offer data plans in the 2 GB to 6 GB range that are 25% cheaper than they were in January of this year.
The first set of wireless pricing data released today by ISED focuses on Rogers’ Fido, Telus’ Koodo and Bell’s Virgin Mobile brands. ISED examined pricing from February to June 2020 for data plans ranging from 2 GB to 6 GB (with some gaps in terms of which level data plans are available or advertised by the providers).
The benchmark price, or the price to which the 25% reduction must apply, is based on prices advertised on carriers’ websites in January 2020 for postpaid, bring-your-own-device (BYOD), unlimited talk-and-text 4G/LTE plans in the 2 GB to 6 GB range.
Generally speaking, none of the three flanker brands examined (Fido, Koodo and Virgin) met the 25% price reduction targets for plans available across Canada, with the exception of the Quebec market. In fact, in Quebec, prices for 2 GB and 4 GB data plans were already lower than the January 2020 benchmark prices, and the 2 GB plans available in the province from all three brands currently meet the price reduction target.
Perhaps not coincidentally, the Quebec market features a strong competitor in Videotron, but ISED is not examining the pricing offered by regional players, not even SaskTel, the primary incumbent in Saskatchewan.
Other than short-term promotional pricing, the discount wireless providers’ advertised prices for the examined data plans did not change from February to June 2020, according to ISED Canada’s data tables.
“Since the start of the Covid-19 pandemic, we have engaged with Canada’s telecom service providers to ensure they can continue to provide the services that we all rely on to stay connected. I want to thank them, along with their essential workers, for the actions they have taken. From waiving home Internet overage fees to maintaining, repairing and upgrading their networks, they have helped support Canadians during this difficult time. In that same spirit, our government is optimistic that it can continue working with the big three providers to reduce the cost of mid-range wireless services by 25 percent over the next two years. The tracker launched today will help monitor progress toward this goal,” said Bains, in the news release.
ISED Canada says price monitoring will be ongoing and wireless pricing data on these data plans will be updated quarterly going forward. If the 25% price reduction target for these limited data bucket plans is not met over the next two years, the government says it will look at other regulatory tools to further increase competition in the marketplace and help reduce prices.
In a statement emailed to Cartt.ca, Rogers said it continues to evolve the company’s services to provide wireless customers with more affordability, value and choice.
“Over the past five years, the cost of data across Rogers brands has decreased 50% and prices continue to decline. We offer a range of options across our three brands for customers to choose from based on their budget and needs, with features like unlimited data plans, device and accessory financing, preowned devices, data overage protection and talk and text plans. We also supported our customers when the pandemic hit by investing in network capacity to keep Canadians connected while waiving roaming fees and Canadian long-distance charges,” says the Rogers statement.
Telus also responded to a request for comment about the government’s price tracking data announcement. In an email statement, the company highlighted the “exceptional network support” it provided to customers when demand spiked during the pandemic.
“During the same period, we enhanced the variety and choice of mobility options that we offer to Canadians from our family of brands, Public, Koodo and Telus, to meet their unique needs at a time when connectivity has been so critical,” reads the Telus statement.
For example, Public Mobile (not included in ISED Canada’s pricing data analysis) offered a 2 GB data plan for $35 and a 4.5 GB plan for $40, both of which exceeded the government’s price reduction targets for those data levels.
“The government data is a snapshot in time and prices are actually coming down across the country in an intensely competitive market,” said a Bell spokesman in an emailed statement. “We continually adapt our offerings in response to consumer demand and to provide ever greater value, like our 8GB plan which offers 33% more data for the same price as the 6GB $60 government benchmark. We actually have new 4GB and 6GB plans in market at $5 less than the benchmark price, representing 9% and 8% savings respectively, and on track to meet the government’s targets.”
Rogers’ chatr brand (also not included in the initial data set) currently offers a 4 GB plan for $40 and Bell’s Lucky brand has comparable pricing.
However, an ISED Canada spokesperson pointed out the low-cost flankers chatr, Public and Lucky typically offer 2 GB to 6 GB data plans over slower 3G technology, and therefore were not considered as part of this benchmark analysis which was based on 4G/LTE postpaid plans. In addition, prices for Rogers’, Telus’ and Bell’s main brands were not included in ISED’s reporting because the carriers’ flanker brands offer lower retail prices.
As well, none of the primary brands offer postpaid data buckets under 10 GB anymore as larger data plans are becoming the norm. For example, Rogers currently offers its Infinite plan for $75 with 10 GB of maximum-speed data (reduced speed thereafter). Telus also offers a 10 GB high-speed plan for $75 and currently has a limited-time offer of 20 GB for $80. Bell, too, has similar offerings.
Telus said in its email statement that it has seen growing demand for large data plans, and when given the choice, Canadians opt for larger data buckets and in Rogers’ latest quarterly results the company reported it has signed up two million customers to its Infinite plans, launched a year ago, which was far faster than it planned.
However, in its news release, ISED Canada cited data from the CRTC’s 2019 Communications Monitoring Report that said on average, Canadians were using about 2.5 GB of data per month in 2018. That said, the compound annual growth rate when it comes to data usage is said to be 34%, meaning the average amount of data Canadians are now using, need, and want, is well above 2.5 GB/mo.
As Canadians consume ever more data, the limited plans ISED has chosen to track may fall by the wayside, or only be used by a small minority of Canadians, by 2022.
To view ISED Canada’s first set of wireless pricing data, organized by province, please click here.
