Bell and Telus propose 500MB for $30; Rogers 400MB for $25
GATINEAU – Rogers, Bell and Telus have given the CRTC what it asked for – new data only wireless plans meant to fill a gap the Regulator sees in the market.
A multifaceted wireless decision last month included decreases in wholesale wireless rates, a “no” to Wi-Fi first models, and an early review of the wholesale wireless framework that will again reconsider MVNO rules. However, as part of that, the Commission directed the big three to immediately come up new data-only wireless plans which: must not be tied to customer income; must be made available on the latest, greatest network (4G), must be nationwide, and be available on post- and pre-paid plans. Those plans, said the CRTC, will fill a hole in the market which the Commission says is a serious problem for low income Canadians. (We dubbed it “skinny wireless” after the CRTC’s $25/month skinny basic TV, which was mandated in 2015).
Rogers Communications’ submission (all were filed late Monday and posted to the CRTC web site Tuesday), actually says it had skinny basic TV in mind when pricing its proposal, which is a $25/month plan offering 400 MB of data on its 4G LTE network, nationwide. The price is “consistent with the Commission’s ‘starter basic’ cable plan which was similarly designed to provide a basic, introductory service to Canadian consumers at an economical price,” reads its submission, which did not identify which brand it might use to roll this out.
Bell Mobility’s proposal to the CRTC says it will offer 500 MB of data on its 4G LTE network, under its Virgin brand. “The price of our proposed plan is about $7 per week, or the same as a few cups of Tim Horton's coffee. It is also about 1% of Canada's Low Income Measure for Canadian Households,” reads the proposal.
As for Telus, it was the only one of the big three already offering a national data only plan before the Commission’s demand. Its lowest cost Public Mobile brand offered 250 MB of data for $20 a month, but that was only on its 3G network, not the newest and fastest network demanded by the Commission. So, Telus said it will launch a new plan under its Koodo brand offering 500 MB of data for $30/month on 4G.
UPDATE: Its submission also said there is a new prepaid plan forthcoming from Public Mobile which will offer 600MB of data for $30/month, also on its national 4G LTE network.
That amount of data, reads the Telus submission, will let an average user “send 25,000 text emails, view 500 web pages, send 16,600 IMs, or download 125 songs.” Of course, 400 or 500 MB of data won’t let the average user watch much video in a month but, say the submissions, that’s what Wi-Fi is for. Besides, “(l)ower-cost data-only plans providing lesser amounts of mobile wireless data are not designed to enable increased Netflix usage, but rather to ensure that Canadians can use their mobile devices to actively participate in the digital economy,” reads the Telus submission. “This includes activities such as conducting job searches, consulting with schools and health care professionals, communicating with friends and family, interacting with government agencies, etc.”
All three carriers promised to market their new offering as well as it markets other such plans and that customers can bring their own devices or buy one. New customers would also have to purchase a SIM card.
“Retail competition has resulted in wireless prices declining over time.” – Bell
All three companies also told the Regulator that there is no need to mandate a price ceiling for such plans – nor a data allotment floor, which was intimated in the Commission’s call in the first place. “Neither a price ceiling nor a capacity floor are necessary. Rogers’ proposed plans are economical to Canadians with low incomes and provide more than enough mobile wireless data to provide for a full month’s worth of connectivity, especially when coupled with ubiquitous and free Wi-Fi services,” reads the Rogers submission.
Bell notes there are over 20 wireless brands with a wide range of affordable pricing options already fighting for market share in Canada – which shows there is already ample competition – plus, the fact competitors like Public, Chatr and Freedom, as well as its own new Lucky Mobile brand, offer low-cost plans for low income Canadians already means no new rate regulation is necessary.
“Retail competition has resulted in wireless prices declining over time. According to a recent report by the Nordicity Group which was commissioned by Innovation, Science and Economic Development (ISED), Canadian wireless prices have fallen significantly over time,” reads the Bell submission. “For example… wireless plans that provide for the use of 450 voice minutes and 300 texts, and wireless plans that provide for the use of 1,200 voice minutes, 300 texts and 1 GB of data, declined by over 30% between 2008 and 2017. Over that same period, inflation increased 14%.”
Telus went some steps further than either Bell or Rogers, saying that the Commission doesn’t have the power, under the section of the Telecom Act used in the proceeding (s. 24), to make any rate determinations, and that the original Order-in-Council from the federal government which drove this proceeding is based on a false premise.
“Neither of these statements is borne out by the evidence.” – Telus
“Any proposals to cap rates or mandate the availability of a low cost service are necessarily rate regulation,” reads its submission. “Rates are primarily regulated under subsections 27(1) and 27(2) and section 25 of the Act, not section 24 (Ed: which lets the CRTC mandate conditions of service). Attempting to institute regulatory mechanisms such as rate ceilings or mandating a data-capacity floor would require a reversal of previous forbearance decisions. The Commission has not sought any evidence that would allow it to make such a determination in this proceeding, and the Commission has not provided parties with notice that it would consider reversing its forbearance rulings.”
As well, “the Commission states that there exists ‘a gap in the market with respect to lower-cost data-only plans.’ The Commission also refers to the ‘concerns set out in the Order in Council, especially the concerns regarding affordability.’ Neither of these statements is borne out by the evidence,” continues the Telus submission.
“The market for mobile wireless services in Canada is high-performing in terms of network innovation, wireless adoption, declining prices and choice of competitive services. The Commission has found as much repeatedly over the last 20 years, and all reliable evidence continues to reinforce this point. There is also no gap in the market for lower-cost data only plans… Because the predicate findings underpinning this proceeding are incorrect, there is no need for Commission action.”
Interested parties now have until May 23rd to respond to the Rogers, Bell, and Telus filings, which can be found here.
