

Canada's Telecom Market is Rigged, says Wind Mobile backer Naguib Sawiris - jsnk
http://www.dslreports.com/shownews/Wind-Billionaire-Backer-Rips-Rigged-Canadian-Market-117095?nocomment=1

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jbarham
By way of comparison, I'm living in Melbourne, Australia, and pay $55/month
for the Nexus S w/ unlimited calls within Australia (including to other mobile
phones), unlimited texts (IIRC) and 500 MB of data. That's for a one-year plan
w/ Vodafone, and I didn't pay anything up-front for the phone. Needless to say
I'm looking forward to upgrading to the Galaxy Nexus soon. :) My wife has the
the same phone and same plan for two years and pays $45/month.

The Australian mobile phone market is very competitive, and it has a number of
foreign players (e.g., Optus, Vodafone, Virgin). Australian fixed-line
telecommunications are much less competitive due to the legacy stranglehold of
the former government monopoly, Telstra.

IMO Canadians are far too complacent about government sanctioned monopolies or
oligopolies (e.g., car insurance in BC, alcohol sales are provincial
government monopolies, dairy product quotas, wheat board monopoly) that means
they pay more for less choice, supposedly for their own good, when in reality
it just enriches an old-boys network of politically well-connected players and
condemns the protected industries to being being unable to compete
internationally.

FWIW I'm Canadian.

~~~
gyardley
The typical Canadian will irrationally defend any policy that differs from the
equivalent policy in America, because the typical Canadian's sense of national
identity is 10% hockey and 90% 'we're different from the Americans'.

We're never going to deregulate and allow a little free-market competition to
lower prices as long as these proposals can be criticized as 'Americanization'
or 'the American way'. It's not complacency that ties Canadians to our goofy
oligopolies, it's our own misguided nationalism.

~~~
nolanw
This is so laughably wrong as to be absurd. Your explanation for Canadian
telecom entrenchment and protectionism is that it's anti-American? Canada and
its provinces have imported America's love of faux-competition in media,
telecom, electricity, non-health insurance, and other areas nearly whole hog.

Anti-Americanism also runs contrary to Canada's: plans to imprison more of its
population; paying extra for ill-performing military hardware; treating its
First Nations like shit; increasing gap between rich and poor; busting of
unions; beating the hell out of protestors; resisting all meaningful measures
against climate change; and fighting pointless wars.

Canada could use some of this "we're different from the Americans" attitude
that you claim pervades the nation. Sadly, I don't see much evidence of it in
any of several areas of society, especially the telecom industry.

~~~
gyardley
I'll agree that the current federal government is a bit of an aberration
compared to past Liberal and Conservative governments, but playing up
differences from the Americans to justify political policies (good or bad - I
suppose that depends on your personal politics) has been a big part of
Canadian political life since Trudeau's first term in the late '60s.

Whether Canada is actually all that different from America or whether
'different from America' is just used as a cynical political tool is another
question.

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zmanji
I've never understood why in many western industrialized countries
telecommunications has not been regulated the same as sewage, roads,
electricity, etc. It is a vital piece of infrastructure in the 21st century
and it should be the responsibility of the government to manage such
infrastructure.

~~~
snowwindwaves
we used to have that, and while the service of providing roads, electricity,
or sewerage hasn't changed much in the last 100 years, telecommunications
certainly has. while networks might lend themselves to natural monopolies,
government sponsored telecommunications monopolies couldn't keep up with the
pace of innovation these days and as a result consumers would be left paying
high rates for antiquated service.

~~~
teamonkey
This is going to sound like trolling, but compared to the European mobile
telecoms services, you in the US _are_ paying high rates for an antiquated
service (specifically, non-GSM use is still common, everyday data speeds are
slower, dropouts are higher, call quality is lower).

Judicious government investment into telecoms infrastructure in certain
European countries has led to fast, cheap and stable communications.
Government investment doesn't always equate to bad; if it's bad it means that
particular government body did a bad job in that particular case, that's all.

~~~
nl
I don't think there has been significant government _investment_ in mobile
telecoms in Europe (citation requested if I'm wrong).

There is much higher levels of competition, enforced by government regulation
though.

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DuncanIdaho
There has not been significant investment into _mobile_ , there was regulation
that forced carriers to cover even the areas that would otherwise prove
unprofitable, if they wanted the frequencies that is.

And mobile network is also heavily dependant on landlines, which were built by
government owned telcos.

~~~
com
Just to add nuance: mobile _was_ heavily dependant on landlines. In my
experience, not any more.

Recently began (2009) a national gigabit to the mast rollout project in a
medium-sized European country which is almost complete now.

This didn't use a legacy copper investment (or even legacy fiber, not that
there was a lot of that).

~~~
DuncanIdaho
I didn't know that. Thank you for clarifying - this project would be probably
taking place in Finland?

However 20 years ago the ubiquity of state sponsored infrastructure is what
enabled fast and competitive coverage of Europe with mobile
telecommunications.

It's just an example of how what our US colleagues would call "socialsim" can
provide better results than "free market".

There is a point I just realized. Whenever there is a state sponsored monopoly
in Europe - it is forced to provide a service to all, even if it means loss in
some cases. However whenever there is a state sponsored monopoly in US it just
removes competition, while internally the organization still sticks to the
"profit first" doctrine.

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FreeKill
I doubt anyone who has ever had to deal with one of the big 3 in Canada
(Rogers, Telus, or Bell) would argue against this point. Canadians really need
to push for an open system that allows foreign competition to enter the
marketplace. Until we do, the status quo is simply going to continue to press
the advantage they have at the expense of the Canadian consumers.

~~~
JonLim
I would love to have an idea of what we CAN do.

This is the one thing in my life where I can't vote with my wallet. I only
really have three viable choices for wireless right now: Rogers, Bell, and
Telus.

~~~
mladenkovacevic
Have you tried one of the small guys struggling to compete against the big 3?
Mobilicity, Wind or Public Mobile. I am with Mobilicity and pay $35 for
unlimited everything (one of the amzing early plans they had.. you can still
get he same for $40 or so) and that includes data, global text messaging and
North American long distance.A couple of caveats are that plans are metro-area
limited so if you go out of any of their zones (Toronto, Vancouver, Ottawa,
Calgary...) you are roaming at about 25 cents per minute and if you need fast
data forget it (highest I get is about 3Mbit/s). Some changes are coming
though so all of us with the little carriers are kinda unsure what's going to
happen - Mobilicity's CEO was just fired, CRTC declared that the small guys
have to bid for the same LTE spectrum along with the big 3 (which is what the
main Wind investor in the article above is complaining about).

~~~
JonLim
I really wanted to go with Wind when they came out, but none of the new
providers would let me use an iPhone on their system, which meant that they
were instantly out of the running.

Sounds silly I know, but I want to keep using the phone I'm using.

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dhughes
I have cell service with Bell Aliant (eastern Canada) and my data is horrible!

My phone a Samsung Galaxy SII on Bell's HSPA+ network which from what I
understand can be anywhere from 21Mbps to 42Mbps but my phone is only capable
of a max of 21Mbps. I don't expect to get 21Mbps or even 15Mbps but most days
it's 0.3 or 1Mbps maybe 5Mbps to 9Mbps on a good day. Outright lies or
incompetence or both to say such a thing and not have anywhere near what they
promise.

Bell's excuse is the network is busy with other users but I test it at all
hours of the day and each day and weekend but it's never consistent. They
advertise "HSPA+ 21Mbps" but make excuse after excuse once you're a customer
that you'll never ever see that.

I complained to the CRTC Donna Shewfelt Client Services wrote back to me gave
me a case number 'CRTC Case ID: 548491' but then "The telecommunications
industry has established an independent consumer agency, the Commissioner for
Complaints for Telecommunications Services (CCTS)"

and

"Given the concerns you have raised, we believe this complaint is more
properly within the scope of the CCTS and have forwarded your complaint to
them."

That was September 22 of this year (2011) and not one reply since then from
any of them.

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snowwindwaves
new zealanders have a rough go with their telecommunications as well. I recall
seeing the vodafone CEO on the news saying they made 3-4x as much profit in
new zealand as anywhere else (per customer probably). The only competion was
the ex-public telecom.

canadians don't have it quite so bad as the new zealanders, but they get a
worse deal than the americans for sure.

~~~
wavephorm
Canada has BY FAR the most expensive cell phone rates in the world. New
Zealand is 19th according to this list. See:

[http://www.mobilemag.com/2010/08/27/canadians-have-the-
most-...](http://www.mobilemag.com/2010/08/27/canadians-have-the-most-
expensive-cell-phone-bills-in-the-world/)

That graph doesn't even give justice to the true cost. Canada plans are almost
always regional, so to call another city, even one nearby is a long distance
call. VOIP phones are also rare because numbers are restricted, Skype and
Google Phone do not exist here.

Canada's telecom industry can accurately be described as a mafia-style public
cartel.

~~~
snowwindwaves
I wonder why Skype In (Skype Online Number) - where people call a POTS number
and get your skype account, isn't available in canada.

What is stopping everyone from making calls from mobile phones over data
networks? surely skype is available for iphone and android?

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nobody31415926
Data costs in canada are even higher than voice costs!

skype is only available on some androids and charges calls against your voice
minutes.

~~~
snowwindwaves
I had a t-mobile blackberry flip phone in the USA that could make calls over
wifi. when it was connected to an access point I could turn off the carrier
connection and just use the wifi, but it did still use my minutes and the
quality was not good.

Does anyone know if a SIP soft phone app like X-lite and a smartphone that can
use a wifi connection to so that at least outgoing calls could be made over
data without long distance charges or ridiculous data rates?

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greyboy
I'm not sure if this is what you're asking about, but the Nokia business-
oreinted phones E-series come with SIP capabilites natively (or one can use a
third party client). I've used it on my E73.

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wmougayar
This definitely sucks for Canada. The Telco's and the antiquated regulation
that protects them are big gatekeepers to progress and innovation. How do we
break out of this deadlock?

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zmanji
One has to fix the prime example of regulatory capture that is the CRTC. This
can be achieved by either changing the current management or drafting more
legislation.

~~~
freejack
IIRC, there are only a few commissioners who don't come from Canada's
media/telco industries. i.e. the commission is mostly populated by insiders
from the industries that the CRTC purports to oversee and regulate. Fox,
henhouse, etc.

<http://www.crtc.gc.ca/eng/about/commissioners.htm>

~~~
zmanji
The question that I always have is, how can we find people who have the
knowledge to regulate the telco industry but who have not worked in the telco
industry in a large capacity before?

~~~
a3camero
Research in Motion employees, other electronics companies. How about just
business people? People who've worked for foreign cell/telecom companies who
want to move back to Canada. IT experts who've worked with the infrastructure.
Lawyers in the industry who work for private law firms (biased, but less so
probably).

There are plenty of people who would be a better choice than someone who's
worked for an incumbent player.

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deathchill
It's almost as terrible as the car insurance market in BC:

<http://ihateicbc.com/icbcs-dirty-little-secret.html>

BC only has one car insurance provider so they're free to set the prices as
they see fit. They even try and pretend that they're doing it to help keep
prices low as competition would only raise the prices for everyone (yes, they
really said this).

~~~
nobody31415926
They did it because they made motor insurance mandatory and it would be unfair
to force someone to have something that the market didn't have to provide.

In europe it's essentially impossible for anyone under 21 to get insurance (
without tricks like being listed on parent's cover ) even though the law says
you can drive at 17. Typical rates for liability-only on a 17 year old are
$10K/year

Imagine living in a rural part of BC where work and shopping is 20 miles away
and the insurance companies all charge $10K for drivers under 21.

Yes it's unfair that as a middle age driver I pay 2-3x as much as I would in
europe in order to cover a west vancouver millionaire's kid in a ferrari. But
it's also unfair that I'm paying for elementary schools for someone else's kid
or subsidizing somebody else's cancer treatment.

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alsocasey
Hold the phone, motor vehicle insurance isn't mandatory in the US?

~~~
amalcon
No. It's mandatory for residents of most individual states, but (for example)
New Hampshire does not require it of its residents.

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loceng
It keeps competitors out. Many governments do this. Keeps jobs and profits
local, for the most part.

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noarchy
For the most part, maybe. Tell that to the Bell customers who deal with Indian
call centres when they need tech support. I know I did, years back (haven't
dealt with Bell in a while).

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cheez
Heh, I know the guy who piloted that way back. He still gets royalties.

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1010010101
This is meant to be a legitimate question, not sarcasm: Are there any
countries where telecom is not "rigged"? That is, places where an entrepreneur
could enter the market and the incumbents by and large would play "fair"?

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napierzaza
That is indeed Canada. Try and get DSL or cable internet here too. It's
terrible. Bad service, bad price.

~~~
jackvalentine
Can you give me some concrete examples of this? I have a lecturer at
university who constantly harps on about "canada doing it right" with
broadband access and I've always had the feeling that he has no idea what he's
talking about. I'd love to go head-to-head with him next year over the topic.

This guy: <http://www.politicalscience.com.au/>
<http://www.politicalscience.com.au/p/my-media.html>

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nobody31415926
In other news - bears discovered to shit in the woods and pope a catholic
shock discovery.

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feralchimp
#define regulatedMarket marketRiggedForEstablishedPlayers

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nobody31415926
Even worse in canada - all incoming firms have to be Canadian owned and
financed. Try raising the money for a nation wide set of phone masts if you
aren't allowed overseas investors

