Big cellcos ordered to cut mid-range prices by 25%; smaller players’ 3.5GHz set-aside confirmed

6 Mar 2020

Canada’s Minister of Innovation, Science & Economic Development, Navdeep Bains, has issued a directive to the country’s three large national mobile network operators (MNOs) – Rogers, Bell and Telus – to lower their prices by 25% in the next two years for mobile phone packages that include 2GB to 6GB of monthly data. If the big MNOs do not comply, the government ‘will take action with other regulatory tools to further increase competition and help reduce prices,’ the minister stated, adding that the aim was to increase competition and give users more affordable options by reducing the cost of ‘mid-range’ wireless packages. To track progress of reductions, the government will release a quarterly price benchmarking report.

Supporting the directive, Minister Bains announced the release of the 2019 Price Comparison Study, which showed that average prices from regional providers (smaller MNOs including Freedom Mobile, Videotron, Sasktel, Eastlink and Ice Wireless) were ‘up to 45%’ lower than the big three’s plans, but prices for mid-range plans had ‘not moved’. The study also claimed that Canadians have been paying more overall compared to consumers in other G7 countries and Australia.

TeleGeography notes that Prime Minister Justin Trudeau’s Liberal Party ran for re-election in October 2019 with a pledge to lower wireless tariffs by 25%, claiming this move would save the average family of four almost CAD1,000 (USD752) a year. One of the big three, Telus recently responded by introducing its ‘True North Affordability’ pledge to cut prices to below government targets.

In another measure to promote greater regional competition and lower prices, Minister Bains has also confirmed rules for the upcoming (Q4 2020) 3500MHz 5G spectrum auction, reserving 50MHz for small and regional telecom companies within the 3450MHz-3650MHz range.