Political parties during the current election campaign are promising to lower the cost of cellphone bills. Laura Tribe, director of OpenMedia, argues it’s about time as successive governments created a mess; now it’s up to our next government to fix it. But Robert Ghiz, president and CEO at Canadian Wireless Telecommunications Association, writes costs are already falling and legislation will undermine efforts to expand rural connectivity and will hurt the quality of Canada’s networks.

It’s no secret Canadians pay some of the highest cellphone prices in the world. But after decades of ignoring the problem, Canada’s major political parties have finally decided to make our cellphone nightmares one of their hottest election talking points.

The Liberals, NDP, and Greens have all promised to tackle the cellphone affordability problem through some combination of retail pricing controls and competition policy. The only major party that’s been silent on this so far is Andrew Scheer’s Conservatives.

Cynics and critics are quick to refute these plans with the argument that the government can’t fix the problem at all — but don’t listen to them. Not only is legislative change a realistic solution, it’s the best solution we have.

All Canadians want to see prices go down. But to achieve that, we need effective government action to fix the underlying systemic problems that have allowed our cellphone bills to become so expensive in the first place.

There’s one simple legislative change that will lower our cellphone prices: mandating fair wholesale rates for Mobile Virtual Network Operators (MVNOs) — smaller cellphone companies like Ting, Google Fi or Canada’s hopeful startup DotMobile, that operate over pre-existing networks. Right now the Big Telecom giants won’t allow these providers access to their networks at a fair rate and only new rules can make it happen.

We need more providers in the marketplace — and we need them now. And this is the way to do it.

Canada’s cellphone market is dominated by three national players: Bell, Telus and Rogers, which account for approximately 90 per cent of cellphone revenues in Canada. That is not a healthy marketplace — it’s functionally an oligopoly. It’s the result of years of bad policy decisions and legislation that have continued to prop up these three companies, at our expense.

To make sure prices go down and stay down, the government needs to replace existing problematic policies with ones that actively support customers — the MVNO policies described above.

Right now if companies want to enter the market, they need to build their own parallel network from scratch.

Well, if everyone was starting on a level playing field, that might work. But Bell, Telus and Rogers have a decades-long head start on new entrants. Requiring every competitor to duplicate facilities that already exist is also costly and economically inefficient.

In 2006, then-Conservative Industry Minister Maxime Bernier issued a policy direction compelling our federal telecom regulator, the Canadian Radio-television and Telecommunications Commission (CRTC), to prioritize market forces in all of its decisions. Essentially, don’t regulate unless they have to.

But market forces don’t work without meaningful competition. So in the dysfunctional oligopoly we’re living in, that simply meant ensuring that incumbents continued to reign supreme.

In other markets, MVNOs can rent unused space on existing networks and set up shop quickly. In countries like Australia, MVNOs provide intense competition. But the CRTC has been prevented from taking the steps necessary to bring this form of competition to Canada.

The Big Debate:

The telecom industry and its lobbyists will tell you that legislative change is not only unrealistic, it’s downright problematic. But their agenda is clear: increased competition threatens their profit margins.

While parties may not have unlocked quite the right policies just yet, at least some are on the right track. Both the Liberals and NDP are promising to bring in MVNOs; the problem is that they haven’t promised to do it fast enough.

For the next two years, the Liberals are planning to ask the telecoms to lower their rates by 25 per cent. If asking nicely doesn’t work, they’ve said they’ll then consider a narrow set of MVNO rules. And while retail price caps proposed by the NDP will offer short-term relief for some users, they won’t tackle the underlying structural problems in the market.

Affordable cellphone plans could finally be a reality in Canada with strong legislative change, clear direction to the CRTC and rules to hold Big Telecom accountable.

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Previous governments created this mess, and now it’s up to our next government to fix it by implementing common sense MVNO rules as soon as humanly possible.

Laura Tribe is the executive director of OpenMedia, a community-based organization working to keep the internet open, affordable, and surveillance-free.

Canadians have been on the receiving end of a long list of promises throughout the election campaign. These promises could lead to new public policy and legislation with serious impacts for Canadians. But any new legislative proposal should be based on facts. If we ignore the facts we risk doing real harm to Canadians and the Canadian economy. That is what we are seeing when it comes to the debate around the affordability of mobile wireless services.

The party platforms released to date regarding wireless prices ignore a critical fact: wireless prices have already been declining significantly over the last several years. In fact, the cost of wireless plans measured by the CRTC decreased on average by 28 per cent between 2016 and 2018. With the introduction of national unlimited data plans, the cost of wireless data has continued to drop this year.

Governments from across the political spectrum have pursued policies that encourage competition among the companies that invest in building our world-class wireless networks, most commonly referred to as facilities-based competition.

These policies include fostering the introduction of new regional facilities-based carriers that have played an important role in providing even more competition and contributing to the continuing downward trend in prices, while at the same time making their own investments in building and expanding Canada’s wireless networks.

THE BIG DEBATE: For more opposing view columns from Toronto Star contributors, click here.

This intense competition among facilities-based wireless service providers is directly responsible for the downward trend in prices and Canadians receiving more for what they pay. The regulatory interventions proposed by some of Canada’s political parties simply will not do anything that isn’t already happening — but will undermine efforts to expand rural connectivity and hurt the quality of Canada’s world-class networks.

The election proposals to date, fuelled by simplistic international price comparisons, also fail to recognize that price is only one factor to consider when discussing what Canadians need from their wireless services. Network performance and coverage are also fundamentally important.

Given its size and climate, Canada is one of the most challenging countries in which to build wireless networks. To date, Canada’s wireless providers have invested over $70 billion to build world-class wireless networks, which have been ranked the third fastest in the world (and twice as fast as the U.S.).

This success is not limited to urban centres. OpenSignal reports that network coverage and performance in Canada’s rural areas is also among the best in the world, despite having a population spread across a vast area. In fact, according to OpenSignal, the average download speed across rural Canada is faster than the average speed across all of the United States and more than 70 other countries.

Campaign promises that would allow companies that do not invest in our nation’s wireless infrastructure to use operator networks at government-mandated wholesale prices will have serious detrimental effects on Canadian wireless services:

First, they will disproportionately hurt the regional network operators who are furthering the intensity of competition in our industry, but who are still in the process of establishing themselves in the market.

Second, such policies will negatively impact all network operators’ ability to continue to invest in the building and expanding of their networks. This would be especially harmful for rural Canadians, who are depending on private sector investment to continue to invest in rural connectivity and to the rollout of the next generation of wireless technology, 5G.

Canada can’t afford to ignore the success our facilities-based carriers have had in delivering performance, coverage and decreasing prices. Promoting dangerous policies that have either been rejected or failed in other countries would discourage investment in Canada’s network infrastructure. In turn, this would have a profound negative impact on Canada’s ability to expand wireless services to all Canadians and be a leader in 5G.

We cannot let that happen to Canada’s world-class wireless services. Because of facilities-based competition, Canada is a world leader in wireless and because of increasing competition among national and regional facilities-based wireless providers, prices have been steadily decreasing.

Let’s ensure we maintain this momentum and keep the focus on policies that will encourage ongoing investment in Canada’s future and deliver even more value to Canadians.

Robert Ghiz is president and CEO at Canadian Wireless Telecommunications Association.