Canada's biggest wireless companies are calling on Ottawa to slash the licensing fees they pay to access public airwaves, but there's little indication that any savings will be passed along to subscribers – particularly when it comes to the controversial "system access" fees that show up on wireless customers' monthly bills.

In documents filed with Industry Canada, the Canadian Wireless Telecommunications Association argues that the nearly $130 million in spectrum licensing fees handed over to the federal government each year far exceeds the estimated $3.8 million it costs Ottawa to manage the public resource, putting the Canadian wireless sector at a competitive disadvantage.

The fees, calculated to give a "fair return to the Canadian public," are over and above what the carriers pay for the spectrum licences themselves.

"There's an impact on the costs to the carriers, and any impact on costs reduces the available money for investment or driving down prices," said Keith McIntosh, director of regulatory affairs for the association, in an interview yesterday.

He said a better approach would be for Ottawa to adopt a cost-recovery model such as the one used by regulators in the United States.

Bell Canada Inc. went a step further in its submission and requested a "spectrum fee holiday." Rogers Communications Inc. disclosed that it pays $50 million annually in licensing fees, adding that higher fees translate into higher prices for customers. Telus Corp., meanwhile, said any savings would likely be put toward network investments.

But there was no word yesterday on whether any of the carriers would consider scaling back the system access fees they charge to subscribers, which range from $6.95 to $8.95 per month and have been previously justified, in part, by the need to offset the licensing fees collected by Ottawa.

The fees were implemented during the early days of the industry, when the government required cellphone users to pay to access the airwaves – a practice aborted long ago.

The rationale for maintaining the fees varies from carrier to carrier, but generally includes the need to offset the costs of operating and maintaining a wireless network, including technology upgrades and the cost of buying and owning spectrum.

But critics note that such expenses are merely the cost of doing business in the wireless sector – no different than paying employees or leasing office space.

"It's a misleading charge," said John Lawford, a lawyer with the Public Interest Advocacy Centre, noting that such add-on fees allow cellphone companies to advertise lower prices.

Bell spokeswoman Julie Smithers said it was too early to say what impact a change in government policy would have on Bell's customers, but noted there hasn't been a direct link between the company's $8.95 wireless system access fee and federal spectrum licensing fees for years.

Officials at Telus and Rogers declined to comment.

A 2004 class action lawsuit estimated that the industry collected about $800 million annually from the extra charges, with the figure now pegged closer to $1.3 billion to $1.5 billion.

The suit, certified two years ago by a Saskatchewan court, alleges that Rogers, Bell and Telus, among others, falsely led subscribers to believe their system access fees were required by federal regulators.

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In fact, Industry Canada put in place rules five years ago that prohibited wireless companies from referring to the fees as a government charge.

Over the past year, the threat of increased competition in the $12.7 billion Canadian wireless sector has prompted Rogers, Bell and Telus to remove or waive system access fees for customers of their discount brands.

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