For the first time in a long time, Canadian wireless prices — which have long been among the highest in the world — are finally starting to decline. In fact, according to one analyst, the target set by the minority Liberals in the fall to cut cellphone bills by 25 per cent over four years has already been reached.

The bad news is that prices are declining more quickly in many other countries — so even with the decline, Canadian prices are still some of the highest in the world.

Law professor and technology writer Michael Geist, notes that the federal government’s own 2018 telecom price comparison study — which focused on showing how increased competition has lowered wireless pricing plans — indicates that prices are either the highest or second-highest among the reviewed countries.

CRTC data and a 2018 government-commissioned report found that prices for internet and wireless plans are declining, though, helped in part by introduction this summer of new no-data-overage offers by the big telecoms, although a number of studies continue to show they remain above international averages and are roughly double those in Australia.

Swedish consulting firm Tefficient, in its most recent international pricing report, said Canadian telecom carriers drive the highest revenues per wireless gigabyte in the world, while the Competition Bureau, using public information, found that wireless plans in Quebec, Manitoba and Saskatchewan are priced consistently lower than in the rest of Canada.

A 10-gigabyte plan in Ontario, for example, was 80 per cent more expensive than in Saskatchewan in April, with the differences not explained by variances in network quality and population density, the bureau says.

And while Canadian telecom service prices reflect investment in a world-class network and a user based that’s spread out over a huge country, they are still “exorbitant” in some categories, Geist says, and are typically falling more slowly than in other countries.

“The gap between Canada and other countries on wireless affordability is growing, not shrinking,” he writes. Put another way, Geist says while the Canadian median gigabyte price in smartphone plans fell during the second half of 2019, Canada’s competitiveness among the EU OECD (Organization for Economic Co-operation and Development) countries further worsened.

One consequence is a high revenue per user for Canadian telecoms but another has been a comparatively low wireless penetration rate, notes Benjamin Klass, a PhD student at Carleton University’s School of Journalism and a contributor to the Canadian Media Concentration Research Project.

“We languish down at the bottom of the OECD rankings right alongside Turkey and Mexico in terms of (wireless) adoption levels.”

In this context — and with affordability a priority for the Liberals — he says households can expect moderate price declines for wireless and internet services in 2020.

The expected price decline is due to several factors, including the growth of regional rivals such as Eastlink and Vidéotron, policies that have set aside wireless spectrum for new competitors, reduced wholesale charges for broadband network access, and more wireless roaming options for travellers.

And while the telecom and internet market continues to be dominated by Bell, Rogers and Telus, lower-cost flanker brands, regional competitors and upstart ISPs have combined to heighten competition.

Consumers of internet services got a boost as well from a decision by the Canadian Radio-television and Telecommunications Commission to slash wholesale rates for third-party access to broadband networks, a move that was successfully stayed on an appeal in September by major telecoms though many Canadian network operators immediately dropped prices and bumped up speeds regardless.

All of this has led to more payment options for consumers and an expanded range of wireless service pricing. In fact, according to a note published in September by Scotia Capital analyst Jeff Fan, because the Liberals used outdated data for their “current prices” when they promised a 25 per cent reduction in prices this fall, their target has actually already been achieved.

Even so, “a large number of seniors, youth, newcomers, visitors and people on a budget are being pushed into service options that are not optimal for their needs,” Algis Akstinas, CEO of Dotmobile, a company focused on bringing affordable wireless service to underserved Canadians.

“Lower-tier plans have high (and increasing) overages, do not have good cost-control tools, often artificially limit the speed, and puts the user at the back of the line when they contact the call centres. We’re told time and again that Canada excels at building wireless networks, but we continue to fail at delivering service and many Canadians are underserved.”

He says years of focus on the premium market has resulted in fundamental misalignment between current wireless brand offerings and reality — “not everyone wants or can afford a top-tier plan or high-end smartphone.”

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Akstinas argues that opening the door to mobile virtual network operators (MVNOs) to temporarily lease bulk space on incumbents’ infrastructure and resell network services at reduced costs would help fill a gap in nationally available affordable service. The federal telecom regulator last summer said it shared the “preliminary view” that there should be more opportunity for MVNOs, suggesting that smaller operators need a guarantee they can connect with established networks.

Opponents, however, warn that allowing virtual operators access could undermine decades of investment by major telecoms in spectrum licences and network build-out. Industry groups also oppose having a government or regulator set the wholesale price they can charge for access, saying having to sell access at or below cost would discourage future investment and hinder expansion of wireless and internet services in remote regions.

The CRTC is reviewing the state of the mobile wireless market and whether further action is required to improve choice and affordability, with a public hearing scheduled for early in the new year.