Question Period Note: TELECOMMUNICATIONS – REDUCING THE COST OF CELL PHONE BILLS

What is the Government of Canada doing to reduce Canadians’ cell phone bills?

• More than ever, Canadians are relying on telecommunications services for work, school, finances and health care – making access to high quality and affordable wireless services absolutely essential.

• The Government of Canada has been clear that greater affordability, competition, and innovation in the Canadian telecommunications sector is important.

• That’s why the government has introduced measures to make wireless services more affordable, including through our spectrum policies and keeping providers accountable for their pricing.

• The government continues to build on the progress made to promote competition and further reduce prices.

SUPPLEMENTARY MESSAGES

Benchmark and Quarterly Reporting:
• As announced in March, 2020, the government continues to report on wireless pricing quarterly with a clear benchmark to ensure transparency and demonstrate progress towards a 25 per cent price reduction target for mid-range plans.

• Over two years, the three major wireless providers, which represent 90 per cent of the national market, will be expected to offer plans that are 25 per cent cheaper in the 2 to 6 GB range.

• If these options are not offered to Canadians in the next two years, the government will look at other regulatory tools to further increase competition in the marketplace and help Canadian consumers make better-informed decisions on their telecom services.

• Prices for a majority of 2 GB to 6 GB data plans across Canada have decreased since beginning price tracking.

Wireless Pricing

Benchmarks against the government’s 25% price reduction commitment were announced in March 2020, and data is reported quarterly. The most recent results were published May 4, 2021. The results generally showed reductions in the range of 9% to 25%, though this included promotional pricing.

Separately, the annual Price Comparisons of Wireline, Wireless and Internet Services in Canada and with Foreign Jurisdictions report has been commissioned by the government since 2008. The 2020 study found that in the low- to mid-level service range, prices have declined between 19 to 28 percent compared to 2019. Despite price declines, Canada is still more expensive than most peer countries.

Device Financing Plans

On March 4, 2021, the Canadian Radio-television and Telecommunications Commission (CRTC) determined that device financing plans fall under the scope of the Wireless Code, including plans over 36 months. Device financing plans must comply with all relevant protections of the Wireless Code – including contract limits of two years - to ensure consumers are fully protected.

The Commission also established that device financing plans are similar to device subsidies when determining early cancellation fees under the formula established in the Wireless Code. To ensure that customers know what early cancellation fees to expect, the same protections will apply.

Policy Direction to the CRTC

In June 2019, the government issued a policy direction to the CRTC that requires it to clearly consider certain principles in all of its telecommunications regulatory decisions. These include the extent to which decisions encourage all forms of competition, foster affordability and lower prices, enhance and protect the rights of consumers, and enable innovation in telecommunications services.

CRTC Wireless Review

On April 25, 2021, the CRTC concluded a review of its wireless regulatory framework. The CRTC mandated that some of the large wireless service providers allow smaller, regional companies to access their networks to encourage network expansion and competition. Additionally, the CRTC expects that the national wireless carriers will begin offering low-cost and occasional-use plans, and requires that they will provide regional service providers with seamless roaming, including 5G services. The government is currently reviewing this decision.

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