Canada’s Big 3 (Telus, Rogers, Bell) telecommunications companies (telcos) recently shifted to “unlimited” plans which push consumers to pay higher prices, regardless of their actual needs. From my vantage point, this reduces access to wireless services by creating a more expensive entry point for all consumers (as an aside, I’m curious about the CRTC’s view on this and their perception on the impact to consumers).
|New Plan and Pricing||Previous Plan and Pricing|
Side-by-side, the new plan and pricing seems like a deal given more gigabytes per dollar, which is great if you need 20GB or previously faced hefty dollars in overages. However, if that wasn’t your situation, the new plan adds $360 to your annual household expenses (for a two-person plan).
Given the advancement in technology where we’re seeing higher speeds at lower costs, consumers should expect to see better plans for less. Instead, telcos continue to raise rates claiming they have to pay for additional infrastructure due to increased consumer usage (yes, consumers are using more, but new and better network devices cost less). My suspicion is that, in reality, telcos want to offset any additional expense to maintain profit margins; have a look at a telco’s past few years of annual earnings and note how their profits have performed.
Here’s where these companies are leaving lower-income Canadians behind: if you need a primary phone and data, you only have prepaid options such as $35 for 250MB with 100 local minutes, unlimited evenings and weekends (then overages). The next step up is to pay $55 for 1GB with 500 nationwide minutes. This puts a two-person lower-income household into a position of having to choose between paying $70/month for prepaid (which has a lot less) or $150/month for a contract. While $80 per month may not seem like a lot for a family that has no problem making ends meet, it’s significant for the many families that have to make their dollars stretch. Where are the lower cost options for 2, 3, and 5GB with unlimited nationwide talk and text?
Instead of taking more money from consumers and creating a greater divide between lower-, middle-, and upper-income Canadians, telcos could help close the wireless access gap. Connect more people with each other and information and you strengthen society. A stronger society means a stronger economy. And we all benefit from that.