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Wireless market ‘functioning well’ in Canada: researcher

Wireless market ‘functioning well’ in Canada: researcher

Fred Lum/Fred Lum/The Globe and Mail

Wireless services in Canada are globally competitive both in prices and in innovative technology on offer to consumers, contrary to what many observers claim, says a research note published by the Montreal Economic Institute.

Canada ranks in the middle for wireless prices charged among developed countries, says author Yves Rabeau, associate management professor at the Université du Quebéc à Montréal.

"Canada is neither among the best, nor among the worst," says Mr. Rabeau, who is also an associate researcher at the institute.

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The price of a basic wireless plan in Canada is comparable to what is paid in U.S. cities, although higher than in other cities examined, according to 2012 figures by Wall Communications, says Mr. Rabeau.

In four out of six usage scenarios cited in the most recent biannual report by the Organization for Economic Co-operation and Development on the communications industry, prices are lower in Canada than in the U.S., though they are higher than the OECD average, he says.

"Furthermore, in the usage case including the most calls and text messages, Canada ranks as the fifth least-expensive of 34 countries."

It is inaccurate to say that Canada has higher roaming charges than all other OECD countries, as has been claimed by many Canadian media outlets, he adds.

The comparison is based on downloading one megabyte while roaming without a plan, an unrealistic situation, he says.

A far more realistic study concludes that Canada ranks as the seventh least-expensive of 34 countries, according to the research note.

Other studies show that Canada is holding its own in the deployment of the latest wireless technology, says Mr. Rabeau.

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Canada is also not at the Third World level when it comes to the penetration rate of broadband wireless services, "as critics are fond of claiming, but once again right in the middle of the pack of rich countries," he says.

"We are therefore far from the caricature propagated by certain analysts of a Canada trailing the rest of the world in Internet and wireless access."

The upshot is that Canada doesn't need more regulation to force providers to lower prices, increase download speeds and improve service quality, he says.

The Canadian Radio-television and Telecommunications Commission said in April it intends to revisit its decision almost 20 years ago not to regulate the wireless industry. It should refrain from doing so, Mr. Rabeau concludes.

"The wireless market in Canada is in full expansion and functioning well."

Independent analyst Amit Kaminer says he has not read the report and can't comment directly on it, but believes there has been an improvement in wireless service and prices in Canada over the past few years.

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"If you compare 2006 and 2012, there is a world of difference. We have better service choice, better technologies and better prices than we used to. Canada is not perfect but it's progressing,"Mr. Kaminer, of consultancy Seaboard Group, said in an interview.

In an e-mail, he added: "Wireless is better now: more competition, more choice to consumers, better service and better prices."

But he cautioned that there are challenges ahead, including making sure that the improving situation is sustained over the long run.

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About the Author
Quebec Business Correspondent

Bertrand has been covering Quebec business and finance since 2000. Before joining The Globe and Mail in 2000, he was the Toronto-based national business correspondent for Southam News. He has a B.A. from McGill University and a Bachelor of Applied Arts from Ryerson. More

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