Tuesday, September 11, 2012 – On the eve of an eagerly anticipated decision from the CRTC regarding the regulation of wireless services in Canada, it is important to have a clear understanding of the situation. Contrary to what is sometimes claimed, the Canadian wireless industry is doing well compared to other countries based on various international rankings. So argues Yves Rabeau, associate professor at UQAM and the author of several articles and papers on telecommunications, including an Economic Note published today with the Montreal Economic Institute (MEI).
“To evaluate the wireless industry properly, there are many variables that need to be taken into account in order to see what’s really going on. One must be particularly careful not to generalize from a single piece of data. When you look at the whole picture, Canada is very much within the norm for developed countries with regard to prices, available technologies and network speed,” says Mr. Rabeau.
For example, according to a 2012 study by Wall Communications, high usage Canadian rate plans are less expensive than similar American plans on average. According to the OECD, Canada is the 7th least expensive of 34 countries examined when it comes to roaming fees (20 MB in 20 sessions). As for the penetration rate of broadband wireless services, Canada places 24th, not far behind France and ahead of Germany and Italy. Other factors taken into account in the Note also confirm Canada’s position in the middle of the pack.
Generally speaking, the wireless telecommunications sector is progressing well in Canada. In particular, the use of smartphones has gone from 33% to 45% in just a few months, from March 2011 to December 2011. In order to preserve this momentum, Canadians have every reason to want to maintain the current approach and refrain from imposing new regulatory constraints, concludes Mr. Rabeau.
The Economic Note entitled Is the Canadian Wireless Sector Competitive? was prepared by Yves Rabeau, associate professor in the faculty of management at the Université du Québec à Montréal (UQAM) and associate researcher at the MEI. It can be consulted free of charge on our website.
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The Montreal Economic Institute is an independent, non-partisan, not-for-profit research and educational organization. Through its publications and conferences, the MEI stimulates debate on public policies in Quebec and across Canada by proposing wealth-creating reforms based on market mechanisms.
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