Canada’s telecommunications regulator opens the door to more wireless competition by allowing a smaller number of regional companies to pickpocket on established player networks.
Canadian Radio-Telecommunications and Telecommunications Authority Thursday Telecommunications providers with their own established networks in Canada are real mobile virtual network operators or MVNOs – companies that acquire access to the entire network, then resell them to consumers.
True MVNOs do not have the spectrum, towers or wireless infrastructure. This allows them to provide wireless services at a much cheaper price because they do not have to accept the cost of installing and maintaining the infrastructure.
Companies must have existing Canadian networks
MVNOs are key players in places like the US and Europe, but so far they have not been allowed to operate in any sense in Canada.
Companies that choose to use CRDC’s move on Thursday will not be real MVNOs because they have their own wireless infrastructure, but functionally they will operate like one in some parts of the country.
“Regional providers investing in network infrastructure and spectrum can provide competitive services as mobile virtual network operators to millions of Canadians in limited areas,” CRTC said.
“These companies are already contributing to more competition and helping to reduce prices.”
The move applies to small companies with regional wireless networks, but has not yet invested in building national networks due to restricted costs. Some of the companies that are theoretically eligible include Atlantic Canada’s Eastling, Quebec’s Videotron, rural provider Xplornet, Ice Wireless in the north of Canada and Dipatel in Ontario.
When it opens a crack for MVNOs, it is not completely kicked. CRDC states that the only companies allowed to become MVNOs must have existing Canadian networks.
Completely foreign MVNO like Mint Mobile, owned by Canadian Ryan Reynolds and having 15 million customers in the United States, but was barred from providing wireless services to Canadians under previous rules – access is not mandatory.
The new rules theoretically allow a foreign MVNO to find the back door behind Canada by working with Canadian regional players who want to resell an MVNO access, but that must be negotiated on a case-by-case basis.
The regulator did not force any company to allow it.
The controller also does not force large companies to provide access to their networks.
CRTC wants to speed up competition
The move comes as Ottawa is considering Massive proposed link between Rogers Communications and Shaw Communications, Canada’s second largest wireless company will see the acquisition of a fourth largest company, which will reduce competition.
Overall, Canadians pay more for wireless services than consumers in other countries.
“Despite the encouraging signs that prices are going down, we need to accelerate competition and affordable prices for Canadians,” said CRDC President Ian Scott.
“The competitive model we are introducing today will provide more choice and cheaper mobile wireless services for Canadians who are now relying on their smartphones more than ever.”
Aside from opening the door to MVNOs, current telecommunications, including Rogers, Telus, Bell and Saskatell, are “very expected in most markets to offer low-cost and occasional utility plans”, much less for seniors and other low-income earners who use cell phones. Locked up in expensive projects they don’t need.
Watch: Higher wireless costs exacerbate inequality
Norma-Jean Quiebel works with Acorn Canada, a national organization that speaks to low- and middle-income families. He says he is glad to see the regulator take some action, but it is doubtful that it will have much of an impact.
He told CBC News in an interview that the wireless service in Canada was simply out of control “not for many years”.
“The gap between the rich and the low-income is getting bigger because now everything is online,” he said, adding that cell phone services are not a luxury, or something that people can do without.
Without affordable cellular service, “families are going to be isolated from health care, government programs and education,” Quiebel said.
“Everything is online. It is almost impossible to get a job today without being online.”