Study: Canadians Pay Highest or Almost Highest Cell Phone Rates in the World

Canadians pay among the highest rates in the world. New research is backing up this observation with analysis that studies several countries.

Throughout the debate over whether Rogers should by Shaw, we’ve been saying that Canadians pay some of the highest cell phone rates in the world. That isn’t just a talking point being thrown around to complain about bills. There is actual evidence to support that point. A new study pretty much reconfirms this point as well.

A Rewheel research paper shows just how expensive Canadians cell phone rates are compared to 51 other countries around the world. From the study (PDF):

Rewheel has been tracking and analysing 4G prices in 41 EU & OECD countries, bi-annually, since 2014. In 2019 we added 5G prices and in 2020/21 we expanded the scope of our international comparison by adding another 10 countries to bring the total to 51(more than 60% of the world’s population). The 15th bi-annual release 1H2021 (March 2021 prices) contains 1943 smartphone plan tariffs, 722 mobile broadband plan tariffs and 276 wireless broadband plan tariffs. Those were sold by 179 mobile network operators, 93 operator sub-brands and 64 MVNOs that were present in the 51 European, American, Asia Pacific, Middle East and African countries. The entire database includes ~25,000 4G and 5G tariff plans.

Like many other independent research studies (e.g., Wall, FCC, OECD), we have consistently shown the last 5 years that Canada has among the highest monthly/gigabyte prices.The root cause of the high Canadian wireless prices, as we shown in our 2019 study, is the fact that the Canadian wireless market is a de-facto network duopoly.

In light of the proposed acquisition of Shaw (Freedom Mobile)by Rogers, that would further concentrate retail market shares and most importantly consolidate probably beyond repair the network layer, once again we show here in using the straight forward MIN monthly price metric, that the Canadian March 2021 wireless prices are among the highest in the world and 3 to 14x higher than French prices.

There is a series of charts throughout this study comparing prices around the world. In one particularly eye-popping chart, for 20GB plans, Canada ranked the highest with the United States ranking 17th:

It wasn’t just 20GB plans that was analyzed in the study, though. They analyzed numerous other plans and Canadians do pay among the highest in the world:

The studies authors comment that, absent of any government remedies, the merger will likely impede competition, leading to higher prices and greater consumer harm.

For American’s who are curious, no plan that was analyzed in the US was more expensive than in Canada. The closest we saw in the charts was America being two places below Canada.

One argument that often pops up among ISP apologists is Canada’s population density. Statistically, Canada also has some of the lowest population density. This has been a long debunked theory because it ignores actual Canadian geography. Canadians don’t live evenly spaced out across the country. In fact, most Canadians live in densely populated areas such as Toronto or the greater Vancouver metropolitan area to name two examples. Despite the larger metropolitan area’s, the prices remain stubbornly high. As a result, the lack of competition is by far the more likely culprit here.

If you want another point that debunks the theory, compare Canada’s prices to Australia (who similarly also has massive land mass and a low population density) in the first screen shot. Australia doesn’t even have anywhere near the same problem of prices compared to Canada.

For many Canadians, the studies findings isn’t exactly surprising. It’s more or less a mutual understanding that the prices are sky-high and has been a problem for decades. In fact, CBC’s Marketplace ran a special called Canada’s Worst Cell Phone Bill in 2010. It proved so successful, that they even ran a sequel for good measure a year later.

Regardless, prices for cell phones have been a very long standing problem. With no signs of relief anytime soon, it’s little wonder why Canadians are complaining in huge numbers about the merger in the first place. The last thing Canadians want to do is go in the wrong direction on this longstanding decades long (plus) problem.

(Via @mgeist on Twitter)

Drew Wilson on Twitter: @icecube85 and Facebook.



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