March 24, 2021 – Cellular services have seen a 25 percent price drop over the past five years, a decline that aligns with Ottawa’s promised wireless rate cut, says a new report from the C.D. Howe Institute.
At their recent meetings, the Telecommunications Policy Working Group discussed the regulation of prices, modernizing the Canadian Radio-television and Telecommunications Commission (CRTC) and mandated access (requiring facilities-based wireless carriers to allow service providers access to those facilities at rates set by the CRTC).
With the federal government’s focus on wireless pricing, the Working Group stressed the importance of timely and transparent telecommunications data that reflects actual prices paid by Canadians. The approach used by Innovation, Science and Economic Development Canada to determine the government’s 25 percent reduction target, based on a review of wireless prices advertised on company websites, may lack accuracy and validity. Accurately assessing prices across time and jurisdictions for telecommunications involves resolving differences across tiers for service and bundled pricing for a diversity of consumer profiles.
Rather the group points to Statistics Canada’s reporting, which is methodologically robust and based on solid empirical work. Based on data from Statistics Canada’s consumer price index, cellular services have seen a 25 percent decline from January 2016 to December 2020.
The group recommends:
- First, that policy discussions around telecommunications pricing in Canada rely on methodologically robust price comparisons and rigorous tracking of the actual costs facing consumers;
- Second, that the debate over critical issues in telecommunications policy shift its focus from pricing due to the 25 percent price drop in cellular services over the past five years; and
- Third, that the federal government improve accountability, internal capabilities, and timeliness of decision-making at the CRTC.
The group of experts in both the private sector and academia is co-chaired by Len Waverman, Dean of DeGroote School of Business at McMaster University; and Steve Orsini, Adjunct Professor, Public Policy & Administration, Carleton University and former Ontario Secretary of Cabinet.
For more information, please contact: Benjamin Dachis, Director of Public Affairs, C.D. Howe Institute; or Nancy Schlomer, Communications Officer, C.D. Howe Institute, email: nschlomer@cdhowe.org.
The C.D. Howe Institute is an independent not-for-profit research institute whose mission is to raise living standards by fostering economically sound public policies. Widely considered to be Canada's most influential think tank, the Institute is a trusted source of essential policy intelligence, distinguished by research that is nonpartisan, evidence-based and subject to definitive expert review.