What’s the opposite of shrinkflation?

ShrinkflationEvery grocery shopper has experienced shrinkflation. Headline prices for asparagus, previously quoted by the pound, are now often listed for 325g bundles – you end up with 25% less for the money. Boxes of cookies and snacks are smaller; cereal boxes shrank. Prices for items may appear to hold constant, but the packaging is smaller. The headline price disguises the fact you are getting less.

Last month, I wrote “Statscan says cellphone prices are plunging – and they are”. In that post, I used a purely hypothetical apartment metaphor to describe how Canadians might choose to lower their monthly bill for a similar size apartment, or pay the same amount and get a bigger place with better quality. That might be the case if the cost of accommodations happened to be falling. If only!

But, despite these inflationary times, Canadian telecom – especially Canadian mobile wireless service – is actually delivering more value for less money.

A recent post by the Canadian Telecommunications Association talks about this effect in terms of grocery shrinkflation.

In a world of shrinkflation, Canada’s telecom sector stands apart.

  • Lower prices – more data

    While prices for most things have increased, prices for both home internet and wireless services are declining. According to Statistics Canada, overall consumer price inflation has risen by 18.5% over the last five years, but prices for cellular services have decreased by an average of over 47% and prices for internet access services have decreased by an average of nearly 8% during the same period.

    For example, according to the Government of Canada’s annual telecom price study, in 2019 the average price of a wireless plan that offered 1GB of data (and 1200 call minutes and 300 texts) was approximately $65 per month (or approximately $75 in today’s dollars). Today, for $65, a consumer can get a plan that offers 75GB of 5G data and unlimited talk and text Canada-wide, with no overage fees. This amounts to a 98.6% decline in price per GB (without factoring in additional savings attributable to unlimited talk and text and zero overage charges). Smaller data plans are also available, like 30GB wireless plans for $34 and $50 for 60GB, which offer more data at lower prices than what was available just a few years ago.

  • Faster Speeds

    If you check the label on your favourite packaged good you may find that one or more ingredients have been switched for a cheaper and lower quality ingredient. The opposite is the case in telecom. Though prices are declining, the quality of service has steadily increased. For example, the average mobile data download speeds in Canada have increased by 90% over 5 years1 and fixed broadband download speeds by nearly 400%2. With faster speeds, Canadians can stream movies, play games online, and join video conferences while on the go.

  • More coverage.

    While other industries are shrinking the size of their products, Canada’s telecom providers are steadily expanding the coverage of their wireless and fixed networks, with the vast majority of Canadians now having access to mobile wireless and high-speed internet services. And with investments being made in new innovations like cellular-to-satellite communications, Canadians will soon be able to connect from even the most remote parts of Canada.


While other industries are shrinking their products, the telecom sector is giving more, not less. By investing billions each year, it is providing Canadians with more data, faster speeds, and wider coverage, all at lower prices.

I shamelessly stole the shrinkflation metaphor last week when I was quoted by Canadian Press talking about the latest Statistics Canada consumer price index report. In February, the cellular price index was down more than 25% compared to a year ago.

Price declines in the national inflation report could indicate that consumers are getting more bang for their buck through new offers, such as bigger data packages, international roaming perks, or voice-to-text voicemail services.

“They’re either getting more for the same price or they’re paying less for the same thing,” said Goldberg, who likened it to “the opposite of shrinkflation.”

“If you go into a grocery store and the box of cereal on the shelf is $3.99, but last month it was a 500-gram box and this month it’s a 400-gram box … you’d say prices went up 25 per cent. In this case, it’s the opposite.”

For years, Canadian telecom policy has recognized the value of investment in telecommunications infrastrucutre. In approving the merger of Orange and MasMovil, I noticed that Spain has recently adopted a similar view, with Digital Transformation Minister José Luis Escrivá saying “the competitiveness of a country partly depends upon its digital infrastructure and its connectivity.”

Here, we phrase it simply. “Canada’s future depends on connectivity”.

Censure, not censor

Alan Borovoy, Canada’s great civil rights lawyer, used to say we should censure, not censor, those who spew hate speech.

He and I worked together on a committee many years ago. I would frequently give him a ride home afterwards which gave us opportunities to chat. His views continue to influence my perspectives on Bill C-63, Canada’s Online Harms Act. An editorial in the Toronto Star (written to mark his passing in 2015) should be mandatory reading for parliamentarians reviewing the Bill.

Alan was the long time general cousel of the Canadian Civil Liberties Association. The CCLA has called for “substantial amendments” to the Act.

Our preliminary read raises several serious concerns. While the CCLA endorses the declared purposes of upholding public safety, protecting children, and supporting marginalized communities, our initial assessment reveals that the bill includes overbroad violations of expressive freedom, privacy, protest rights, and liberty. These must be rectified before the bill is passed into law.

I referenced The Star’s tribute a couple years ago, writing about early proposals for the Online Harms Act. It is worth another look. As The Star notes, Borovoy’s view, that even the most offensive speech deserved protection, would lead him into “clashes with others on the left.”

I have frequently cited Aaron Sorkin’s version of that perspective from the film The American President: “You want free speech? Let’s see you acknowledge a man whose words make your blood boil, who’s standing center stage and advocating at the top of his lungs that which you would spend a lifetime opposing at the top of yours.”

There are a number of recent articles highly critical of portions of the proposed Online Harms Act, especially as related to Part 2, amendments to the Criminal Code and the Canadian Human Rights Act. Michael Geist writes about why those provisions should be removes from the Act. Christine Van Geyn writes in the National Post that the proposed process creates financial incentives for filing complaints. Individuals face no costs in bringing a complaint — not even the costs of a lawyer — and could receive a $20,000 civil award if successful. “The process becomes the punishment even if the case does not proceed past an investigation.”

Last week, Andrew Coyne wrote “Canada’s Online Harms Act is revealing itself to be staggeringly reckless”, saying, “the more closely it was examined, the worse it appeared.”

There is, first, the proposal to increase the maximum penalty for promoting genocide from its current five years to life imprisonment. Say that again: life in prison, not for any act you or others might have committed, not even for incitement of it, but for such abstractions as “advocacy” or “promotion.”

The most remarkable part of this is the timing. At the very moment when everyone and his dog is accusing someone else of genocide, or of promoting it – as Israel’s defenders say of Hamas’s supporters, as the Palestinians’ say of Israel’s, as Ukraine’s say of Russia’s – the government proposes that the penalty for being on the losing side of such controversies should be life in prison? I have my views on these questions, and you have yours, but I would not throw you in jail for your opinions, and I hope you would not do the same to me – not for five years, and certainly not for life.

Earlier this week, writing in the Toronto Star, Rosie DiManno says “Bill C-63 is a mess of a bill, a fatally flawed piece of overreaching legislation that has drawn scorn from, and made weird allies of, Margaret Atwood and Elon Musk. So maladroit that it can’t possibly be fixed — apart from the obvious correction of severing the child protection part from everything else”.

Finally, a commentary by David Thomas, former chief of the Canadian Human Rights Tribunal, says Bill C-63 is “terrible law that will unduly impose restrictions on Canadians’ sacred Charter right to freedom of expression”.

I have also said that there are limits to our speech freedoms. As the (oft misattributed) expression says, “one’s right to swing their fist ends precisely where the other one’s nose begins.” As CIJA said in its statement on March 6, “We cannot allow mob-driven demonstrations to obstruct our right to participate fully in society.”

There are lines that may not be crossed. Intimidation, threats of physical harm, go beyond the bounds of protected speech. But, we should be able to find a better balance than what has been proposed in Bill C-63.

As Alan Borovoy espoused, censure, not censor.

Let the marketplace work

Canada seems to be afraid to let the marketplace work on its own for telecom. The old “regulators gonna regulate” thing.

A few weeks ago, the Competition Bureau testified at the Standing Committee on Industry and Technology saying, “This committee is well aware that the bureau filed an application to the Competition Tribunal seeking to block the proposed merger between Rogers and Shaw. While we were unsuccessful in our attempt, we stand by our decision to bring the case and our reasons for it.” The representative from the Bureau later said “For example in the Rogers-Shaw case, we would have seen that the four largest firms would have held a market share of 95% collectively.” Was this really a bad thing? Many of our peer countries only have 3 competitors in the telecom market.

The Bureau still talks about Rogers-Shaw as though it should not have been allowed even though the Competition Tribunal thoroughly discarded the Bureau’s arguments. Millions of dollars in legal costs were assessed against the Bureau as a further slap-down of its misguided opposition to the deal. Recall, I cited the finding by the Competition Tribunal, where it stated [pdf, 1.25MB]:

It bears underscoring that there will continue to be four strong competitors in the wireless markets in Alberta and British Columbia, namely, Bell, Telus, Rogers, and Videotron, just as there are today. Videotron’s entry into those markets will likely ensure that competition and innovation remain robust. … Moreover, instead of the two firms (Telus and Shaw) that offer bundled wireless and wireline products in those markets today, there will be at least three (Telus, Rogers, and Videotron).

The strengthening of Rogers’ position in Alberta and British Columbia, combined with the very significant competitive initiatives that Telus and Bell have been pursuing since the Merger was announced, will also likely contribute to an increased intensity of competition in those markets.

The Competition Bureau witnesses only provided a partial picture when saying 4 players have a 95% share. But, this disinformation played well to the expectations of the audience – the Committee MPs.

I already wrote about the faux outrage on display for the telecom carrier witnesses at the committee. As Ted Woodhead wrote, “Most of the MPs on the Committee clearly didn’t care or listen to anything they heard. They engaged with none of it, they speechified, interrupted, some insulted, derided and lectured the witnesses with fact free questions.” Yesterday’s meeting of the Committee was no better.

Many MPs on the Committee simply weren’t interested in fact-finding for their study, ostensibly examining “Accessibility and Affordability of Wireless and Broadband Services in Canada”. Had they been interesting in understanding affordability, there would have been more follow-up on low cost connections, a topic I recently covered in a February blog post.

Earlier this year, I wrote “The failure to properly acknowledge the decline in Canadian mobile prices is a form of misinformation, perpetuating a distorted view of the industry. This leads to uninformed public discourse, and misguided policy and regulation.”

The facts are clear. Mobile prices are half of what they were 5 years ago. People get faster speeds, and far more data for lower monthly rates than ever before. Many plans include unlimited calling and messaging. Most service providers have unlimited roaming options available for the US and beyond. Better quality, faster speeds, greater capacity, lower prices. Competition drove these changes. The marketplace is working. As the Canadian Telecommunications Association wrote earlier this week, “in this period of heightened inflation, there is a notable exception – the price of telecommunications services.”

Still, MPs display faux outrage against the telecom industry. When government policies are set based on electoral calculus, that is a failure to lead.

Carriers are prepared to invest billions of dollars more in digital infrastructure, despite the regulatory uncertainty that overhangs capital markets for the sector.

As I said before, government should declare victory and get out of the way. It is time to let the marketplace work.

Immigration impact on telecom

How does immigration impact the telecommunications sector?

As I noted in January, more than one million immigrants entered Canada in 2022. This has led to a number of political and economic discussions in the country, such as how immigration has contributed to the cost of housing and rental prices. A year and a half ago, I first looked at the impact of immigration on Canada’s mobile markets.

Adding to the discussion, Morningstar DBRS recently released a report, “Canada’s Immigration Influx Spurring Telecom Subscriber Growth”. The report identifies these key highlights:

  • Canada’s immigration influx has fueled Telecom subscriber growth.
  • Reduced immigration inflow or maturing wireless market could significantly increase market competition.
  • Over the near-to-medium term, Telecom players have a number of levers to mitigate such headwinds; however, continued investments are required to boost network and technological advancements.

The report says that Canada’s population growth continued to lead its G7 partners in 2023 and likely among the 20 fast growing countries in the world last year. “Canada’s population growth of 3.3% during the first nine months of 2023 had already exceeded the total growth for any other full-year period since Confederation in 1867 following a record growth of 2.74% in 2022. Ninety-six percent of this population growth came from international migration.”

While much of the discussion of high population increases has focused on pressures on accomodations, healthcare, and infrastructure capacities, Morningstar DBRS has joined other financial analysis in identifying the implications of high immigration for Canada’s telecom sector. Further, Morningstar DBRS says plans to admit 500,000 immigrants annually will continue to provide future growth.

Of course, the flip side is the potential for a shift in the flow of people. Will political pressures lead to lower rates of immigration? Will high costs of living contribute to people leaving Canada?

Overall, mobile prices continue to decline. Rates of mobile adoption are approaching 100%, creating a more mature market. Morningstar DBRS also notes changing policy and regulation as factors that can impact the industry. How will the market react?

Some wireless carriers are expanding into adjacent markets, such as residential broadband, by offering fixed wireless access to reach homes outside their wireline service areas.

The Morningstar DBRS report complements the agency’s “Global Telecommunications Outlook: Highlighting the Critical Nature of Connectivity” issued 2 months earlier. That report identified challenges facing telecom worldwide, while recognizing overall resiliency of the sector. “We anticipate a more conservative approach to capital allocation going forward.” We have seen that in Canada.

When I started in the telecom industry, there used to be a department in the phone company that would produce a “General Planning Forecast” to help guide our analysis of traffic and equipment utilization, and to support capital spending requirements. It is important to understand these kinds of economic trends, anticipating such factors as the immigration impact on investment and markets.

Do regulators and policy makers appreciate these issues?

Digital literacy training

Will online digital literacy training drive increased digital inclusivity?

As I mentioned last month, Alberta launched free digital literacy training. I thought it might be worthwhile to take a closer look at what the courses look like.

Training is available online in English and in French – at no charge. It has two streams: beginner, and intermediate. The beginner stream has 10 modules; there are 9 modules in the intermediate stream. Each course module is designed to be completed in 30 minutes or less.

Alberta’s digital literacy training program was developed with support from the federal Skills for Success program. That could explain why the online program appears to be open to all, including non-residents of Alberta.

The lessons are designed to be practical, focusing on skills that every internet user should have.

Alberta Digital Literacy Program
Beginner Stream Topics Intermediate Stream Topics
What is a Computer and How Does It Work? How do I know if what I’ve found is good information?
What is the Internet? What is Netiquette?
How Do I Connect to the Internet? What is a Digital Footprint?
How Do I Get Around the Internet? How do I keep myself safe online?
How Do I Find Information? How can I find apply for work online?
How Do I Interact Online? How can I use the internet to learn?
How Do I Save Things I Find on the Internet? How do I shop online?
What is Cybersecurity? How do I access services online?
What Information Should I Share Online? Is social media right for me?
What Are the Ways I Can Use the Internet to Communicate?

Last summer, I wrote that digital inclusion needs more than just money. Building broadband access is only part of solution for digital inclusion. We need to understand the non-price factors inhibiting people from connecting to broadband services. And then, we need to solve those factors.

The Alberta Digital Literacy program provides a mix of basic skills and it includes courses to develop sensitivity to online safety and security. The first intermediate course teaches about different types of online content, and how to tell if a website is reliable. Modules include Online Content; Qualities of Good and Bad Content; Evaluating Online Content; Sharing Online Content; and a Knowledge Check.

The program is designed for those with little to no experience using computers, but it also incudes a range of topics helpful for boosting and tuning up digital literacy skills.

Please share this with friends or family who may need help. I’d be interested in hearing feedback from readers.

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