The Washington correspondent for the Globe and Mail, Kevin Carmichael wrote last week that Canada should follow the lead of American regulators and impose further rules on wireless carriers here in Canada to “germinate” a fourth wireless provider (“U.S. telecom regime provides strong model for Ottawa,” August 1, 2014).
There is a strong gravitational pull in the telecommunications business to consolidate to achieve economies of scale. A government can counter those forces, but only if it is resolute about it.
It might be be worthwhile to review the state of Canada’s wireless industry.
Canada already has at least four wireless competitors in all major markets. According to a recent government study, Canadian wireless prices match and usually beat those in the U.S. And while the U.S. has just two national carriers offering the latest wireless network technology, 4G LTE, Canada already has three, despite the challenges imposed by our larger geography and more dispersed population. The quality of Canadian wireless services are similarly acknowledged as superior to those in Europe – where countries like Germany recently reduced their number of national carriers from four to three, in hopes of bringing wireless network investment to North American levels, with more countries expected to follow soon.
The federal Government has recently introduced some legislative changes, and the CRTC had a major ruling on Thursday, both contributing to lower costs for smaller new entrant players. Combined with generous terms in the next spectrum auction, we see Canada has already taken aggressive steps to benefit smaller competitors, the impact of which has not yet been seen, let alone measured.
Wireless is a part of everyone’s lives and discussing how Canada can continue to build our lead in the sector is always worthwhile. But we need an informed understanding of the real state of the Canadian marketplace before adopting foreign “solutions” for it.
You can’t manage what you aren’t measuring. Another reason that we need a better Digital Economy Scorecard.