{"id":6543,"date":"2013-07-18T10:08:03","date_gmt":"2013-07-18T14:08:03","guid":{"rendered":"http:\/\/mhgoldberg.com\/blog\/?p=6543"},"modified":"2020-02-07T15:58:59","modified_gmt":"2020-02-07T20:58:59","slug":"the-cost-of-regulation","status":"publish","type":"post","link":"https:\/\/mhgoldberg.com\/blog\/?p=6543","title":{"rendered":"The cost of regulation"},"content":{"rendered":"

Jamie Sturgeon of Global News wrote a story<\/a> yesterday about new 2-year wireless plans being rolled out in response to the CRTC’s\u00a0Wireless Code<\/a>‘s effective ban on wireless agreements longer than 24 months.<\/p>\n

As the story says, “customers may shake their fist at the Canadian Radio-television and Telecommunications Commission (CRTC) when the first bill arrives.”<\/p>\n

Witnesses at the CRTC hearing had warned that this would be an outcome. Simple math suggests that if a $600 smartphone subsidy is paid off over 2 years instead of 3, the monthly price will increase.<\/p>\n

Even the lawyer for OpenMedia acknowledged that its proposal would raise prices. In an exchange with CRTC Commissioner Candice Molnar<\/a>, OpenMedia was asked to clarify its position:<\/p>\n

3255\u00a0\u00a0\u00a0<\/em>COMMISSIONER MOLNAR: If I could just kind of put back what I think I heard you say and you can tell me if I understood you?
\n3256\u00a0\u00a0\u00a0<\/em>It is better ultimately for the industry for the potential cost of devices over time and due to the pressures of competition that will be increased by eliminating the switching cost. So it is better over time even though customers may have to pay more upfront. The long term benefits outweigh deferring that payment.
\n3257\u00a0\u00a0\u00a0<\/em>MR. ISRAEL: Right, because the service fees will go down.
\n3258\u00a0\u00a0\u00a0<\/em>COMMISSIONER MOLNAR: Do you promise?
\n3259\u00a0\u00a0\u00a0<\/em>MR. ISRAEL: I’m sorry.
\n— Laughter
\n3260\u00a0\u00a0\u00a0<\/em>MR. ISRAEL: I promise.
\n3261\u00a0\u00a0\u00a0<\/em>Do I get a commission?
\n— Laughter
\n3262\u00a0\u00a0\u00a0<\/em>COMMISSIONER MOLNAR: We are going to tell everybody that you said the fees would go up.<\/p><\/blockquote>\n

So it was a little disingenuous for TechVibes to write yesterday<\/a> “OpenMedia Communications Manager Lindsey Pinto saw this travesty coming.” OpenMedia didn’t just see “this travesty”; it asked for it. OpenMedia Communications Manager Lindsey Pinto was sitting with her lawyer when he asked the CRTC for provisions in the Code that he acknowledged would make prices go up.<\/p>\n

There are a number of other provisions in the Wireless Code that are increasing costs for all of the industry participants. Indeed, beyond the Wireless Code, a number of CRTC and Industry Canada projects are driving costs that can be expected to be passed on to consumers:<\/p>\n