In Over Your Head

The cost of doing business

Hugh blogs about how the Canadian mobile industry is stiffing us. Check the graph below.

My comment about this: The mobile industry in Canada is closer to a monopoly than almost any other first-world country, and they like it that way. I just bought a Virgin phone to get an Austin, TX number– it cost me 50 bucks and I can call every state with no long distance charges. Meanwhile, Fido (i.e.: the Rogers conglomerate) is charging clients 25c/minute for long-distance, and I’m paying over $2 a minute to make calls here.

Man, I could blog forever about this.

I’d developed a certain loyalty after working for Fido for three years. They used to be a big force in the market, with plans that disrupted the profit margins of the other carriers. I have to say though– I’m considering just holding onto this Virgin phone, and buying a Canadian one too. It’s gotta be better than the $375 I paid last month.

More: Canada’s Wireless Monopoly

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Joe Gannon

Comments

10 responses to “The cost of doing business”

  1. Rob McDougall Avatar
    Rob McDougall

    Hells bells.

    I’m being charged £4 a month for 8MB on Orange here in the UK, so that works out at 50p per meg. So on this graph I’m paying CAN$565, presuming this graph’s in canadian dollars… Ouch. I only mention this as the only UK carrier on there is Vodaphone.

    I think it’s terrible. There’s no good reason for charging quite so much… I had a sudden sense of deja vu reading this and realised I’d been discussing nation-wide wifi networks with someone else earlier today! (took me 10 minutes to find the proof though!)

    Reply
  2. Martin Avatar
    Martin

    Julien,

    I was expecting more coming from you, considering you did work for the dog.

    Don’t get me wrong, Canadian rates are expensive and Rogers did massive increases in the past which doesn’t make sense at all, but you simply cannot compare US rates vs. Canadian rates like that without any other variables and say our rates are too expensive.

    The US providers have roughly the same amount of land to cover with antennas (therefore similar operation costs in terms of network), but have roughly 10 times more population (30M$ vs. 300M$).

    Simple equation of offer vs. demand.

    So yes, rates HAS to be more expensive than in the US, but there’s still room for improvement.

    Reply
  3. Clyde Smith Avatar
    Clyde Smith

    “The US providers have roughly the same amount of land to cover with antennas”
    Martin –
    How does that work? Since I’m sure you aren’t comparing square “footage” [not everything gets covered] so what are you comparing?

    Reply
  4. Clyde Smith Avatar
    Clyde Smith

    There’s really no comparison based on coverage areas. U.S. coverage is far bigger than Canada’s:

    http://www.fido.ca/portal/en/packages/coverage.shtml

    http://www.t-mobile.com/coverage/

    You guys are getting screwed. Now I don’t feel as jealous of South Koreans.

    Reply
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  7. Martin Avatar
    Martin

    Clyde,

    US Coverage is bigger than Canada, but not 10 times bigger. There is however 10 times more population than Canada, which brings down the cost.

    It’s really simple Business 101: More customers = Lower TCO = Better deals for the customers.

    Reply
  8. Stephanie Avatar
    Stephanie

    Julien,

    Thanks for thoughts- it’s been driving me crazy since I got back to Canada. In Korea, I paid 10$ a month for my phone and enjoyed free call waiting, voice mail, call display, unlimited incoming calls and free minutes calling from phone cards. When I bought the phone, I paid 140$ for it used. I asked the woman how much with ‘all the charges’. She kept repeating 140$. I asked her how much she would charge to give me a phone number, she asked me what good a cell phone was without a number. No connection fees, processing charges or bullshit. 140$ with my first month of service and an extra battery. I had reception everywhere in the country- in the subway, and even in the mountains. I almost cried when I got my first Fido bill after arriving back in Canada. Our system needs to change!

    Reply
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