All about Canadian Cell phone providers

One of the listeners of The Cell Phone Junkie (Steve) was kind enough to write this fantastic review of Canadian providers for the show. Here is what he had to say:

First off, there are 3 companies who own and operate all of the networks in Canada. These companies are:

Rogers Wireless: a division of the much larger Rogers empire that own cable TV service, TV stations, radio stations, and magazines

Bell Mobility: a division of Bell Canada, who in turn is owned by Bell Canada Enterprises. BCE owns the CTV television network and most of the landline systems in Ontario and Quebec. They are also the parent company of Northern Telecom

Telus Mobility: who is a conglomerate of western telephone and technology companies that sprang from AGT, which was at one time owned by the Alberta provincial government (though Telus is no long affiliated with any provincial governments).

There are 4 physical networks: A GSM system owned by Rogers, a CDMA system owned by Bell Mobility, CDMA system owned by Telus Mobility, and an iDEN system (like Nextel) also owned by Telus Mobility.

There are countless virtual network providers, just like in the US (including a number of names that will be familiar to you down there). The largest of these virtual providers are:

Fido: Fully owned by Rogers, but it was once a distinct GSM network. The Fido network no longer exists, but Fido lives on as a defacto virtual operator that LOOKS LIKE a full network, just like they were before they were bought.

Virgin Mobile: The same company as you have down there, but not totally owned by flamboyant billionaire Richard Branson. They are in part owned by Bell Mobility, the CDMA network on which they operate in Canada.

7-11: I’m not sure if this US-based store also runs a virtual network down there, but they do up here (on the Rogers GSM network). They call it “Speak Out Wireless”.

Amp’d: Same people as in the US, but they don’t technically run a true virtual network. Instead they operate as a kind of division of Telus Mobility, whose CDMA network they use. Phones sold under the Amp’d name are sold by Telus with the Telus name on them.

President’s Choice: This a name used by a very large food store chain called Loblaws. Some of your US listeners in the northeast might know them, as they do operate stores in that part of the States. They use the President’s Choice name on tons of different products (most of them food items, but they also offer financial services and insurance under that name as well). They decided to extend the name to pre-paid wireless, which operates on the Bell Mobility CDMA network.

Solo: I’m not sure you can call this a real virtual network, as it’s a separate identity that Bell Mobility uses to market all of their pre-paid services. I suppose that it’s a bit like Fido, but restricted only a small niche market.

Canadian cellular phone services are subject to federal tax (known as the GST, which is presently 6%) and provincial tax. The latter varies from province to province, but in Ontario is it presently 8%. The federal government also mandates a 50 cent charge for support of nationwide 911 service. There are no local taxes beyond this or surcharges taken by any level of government.

However, all of the providers that offer monthly service also charge something they call the System Access Fee. They’ve been raked over the coals for calling it this, as it has nothing to do with system access and is nothing more than an added fee they separated out of the monthly charges to make them look lower. Presently everyone but Bell Mobility charges $7 per month (Bell put it up to $9 per month). Oddly, none of the prepaid services charge this fee, but prepaid is subject to federal and provincial tax, as well as the 75 cent 911 fee.

While it is true that Canadian providers are in love with 3-year contracts, I should note that contracts ARE NOT MANDATORY and all customers have the choice of paying month-to-month (no contract) or opting for shorter contracts (1 or 2 years). Contracts rarely affect the monthly cost of whatever plan you choose, but instead they offer a varying degree of discount on the price of a new phone. Not surprisingly, the discount given for 3-year contracts is often disproportionate to those of the 1 and 2 year contracts. This is to ENTICE buyers to opt for the 3-year terms.

There is a lot of discussion on Canadian cellular forums (especially HowardForums) about whether Canadian prices are higher or lower than those in the US. If you study the various packages offered in both countries you’ll find that both points of view are valid, but in different areas. Canadian providers seem to offer better value to low-end users on both prepaid and monthly plans. US providers offer better deals to heavy users and for data access.

In fact, a number people even discovered that, under the right circumstances, getting a particular US cell phone plan and the ROAMING with it in Canada was actually cheaper than getting a Canadian plan. Obviously there were drawbacks, not the least of which was forcing everyone to call a US number to get in touch with you, and any possible restrictions that the US provider might have placed on 100% roaming under the plan.

To their credit all of the Canadian providers honor GRANDFATHERED plans indefinitely. Even when not on a contract, companies will allow subscribers to stick with whatever price plan they started with so long as they don’t change it. There are users on Telus Mobility for example that have plans dating back almost 10 years that include pricing (and per-second billing) that is no longer offered on current plans. I don’t know if this is required under Canadian law, but I suspect that it is not. It might just be a Canadian business ethic that the companies graciously stick to (despite some of the other less palatable things they seem to do).

Wireless number portability, as you noted in show #28, is not yet available in Canada, but it has been mandated for March of 2007. About 2 or 3 years ago however, when Fido was still a distinct GSM network, it went to the trouble of getting local provider status. That gave them the ability to migrate a landline phone number over to a Fido cell phone, and we’ve had that available (on Fido at least) for quite some time.

Now I know you guys aren’t really interested in iDEN, mainly because it offers exceedingly slow data rates, but as a phone network it does exceptionally well here in Canada. This is because Telus Mobility has wisely chosen NOT to mass-market it to the general public. This is not to say that it’s difficult to get or is expensive. Telus Mike phones are sold in the same stores as Telus PCS, come with the same 30-day money-back guarantees, and they have low-end plans that the equal of anything offered by other PCS providers. What they don’t do is ADVERTISE it.

Their core customer base is made up of businesses that give Telus Mike an ARPU higher than any other service in Canada. They do sometimes run ads in business magazines, but there are no TV ads and no general radio or newspaper advertising. This keeps the network from getting overbooked, so to speak, and so it works exceeding well in the areas where coverage is available.

Also in show #28 you talked about store having or not having LIVE phones for people to try. Going back about 3 years we’ve had a number of Bell Mobility stores that kept activated phones up on their walls so you could actually go in the store and call people on them. This wasn’t a companywide policy and it was completely up to the dealer in question. Yes, many of the stores do leave out dummy phones, which are useless to a buyer to compare, but most stores usually have operational (but not activated) phones out on display.