GATINEAU – Leave the Wireless Code of Conduct alone, for the most part, three of Canada’s largest wireless operators told the CRTC on the second day of a hearing which is the code’s scheduled three-year review.
Rogers, Bell and Quebecor said consumers now have a much better understanding of their rights, and the code has led to a more competitive environment – so therefore there is little need to make major changes.
“The current Code strikes the right balance of providing standardized protection for consumers, while allowing competitive market forces to introduce differentiated products and customer support,” said David Watt, senior VP of regulator and chief privacy officer at Rogers Communications.
Arguments have been raised that because the industry’s churn rate is very low that means there is a lack of competition. Bell Mobility argued, on the contrary, this means customer service is improving and consumers are more satisfied with their providers.
Robert Malcolmson, senior VP of regulatory with BCE, noted that the company has made considerable investments to compete in the sector. Highlighting figures from the company’s fourth quarter financials, he said retention spending and subscriber acquisition costs increased $67 million year over year in Q4. Customer acquisition costs increased by 3% to $541 per subscriber and retention spending now represents 16.4% of wireless service revenue.
Quebecor Media (QMI) and Rogers agreed the wireless industry is more competitive than churn might indicate. QMI said based on its calculations one in four Canadian changed service providers last year. Rogers estimated that upwards of five million wireless subscribers changed providers in 2015.
While the carriers believe the code has worked well, enhancements can be made to better address the current environment. Rogers noted that the rise of multi-line accounts requires a change to the data overage fees. It said the current $50 cap would apply to single line accounts, but for multiple line subscriptions, the amount would be raised to $100.
Donavan Beth, senior director of wireless data and roaming, explained that the code serves as a safety net for subscribers and if the $50 cap remains in effect for multiline accounts, the subscriber may simply agree to accept that charge since it could represent a small percentage of the overall bill.
“With multiline accounts, it’s important that you don’t have it (the notification of the charge) too early otherwise it becomes just something that people accept, they continue and you lose your safety net. And we feel that this is in the customer’s best interest to have a $50 for individuals and $100 for multiline,” he explained.
To help customers deal with potential overage charges, the company has introduced a new self-serve tool that gives subscribers greater control over data consumption. Data Manager enables the account holder to set customized alerts for data usage, allowing the user to buy more data or even block it on a line. Rogers said this has led to a reduction in unexpected data charges for customers.
“Customers know they are paying $5 and that absolutely eliminates any concerns around voice and data bill shock.” Claire Gillies, Bell Mobility
Voice overage charges continues to be raised by the commissioners, but Bell noted they are overblown. The company said that its $5 per day Roam Better service provides customers with unlimited voice minutes and texting as well as 100 MBs of data while roaming in other countries.
“Customers know they are paying $5 and that absolutely eliminates any concerns around voice and data bill shock,” said Claire Gillies, VP of marketing at Bell Mobility.
Vice-chair of telecommunications Peter Menzies questioned Bell about why consumers don’t see a reduction in their bill once the device is paid off during the contract term. Gillis noted that Bell doesn’t provide device financing. Rather the company provides the customer with a subsidy in exchange for a commitment to a contract.
This entitles subscribers to do one of four things at the end of their contract.
“They can choose to upgrade; they can change their rate plan to another rate plan that we have in our lineup, they may choose to leave us and select a different carrier, or they may do nothing in which case they continue to benefit from all the service components and the rate plan bonuses that were provided to them upon activation,” she explained.
During the first day of the hearing, Telus Corp. lamented the difficulty it has had in dealing with Quebec’s consumer protection legislation as well as the Wireless Code. CRTC chair Jean-Pierre Blais asked QMI to reflect on its own experience.
Dennis Beland, VP of regulatory affairs for telecommunications at the Quebec media and communications company, noted that it’s a fact of life for QMI.
“It’s not an ideal situation operationally but we live with it,” he said.
But not all is well with the code, according to the Consumers Council of Canada (CCC). Dennis Hogarth, a representative for the CCC, noted that while the wireless code has had positive impacts on the wireless sector, the most significant being the mandated maximum two-year contracts, there are still problems that need to be fixed.
One such issue is what CCC describes as the ongoing complexity of wireless contracts. Replacing devices or changing services can have unintended consequences such as extending the length of the contract. Another relates to the bundling of a variety of communications and broadcasting services.
“Bundled offerings are often complex and frequently include short-term price reductions as incentives to sign up consumers for the services. The greater the concentration of services from a single WSP, the more difficult it is to change suppliers,” said Hogarth.
The wireless code hearing continues tomorrow with Freedom Mobile, SaskTel and others appearing.
