The Real Reason Why Wind Mobile, Public Mobile and Mobilicity Left CWTA

by Istvan Fekete on April 11, 2013

Would you be part of a group that claims to serve your interests but in reality works against you? How would you react if the mouth you have fed bit your hand?

This is exactly why Wind Mobile, Public Mobile and Mobilicity have announced their withdrawal from the Canadian Wireless Telecommunications Association (CWTA) yesterday, shocking the Canadian tech world.

Although the move seems to have come out of the blue, it was just a question of when rather than if the new entrants would leave the CWTA, which claims to be the authority that represents wireless carrier interests.

As Simon Lockie, Chief Regulatory Officer of Wind Mobile points out in the press release the three signed: “When we were first approached by the CWTA, we were promised clear and fair representation on issues of true industry alignment. But despite making our objections and concerns abundantly clear on numerous occasions, the CWTA has repeatedly failed to honour this promise, leaving us no alternative but to withdraw.”

“It has been evident for quite some time that, rather than being a true industry association which represents the views of all players regardless of size, the CWTA has instead largely been an advocate for Rogers, TELUS and Bell, and often directly contrary to the interests of new entrant wireless carriers,” said Bob Boron, General Counsel and Senior Vice-President, Legal & Regulatory Affairs for Public Mobile.

“We have spent the better part of three years repeatedly voicing our opposition to the CWTA on a wide range of matters to the point of issuing a press release in January 2011 that publically expressed our dissent on the CWTA’s position on wireless consumer protection,” said Gary Wong, Director of Legal Affairs for Mobilicity. “There seems to be a blatant disregard of the new entrants in favour of acting in the best interests of the Big Three carriers and it is unacceptable.”

The CWTA denied the accusations — of course — and played the role of the innocent as they leave. Why? Because the withdrawal of the three new entrants unveils the real scope of the Association and sheds light on the real state of the Canadian wireless market.

So, what does the CWTA represent? Here are some facts that reveal who’s interests are protected by the Association. By having all carriers on board, it successfully spread the impression that its position represents the perspective of all wireless players:

  • In 2009, the CWTA lobby helped kill a consumer cell phone cost calculator that provided a detailed list of suitable plans from Canadian providers that cost the government close to $1.4 million in taxpayers’ money. The reason: Bell and Telus were concerned that the tool only covered voice services, and that it was geared toward lower-priced plans. We must place a reminder here: before the new wireless start-ups entered the market, Canadians paid the highest wireless rates. Transparency killed.
  • The CWTA Code of Conduct was supposed to be backed by all carriers — as it comes from an association they are part of — but it was heavily criticized in a press release by Mobilicity (and other public advocacy groups), because it barely required the minimum information disclosure from carriers when it came to their obligations to disclose information to customers. Transparency killed again.
  • The CWTA is against Canadians’ No.1 complaint: three-year contracts, which involves high-cost smartphone subsidies and no transparent cost control. Interestingly, the Association’s perspective coincides with the incumbents’, which conducted a survey finding that despite consumer complaints, Canadians do prefer three-year contracts and smartphone subsidies instead of shelling out hundreds of dollars for a smartphone.

Considering the above facts, I think Wind Mobile, Public Mobile and Mobilicity’s withdrawal from CWTA is a no-brainer, as the association that was supposed to be representing the interests of all carriers, regardless of their size, is in fact the lobby group of the big three, which control 90% or more of the Canadian wireless market, not of the three start-ups who control roughly 6% of the market.

I also think Wind, Public Mobile and Mobilicity’s position and message is clearer now that they have left the Association. The message sent to consumers can no longer be blurred by the CWTA’s incumbent-interests-controlled communication channel.

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Written by: Istvan Fekete. www.digitcom.ca. Follow TheTelecomBlog.com by: RSS, Twitter, Facebook, or YouTube.

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