Wind Mobile Calls CRTC to Cut Wholesale Roaming Rates

by Istvan Fekete on October 2, 2014

The incumbents are charging rivals too much for roaming services, said Wind Mobile during this week’s CRTC hearing about the wholesale wireless market. Ottawa has capped some rates, but the charges are too high, argued Simon Lockie, Wind’s chief regulatory officer.

After looking into the incumbents’ practices, the government introduced temporary limits on wholesale roaming rates in June, capping them at no more than what carriers charge customers at the retail level.

As a direct result, Wind was immediately able to reduce roaming rates in August, cutting the price to $0.05 per megabyte, down from $1. That’s a significant change. However, from Wind’s perspective, the wholesale caps tied to the retail rates charged by the Big Three “still need to be substantially lower”.

Going further, this isn’t just the view of Wind Mobile, a player which managed to become the biggest of all wireless startups with 770,000 subscribers despite having coverage in just a handful of areas.

It’s Mobilicity, the small carrier currently under creditor protection, whose situation emphasizes that the government had it wrong from the start: the caps imposed a few months ago would have saved “millions and millions of dollars” and placed the struggling wireless carrier in a much better position that it is right now.

Peter Menzies, vice-chair of telecommunications at the CRTC, pushed Wind executives to address apparent signs of healthy competition at the retail level, noting that Wind has been on the rise lately. He also noted that the incumbents are spending tremendous amounts on marketing to attract customers, but that the recent quarterly reports show a slowdown.

“Banging garbage can lids together and buying ad space and comparing networks and so on – that’s all well and good. … but when you look at the pricing, [the incumbents] are virtually indistinguishable,” Mr. Lockie responded. “I think if they really were rivalrous, what they would do is compete on price and that’s something you don’t see.”

Representatives of Cogeco and Telus have appeared at the hearing, and yesterday it was the turn of Rogers to defend its position on the wholesale market.

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

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