Seaboard’s damning indictment of Canadian Cellular Providers
Seaboard Group popped a piece titled Lament for a Wireless Nation into my mailbox just as I was leaving on vacation. It's a 39 page indictment of Canadian cellular pricing models which leads off with the observation that Canada has the same market penetration for cellular that Botswana and Gabon do. We lag the developed world dramatically.
Seaboard argues that the Canadian market has done well during periods of competition, noting the high growth that occurred while Clearnet and Microcell were still independent. However, since their acquisition by Telus and Rogers, respectively, growth has once again stagnated.
Here in Mexico, I dropped into the local Telcel dealer earlier this week and bought a prepaid SIM for M$200, and a M$500 top up. That puts my rate at M$2.2/minute for local calls and M$5.5 for long distance — roughly 24 cents Canadian and 60 cents for long distance. Not cheap, but cheaper than Rogers rates in Canada. Moreover, there is already a debate here about whether Mexican magnate Carlos Slim has too much power in the wireless industry.
And everywhere I look, Mexicans are carrying cellphones. That's a huge difference from the last time we were here two years ago.
Seaboard's onto something. Besides, what's not to like about the prospect of lower cellular bills?
March 16th, 2007 at 1:27 pm
Hi Alec. Your skeptical brother here.
Why does everyone need to carry cel phones? How come more Mexicans carrying cels is unquestionably a good thing? (I know your point is that lower rates make them more accessible, but I still think don’t get why more cel phones — just, apparently, for the sake of having more cel phones — is a good thing.) And if Canadian market penetration is poor, man oh man, I’m not sure I want it to improve. They’re everywhere here in Vancouver. If people could get their dogs to use them they would. Really. “Just a sec. It’s Fluffy on the line. I said she should call if she couldn’t find her chew toy, or if her water got stale.”
March 17th, 2007 at 10:10 am
I make most of my calls from my cell phone, Sean. It’s convenient, it has my address book built into it so I don’t have to remember numbers anymore, and I am reachable when and how I choose. If actually sitting at my desk (the old fashioned option), I am frequently trying to get work which requires concentration done. A desk phone would be a nuisance.
Moreover, it’s my personal number. It’s not shared with anyone else. You wouldn’t have a shared email address, so why a shared phone number? It’s a legacy of the old telecommunications network.
March 17th, 2007 at 1:42 pm
Sure, the way you use a cel, particularly in connection with your business, makes sense. I’m not suggesting that nobody should have cels. My point is simply that more and more cels is not a virtue in and of itself. If market penetration is “poor,” perhaps the people who need really need cels (plus the zillions who just want them) already have them. I don’t need one, nor do I want one, and it would take a lot more than knowing that market penetration isn’t what the industry wants it to be to convince me to get one.
As for Canadian market penetration being equal only to that of Botswana and Gabon, there is a simple explanation for that: Canada has long history of well-established land lines that is absent in the developing world. In some ways, widespread cel phone ownership makes way more sense in developing countries than in the developed world.
March 20th, 2007 at 4:50 am
Another sad fact about the antiquated cell system we get gouged for here in Canada. I’ll tell you another hilarious story about gouging cell providers in Canada. Fido (while owned by Rogers), tried to charge me $250 to unlock my phone. When I asked them why, they replied “So you don’t go to our competitors.” Adding insult to injury, the idiot said this a few days after I comitted to another 2 year term with them (a fact I made clear to him earlier in the conversation). Equally, it was the same period of time after another Fido rep called me up and called me one of their best customers.
If you stick with a cell company for the term of your contract, you are called a “best customer”. This entitles you to:
- None of the “freebies” that new subscribers get when you renew.
- Attempted theft if you try to unlock your phone for use in other countries.
- Data rates that are orders of magnitude greater than those found in Asia, Europe, and even in the US. (4 cents/KB here, 0.2 cents/KB from Helio for pay-as-you-go, unlimited data for $25/month more.
July 10th, 2007 at 3:33 pm
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