Canada Orders Big Wireless Firms to Sell Access to Networks

Derek Decloet and Ilya Banares, Bloomberg News

(Bloomberg) -- Regulators in Canada issued new rules to bring down wireless costs, forcing large carriers including BCE Inc. and Rogers Communications Inc. to offer low-cost plans and resell access to their networks to smaller players.

The decision by the country’s telecommunications regulator makes it easier for regional providers such as Quebecor Inc. and Cogeco Communications Inc. to compete on wireless plans with the sector’s three dominant companies -- Rogers, BCE and Telus Corp.

Only companies that already own spectrum in Canada will be eligible, cutting out foreign players that can’t enter the market because of domestic ownership rules. The “mobile virtual network operator” ruling was released Thursday by the Canadian Radio-television and Telecommunications Commission.

The CRTC is also ordering the dominant carriers to sell lower-cost plans. By July, Bell, Telus and Rogers will be expected to “offer and promote” wireless plans for C$35 (about $28) a month that include 3 gigabytes of data and unlimited messaging within Canada. They must also offer cut-rate plans for people who don’t use their phones much for C$15 a month. The rules also apply to Saskatchewan Telecommunications Holding Corp., or SaskTel, a government-owned telecom in the western province.

“While there are encouraging signs that prices are trending downwards, we need to accelerate competition and more affordable options for Canadians,” CRTC Chairman Ian Scott said in a statement. “The competitive model we are introducing today will result in greater choice and cheaper mobile wireless services for Canadians, who rely on their smartphones now more than ever.”

The CRTC also said the major telecom companies may negotiate directly with resellers of wired internet service, instead of the regulator mandating a specific price. This comes after a 2019 ruling that cut wholesale rates.

That part is a win for the national carriers, which have said the new rates were below cost and could jeopardize future spending on networks, resulting in slower expansion of broadband into remote or rural areas. The federal government agreed with them, and asked the CRTC to review its decision.

(Updates with addition details throughout. An earlier version corrected the day of decision in third paragraph)