Are Canadian Mobile Data rates too high?
If you are a Telecom or Wireless equity research analyst, this will be interesting to you.
There is always something going on in the blogosphere…. This week’s local tizzy isn’t Imus, but what appears to be a well researched piece by Tom Purves regarding the costs of Canadian wireless data transfer.
If Mr. Purves’ analysis is right, and Canadians are paying as much as folks in Ghana for mobile data access, then two things should happen quite quickly:
First, a politician should rush to make this his/her issue, as the ATM fee storyline is getting a bit stale. The carriers are the new banks, after all.
Second, one of the equity research analysts that stops by this site should take it upon themselves to figure out what the earnings impact would be for Bell (BCE:TSX), Rogers (RCI.A:TSX) and Telus (T:TSX) if Canadians were to pay merely triple what Sprint’s customers pay, for example.
These are not the type of gouges that survive very long. And if Telus can’t claim to be the most reliable wireless network in Canada, at least they can say they charge “one quarter what those Eastern folks do….”
Looking forward to reading about this in an upcoming research report.
MRM
Here in Vancouver Blackberry users have a 25MB cap on their monthly downloads, some users report $800 in overage charges on data. I have a Washington state Verizon account so I called and asked about a Blackberry account with roaming to Canada. For US$79.99/mo I can get unlimited downloads in Canada. Something is wrong here.
Mobile rates in Canada are crazy, and so are investors in the Telcos to accept this pricing.
There is another equilibrium of pricing that makes the same income: mass volume, low price and no regulatory risk.
See my post above about how you should be complaining to your Telco’s investor relations department. Lower prices are the shareholder’s interests, dammit.