CRTC strikes a good balance in its Consumer Wireless Code

Sugar_Maple_LeafLast week the Canadian Radio-television and Telecommunications Commission (CRTC) released its much-anticipated consumer Wireless Code, and we think they got most of it right. The Code creates meaningful and enforceable rights for consumers coast-to-coast without unnecessarily limiting the flexibility of service providers to respond to their ever-changing needs.

TELUS has been a strong advocate of this kind of code since the beginning, in part because it will eliminate confusion about the applicability of conflicting provincial rules to federally regulated telecommunications services. We already do most of what the Code requires, and our Clear and Simple policies, which we started in 2009 in response to customer feedback and have built on since, will continue to exceed its standards in many respects.

The Code requires clarity and transparency in consumer documentation (we’ve already completely re-written our service terms in plain language), and mandates tools to help consumers manage their usage and spending. TELUS and Koodo already empower customers with a wide range of tools to prevent “bill shock” (such as capping international data roaming charges) and much of the Code will make our practices uniform across the industry. We will continue to exceed the Code’s requirements in this area by providing the most extensive suite of usage notifications and online and on-device usage information available.

All consumers will join our customers in having the benefit of device balance transparency (we already put the starting and remaining device balance on your bill), certainty as to early cancellation fees (limited to the amount of the remaining device balance), and the ability to have their device unlocked (in order to be able to use a foreign SIM card when travelling, for example). TELUS already provides a trial period, as well as one-on-one free tutorial sessions at our Learning Centres where customers can learn how to get the most out of their device. We give effect to service cancellations immediately, instead of forcing the customer to give 30 days’ notice, something that some of our competitors require but the Code now prohibits.

Throughout this proceeding, TELUS (and other carriers large and small) urged the Commission to avoid prescribing rules that could regulate competition out of the market by being too prescriptive, or that would lead to unnecessary operational inefficiencies or higher costs. The Commission has carefully balanced the consumer benefits of new rules against service provider costs and competitiveness, and come up with flexible rules that let each carrier decide how best to implement them. That’s ultimately just as customer-friendly a policy as the rules themselves.

We do have some concerns about a few of the rules, and will need clarification on others to ensure that the Code doesn’t have unintended consequences. Reducing the amount of time in which consumers can pay down device subsidies from three years to two could have the effect of increasing up-front costs to acquire new smartphones. There are also concerns about the impact of the Code on the tab model, which Koodo pioneered in Canada. We doubt the Commission intended the Code to reduce the viability of this popular consumer option, which features the ability to pay down a device balance gradually, based on how much the customer spends each month, without a term commitment.

We are philosophically aligned with data usage caps – they are a good way to avoid surprise bills – and we already have them in key areas. Nonetheless, the Code has relatively low default triggers of $50 in domestic data overage and $100 in international data roaming charges, which could make them more of a hindrance than a help for some. Applying them at the account level instead of the user level could lead to frustration among customers who have multiple devices on their accounts, such as small businesses and families. Fortunately, consumers will have the choice of opting out, so there’s flexibility built in to the rule.

Choice will continue to be the key for Canadian wireless consumers. Canadians always have the choice of buying a new wireless device outright and going month-to-month with no obligation or taking advantage of some of the world’s most favourable device subsidies in exchange for a term commitment. These subsidies have made smartphones affordable for more consumers here than in perhaps any other country. Further, international surveys show that Canadians pay rates that are about average among comparable markets, and in fact lower than average for heavy users.

Canadians love the value their smartphones provide, and are among the most enthusiastic users of them in the world. This is no doubt due, at least in part, to the fact that Canada’s wireless networks are also among the best in the world, thanks to enormous capital investment by competing carriers. TELUS alone has invested $30 billion in infrastructure and technology, wired and wireless, since 2000.

The Commission’s intention with the Code is to enhance Canadians’ ability to exercise choice, and we support that goal. We put what matters to you at the heart of everything we do because we want to be your choice and earn your business through strong service and value. We will do what it takes to implement the Code and make it work for you.