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What Canada can learn from the rest of world on wholesale wireless regulation

February 18, 2020


Good public policy is grounded in evidence – a problem is identified and a proven solution is implemented to address it.

If you’ve been following the debate about whether Canada’s national wireless carriers should be required to grant access to their networks to Mobile Virtual Network Operators — so MVNOs can resell wireless services to consumers without investing in their own infrastructure — you’ll know driving more competition to further lower wireless prices in Canada is the rationale.

This will be a key point of debate during the CRTC’s Wireless Review oral hearings from February 18 to 28.

But what if the evidence from around the world just doesn’t support this underlying assumption?

In a new summary report, Richard Feasey, an international expert on developments in the wholesale regulation of wireless services for MVNOs in the rest of the world, highlights four important points.

Feasey has over 25 years experience in telecoms regulation around the world, including as Group Director at Vodafone. He is currently Member at UK Competition and Markets Authority and an expert advisor to Rogers Communications for the CRTC’s Wireless Review. In his comprehensive scan of international markets, Feasey found:

  • Mandating resellers for competitive concerns outside of a merger and acquisition or spectrum license conditions is almost non-existent anywhere in the world. Norway is a rare exception, and the underlying competition concerns in that country don’t compare to Canada. We have three national operators and four facilities-based competitors in every market. In Norway, there are two operators — and one of them has nearly 60% market share. And no country in the world has ever mandated wholesale wireless rates.
  • On wireless pricing, the evidence shows that the vast majority of reductions in European telecom markets can be attributed to cost efficiencies with each new technology advancement, not from the introduction of MVNOs. Feasey writes, “there is no evidence that having more MVNOs in a wireless market leads to lower prices.”
  • Where regulation has been in place, “wholesale regulation of services for MVNOs in other countries has not delivered lower prices for either consumers as a whole or those on low incomes.”
  • Evidence in other parts of the world suggest that regulation of wireless markets would risk the investment required in this capital-heavy industry.

So with this evidence from the around the world, why would Canada push ahead and become an international outlier? Feasey recommends for the CRTC look to international best practices rather than be an outlier — and continue to prioritise facilities-based competition and investment in new technologies such as 5G.