Wirelessnorth.ca

Right now I am in the situation where my three year contract is up but I am waiting for better plans for the Apple iPhone. Perhaps another provider will emerge. I may have to wait a long time, I'm afraid. My wife's phone is vintage 2003. She is on a sharing plan with me and we both are thinking of the iPhone but conditions have to get more reasonable. It puzzles me why an industry such as communication, which is so important, should be so backward in Canada.

You guys are in favour of contracts? Really? Not me: http://tinyurl.com/yooso7

There is another player behind these subsidies and contracts. Yes, the carriers benefit from locking customers into 3 year contracts. But they aren't the only one to benefit. There are the phone manufacturers as well. With subsidies, phone manufacturers can sell the phones at a much higher price than market value with large margins. The consumer does not know how much he ends up paying for the phone. Both manufacturers and carriers play this subsidy/contract game, and we, the consumer, are the cattle.

If carriers offered good value (cost, service, etc) — there would be no need for long contracts.

Subsidized phones are subsidized by the USER, not he carrier — the subsidy is built into the rate and the user has no idea exactly how much they are paying for their phone. Users continue to pay the unknown subsidy even after their contract expires. A better way, in the long run, would be for users to have to pay for their phones outright (or they could pay a down payment and installments over 12, 18, 24 or 36 months). Net result would be almost the same as a contract, except the user would know how much was left owing on their phone, and could pay it off at any time — plus they wouldn't continue making those payments after the phone was paid off.

While I agree with the thrust of your piece, how exactly are Canadian businesses and entrepreneurs hampered? An iPhone App developed by a Canadian can be distributed to any iPhone user anywhere in the world. The same will be true for Android developers.

While I agree with your general thesis, I don't see Canadian developers or entrepreneurs disadvantaged when a Canadian iPhone App or Android developer will be able to effortlessly distribute their mobile apps to users around the globe just like any U.S. developer.

Dale Dietrich and dajad

So in your view, not having a market in Canada is not impeding anyone? re-read what you just wrote and tell me that actually makes sense to you as a Canadian.

Do you think smartphones are actually worth $600-$700 bucks? Compared to other consumer electronic devices, don't you think smartphones are priced waay higher with ridiculous margins?

Look at this old link: http://rfdesign.com/rfic/iphone-isuppli-compone… where the article states an iPhone Bill of Materials (e.g. cost to manufacture) is about $265 and now it costs about $173 bucks (http://www.digitalhome.ca/content/view/2625/206/) to make.

Now you can't really _buy_ the iphone without the damn 3 year contract, but I hear some carriers in the US are selling the iPhone for $600 bucks without a contract. Sure the BOM doesn't include R&D and marketing costs, but a 300% margin for a mass market device? That doesn't make sense.

I should go become a phone startup.

Continuing my post based on the netbook post by wirelessnorth.ca, a netbook – a fully featured computer with *real* browsing i might add – costs under $399.

That's something worth it's price that would actually be useful.

I am convinced that the carriers are using the long term contracts and penalties in response to the number portability that they had to implement.

Forced customer loyalty? Let me tell you how that works:

I just cancelled my contract with Rogers for three phones; after three years, all three phones had major problems. Now, because we had just adjusted the call plan six months ago (saved us about $20 per month), they had put us back on a three year contract, this meant that NOW we couldn't get new phones without paying full price. It all depends on how many months there are “left” in the contract. Even upgrading to Blackberries (with corresponding data plan) was not going to get us anything except gleeful advise that we were stuck with the new three year contract so there was nothing that could be done and that our best course of action was to pony up the money for the full price phones (with a corresponding new three year contract if we wanted data).

I have never liked being put over a barrel, so I moved to Telus, got new blackberries on a better plan (about half the cost of Rogers), and with better service. Rogers is now coming after me for over $1100 in “penalties” for their anti-service and anti-support. As far as I'm concerned; they can go back where they came from (that would be hell).

I will never deal with Rogers for as long as I live.

I quite agree with this. We are quickly becoming an international laughing stock because of how backwards we are, technologically.
I am just quitting my job at a Fido dealer after 11 months. This, plus my 5 years working for a different Rogers deal has built me up to the point of sickness. My clients were more of the international types as time went on. Folks from Chile, India and The Philippines would complain about how much better, cheaper and simpler the wireless services were back home. Sometimes this too would also cause confusion as our systems have more requirements or more hassles; a SIM not working at all out of the box for a Hong Kong originator is a fair example. The grand-daddy issue is the vendor hardware locks; trying to explain to someone that struggles with English how a seemingly normal cell phone won't work with another provider is excruciating. I usually went with the reasoning that Canada is less populous and more spread out, making over-the-air services and equipment more expensive. Yet I was never afraid to truthfully admit how controlled and monopolized the Canadian wireless providers made this situation. I am sick of telling people that Call Display is an extra charge and that the good promos are only on a 3 year slavery grant. Nothing wrong with subsidization, but what kind of a joke is that? I am looking forward to what the new providers will bring and I may return to the wireless market once I have something to believe in. Take a look at Globalive, they seem promising and open enough to the people. http://www.wirelesssoapbox.com/

Noone ask the customer to keep their handset for 3 years. The 3 years contract has nothing to do with handset upgrade (except the initial discount).

If you are having problem after a year with your handset, and are under a 3 years contract, they will probably upgrade your handset at low cost. However they might extend the contract by one year (or redo a new 3 years contract; the first one will be “cancelled”).

Unfortunately people who travel to Europe and/or Asia have little choice but to go with Fido or Rogers. If the CRTC had let T-Mobile buy a controlling stake in Fido this ugly situation never would have happened.

Hopefully all Canadians will reap the benefits of a truly competitive market when Telus and Bell switch to LTE for the 2010 Winter Olympics, as rumoured…

I juts wonder what will happen to the phone and contract for keeping the phone for 3 years ;))

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Noone ask the customer to keep their handset for 3 years. The 3 years contract has nothing to do with handset upgrade (except the initial discount).

I quite agree with you Sharp.

Technology Comunication is so important cause whole around the world be connected, so the regulation must oriented for customer. Thanks.

not in our area, some of us are still keeping the phone for even longer than that, part of third world, they value the phone for the reason that they cannot anymore afford to buy another one.