Last week the CRTC finished up two weeks of hearings as a Review of Mobile Wireless Services. The subject of the 9 days of hearings were whether to mandate (ie force) the current mobile network operators (ie Bell/Telus/Rogers, Big 3, Goliaths) to provide wholesale MVNO (Mobile Virtual Network Operator) access to their networks to smaller carriers (ie Davids). In short to open the market up to competition.
There were many parties giving evidence and opinions. The Big 3 are very against being forced to sell access to their networks. Very against. They cite that the market is already competitive, that mandating MVNO’s would curtail their ability to spend on network expansion (both to rural/remote areas and upgrading to 5G). And they point to a submission from the Competition Bureau that pro-MVNO regulation would harm smaller facilities based competitors like Videotron, Shaw, Eastlink and Xplornet. Telus CEO Darren Entwistle even threatened to cut $1 billion in network investment, 5,000 jobs and philanthropic giving if CRTC dared to mandate MVNOs.
Is the Canadian mobile market really competitive ? The reason this procedure was even going on was due to the outcry from Canadians about their cellphones! It seems self evident that Canadians view the current situation as unfair and that the Big 3 are acting as an oligopoly. They hate their current providers (see here) This came up more than once in various submissions, including co-ordinated rate plans (one moves they all move), the smoke-screen of flanker brands to confuse the market etc.
There were other parties like TekSavvy, Distributel, Tucows, CNOC, Ice Wireless (Iristel) and others arguing in favour of MVNO’s. They argued that as Full MVNO’s they would not own spectrum or operate their own radio access network, but purchase that from the Big 3 . Except for the operation of such a radio access network, they would be responsible for all other aspects of their operations such as sales, marketing, billing and the operation of a core network. From there they could increase competition in the marketplace to provide more services to Canadian consumers and businesses.
We won’t know the outcome from these hearings for a while, maybe not until 2021. I am watching this process carefully; not because AurorA plans to become an MVNO. Almost my entire 35 year career has been on the competitive side of the industry, competing against the various incarnations of the Big 3. And they are formidable competitors indeed who do not cede an inch of any markets that they consider as theirs. My rooting interest naturally falls to the underdogs, the Davids competing against Goliaths.
If MVNO’s are mandated though, it could also open up a raft of new mobile competitors . Those competitors would need premium quality termination for their overseas calls. Mobile calls originate on cellphones and already undergo compression just to reach the core; from there you want to ensure premium quality so that the caller gets through perfectly. An LCR here makes zero sense; if the caller wanted a cheap call they would use a free app on their phone like Skype or WhatsApp. If they use the phone it has to be high quality. And I know just who has the best quality international voice termination !
