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Canadians Pay Extra For Their Wireless Hardware
Todd Alivoy writes "Looks like
Canadian wireless subscribers have been getting hosed when looking to get new hardware. This isn't the first time Canadian carriers have managed to charge far more than thier US conterparts for the same services. Anyone up there know why? It sure isn't the exchange rates." The linked article shows the price disparity for 14 phones available in both markets.
More competition = lower prices. Less competition = higher prices. (Duh.)
Also:
More customers = lower prices. Fewer customers = higher prices. (Less overhead per customer.)
"Accept that some days you are the pigeon, and some days you are the statue." - David Brent, Wernham Hogg
Perhaps they will set up store-front re-import shops where Canadians can buy cheap wireless gear from the US.
Some will argue that the US should not be able to get the stuff so inexpensively, that the reduced cost raises prices elsewhere. Others will argue that Canadian research firms put a lot of money into the wireless industry, and price controls would kill the industry.
Canada is much bigger than the states, but with far less people. The cost of having towers running is a nobrainer.
No, no... Finland is Lunix... Canada is OpenBSD, idiot.
I wonder if you can run OpenBSD on a cellphone. the antenna would probably be off by default though...
I had a blackberry through Rogers/AT&T, and once I got the U.S. roaming package on there, it cost me $57 (CDN) per month. That's more than my 3000 kb/s cable modem internet connection (under $40 per month). I loved the blackberry, but decided to cancel the subscription.
Then, the day after I decided to cancel it, we were broken into and they stole it off the table. Reporting it stolen actually saved me the cancellation charge (~$50), and I figure whoever ended up with the hot item is getting payback by paying the high fees.
That's what I tell myself anyway. Maybe it was that Michael Moore guy... I heard he was snooping around Windsor opening people's doors.
"I have never let my schooling interfere with my education." - Mark Twain
It has a lot more to do with carrier subsidies for the phones. Most countries in the world don't have the same system that we do in the US, where your phone will only work on the network of the carrier that sold it to you.
When a carrier gives you a discount on a phone, it makes a bet that writing off part of the cost of the phone will pay off with the contract you have to sign to use the phone on their network.
Since GSM is now fairly prevelant in the US, I've taken to buying my phones and using whatever carrier I want (ok - there are only 3 choice right now) and allows me to use my unlocked phone with any carrier around the world, as long as my phone uses a frequency that is used in that country. Hence, I have 3 very high tech phones that I can choose between, depending on what I'm doing and where I am.
That's what mobility is all about.
I am not familiar with the way cell phones work in Canada, but I would guess your suggestion would not work. If I purchase a phone in US, I cannot transfer it to another US company because of the so called provider optimization (a.k.a. cell phone lockdown). I had two absolutely exactly same cell phones, one AT&T, another non-AT&T from a friend. Once my AT&T phone died, they would not switch my service to the other phone, claiming that it has been optimized for another provider. So I would not be surprised if cell phone companies found a way to block US-to-Canada phone transfer.
You don't think that this disparity is because of the ability of these companies to differentiate the cost legitimately? There is large fixed cost to be amortized in providing wireless infrastucture over such a large country, with such low population density.
Here in Vermont we have the same problem with electricity - it costs a lot when you have few customers per mile of wire (or even wireless miles). For the national utilities (like Verizon Wireless and the wired long distance carriers) they lose money on rural areas in order to provide the same bundle to all customers within the country. In rural Alaska all your long-distance calls come over satellite to ground stations that might serve 1000 people who are paying 6.2 cents a minute for long-distance!!!
Always look for a rational reason before you complain too much about conspiracies.
When you sign up for service in Canada, do you have to pay a year long contract? If so, then never mind, I step down. If not, then I'd suggest that the money is still being spent, just in a different order.
Personally, I think it's just that competition's not so hot up there.
"Derp de derp."
Ok, so just a quick drive down south to Australia and I'll get a free phone? What a deal! I'll be there shortly.
Except my car's broken. Is Australia within walking distance? I'm in Vancouver. Please respond (I was banned from MapQuest).
True story.
Most of the people I know who have Cell phones, couldn't afford $500 CDN, and pay more for minutes. Cell phone companies are trying to bring in new users, so they sell the phones cheap, figuring they'll make it up over time while they make a profit on the service.
Second, the US market probably has more cell phones in the top 20-40 markets then Canada has people period. So a lot of fixed costs have to be amortized over fewer people in Canada.
Finally, everything the in US wireless market appears to be about taking it in the shorts to gain market share, and to gain volume, to drive prices down. So they are investing (read losing their shirts) tons, and tons of money, trying to steal customers away from the other carriers, and make money on slim margins. Where as the Canadian market appears to be trying to sustain profitability at a much smaller volume. This means that Canadian service is probably a much better investment (from a business perspective). 5-10 years ago, cell service was a lot more expensive down here then it is now. Pricing for service is probably about the same. Not sure about the phone pricing.
Kirby
This isn't the first time Canadian carriers have managed to charge far more than thier US conterparts for the same services. Anyone up there know why?
Well, I'm not entirely sure, but I get the distinct feeling it has something to do with Soviet Russia.
I'd rather be a conservative nutjob than a liberal with no nuts and no job.
I'm sure there are economies of scale that could account for the price differential.
"Academicians are more likely to share each other's toothbrush than each other's nomenclature."
Cohen
"Routers For Meds" Program. Each wireless router is good for one name-brand prescription or three generics.
I have a Rogers AT&T (Canada) phone (Pay as you go) and I get charged airtime when someone calls to leave me a message on the voicemail.
;-)
So I called up Rogers and asked them to deactive the voicemail, so they did. Now whenever someone calls they get "This costumer needs to setup there voicemail etc etc" and I still get charged airtime! (even when the phone is powered down)
I've called around to all the other cellphone carriers and none of them are this freakin' crazy.
Basically my plan of attack is sell the phone (brand new which seems like a waste) and go with someone like Bell or Telus.
Anyone want a phone
Candle burns its brightest in the dark
No Competition means higher rates, no reason to lower them, who else are you going to go to.
I don't know the answer but here are some interesting stats on Canadian wireless:
...maybe it's because the Canadian phones need to include both French & English?
http://www.cwta.ca/industry_guide/facts.php3
You know you could really save a lot of money if your country went ahead and consolidated to using just French.
IIRC you can't use phones purchased in OZ in North America unless you buy a ghastly expensive tri-band phone. I had to sell my mobile when I left the UK for that reason. And it is the service that is the major problem, as they are selling the phones.
:-)
Ah, how I miss my Virgin Mobile service...buying top-up cards when I needed them rather than paying a monthly fee for minutes I may or not use, and not getting charged for the calls that you receive?! I re-emphasise "service"; what a concept
Anyone want to arrange a deal where we trade cheap cel-phones for high-flow toilets? I think we could work something out.
It's good to use your head, but not as a battering ram.
I don't know what the author is rambling on about.. I just bought a Fido phone (Siemens A56) with 3 months of service for $75 CDN.
The monthly plan is $25/month = 100 weekday minutes plus 1000 weekend/evening minutes AND all Fido-to-Fido calls and SMS are free. That's $19 USD per month.. AND a free phone.
And to top it all off, Fido subsidizes all their handsets AND you're never locked into any contract - it's all on a monthly basis. No complaints here when it comes to cell phone prices or cell phone plans in Canada..
- One Happy Fido Customer.
You mean, the same things in different countries have different prices?
What a stunning observation.
Canada is not the US. You will find a great many things where prices are not the same, some higher, some lower, sometimes by a lot either way.
You don't think that this disparity is because of the ability of these companies to differentiate the cost legitimately? There is large fixed cost to be amortized in providing wireless infrastucture over such a large country, with such low population density.
Here in Vermont we have the same problem with electricity - it costs a lot when you have few customers per mile of wire (or even wireless miles). For the national utilities (like Verizon Wireless and the wired long distance carriers) they lose money on rural areas in order to provide the same bundle to all customers within the country. In rural Alaska all your long-distance calls come over satellite to ground stations that might serve 1000 people who are paying 6.2 cents a minute for long-distance!!!
Always look for a rational reason before you complain too much about conspiracies.
Subsidy lockout exists because cell phones don't actually cost $50-$100, they are alot more and the provider pays most of that price counting on customers using their service long enough to make up their investment, if you buy a phone at it's actual cost you will be able to use it on any compatable network, but with the mess that is the current cell network in the US i'll stick to subsidy locked cheap phones for now.
Snowden and Manning are heroes.
Long term customers of Rogers get their cell phones for free.
:)
I've been with them for almost 10 years, and I only paid for my first phone, which was one of those old Motorola bag phones...remember them?
About every 2 years I've been offered a choice of a new phone for no charge, and they've always given me a good selection to choose from. My latest is the Nokia 3595 which I received about 6 months ago...and it's a great phone.
I suspect that the article is right when it comes to new customers signing up, or customers that only want to go on pay as you go plans. In those situations Rogers can't be sure that they will come ahead by giving you the phone for free. But if you're a long term customer they certainly look after you and make sure that you always have a fairly modern phone.
I don't know if US carriers do the same but it seems reasonable to me. Why give phones away if you haven't got some assurance that your customers will stick around?
I can't complain about the rates either although I don't know what the US carriers rates are to compare with. I used to have the Digital 1 plan when I did a lot of travelling (both in the US and Canada) and long distance, international roaming charges, unlimited text messaging, and 1000 daytime minutes (evenings and weekends unlimited) cost me about $100 a month. The amount of time I used the phone combined with the fact that most of my calls were always long distance sure seemed like a good deal to me.
I've always felt I've got a fair shake up here.
-Pat
...to make up for their relatively affordable internet access.
I live in Canada and the one thing that made me give up my cell phone plan was the dreaded monthly "Access Fee."
I had a plan that was $20 for 200 minutes any time, but on top of this EVERYONE is required to pay a $7.95 access fee regardless of what plan they're using. So if you're a businessperson with a $100 a month plan you end up paying what amounts to an 8% tax, but if you are a po' ass student like me you end up paying an insane %40 tax (plus you also have to pay %15 tax on top of the total amount). INSANE.
All providers in Canada charge this fee. It seems to be governemnt mandated, although I think I read once that the individual providers are allowed to set what the fee is but they all decided to make it 7.95.
IMHO this is why we don't have wider adoption of mobible phones in Canada.
Also I'm not sure how it is in other countries but every text message you send with SMS costs 10 cents. So if you want to send a text message to your friend's mobile phone that says "Hi Jane how are you?" that's ten cents.. then if she replies "I'm good, yourself?" another ten cents, and on and on. My carrier (fido) had a "introductory period" where they gave away the text messaging for free and a lot of people were using it. Now that it's 10 cents per message (I think it's max 256 characters) NOBODY USES IT. I mean come on, does it really cost them 10 cents to transmit a 256 character max plain text message? I think if they charged 1 cent per message they would make more money because people would actually use the service.
There is one and only one reason that phones are so cheap in the States. (It isn't that they are more expensive in Canada).
Craig McCaw and bro's changed the rules of cellular in the United States. There belief was that it was "the subscriber" uber alles. That all else would just follow. In other words, you have to give away the expensive phones to get the subscriber. A large part of the cellular network has been paid on the backs of investors and lenders in Bankruptcy court, and the McCaws made billions selling out to ATT while the getting was good.
It is going to be more difficult to get new players (capital) to play the same game and risk that kind of capital that would likely be lost in a massive buildup of customers. Canada, just doesn't have a McCaw to rock the boat, and force everyone to play a different game. They do have Canadian Tire money though!
The prices are obviously set by NASA. You see, in Canada, they use the metric system, and NASA thought they were going to go metric, but some of the guys didn't get that memo...
It was an honest mistake, folks, really. It's like rocket science.
Or maybe...
The computer industry did it! I mean, when did you ever buy a 40 GB hard drive that actually was 40 GB? They might have told Samsung to charge $400 for a $372.52 phone and say they were measuring the price differently. Yeah. If you're the only ones who measure it that way, it isn't different - it's wrong.
I really hate signatures, but go to my website.
I always see shit like,
59.99 USD
799,999.999 CDN.
Non impediti ratione cogitationus.
...a fact of which I am deeply ashamed.
And the short answer is "it's more expensive because they can get away with it."
But yes, it does come down to basic economic, with the corporate greed angle tossed in. Canada is a smaller market, with fewer competitors (4 national, plus a few regional). So the wireless carriers CAN charge more because the consequences of doing so not as great. Plus, the major carriers tend to follow each other quite closely. If one finds a way to charge more for something and get away with it, the others will quickly follow -- why should the other guy be the only one to make more?
IMO, the Canadian wireless industry is not particularly customer oriented -- they are competitor-oriented. It's not so much about "how can I win more customers through my excellent handsets and plan" as it is about "how can I get my ARPU higher than the competitors and my Churn lower, thus sticking it to the competition when the rankings are published." If the customer happens to benefit, it's a nice consequence.
That's why the CityFido plan (you probably haven't heard of this unless you're in Vancouver, but you can transfer your landline number to a wireless number, and you get $40/month unlimited local calling) sent the Canadian wireless industry into a tizzy. The other 3 national carriers began running some pretty harsh Fido switch promotions -- particularly on the East coast, where Fido is based. Makes some sense on a competitor level (take out Fido where they are strongest) but not on a consumer level (Easterners who've never heard of CityFido can't understand why the big 3 carriers are all going after the little guy.)
Mind you, Fido has had financial difficulties lately, so they probably had to pull a gutsy move like this. The rest of the industry doesn't see how Fido's model is sustainable.
But on the other hand, some stuff just costs more here. Hence the people who cross the boarder every month to shop.
I can spell. I just can't type.
Im canadian, you insensitive clod.
Comment removed based on user account deletion
You (Canadians) send me prescription drugs, and I (American) send you wireless gear. Everyone saves money!
I checked the price for the 270 here in Los Angeles: $349.99 + a $100 rebate. That works out to $446.51 CDN + $127.55 CDN rebate. Sounds like the Rogers deal is pretty good by comparison.
The moral of the story: cell phone deals are *very* regional, and while you might be able to get a great deal in one town, you won't find such a great one elsewhere. It has nothing to do with which country you are in.
sigs are a waste of space
well that's all well and good that they say a phone costs this much, but there's one small fact that they're missing ALL canadian providers give you a discount on the phone for a term contract, so in reality you DON'T pay the full price
all the phones they listed are the base price WITHOUT a package deal, and most of the american conterparts had a thing about it being free with a deal and such
the thing most people don't realise is that america has 300 million people canada has 30 million. another thing is that most phones aren't made in canada, the blackberry is the exceptoin so there's an import and other such taxes and special chips and such.
Something that bugs the crap out of me is the cell phone companies in Canada don't reward you for being a long time customer. I assume it's the same state side.
Sign up for a 1 or 2 year plan, get a free phone. Once that 1 or 2 years are up, they only offer you either 3 months unlimited calling or a $75 CAD credit towards a new phone at practically full rate.
If you didn't care and cancelled your service, you could go ahead and get that new phone with a new number.
But it's annoying as hell to get someone else's old number and all their calls to you for the next six months.
My contract came up and I love my Nokia 6160. Only complaint is the battery life is shorte. I asked if they could give me the $75 credit towards a new battery, they told me no. Only a new phone would work.
Needless to say, I went with the upgrade to a 6360 to maintain compatability with most of my accessories.
1 EUR = $1.2
Actually it would be better not to account the exchange rate. Use 1/1 for comparison.
These prices don't include a plan. Most quality phones simply don't come with a plan in Belgium. They are more focused on the cheaper phones.
BTW: Why doesn't /. accept € ?
StarTrek.org Free Webmail
I subscribe to data only, "unlimited" GPRS plan from Fido @ $60 /month.
I just got a mail from Fido that the unlimited plan has a limit of 1 gigabyte per month. Their lettre allowed me up to the end of the month to "correct" my usage or "you will be contacted to help you limit your usage".
Now, $60 a month for 1 Gig total may sound like an overkill, and it is considering that in Canada you pay only CDN$ 44/month for unlimited high speed cable connection downloading ISO's in less than an hour, but other wireless providers, like Bell, Tellus and AT&T Rogers, charge $10 per megabyte. Most don't offer a limited "unlimited" plans, and some offer an unlimited period for the first couple of months as a promotion.
If you monitor a remote server, and leave "top" running 24 hrs a day, you'll break the one gig limit within a couple of days.
Now I started to switch cards on my Zaurus, GPRS card when no Wifi siganl is available, and switch to Wifi when I find it. It's a PITA to try to stay within the unlimited limit. It's a hassle, since it will break your SSH connection, and need to reconnect.
As for hardware, the few wireless providers here in Canada who know what a CF card format is, charge $400-$500 dollars for them, and they all have firmware to not be compatible with any other provider. The only exception I found is Fido, where I was able to purchase a card from the US on eBay, and plug into the Fido GPRS network. It only took me 3 phone calls to convince the tech support I don't need to purchase any phones from them, and that my CF card works just like their own PCMCIA cards.
Of course, you can subscribe to US providers from Canada, however you'll be paying roaming fees, so it's not that practical.