Tag Archives: cellphones

CRTC’s Wireless Code vs. Quebec’s Bill 60

On Monday morning, the Canadian Radio-television and Telecommunications Commission issued its final Wireless Code, a set of rules all wireless service providers in Canada have to abide by. I was curious how this code compares to the rules the Quebec government put into place in 2009 that similarly protect consumers in cellphone (and other) service contracts.

The result is this story in The Gazette, which appears in Wednesday’s paper. It lists point by point the provisions of both. In general, they’re very similar in terms of how cancellation fees are calculated, how major elements of contracts can’t be changed unilaterally, and how renewals are done. Bill 60 also includes a prohibition on late-payment fees or additional fees for pay-as-you-go services. But most of the advantage for the consumer is in the CRTC’s code, which specifically deals with wireless service. It includes a de facto two-year maximum on contracts, a 15-day trial period, a right to unlock phones, notification of data roaming and caps on data overage and data roaming fees.

You can read the CRTC’s decision here setting the Wireless Code into place¬†and explaining its reasoning. Quebec’s Bill 60 became law in 2009, and the text of it is here (PDF).

The Wireless Code comes into effect with contracts signed on or after Dec. 2, though providers can start applying the new rules to new contracts as soon as they’re drawn up. Since it’s not really in their interest for people to wait, I would expect the code’s provisions to be in new contracts by the major wireless companies before then.

If your main concern is contract length, by the way, you can go ahead and sign now. As of two years from now, all contracts must comply with the code, which means in two years you won’t have a cancellation fee, even if your contract right now says you will.

How will this be paid for?

The big question now is how these changes (particularly contract length) will be reflected in the marketplace. Having phones subsidized over two years instead of three will mean one of three things:

  1. Higher prices for new handsets. I’m guessing this is the most likely option. Instead of getting, say, a $360 subsidy on a phone, which works out to $10 a month for 36 months, the subsidy might only be $240, which means the phone will be $120 more expensive. Expect fewer $0 smartphones.
  2. Higher monthly rates. If subsidies are done over two years instead of three, then they have to be 50% higher on a monthly basis. So that $10 a month subsidy now has to be $15 a month if the total subsidy is the same. But in my experience there hasn’t been much flexibility in monthly pricing based on device subsidy, and monthly fees have much more competitive pressure than initial handset cost. Prices might inch up slowly, but only if all the major providers agree their profit margin at the lower price is unsustainable.
  3. Lower profits. Yeah, go ahead and laugh. But wireless providers make decisions all the time that result in lower profits, hoping that they might result in higher profits down the road. Acquiring new customers has a large price to it (beyond just the phone subsidy), but if you can lock them in for three years or longer, you’ll make much of that money back. Reducing the contract to two years will mean less time to recoup this acquisition cost. We may see an effect on the bottom line here.

Because, in two years from now, all contracts will have to have zero-fee cancellation after two years, expect new handset costs to go up quickly. Which means even though it sounds like it might be a good idea to wait until December, now might actually be the best time to get a new phone.

Your fake phones are useless to me

Fake phones at Best Buy

I’m currently in the market for a smartphone. I’ve had the same phone for four and a half years now, and it’s starting to show its age. It’s getting tougher and tougher to get the charger’s plug in the right position to get it to charge, and I’ve recently learned that the alarm doesn’t work when the phone is charging.

Meanwhile, my portable media player, a couple of years old, is also deteriorating. The audio jack doesn’t always make proper contact, the top layer of its skin is flaking off, and the software design flaws I tolerated at the beginning are starting to get on my nerves.

Plus, it seems everyone cool has a smartphone but me, and I want to have at least basic access to the Internet when I’m out and about.

So wanting to kill three birds with one stone, I’m doing research into both handsets (I’m looking at non-iPhones) and voice/data plans. I’ll probably do a plan post at some point, as I have a bunch of numbers in a spreadsheet right now.

With online research, I’ve narrowed down a short list of devices that meet my criteria: Wi-Fi and a web browser, an open operating system (Android or Symbian), FM radio (remarkably hard to find, and a major factor against the iPhone), and a feeling of ruggedness – I don’t want some cheap plastic part to break after six months and render the phone useless.

Since there’s just so much I can learn from reading specs sheets and looking at reviews online, I went to some stores recently to check out the devices in person.

Tables and tables of fake phones at Future Shop

Electronics stores have entire sections devoted to cellphones, each one tied to a security cord so you can hold it in your hand but can’t steal it. You can touch the phones, slide out keyboards where such slides exist, and run your fingers across the buttons.

But that’s about it. You can’t turn them on, try the browser, see how high the volume goes, check out what software features it has, or anything else that involves a battery. You can get a vague idea of what the operating system looks like by the fake display that’s pasted on, but you can’t get any sense of how it works.

It’s the same at the carriers’ special shops. There might be a working iPhone display at the Rogers store, but good luck testing out that Motorola Quench or Nokia N97.

This seems ridiculous to me. Computers and laptops are almost always sold in a way that lets you test them out first. So are iPods, digital cameras and camcorders, TVs and other electronic devices.

I asked one of the customer service people at one of those inside-the-mall shops about having phones on display that actually work. He said that if they did that, the phones would constantly be stolen. Those phones, with the bungee cords attaching them to the table? And what about that iPhone – the most in-demand mobile device on the planet right now – that you’ve managed to setup a proper display for?

I’ve gone to Bell, Telus, Rogers, Fido, Virgin Mobile, Videotron and unaffiliated stores, looking for somewhere I can test drive one of these non-iPhone smartphones. I’m facing the prospect of choosing a $500 device without having turned it on first.

It’s not exactly encouraging.

Inside Bill 60

Laurent Maisonnave on his iPhone

Laurent Maisonnave on his iPhone, not that he'd ever cancel his contract unilaterally

The Quebec Liberals this week announced Bill 60, proposed legislation that would strengthen (or “modernize“) consumer protections particularly where it concerns long-term service contracts like cellphones. The bill has already (and unsurprisingly) gained the support of the Union des consommateurs, and others. Cellphone providers have stayed silent for the most part, though their advocacy group says the bill is redundant because the industry is already looking to self-regulate (those who buy this please raise your hands).

The full text of the bill is online (PDF). It hasn’t been debated in the National Assembly yet, so it could very well be changed significantly before it becomes law.

Here are some of the highlights:

  • Changes to contracts must come with 60 days’ notice and the consumer has the ability to cancel the contract without penalty if the changes involve “an increase in the consumer’s obligations or a reduction in the merchant’s obligations”
  • Such changes can’t affect “an essential element of the contract” like the nature of the service offered
  • Fixed-term service contracts can’t be unilaterally cancelled by the provider
  • Consumers can’t be required to pay penalty fees beyond simple interest charges for missed payments
  • Merchants are required to fully explain existing warranties before asking customers if they would like extended warranties
  • If you buy an item second-hand that’s still under warranty, manufacturers can’t require that you prove the previous owner abided by the warranty’s conditions
  • Gift certificates and gift cards cannot have expiry dates, and must come with written explanations of how to check the balance on them. They also cannot be subject to fees
  • Contracts must come with various things in writing, including the total dollar value of “inducements” (like free cellphones)
  • Contracts cannot be automatically renewed
  • You can’t be charged for service while the device you use to access that service (assuming it was provided with the contract) is being repaired
  • Consumers can unilaterally cancel contracts and pay back the value of any inducements provided at contract signing (or 10% of the remainder of the contract, or $50, depending on the circumstance)
  • Advertisements must include the full cost of services, less taxes (though it’s hard to see how this would be enforced since cellphones, cable, Internet and other services come with different plans)
  • In case a company breaks any of these provisions, the government or a recognized consumer advocacy body can seek an injunction forcing the provider to comply
  • The bill also contains some minor provisions dealing with travel agents

A lot of these are common sense (no one should be allowed to unilaterally change a contract without the other side’s consent, and companies shouldn’t get free money out of gift cards). Others will probably be criticized because they allow loopholes that lead to abuse (for example, if I know Rogers is about to change their contract, can I get a three-year free iPhone deal and then cancel the contract a week later without paying a penalty and get a free iPhone?). Still others are open to interpretation (we could expect arguments about whether a certain change really increases the obligation of a consumer).

Others sound like they could be downright annoying, like being forced to sit down while a Best Buy employee reads out the complete text of a manufacturer’s warranty to you.

But all in all, it’s a good bill, and provides some valuable protections for consumers against abusive contracts. Law-abiding businesses should be able to point out loopholes that might be exploited against them, but let’s hope the lobbyists don’t start torpedoing parts of this bill just because it might cut down on their bottom line.

Rogers contract renewal: Just get a cheaper plan

The folks from Rogers Wireless have been calling me incessantly for the past week or two. They always call twice, from an unlisted Toronto number, and never leave a voice mail.

To get them to stop, I finally answered today. As I expected, they were trying to get me to sign on to a fixed-term contract by “offering” me a brand new phone.

Except my phone works fine. Sure, the plug for the charger needs to be jiggled a bit before it works, and the exterior buttons turn the ringer off when it’s in my pocket. But I can still make and receive calls and text messages.

So I told the guy I wasn’t interested. Then he decides he wants to sell me on cool new features, but I’m happy with what I have.

I ask him if there’s anything he can offer me that would reduce my bill and keep the same features. Then he pulls out this “exclusive offer” where I get 100 daytime and 1000 evening/weekend minutes for $15 a month, $10 cheaper than my current plan (which also includes unlimited incoming calls). Knowing that I only use about 100 minutes a month anyway, I figure it’s worth it (evenings also start earlier, 6pm instead of 8pm). I tell him to go ahead.

He also gets me to change my features package for another one at the same price which gives me more text messages and has caller name ID.

But when he told me I’d have to sign on for 36 months, I hestitated. I don’t know where I’ll be in 36 months, and I don’t know if I’m ready to commit that much. No problem, he says, he can do it for 24 months instead (that’s apparently the minimum).

So in exchange for a 24-month commitment, my already cheap cellphone bill is now $10 cheaper per month, and I have more features.

So if Rogers is calling you to get you to sign a new contract, consider the following:

  • If you’re happy with your phone, tell them that and see what kind of plan features you can get instead
  • Ask them what they can offer you to reduce your bill instead of adding new features
  • Don’t readily accept a 36-month contract. See if they’ll reduce the commitment to 24 months. (After those 24 months, you can bet they’ll be calling again to repeat the process.)
  • Do a quick calculation in your head to see if it’s worth it. If they’re not offering a significant discount, don’t accept a new contract. Either get a new phone or tell them you’re thinking of switching to a new, cheaper provider.

I know it when I see it

LCN’s Mathieu Belhumeur has exclusive video that cellphone service providers allow their customers to purchase images of scantily-clad women.

The video report is, of course, filled with examples of such images, just in case you’ve forgotten what a scantily-clad woman looks like.

The real scandal here is that people are expected to pay $2 to download a thumbnail-sized image of anything.

Cell Unlimited not above outright spam

Got this text message yesterday from a shady outfit called “Cell Unlimited” (typos are theirs, not mine):

Appels Sortants Locaux et Interrubains Illimites a partir10$/Mois!
Info:514-227-6240
www.cellunlimited.net
Unlimited Local and Outgoing Calls for 10$/month!

From: 514-291-7194 (4pm Nov. 30, 2007)

I have, of course, never even heard of this outfit, much less had any business dealings with them that would give them the impression that they could text-message-spam me.

I’ve requested an explanation and will update this post if I get one.

(For the curious, the company is an automatic callback service that turns outgoing calls into incoming ones so those with unlimited incoming call plans can get free minutes. The fact that it costs $10 a month makes me wonder if it’s really worth it for most people.)

Cellphone user wants his fees back

I’ve always found it odd that Canadian wireless consumers are forced to pay a “system access fee” of about $7 every month on top of their rate plan. It sounds like something that should just be included in the plan itself. I mean, would you accept it if Wal-Mart imposed a mandatory cashier’s fee, or if the public transit authorities started charging you a monthly fee for accessing their network?

Virgin Mobile is one of the few companies not to charge this fee. Their service is more expensive, but at least it’s honest, and it doesn’t force you into 3-year contracts.

Well it seems the dishonesty of telling someone a plan is worth $20 a month when it’s actually $30 plus tax has hit a nerve. Hou-Hou points us to a story about a Regina lawyer whose lawsuit has just gained class-action status.

It’s potentially the largest class-action in Canadian history, and it goes after the three cellphone giants at once, who will no doubt throw about a quadrillion lawyers on the case.

So … good luck with that.