Wednesday, March 19, 2014

Canadian Cell Costs - Part I

I've been ranting enough on Twitter about this, so I figure it deserves its own blog posts. First, the background:

For around 13 years I was with Bell Canada for my cell service. From a monochrome-screened bar phone, to a slider, to a shiny LG flip phone, to my iPhone 4, and briefly, a 5s.

I've never really had much of a complaint with regards to the service (other than my folks' place being between towers in a bit of a dead zone), but man have their prices ever sucked. My first phone was under my mother's work plan because it was a huge improvement over what was publicly available and my company didn't yet have an individual cell plan deal in place. I moved to my own work's corporate plan when I upgraded phones.

The problems started with the next move, to the LG. I wanted a new phone. This meant a new plan. I said I wanted something close to what I currently had. They gave me a plan that I shouldn't have been able to get (I had no idea at the time). The next bill, Bell changed my plan without telling me. I didn't notice until a few bills later, and Bell refused to make any changes or refund the difference.

Luckily, I had an ace up my sleeve in a friend who worked high enough in the Bell hierarchy to complain on my behalf and get actually helpful people to call me. The problem was resolved beyond my satisfaction and I was happy. The next upgrade to an iPhone meant the inclusion of data - that whole move was actually painless, just add $25/month for 500MB of data. Not a great price, but the best option at the time based on how cheap my voice plan was.

Then came the end of that contract.

My Bell friend and I have long since drifted apart, so calling him up out of the blue would just be rude. Instead I opted to go through the regular channels. It consistently went something like this:

"My contract is up soon. I want to upgrade my phone, which I know means I need a new plan. Here's what your competition is offering. Can you match it?"


"So for 13 years I've been a loyal customer, paying my bills on time, using extra services like roaming plans, and you can't even make an offer?"


"I guess I'll be leaving then."

"Okay, have a nice day."

Wow. Considering I have my Internet connection and landline with them too, this was... surprising.

So I hemmed and hawed and finally, after months of wanting to toss my phone against a wall every day, walked into the Apple store and paid full price for an unlocked, non-subsidized phone. It was worth it to not be tied to any of the carriers in this country.

Then I did the math and discovered something - there are no real phone subsidies.

If you bring your own phone to the big 3 providers (Bell, Rogers, Telus) - you get $20/month off your bill on a two-year contract. That's $480 you're paying towards your phone.

iPhone 5s 32GB - $819. On contract? $329. Difference? $490. $10 in subsidies from the phone companies, if you don't include time value of money calculations. The rest is you paying $20 more a month to get a "cheap" phone up front.

Whoopdeefuckingdoo. That's not a subsidy, that's a phone mortgage.

I'll continue this in another post with some rough comparisons between my options, and how I think these guys will hurt themselves in the name of protectionism and short-term greed.


DuggleBogey said...

I don't know how it works in Canada, but what you describe sounds the same in America when you're talking about the major providers. The average smart phone user in America with AT&T or Verizon pays $150 per month/per person for their phone and plan.

I have my phone with a small provider who gives unlimited everything provided you connect to WiFi when it is available and you keep your ratio at a certain level. The cost is $19 per month, but I had to buy the phone in advance.

I don't know if those smaller providers are available in Canada, but you may want to look into them if you have an unlocked phone.

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