Complaints, bill shock fell after Wireless Code: study

The Wireless Code has proved effective in the two years since its implementation, suggest the results of a CRTC-commissioned study, which reported a decline in wireless complaints as well as incidences of “bill shock.” In the report, produced at the end of March, market research company TNS Canada outlined the results of a more-than $48,500 contract to “determine how consumers understand their wireless service contracts and their related rights and how that has changed over time.” Among the findings was that in 2016, fewer complaints were logged with wireless service providers, with 21 per cent of respondents reporting having made a complaint, down from 26 per cent in 2014. That the percentage of people who reported having made complaints has fallen suggests “Canadians better understand the wireless contracts and services they signed up for,” the report said. When it was introduced in June 2013, the CRTC’s new Wireless Code was touted as a “mandatory code of conduct for providers of retail mobile wireless voice and data services.” Under the new rules, customers could back out of wireless contracts after two years of service without cancellation fees, international roaming data charges and data overage fees were capped, and carriers had to provide contracts “easy for consumers to read and understand.” Two-thirds of Canadians find their contracts clear and easy to understand, the report suggests, with clarity the highest among those aged 18-34 and residents of Quebec. About 14 per cent said they found contracts unclear and difficult to understand. Canadians are also showing a growing preference for monthly or post-paid plans instead of pay-as-you-go options, according to the study, with 88 per cent of customers choosing post-paid agreements this year, up from 85 per cent in 2015. “The preference for monthly/post-paid plans suggests Canadians have become more accustomed to signing contracts with wireless providers, which may be due to a better understanding of what the contract entails as well as the promotion of monthly/post-paid plans by wireless providers,” the report said. “Slightly fewer” people have reported having terms of their contracts change without “being made expressly aware” by the service providers beforehand, the study said. The code has also proved effective in “allowing consumers to take advantage of competitive offers more frequently than in the past,” the findings suggest. While the number of people changing providers has remained steady over the past couple of years (18 per cent), customers are more likely to switch providers to get a better deal, instead of switching due to low satisfaction with their current carrier, the report said, with 55 per cent of people indicating that was the case in 2016, up from 42 per cent in 2015 and 38 per cent in 2014. Barely one-quarter of respondents said they had experienced “bill shock” in 2016, which the report said is “down significantly from 2015 and 2014.” In 2015, 29 per cent of people said they had experienced bill shock, while 28 per cent had said so in 2014. According to the report, the downward trend suggests people understand terms more and that “the protections built in to the Code are having an impact.” Data usage is still the driving factor behind wireless bills being higher than anticipated, with 40 per cent of respondents citing it as the reason behind the shock. “The prevalence of this problem has increased each year from 2014 and may be a function of increased use of smartphones by the Canadian public as well as improvements and changes to mobile apps and the extent to which such apps use data,” said the report. Among the takeaways for the CRTC highlighted in the report was that “it is important for the CRTC to ensure the wireless code fully reflects and addresses Canadians increased interest in data in wireless plans.” Marc Choma, spokesperson for the Canadian Wireless Telecommunications Association (CWTA) said in a phone interview that “overall, it looks like the code has really been effective for consumers.” Wireless carriers were among those calling for the CRTC to create a national code to streamline regulations country-wide, Choma added. “So if consumers are seeing a benefit from that, then that’s a great thing,” Choma said. However, there is room for improvement. Though complaints had declined overall, they actually doubled among prepaid customers, rising from 10 per cent in 2015 to 21 per cent this year. The report did not indicate any reasons why the complaints had increased. Choma also said that the code removed some choice for consumers with the provision allowing them to back out of wireless contracts after 24 months, which effectively ended three-year contracts in Canada. In some cases, customers face higher upfront fees since carriers now space out the subsidy for a device over two years instead of three, he said. The report was based on a phone survey of 925 adult Canadians who owned their own cell phone, conducted between Feb. 3 and Feb. 18, with a margin of error of plus or minus 3.2 per cent, 19 times out of 20. The CRTC plans to hold a review of the Wireless Code in 2016-2017 in order to “ensure its effectiveness in fulfilling its objectives,” according to its three-year plan. — With reporting by Charelle Evelyn at cevelyn@thewirereport.ca and editing by Anja Karadeglija at akarad@thewirereport.ca

Complaints, bill shock fell after Wireless Code: study

News | July 14, 2016

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Complaints, bill shock fell after Wireless Code: study

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