Wireless Code could use tweaks, providers tell CRTC

While the general consensus among the industry’s biggest players is that the Wireless Code has been an effective tool over the past three years, it could do with few upgrades, according to submissions made to the CRTC’s review of the regulation. Saskatchewan Telecommunications Holding Corp. argued a return to three-year contracts is in order. The company said in its intervention that it heard from customers that the old contract term-lengths were desired to help ease the cost of handsets. “Since devices last longer and are feature rich, it is less likely that consumers will want to replace their existing device over shorter time frames,” SaskTel said. “As capabilities and features increased the price of the phones, attaching to the network has increased from the price at the time the Code was written leading to increasing consumer need for a longer period of time to finance a smartphone.“ Many interventions from wireless providers echoed comments made by the Canadian Wireless Telecommunications Association (CWTA), which recommended four updates to the Wireless Code. The code came into effect in 2013 with rules that pushed out three-year contracts and capped overage and roaming data charges. The most recent CRTC-commissioned study examining the code’s efficacy suggested a decline in wireless complaints and bill shock. Specifically, the CWTA said the CRTC should clarify the definition of small business, which is currently limited to those that have average monthly telecom bills of less than $2,500; change the definition of “permanent copy of the contract” to align with the Television Service Provider Code so that electronic formats can be the default instead of paper copies; clear up any confusion about what it means to be a “consumer” or an “account holder”; and, when devices are returned during the 15-day trial period, allow service providers to charge a restocking fee “to level a market imbalance resulting from this policy,” like third-party retailers are able to. SaskTel supported the restocking fee in its intervention, noting that open-stock items are usually sold at half the retail price, representing an average loss of $300 per device. “This year alone SaskTel estimates it will have over 10,000 returned devices and when these devices are re-sold as a used device the revenue reduction is estimated to be $3.3M,” the company said. “Extrapolating this over all of Canada and over all TSPs, the return cost to all wireless service providers is in the 10’s of millions of dollars.” Rogers Communications Inc. and BCE Inc. said they also wanted to see an expansion of the cancellation fees that can be recovered. As Bell noted in its intervention, all that wireless providers can currently recover if a customer cancels a contract early is the device subsidy, but there are other “port-in” incentives to encourage customers to switch carriers that could be clawed back. “These valuable incentives, which can take any number of forms, are unlikely to become a feature of the retail consumer market if they are not recoverable by a service provider under the Wireless Code when a customer who has accepted such an incentive later chooses to break their contractual commitment, provided that adequate disclosure was made to the customer regarding the consequences of early cancellation,” Bell said. In its intervention, Rogers recommended altering the wording of the code governing early cancellation of contracts with subsidized devices to specify that the “early cancellation fee must not exceed the value of the device subsidy and any economic inducement received.” Bragg Communications Inc.’s Eastlink said it liked that the code wasn’t overly prescriptive and that it “generally avoided inadvertently limiting pricing options or approaches to satisfying the requirements of the Code in ways that may be additionally consumer-friendly.” But where companies said the CRTC should be more prescriptive was in enforcing the Wireless Code as the predominant regulation governing wireless agreements. Some provinces, like Manitoba, Quebec, Newfoundland and Labrador and Ontario, have their own consumer legislation. “These conflicting provincial regulations continue to confuse and frustrate wireless consumers and to increase the administrative burden on service providers that must account for multiple sets of rules,” the CWTA said. Rogers also said it wanted the CRTC to “establish guidelines for administration of the Wireless Code and how interpretations of Code provisions can be made.” While not disputing the role of the Commissioner for Complaints for Telecommunications Services (CCTS) as the code’s administrator, Rogers’ submission said it had concerns with the watchdog’s Annotated Code saying that many of its entries “do not just make an interpretation but serve to rewrite Commission policy.” On the consumer side, the Consumers Council of Canada said the code does “an adequate job of setting the standard” for wireless contracts but could be doing more. “The Wireless Code has empowered consumers somewhat. It’s not a failure. But it’s also only a step in what will need to be a bigger adjustment,” the council’s intervention said. A public hearing is scheduled to begin in Gatineau, Que., on Feb. 6. — With reporting by Charelle Evelyn at cevelyn@thewirereport.ca and editing by Anja Karadeglija at akarad@thewirereport.ca

Wireless Code could use tweaks, providers tell CRTC

News | October 4, 2016

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