CRTC bans 30-day cancellation, get ready for price hikes

Regulator introduces another band-aid measure, but systemic telecom issues continue.

30-day cancellation, cancel, crtc, telecom, tv, internet, phone

30-day cancellation blues

There goes that wacky CRTC again, raising everybody’s telecom bills.

The regulator on Thursday announced it was banning TV, phone and internet providers from insisting that customers give 30 days notice when cancelling their services. The ban will take effect on Jan. 23, 2015.

As per the release, the move to strike 30-day cancellation will make it “easier for individuals and small business customers to take advantage of a competitive marketplace by switching service providers,” just like in cellphones, where a similar ban has been in force since the Wireless Code took effect last December.

Right then. How did that particular ban do for consumers? Oh yes. Along with prohibiting three-year contracts, it caused prices to shoot upward. And upward again. And they didn’t just shoot upward in wireless, there were follow-on hikes in landlines and internet service, which increased at triple the rate of inflation over the past year. Up and up and up, across the board.

To be fair, it’s not really the CRTC’s fault. The regulator seems to have its heart in the right place. Its brain, well, that’s another matter.

The Competition Bureau has been clear in asserting that the wireless industry is not competitive. With the wireless companies also being TV, landline and internet providers, that edict is pretty much a proxy for the entire market.

In that kind of reality, seemingly consumer-friendly rules – like the banning of 30-day cancellation – are guaranteed to backfire. Enacting them without addressing the bigger competitive problem in larger, structural ways, is actually dumb because it will only provoke an adverse reaction from the very companies the CRTC is trying to rein in.

In other words, get ready for more price hikes as those companies look to recoup whatever supposed hardship the ban will incur.

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1 Comment on CRTC bans 30-day cancellation, get ready for price hikes

  1. At the end of the day, a regulatory authority is mandated to create and enforce these rules. Maybe force a mandatory price freeze for an indefinite period of time whenever these rules are made in order to prevent the incumbents from trying to set the agenda?

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