Roaming rate hikes, lack of flexibility leading to higher cellphone bills: experts

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This article was published 08/10/2024 (725 days ago), so information in it may no longer be current.

TORONTO – Experts say Canadian travellers face among the highest fees for international roaming on their cellphones after years of rate hikes by the country’s largest carriers.

Gerry Wall, president of Wall Communications Inc., said roaming rates offered by the largest Canadian carriers are “considerably higher” than those in the U.S. and most European countries in part because they lack flexibility.

“They all offer these per-day rates, up to a maximum. They used to offer monthly packages. They don’t do that anymore,” said Wall, whose company publishes an annual report comparing Canadian phone and internet prices to peers around the world.

“In Canada, there has been a reduction in the flexibility that customers have in terms of the number of choices they have for roaming from each carrier,” he said.

“That has eroded.”

Canada’s telecommunications watchdog has taken notice. On Monday, it ordered the Big 3 companies — BCE Inc., Rogers Communications Inc. and Telus Corp. — to detail how they plan to curb rising cellphone fees that customers face when travelling abroad.

Telus and Bell both raised their U.S. and international roaming rates in March 2023, with Telus customers now paying $14 per day to roam in the U.S., up from $12, and those visiting other destinations charged $16, marking a $1 increase.

Bell users face a daily $13 charge to roam in the U.S., up from $12, and $16 in other countries, up from $15. Rogers charges $12 and $15 for daily U.S. and international roaming, respectively.

Around seven years ago, the trio generally offered U.S. roaming rates of around $7 or $8 per day, said Wall.

The CRTC noted that aside from those amounts, Canadian travellers face “inflexible” roaming options. It said Canadians lack choice when roaming, as most consumers cannot select plans tailored to their usage and duration of travel, unlike in other countries such as the U.S., Australia and Germany.

“This means that Canadians are typically charged the same daily fee when roaming, regardless of how much they use their phones,” said CRTC secretary general Marc Morin in a letter to the carriers.

“Canadians often pay roaming rates that far exceed the fees Canadian providers pay foreign carriers to provide Canadians with connectivity. These rates can lead to a one-week trip more than doubling a consumer’s monthly bill.”

The regulator’s review relied on confidential information from Canadian cellphone companies, along with studies and public information on roaming.

One of those studies, which was conducted by Networks, Economics & Strategy Inc. and is available on the CRTC’s website, said Canadian roaming rates were among the middle of the pack compared with Australia, Japan and the U.S. for usage up to three days.

However, for usage exceeding three days, Canadian roaming rates “are generally among the highest,” the report concluded.

It said carriers in other countries offer various options, including roaming plans that specify maximum usage of voice call minutes, text messages or data — either as a combination or for individual services — over a certain number of days.

In Canada, service providers are required to cap data roaming charges in a single monthly billing cycle to $100, unless the customer explicitly agrees to pay more.

To increase Canadian customers’ options, Wall said companies could offer weekly or monthly roaming packages rather than a daily flat rate.

He said Canadian providers could also offer cellphone plans that already bake in roaming costs — a model that has been adopted by Quebecor Inc.’s Freedom Mobile through its “Roam Beyond” plan.

“That is something that the U.S. companies have been doing for over a decade,” said Wall.

“It would depend on what the needs of the customer were. For someone that’s going to spend more than a month in the U.S. … they’re definitely going to benefit.”

Bell, Rogers and Telus did not provide comment on Tuesday when asked what steps they plan to take in order to lower roaming fees.

The companies have until Nov. 4 to respond to the regulator, which warned it will launch a public proceeding on the matter if it “finds that sufficient action is not taken.”

This report by The Canadian Press was first published Oct. 8, 2024.

Companies in this story: (TSX:BCE, TSX:RCI.B, TSX:T)