Bulk billing and the CRTC

Over the past few years Beanfield has been ringing the alarm about “Bulk Billing” because we believe:

1. It is against current CRTC regulations
2. It is anti-competitive
3. It is an “Abuse of Dominance” by large telcos (like Rogers, Bell and Telus)
4. It gives “Undue Preference” to large Telcos (like Rogers, Bell and Telus)
5. It is the greatest threat to consumer choice since deregulation in the 1990s
6. If this isn’t stopped immediately – 50% of Canadians will lose their right to choose in 5 years

Here’s the math:

Apartments and condos make up 1/3 of all housing in Canada but almost 80% of new housing is apartments and condos. We think about 70% of these are now subject to bulk agreements between developers and incumbent telcos and this is growing. Every. Single. Day.

This is creating two classes of Canadians:

1. Those who are wealthy enough to afford a house get choice
2. Those who live in condos or apartments do NOT get choice

It’s also creating two classes of telcos:

1. Large Telcos (like Rogers, Bell, Telus) who can afford to pay millions to buy the rights of future residents – and lose money for 3-4 years before turning a profit
2. Small and medium sized telcos who used to be able to compete and are now being squeezed out of the very market they have positively impacted for Canadians

We think it’s intentional.

We think it’s not fair.

We think it’s not equitable.

We think it will mean that competition will substantially collapse.

We think this means a LOT higher prices are coming for Canadians.

Last week when we spoke about this practice to the CRTC, we warned them. We gave them the statistics and we reminded them that we brought this to their attention 3 years ago, 1 year ago, 9 months ago, and again in a major Part 1 Application – 5 months ago. In the past year of waiting the practice has grown from 50% of new condos in Toronto to 70% and we’ve seen evidence of it cascading across the country.

The transformation of what was a vibrantly competitive market into islands of monopoly will have profound effects – entrenching the incumbent telcos more and hurting small and medium sized competitors (whether they own their own network like Beanfield or buy access on the incumbents – like Teksavvy).

Case in point, today, for the first time in over a decade, Beanfield will be raising the price on its base tier from $50 to $60 because the market now available to competition is vastly smaller. This, we contend, is a market distortion that shouldn’t be happening.

Our intention was always to honour our Beanfield pricing strategy for Fibrestream customers as well- and we have for the past 2 years. Unfortunately, Fibrestream’s business model necessitates us buying some connectivity from incumbents. Their prices have significantly increased to a point where we cannot absorb them without jeopardizing the business, so we made the difficult decision to raise prices for FibreStream customers.*

In the end, we know telecommunication “policy” isn’t something most Canadians worry about – we get it. But Canadians know unfair when they see it and they certainly know unfair when it hits the pocketbook. We’ll keep fighting this fight and welcome any of you who’d like to join us.

Let your voice be heard here.

*Updated for clarity, August 8, 2024.