I wrote earlier about how I thought that the CRTC was hampered in their decision by the Canwest – Alliance Atlantis merger decision from a couple years ago. The CRTC decided in this case that foreign money from Goldman Sachs as the debt and equity holder and controlling owner was preferable than having Egyptian owners, in the form of Orescom. (I’ve heard from CRTC people that national security is part of their decision process – so one wonders whether there was a bit of that here.)

Whether the CRTC was wrong or right in this decision, the CRTC hasn’t been coming off these days as the fearless supporter of the powerless Canadian citizen. Their recent decisions have generally been ones favoured by the lobbyists of the big telecom companies in Canada. A few weeks ago they decided, for the most part, to support the major carriers in a decision which put the burden of responsibility on the consumer to prove the carriers wrong in issues of network neutrality (and we how much know your average consumer knows about internet packet throttling). This week they supported the powerful lobbies of the carriers in the Globalive decision.

By an extension of their own logic, if the CRTC is not supporting and protecting consumers in providing them choice (or assuming that there is enough choice in the market for our consumers) then they have already come to the conclusion (aided by lobbyists) that the Canadian market for telecommunications services is highly competitive – that innovation and new product is high, barriers to entry are low, and prices are dropping and competitive. We, of course, know this isn’t true.

There is an undercurrent going on the techno-telecom crowd in Canada supporting a movement to disolve the CRTC. They better watch out, because it is getting very hard for average Canadians (not the super digerati or highly informed telecom geeks, but those that keep an eye on telecom) to understand the role of the Commission. To those watching from the sidelines, it looks like the CRTC is simply an extra arm of the major carriers to keep the barriers to entry high, competition low, and their cabal tight.

While I write this blog post I have been on hold with Rogers for over 3 hours, and finally got through to a Rogers representative who has put me on hold again. She has told me that it is my fault that I upgraded my operating system and that, unfortunately, my useless Rocket Stick is now my responsibility. If I want to cancel my service, which I can’t use because I’ve upgraded to Snow Leopard, I’ll have to pay a $500 cancellation fee.

Just to put this in context, Snow Leopard is not a sudden and unexpected move from Apple. Developers have had plenty of time to make sure their software is compatible. There were a few applications on my computer that I’ve had to upgrade this week (for free) because of my Snow Leopard OS upgrade, and all have gone smoothly.

The Rogers sales rep told me that it was my fault that I upgraded, and unfortunately I have to suffer the consequences. (blaming your customer is never good customer service). She also said it was up to the folks at Sony Ericsson, and that it was not in Rogers control. Anyone who has worked with Rogers knows the dynamic between supplier and carrier. If Rogers wants to make it work, Sony Ericsson will make it work – they have global customers at stake, outside of Rogers.

What this says for innovation in Canada is appalling. But the important point is that there is no excuse for Rogers not to have the Rocket Stick fix in their back pocket right upon the Snow Leopard release. With the iPhone partnership, Rogers should be keeping well up to date with Apple’s updates, and have as much hardware compatibility as possible. The Rocket Stick, to Rogers, is the vision of the future – connectivity everywhere. It should work with the latest and greatest software by the second most deployed operating system globally. No excuses!

(and no reason, of course, to be on hold for 3 hours before talking to a sales rep! – but that’s another blog post)

Update: Actually you’d think I’d have more of an update. But a Rogers tech support agent (actually it seemed like a fairly senior one) did get in touch with me. I sent him an update by email last Thursday the 3rd of September. So far nothing back. Will continue to update as the situation progresses.

Update (October 16): Apologies for the late update, but about 2 weeks ago Rogers solved the problem. Turns out there are many types of Rocket Sticks, and the old one didn’t work on Snow Leopard. I’ve now been upgraded to a ZTE version, and it’s working fine. Have to give some Kudo’s to Rogers, but I did get a significant hit on my bill for the upgrade. Ouch!

Speaking from personal experience, I know telecom executives in this country take comments like this to heart. And, as Canadians who once held leadership positions in telecom equipment manufacturing with Nortel, and still wave the RIM flag, we do feel somewhat offended.

Pundits, especially ones who make much of their money defending the Canadian telecoms, jumped on the report as flawed. Issues like the size of the call baskets, issues with incoming and outgoing minutes, LD pricing and such, they say,  make the report flawed to the point of useless.

I disagree. Rudulph Van Der Berg Blogs: It’s here, it’s full of statistics! Statistics we can all fight over!

As a primary author of the July 2005 SeaBoard paper “Lessons for Canada – A Cross National Survey of Wireless Pricing”, I know a bit about building a survey like this. It is challenging.Trying to come up with a methodology to compare apples-to-apples will never work out exactly right. As a researcher, you make best efforts to come as close as you can.

At the time that the SeaBoard paper came out there was an existing OECD paper, which showed Canada in a much better light, using a much more primitive methodology. Carriers thought the OECD paper, because it suited their interests, used the right methodology, and the SeaBoard methodology was flawed. (despite having access to all the spreadsheets and data). When I finally got around to reading this report, I was struck by how much the OECD had adapted the SeaBoard research methodology to include more comprehensive baskets. Their buckets of minutes have increased, well above the SeaBoard’s usage levels, (but that’s likely because usage levels world-wide have gone up).

I credit the folks as the OECD for taking a much more thorough approach. Now the carriers are going to turn their PR guns on the OECD, through the CTIA, because their stats aren’t favourable. Instead they cite the Merrill Lynch wireless matrix, which in full admission, the researchers there have noted that they measure “charged minutes as reported by carriers”, not usage minutes, so it’s not much of a research report for comparing apples to apples. It is very good for telling how profitable carriers are globally.  It’s pretty typical.

Rather than get into detailed criticisms of the OECD report, because overall I think they did a great job. Issues like bucket sizes, # of incoming minutes, average usage per country, are difficult to equate. Considering you can almost never compare apples to apples, I’d point out a couple things to Canadian, and even American carriers.

1. The survey is over a year old. In telecom years, that’s a long time. I watched how data rates in Canada plummetted drastically during the course of one years, with the introduction of the iPhone inspired 6Gb data plan. So plans a year old are like looking in a long rear view window. What’s behind doesn’t matter.
2. For some reason the OECD didn’t consider mobile data. They added SMS, and MMS usage (which is almost harder to equate North American to European usage because of the differences), but skipped mobile data – even limited volumes. With the increase in usage of smartphones, blackberries, and other mobile devices, missing that is a key factor in determining phone usage and pricing. Yes, it’s hard to include, because usage among countries varies highly, but that factor would have shown some interesting traits. But it’s more of an example of looking backwards instead of forward. Mobile data is mobile carriers future. With the arrival of skype over iPhone and other VoIP services, mobile carriers should care less about minutes and more about mobile data.

If I was the carriers, or the CTIA, acting as their chief lobbiest and PR folks, I’d dismiss the OECD report as old, and not focussed on the right issues. Move forward, think about tomorrow, not yesterday.

As for Canadians, we’ve already seen drastic shifts in the market for data over wireless in the last 18 months, and with the emergence of companies like Wind Mobile, Public, and DAVE, the market will change again. As Canadians embrace new technology on their own, carriers will need to catch up to consumers.