Android Central

The Canadian Radio-television and Telecommunications Commission today announced that starting December 2, 2013, those of us up north will be able to cancel our contract after two years without penalty, that domestic data overage charges will be capped at $50/month ($100 for roaming), and that devices will be able to be unlocked after 90 days (or immediately if bought outright). The new code also stipulates that buyers will have 15 days to return any device so long as it's within certain usage limits, have the power to accept or decline mid-term contract changes, and that they'll have a contract they can actually understand. These changes are all a result of public hearings that happened back in February. 

This, in short, is freakin' sweet. The code will apply to all of the major carriers. For those unfamiliar, three-year contracts are currently the norm up here, and early termination fees in the past have been as high as $500. Right now, we've got a kind of pro-rated system where carriers factor in the initial subsidy provided for your device and how much longer you've got left on your contract in order to calculate how much customers need to cough up to leave. This can still be pretty high, and may even get higher if that subsidy has to be crammed into a smaller period of time.

Needless to say, I'm really, really pumped about these changes. We're waiting on statements from Rogers, Bell, and TELUS to see what they have to say about the new Wireless Code, but one can assume they won't be thrilled about it. If you're interested in digging into the details, you can have a read over here


Reader comments

Canada finally able to escape three-year contracts, caps data overages at $50/month


There wouldn't be "data overages" if there unlimited data! Or at least a usable amount of data, like no less than 10GB/mo.

5 gb caps are a joke & should be illegal for the price carriers charge. my wife easily uses 5gb per week on her note 2. I don't use near as much as her on my HTC One because I don't constantly stream Netflix and YouTube but I know I easily go way over 5, thank God for Sprint and T-Mobile. Also I read regularly people keeping it under 5 consider themselves power users (not saying you said that) I'm no power user & I would really have to watch myself to keep it under 5, for the price we all pay per month it's ridiculous to have to watch for a cap.

Is there any forum / protest where those gouged by the data overages can vent. Some of these fees are back breaking. These cases are the reason this change is in the works. There are some people very pissed that this situation even exists. Boo big telcos.

"This can still be pretty high, and may even get higher if that subsidy has to be crammed into a smaller period of time."

That shouldn't be a problem, EVERYWHERE else in the world, they manage to do it!

It's a good thing that I'm on a non-binding contract with Telus, the reason being is that I brought a Samsung Galaxy S4 that I won -- from -- to Telus, although it's a Telus phone, I'd still have to pay for overages, but other than that I can cancel anytime I want!

Wow, bravo to our northerly comrades. Perhaps Americans who still see value in a government who has *some* interest in it's people might want to consider moving north. With global warming, even the issue of climate is becoming irrelevant.

Does the new code say anywhere they can't jack up your rates, increase the upfront cost of phones, etc to make up for the lost revenues resulting from the changes?

I haven't read through the whole thing, but probably not. I think it's safe to expect a fair bit of backlash from carriers along those lines. 

Yeah, but the big three could easily jack up prices before December in order to offset losing a year. I think we'll also see better service across the board since providers have additional pressure to maintain loyalty. 

Can't wait to see what new charges The Big Three will come up with to cover the cost of this, because you know it's coming. At least the CRTC is finally doing something.

The issues this code is trying to address are the reasons why I still don't (and never have) owned a mobile phone. The costs are still silly (in particular data) and the contract "fine print" ridiculous. I can't help but think they should just do away with phone subsidies completely.

Anyway, we'll see what the net gain is to the consumer, then maybe (just maybe), I'll consider a mobile. ;)

If that happened guaranteed people would complain about the crazy cost of mobile devices and a lot of people wouldn't be able to afford to buy outright.

I'd bet a large % of people actually think an iPhone costs $199.

The iPhone, and all other mobile phones actually cost less to make than what they charge for them, subsidies or not. It's mark up for profits, that what these manufacturers and retailers are working for.

But I have to say that is a huge win for the consumers in Canada.

Think it going without saying that devices cost much less than the prices that are charged, but where is that not the case with any consumer good?

The issue is that because of subsidies, the price was mostly hidden in monthly statements, and as a result perception of cost is quite skewed.

I personally think it's a good thing to pull subsidy info out of regular carrier costs (similar to what T-Mobile is now doing), but people have to recognise the benefit of subsidies (and by extension contracts). There are many people who simply cannot, or are unwilling to, spend $600+ on a phone as a one-shot purchase.

Most provinces already had regulation limiting carriers from charging ETF fees that were more than the difference in the device subsidy, so in those cases there is nothing new here.

Would this apply to consumers who signed on prior to the Dec. 2 date? Almost all the carriers here in Canada always bring that up, "sorry sir/ma'am this only applies if you signed a contract after this date".

It'll apply to contracts signed on or after December 2nd 2013. It's not something that will be retroactive.

They'll just jack up the up front costs of the phone when you sign a contract so they recover the same subsidy cost in two years instead of 3. Effectively this will be better for the carrier because they will get all their money in 2 years instead of 3 now. I do like though that are getting rid of the ecf administration fees. I think Telus currently charges a 50 dollar admin fee when you cancel. Ridiculous!

The consumer will never see the savings.

It's like when they capped debit card swipe fees in the US, the intent was to limit the cost of taking plastic for merchants, and pass savings to the consumer. The real result? Merchants kept charging the same fees, and banks ended free checking. Who lost? The consumer.

It's a sad reality, but whenever government creates margin through policy, that margin will always be taken by the corporations involved and will never trickle down to the consumer.

I'm not really sure how this changes anything. Currently the balance of my device is amortized over 36 months. I can cancel pretty much any time I want as long as I pay the outstanding balance on my device (and a nominal cancellation fee).

If the CRTC mandates that the device must be amortized over 24 months it just means my monthly bill will increase OR the price of the phone at the beginning will increase.

The only thing this really eliminates is the cancellation fee correct? I don't really see how I'm any farther ahead.

Being able to amortize over two years rather than three provides more flexibility for switching providers, even if you're paying more up-front or per-month. This puts more pressure on carriers to make their plans competitive. The unlocking is also pretty big. I bought five phones outright between Rogers and Bell the other month, and nobody offered me an unlock code. Capping data fee overages is also a pretty big deal, even if the horror stories are exceptions rather than the rule. I agree that this isn't going to change everything overnight, but these are all steps in the right direction as far as I'm concerned. 

Agreed.... capping the roaming data charges is big. One I thing I wish they would do though is make them subsidize equally over the number of years. 600 dollar phone typically goes 549 on 1year,449 on two year or 99 on 3 year. Basically forces the consumer to sign a 3 year. It will be interesting to see what some carriers do with this. All it usually takes is for one of the big three to do away with 3yr contracts on new flagship grade phones and the others will follow. That's what seems to have happened with the tab type contracts where if you cancel all you usually pay is the remaining subsidy instead of an enormous flat cancellation fee.

Fair enough - I actually do completely agree with you about unlocking and caps to the overage fees.

Your points about competition and moving in the right direction are also reasonable and I agree to an extent. I think my real issue is that the average person on the street is reacting to this announcement as if the clouds just opened up and offered them a means of escaping from their carrier after two years without fully paying for their device. In my experience the average person doesn't understand the concept of phone subsidies so they're in turn unreasonably angry when they're unable to walk away from the contract whenever they want free and clear. (I'm excluding those of us on android central etc. of course from that generalization)

People are so frakking stupid. You bitch about contracts, but you don't want pre-paid. Still bitch, they do something to make it better & still complain.

It's like idiots in the U.S. who don't get how T-Mobile US has shaken things up.