Industry Committee on March 18th, 2024

[Mirko Bibic]

Yes.

[Ryan Turnbull, Liberal, Whitby, ON]

Mr. Staffieri.

[Tony Staffieri]

Yes, Rogers will do the same.

[Ryan Turnbull, Liberal, Whitby, ON]

Thanks.

You also said that you have made significant increases in investments in infrastructure, which I understand are very large amounts of money and large commitments. Would each one of you do the same, year over year, for the last five years on your infrastructure spends or investments?

I'll accept a nodding of the head if you're willing to do that—I think you probably will be.

That's great. I think that will help inform our committee report here with some facts and evidence.

Mr. Staffieri, I wanted to ask you about the Rogers-Shaw merger. We've heard Conservatives claim over and over again that that merger has increased prices. My understanding is that since that merger happened, prices have fallen and Rogers packages are less expensive. Is that true, Mr. Staffieri?

[Tony Staffieri]

It is very much true. Since we concluded the Shaw merger, prices have come down in both wireless as well as wireline services across the country, but in particular in the west.

[Ryan Turnbull, Liberal, Whitby, ON]

How much have prices fallen since the merger, Mr. Staffieri?

[Tony Staffieri]

If you were to look at wireless pricing—I'll refer back to StatsCan, since it's an official, credible data point—you would see that it's come down 16% in the last year alone for the industry. If you were to look at some of the price plan changes that we made, you'd see that they've been significant. I mentioned the lowering of our 5G wireless entry point down to $50. That's a 40% reduction in terms of an entry to a 5G plan, and our most popular 75-gigabyte plan is down 70% year over year. If you were to look at home Internet services, you'd find that those have come down significantly as well, again, against the backdrop of inflation in other sectors that Canadians are experiencing.

[Ryan Turnbull, Liberal, Whitby, ON]

Thank you.

I understand we've heard testimony time and time again—and I've experienced this in talking to residents in my riding of Whitby—that the average customer does not perceive that their bills and prices—mainly their bills—are coming down as quickly as the data shows. There's a prevalent misperception out there. We know the data from StatsCan is telling us that prices are coming down. The consumer price index shows that lots of prices for almost all goods that Canadians pay for are going up; at the same time wireless prices are coming down. You've said that today. What explains the prevalent misperception out there?

Mr. Entwistle, I'll go to you. Can you explain why Canadians are not recognizing the dramatic price decreases that seem to be the case, the fact?

[Darren Entwistle]

I'd say, first, that I don't think the industry has done a very good job of communicating with the general public in terms of the value that we provide and the cost of the service.

Second, if you mathematically cut the cost in half but the user uses twice as much data as they did historically, the cost is going to look the same to the user from a nominal bill point of view.

Third, as it relates to the device component, that's an area where we do not control the economics. We are price-takers, not price-makers, on that front, and that's a significant component of the overall costs, sometimes making up close to 50% of the overall bill.

I think those three factors have had an impact on Canadian psychology.

The other thing that has not been made clear is that the value that we bring through that increased data is significant. In my remarks, I talked about how our move on technology and our deployment of infrastructure and services has created $77 billion in GDP for Canada alone in just the 2022 year. I think that connecting the dots in terms of the value that this creates for our economy and our society with consumer understanding is something that the industry has not been particularly adept at. It's something that we need to move forward on.

Lastly, we do great things on the affordability front for underserved Canadians—at scale, by the way. There are 1.1 million Canadians—from kids who are aging out of foster care to indigenous women, low-income families, low-income seniors and new immigrants supported by the Canadian government—who have services from Telus that are highly subsidized, below our cost base, to support the affordability agenda. I think we need to do a better job of communicating those things, and that's on us.

[The Chair, Liberal, Joël Lightbound]

Thank you.

Mr. Garon, you have the floor.

[Jean-Denis Garon, Bloc, Mirabel, QC]

Thank you, Mr. Chair.

Mr. Staffieri, I find it very interesting that you told my fellow members that we should compare apples to apples. Our Conservative colleagues have been getting all excited about apples for some time now.

Now I'm going to ask you a question about roaming rates. Earlier, I made the honest mistake of saying that Bell had appealed the arbitration decision on roaming rates with Videotron. It was actually you who appealed the decision. I understand that it's a business decision that raises legal issues and that you don't necessarily want to discuss all those details at committee today.

That said, do you understand that from an outside point of view—from the point of view of consumers, parliamentarians and competitors—this may be perceived as a desire on your part to significantly reduce competition and drive a rival company out of your markets?

[Tony Staffieri]

Respectfully, when it comes to roaming amongst competitors' networks, there's a process in Canada through the CRTC, and we've been going through that process. I think it's important to note that roaming fees have been coming down, but as we made public in our filing when we appealed that decision, having roaming rates that are less than the actual cost of the network—

[Jean-Denis Garon, Bloc, Mirabel, QC]

I understand. However, I'm going to interrupt you, Mr. Staffieri, because I don't have much time left. I don't want you to think I'm being rude.

I'm going to ask you a very factual question: How often does a company the size of yours appeal an arbitration decision like this? How often does that happen?

[Tony Staffieri]

It's important that we preserve the economics of the investment we make, and when there are roaming rates that are decided that are below cost, that goes against a fundamental policy of this government of encouraging facility-based investment.

[Jean-Denis Garon, Bloc, Mirabel, QC]

With all due respect, Mr. Staffieri, I have to interrupt you again because we have 30 seconds left.

I will repeat my question. By definition, an arbitration decision is not appealed. It must be a very unusual practice. Does it often happen that a company the size of yours appeals an arbitration decision? Please answer yes or no.

[Tony Staffieri]

We appealed the decision in this case because the result just did not make economic sense for Rogers and for the industry long term. A competitor is more than welcome to invest in their own network in the event that they're not happy with the decision on roaming.

[The Chair, Liberal, Joël Lightbound]

Thank you, Mr. Garon and Mr. Staffieri.

Mr. Masse, you have the floor.

[Brian Masse, NDP, Windsor West, ON]

Thank you, Mr. Chair.

Well, let's talk about economic sense here, Mr. Staffieri. Twelve dollars per day is what you charge people to have access to their phone when they go into the United States. If you turn the phone on and it's not in airplane mode, you get that charge right away. Then, later on, if you find out, you can actually get a monthly plan at $25.

How do you justify charging people $12 per day just to turn on their phone to be accessed when they go into the United States, especially when we have so many families that have to cross over for health and medical reasons? Without even giving them a chance to say yes or no, you charge them $12. Why is it $12 per day just to have your phone on to get a text in the United States?

[Tony Staffieri]

We have plans depending on how the customer intends to use it, and if the customer is an infrequent user, then we look at coming up with a price point that takes into account [Inaudible—Editor]

[Brian Masse, NDP, Windsor West, ON]

I'm telling you right now, my wife, my partner, has had this happen, where she turned on her phone and it charged $12, no matter what, right away. How do you explain $12 just to turn on your phone? This is what happens every day. We have doctors, nurses and others who commute into Detroit, thousands of people every single day. How do you justify $12 just to turn on your phone? Meanwhile, if you want to pay $25 per month, you have that. But imagine paying $12 times 30—which, by the way, is never advertised, you have to go into the store and find that out—versus the $25.

[Tony Staffieri]

Our pricing plans are clearly promoted and advertised on our websites, and our in-store reps are very transparent about the options with respect to roaming outside Canada.

[Brian Masse, NDP, Windsor West, ON]

Your in-store reps are, but after you have actually been taken to the wood-house, so to speak, after years. Also, if you just turn on your phone, you're charged 12 bucks just to get an emergency call. How do you justify that?

[Tony Staffieri]

The pricing of our roaming plans, both in the U.S. and internationally, is based on a number of factors, including the cost of that, which is beyond our control, as we buy roaming minutes and data buckets from the operators in the various countries.

[Brian Masse, NDP, Windsor West, ON]

Yes, but you don't go back and rebate people for having a phone on for emergency and never using it. You just take the $12 and you run with it. That's the problem here. It's about fairness.

[The Chair, Liberal, Joël Lightbound]

Thank you, Mr. Masse.

Mr. Généreux, you have the floor.