Industry Committee on March 18th, 2024

[Tony Staffieri]

—and you'll see in our annual disclosure that we are on track to meet—

[Rick Perkins, Conservative, South Shore—St. Margarets, NS]

You won't answer the question. I'm going to move on then.

You also brag in your analysts' reports, your investor relations reports and your quarterly reports to shareholders about your average revenue per user going up every year. That's why Canadians feel they're paying more, because you're charging them more.

Can you comment about why you brag to your investors about the average cost per user going up while here you make claims about your Black Friday sale being what we should judge you by on your cellphone rates?

[Tony Staffieri]

It's important to clarify at the outset that average revenue per user does not equal price. RPU, or average revenue per user, is an accounting metric that is total revenue divided by number of customers, and it includes services—

[Rick Perkins, Conservative, South Shore—St. Margarets, NS]

We can do math.

[Tony Staffieri]

—that the customer can choose to add on, like device protection. It also—

[Rick Perkins, Conservative, South Shore—St. Margarets, NS]

Yours has gone up from $50.75 in 2020 to almost $60 now in only four years.

I will ask you again: Isn't that why Canadians feel that their prices are going up and they're paying more, not less?

[Tony Staffieri]

As I said, the calculation of RPU includes additional services, but it also includes enterprise revenues like Tesla, which is one of our customers, so the revenues from there are included in the total revenues. You have those business accounts, which have been growing for us, that have been supporting some of the increase that you see in RPU.

[Rick Perkins, Conservative, South Shore—St. Margarets, NS]

Mr. Entwistle, I have a question for you.

The carbon tax is going up 23% on April 1. You run, as Rogers and Bell do, quite large retail networks and quite large fleets to manage all of your businesses. You also have to maintain diesel fuel for your cellphone towers being brought up. Is the 23% increase in the carbon tax going to result in increased costs for cellphone rates and wire line users?

[Darren Entwistle]

I don't envisage that particular cost flowing through to cellphone users.

Second, Telus is an organization that leverages our technology to bridge time and distance and reduce the carbon footprint. Our goal is to be not just carbon neutral but nature created by 2027.

[Rick Perkins, Conservative, South Shore—St. Margarets, NS]

So you're going to be altruistic and eat those costs. You don't pass on increased taxes to your customers.

[Darren Entwistle]

I think, as an industry, that we've shown ourselves to be significantly proficient at eating costs.

Again, if you go back to my remarks, compared to the G7 plus Australia, costs—

[Rick Perkins, Conservative, South Shore—St. Margarets, NS]

I can see that, Mr. Entwistle. With the 60% operating gross margin, you're very generous on your eating of costs.

I have a quick question for Mr. Staffieri, please.

[Darren Entwistle]

I would like to highlight that is not our operating margin. That's an—

[Rick Perkins, Conservative, South Shore—St. Margarets, NS]

Mr. Staffieri, you claim that you have lower prices than the United States. I think your all-in, North American plan standard, not Black Friday sale, is $125 for a single line to have unlimited data and text for North America. I have here a friend's bill who gets five lines in the United States, everything around the world included for those five lines, and it costs $280. Now, that's a family plan. On an individual plan, I have a friend who went across to Rochester, not far from Ottawa, and paid $60 for the same global plan.

You're charging twice as much as I can get from AT&T in the United States, which is not a small company. How can you claim that your rates are lower when AT&T is charging half of what you are?

[Tony Staffieri]

I think it's important that we stick to the facts and that we compare apples to apples, not apples to oranges. In your example, you took a single line and compared it to an AT&T customer with five lines.

What you'll find, and the data is very clear, is that ISED's own study showed that Canadian prices in virtually every bucket were 25% lower in Canada than in the U.S.

Again, I refer you to the information that Rogers submitted to this committee showing very clear comparisons of Canadian to U.S. pricing.

[The Chair, Liberal, Joël Lightbound]

Thank you.

I give the floor to Mr. Turnbull for five minutes.

[Ryan Turnbull, Liberal, Whitby, ON]

Thanks, Chair.

Thanks to the witnesses for being here today.

What spurred this study on was that Rogers announced a seven-to-nine dollar increase for customers who were rolling off contract, and the Conservatives jumped on this as an opportunity to claim that cellphone prices were increasing when we know from Stats Canada—and with your testimony today it has been corroborated—that those prices on average are actually decreasing.

What is useful to me in this conversation is to be informed by facts and evidence. I want to ask each one of the witnesses if they would table for the committee information that backs up the claim they've made today, which is that their basic plans are decreasing in price.

Mr. Staffieri, would you table documents with this committee that demonstrate a year-over-year downward trend in the prices for your plans from 10 gigabytes to 60 gigabytes over the last five to seven years?

[Tony Staffieri]

Rogers would be pleased to provide the factual data on our price plan changes to demonstrate price declines.

[Ryan Turnbull, Liberal, Whitby, ON]

Thank you.

Mr. Bibic, would you be willing to do the same on behalf of Bell?

[Mirko Bibic]

Yes, absolutely.

[Ryan Turnbull, Liberal, Whitby, ON]

Mr. Entwistle, would you be willing to do the same on behalf of Telus?

[Darren Entwistle]

Yes, we would be pleased to do so—both our information and also third party independent assessments.

[Ryan Turnbull, Liberal, Whitby, ON]

Thanks.

If possible, it would be great to have an average price per gigabyte year over year, which I think is probably a useful measure to show that downward trend as well.

Can you also table data on the rate at which users are consuming data today? I understand from some of your testimony that the consumption rate of data is increasing quite dramatically as well—I think someone said up to 200%—which may explain some of the misperceptions that are out there when we factor in prices of basic packages versus what bills people pay. Would each one of you be willing to table any data you have on the increased rate of data consumption?

Mr. Entwistle.

[Darren Entwistle]

Yes, we'll table again our information plus independent third party information as it relates to data consumption, and do it on a relative basis to show Canada versus other G7 countries.

[Ryan Turnbull, Liberal, Whitby, ON]

Thank you.

Mr. Bibic, would you do the same?