The Canadian iPhone Conundrum
NEWS FLASH: Rogers caves to complaints, unveils new 3G data rates
I’ve been watching the online rancor build about Rogers‘ outrageous voice/data packages linked to the iPhone. The fact is that wireless has been the easiest and best way to bilk extra money from Canadians. We Canucks seem quite content to pay a sh*tload for our little portable talking sticks.
How did we get here? I used to work with a local community television station (which until a territorial agreement was struck between competitor Shaw Cable that effectively split Canada between 2 corporations for all wired TV service) that was run by Rogers. In 1987, I attended an event downtown featuring billionaire Ted Rogers as he announced CanTel, the company which was eventually renamed Rogers Wireless. Hard to believe that it has only been 21 years since wireless phones became the mainstream consumer device we cannot live without today.
[iPhone] is more like an expensive sex toy that you can whip out in public and not have anyone call the cops. Au contraire, you’ll attract an audience.
Competitors crept into the market, temporarily knocking Rogers off of its gross market share, and costly talk plans. Minor companies such as Fido arrived in the Canadian marketplace. For a time Rogers even offered “per second” billing before moving back to the more profitable “per minute” billing. Today, Fido is owned by Rogers, and all minor players in the Canadian cellular phone service marketplace are owned by one of three providers: Rogers, Bell, and Telus Mobility.
Canadians, who by and large suffer large monopolies, such as in banking and telecommunications, have had little choice but to accept high fees for products and services when compared to the neighbouring USA, or other markets abroad. Policies used to protect consumers from foreign invaders serve to plump up the profits of a handful of very large corporations.
Fast forward to July 11, 2008, the release date of Apple’s innovative iPhone 3G in Canada, the first time this product has been legitimately available north of the 49th parallel. Few technological gadgets have prompted more drooling by adults than the iPhone. It is a indeed the Swiss Army Knife of portable communications. It’s more than a phone or a music playing device, it is more like an expensive sex toy that you can whip out in public and not have anyone call the cops. Au contraire, you’ll attract an audience.
As a Rogers mobility customer for a decade, I’m utterly torn by their iPhone pricing scam, and I expect the company is aware that this is the case. Right now I have a pretty healthy 500 minutes of monthly talk time that suits my needs, with a modest data package to use Gmail Mobile. My bills are just over $60/monthly including all the hefty taxes. It’s not exactly cheap, but I can afford it.
If I get an iPhone, I get a fraction of that talk time for the same price, and an insufficient allotment of data usage. The iPhone’s full blown browsing, email and map search capabilities will easily drain even healthy mobile data plans, dumbing down one of the most important applications of the device. You might own a new iPhone, but you don’t dare show what it can really do unless you want to own a 2nd mortgage.
Rogers completely underestimated the backlash to their miserly iPhone plans, but they won’t back down. Their 2008 profit projections depend upon their monopoly ownership of the rights to sell the iPhone, and Canadians willingness to endure the financial pain required to keep them on.
Inevitably prices will fall, and the groaning will cease. The shame of this is that if we only made innovative communications tools more affordable it would surely make our country a leader in developing technology, and provide a much needed boost to our economic productivity.
UPDATE: Apple allegedly sanctioning Rogers for iPhone rates
