Canada will regulate how much the country’s dominant phone carriers can charge rivals to use their wireless networks as the government seeks to boost competition in the lucrative industry.
BCE Inc., Rogers Communications Inc. and Telus Corp., which together control 90 percent of the market, will be restricted to charging only their costs plus a markup, said the Canadian Radio-television and Telecommunications Commission Tuesday in a ruling. Costs and the markup will be determined in negotiations with the regulator.
Canada, with a population of 35.5 million, has more than 28 million mobile-phone subscribers. The wireless industry generated C$21.2 billion ($17.5 billion) in 2013 revenue, or almost half the total for telecommunications, the CRTC said.
BCE, Rogers and Telus, the only companies with nationwide networks, have until Nov. 4 to come up with a new rate.
“There’s going to be a big fight over how they figure these costs out,” said Benjamin Klass, a communications policy researcher at Carleton University in Ottawa. In the end, it’s unlikely the commission will force rates to go much lower, he said by phone.
Shawn Hall, a Telus spokesman, declined to comment on the decision. Kevin Spafford at Rogers said the company is reviewing the decision and declined to comment further. Mark Langton, a spokesman for BCE, didn’t immediately return a request for comment.
Until then, prices will be fixed at existing rates which the government capped last year. The new regime will be in place for at least five years, the CRTC said.
The changes are designed to make it cheaper for carriers with fewer cell towers to buy access to nationwide networks owned by Telus, BCE and Rogers.
The decision is in line with the federal government’s drive to increase competition and bring down wireless prices for consumers by fostering a fourth national wireless carrier.
“The measures that we are putting in place today in the wireless market will ensure that Canadians continue to have more choice as well as innovative high-quality services,” Jean-Pierre Blais, chairman of the CRTC said.
BCE closed down 0.9 percent to C$53.31 in Toronto on Tuesday, Rogers fell 2.1 percent to C$42.12 and Telus fell 1.9 percent to C$40.86.