Canada’s telecom regulator decided in April 2018 that payphones are not essential, and that because of this the market no longer needs wholesale pricing regulation.
The Canadian Radio-television and Telecommunications Commission (CRTC) has agreed with Bell and Telus that it no longer needs to mandate a special discount for payphone lines in comparison with regular business lines. The Commission ordered a one-year phase-out period for the discounted services.
This comes 20 years after the CRTC decided to open up the payphone market by mandating that Bell and Telus sell payphone lines to smaller competitors for 25 percent less than business lines, a scheme that it hoped would stimulate competition.
Of course, the writing is on the wall for payphones in this wireless era. A CRTC report released last year showed that just 57,542 payphones remained in Canada, a decline of 9,455 from the 66,997 payphones that existed in 2015. Even that number pales in comparison to the days when payphones were broadly in use. For instance, there were 185,000 payphones in operation in 1998.
Payphones still pull in a surprising amount — $22.2 million in 2016. Additionally, as the regulator pointed out, payphones remain important to those with low incomes and socially vulnerable groups such as the homeless.
However, since Bell and Telus own the majority of payphones (Bell had about 45,000 at the end of 2016), the CRTC’s decision shouldn’t drastically impact the payphone market.
There are also still protections in place. Bell and Telus must provide 60 days notice before removing the last payphone from a community or area with no wireless coverage.
Ultimately, though, the CRTC’s decision marks an important moment — the moment that payphones were no longer considered essential.
Source: CRTC Via: Financial Post
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