Government releases second report tracking 25 percent wireless plan reduction commitment

Midrange plan prices have fallen between 8 to 10 percent mainly due to promotional pricing


The government has released its second quarterly report tracking the progress of its commitment to reduce the cost of wireless plans in the 2GB to 6GB range by 25 percent over the next two years.

The report indicates that midrange plan prices have fallen between 8 to 10 percent in certain provinces over the quarter relative to the benchmark price, mainly due to promotional pricing.

For context, the benchmark price, or the price to which the 25 percent reduction will apply, is based on prices advertised on company websites in early 2020 for post-paid, bring your own device (BYOD), unlimited talk and text 4G/LTE plans in the 2 to 6GB range.

In the majority of provinces, 2GB plan prices have dropped by 10 percent relative to the benchmark price. Prices for 4GB plans have dropped nine percent, while prices for 6GB plans have fallen by eight percent.

“Our government is optimistic that we can continue working with the big three providers to reduce the cost of mid-range wireless services by 25 percent over the next two years. We have begun to see progress in these efforts, and we expect these positive trends will continue,” said Innovation Minister Navdeep Bains in a statement issued to MobileSyrup.

This second quarterly report reveals some progress towards the reduction target goals. It’s also worth noting that some areas don’t offer plans that meet the categories and prices set out in the report.

Further, the report reveals that in the majority of Canadian provinces, the 25 percent reduction target has not yet been met for mid-range plans between June and September.

Prices in Quebec are once again the only exception, as the cost of 2GB plans in the province were already lower than the January 2020 benchmark prices, which was the case in the first report released in July.

The benchmark for 2GB plans is $50, and after the 25 percent reduction, the target is $37.50. 2GB plans from Fido, Koodo and Virgin Mobile in Quebec generally cost $35, indicating that prices in the province already meet the reduction target.

In March, the government detailed the different benchmarks for the mid-range plans. The benchmark for a 2GB plan is $50, and with the 25 percent reduction, it would bring the price down to $37.50 per month. The government says this would save a family of four $12.50 a month, $150 per year and up to $600 overall.

Next, the benchmark for a 4GB plan is $55, and would come down to $41.25 after the reduction. This would save a family of four $13.75 a month, $165 a year, and up to $660 overall.

Lastly, the government outlined that the benchmark for a 6GB plan is $60 and that after the reduction, it would come down to $45 per month. This translates to a family of four saving $15 in a month, $180 a year and up to $720 overall.

Earlier this year, Bains told MobileSyrup in an interview that “if the companies are unable to get to that 25 percent target, we will look at additional regulatory measures. For instance, we will consider how we deploy spectrum or how we assess the roll-out of MVNOs, to drive more competition and in turn reduce prices.”

In a statement, Telus outlined that it is “pleased that the results of the federal government’s second update on its affordability mandate demonstrate that costs are declining for consumers and have been for some time. Telus is proud to offer customers a range of plans across all of our brands that provide connectivity for every budget.”

Further, Rogers said in a statement that “the report shows prices are coming down and we’ll continue to evolve our services to deliver more affordability, value and choice to meet the needs of Canadians. We offer a range of options across our three brands for customers to choose from based on their budget and needs.”

Bell outlined in a statement that “the new report shows significant progress on the industry’s work towards meeting federal targets in a highly competitive marketplace. We’re proud to offer customers a wide range of plans to match every budget across the Bell, Virgin and Lucky Mobile brands.”

Image credit: Innovation, Science and Economic Development Canada