Canadian consumers pay the price for Cabinet decision on internet rates

No action or accountability over anti-consumer CRTC decision that hikes prices and kills competition

CHATHAM, ON, May 27, 2022 /CNW/ - TekSavvy Solutions Inc. ("TekSavvy") said yesterday's decision by the federal Cabinet endorsed higher internet prices and misconduct by the head of the CRTC, amounting to a big loss for consumers and competition in general.

Cabinet proposed a new policy direction that, if adopted, may encourage the CRTC to promote competition in the future. But in doing so, it rejected an appeal by TekSavvy and other competitors that would have immediately put in place lower rates set in 2019, which the CRTC later arbitrarily reversed.

"The federal government says its proposed policy direction is a win for consumers and smaller ISPs, but it is not," said TekSavvy spokesperson Peter Nowak "Instead of immediately lowering prices by overturning a bad CRTC decision, it is asking us to hold out hope that the CRTC will do better in the future. This lack of action and faith-based policy approach is why competitors will continue to exit the market and Canadians will continue to pay some of the highest telecom prices in the world."

Cabinet's approval of the CRTC's reversal maintains higher prices for consumers and transfers hundreds of millions of dollars from smaller competitors to former monopolies such as Bell, while crushing their ability to compete moving forward. Bell recently bought EBOX, the then-largest independent competitor in Quebec.

The Cabinet also ignored photographic evidence of misconduct by CRTC Chair Ian Scott. Mr. Scott was photographed in a private "one on one" meeting with Mirko Bibic, the chief executive of Bell, at an Ottawa bar just one week after Bell filed an appeal to the CRTC concerning wholesale internet rates. The CRTC then arbitrarily reversed its own rate decision, resulting in higher internet prices for millions of Canadians throughout the COVID-19 pandemic.

In its appeal, TekSavvy submitted that Mr. Scott is clearly offside the standards required by the Cabinet for its appointees, as confirmed by Cabinet's termination of one CRTC Commissioner's appointment for far less egregious conduct in 2017. In addition, Mr. Scott is currently under investigation by the Conflicts of Interest and Ethics Commissioner.  None of this apparently bothered the Cabinet enough to do the right thing for Canadian internet users.

Yesterday's decision does nothing to stem those higher costs and more competitors are likely to exit the market, leaving Canada's biggest telecom companies free to continue raising prices.

About TekSavvy

Based in Chatham, Ontario, TekSavvy is Canada's largest independent telecom service company. TekSavvy has been proudly delivering award-winning services and fighting for consumers' rights for more than 20 years. TekSavvy is committed to providing quality competitive choice and closing Canada's digital divide.

SOURCE TekSavvy Solutions Inc.

Trevor Campbell, The iPR Group, 647-201-5409; John Settino, The iPR Group, 416-662-2955; [email protected]