Canada’s largest telecom companies must sell access to their wireless networks to some smaller regional providers, the Canadian Radio-television and Telecommunications Commission (CRTC) decided Thursday. It’s a landmark decision meant to boost competition in the sector and make mobile plans more affordable for customers, but it stops short of measures the CRTC was considering that would have granted mobile network operators unconditional access.

Here’s what you need to know: 

The decision: Canada’s Big Three telecom providers—Bell, Rogers and Telus—as well as SaskTel will be required to sell access to their network infrastructure to smaller regional telecoms and to mobile virtual network operators (MVNOs) that invest in infrastructure and spectrum. MVNOs are carriers that offer mobile services but don’t have their own infrastructure. Regional carriers will also be allowed to resell their access to other MVNOs, “which will enable further competition in the marketplace,” the decision reads. The arrangement isn’t meant to be permanent, and expires in seven years. The idea is that MVNOs will have established their own networks by then in a bid to build out Canada’s telecom infrastructure.

The money quote: “While there are encouraging signs that prices are trending downwards, we need to accelerate competition and more affordable options for Canadians,” said CRTC chair and CEO Ian Scott in a statement. “The competitive model we are introducing today will result in greater choice and cheaper mobile wireless services for Canadians, who rely on their smartphones now more than ever.”

What’s it going to cost carriers?: The CRTC isn’t setting a fixed rate for access. Would-be MVNOs will negotiate rates with the large providers. If the parties can’t reach an agreement, they will go to arbitration with the CRTC, and the regulator will rule on the rates. 

How we got here: The decision comes more than two years after the CRTC launched consultations on whether to require Canada’s Big Three telecom firms to sell access to their networks to smaller operators at fixed wholesale rates. The review was primarily meant to address concerns over a lack of competition in the industry and its stifling effect on affordability and choice. The Big Three have contested wholesale price guarantees to MVNOs throughout the process, arguing it would discourage incumbents from investing in infrastructure, and hamper innovation and service quality. 

Why it matters: Canada has some of the highest cellular rates among advanced economies. A 2019 study commissioned by the government found that Canada’s rates were among the highest of all G7 countries and Australia. It also found that prices from smaller regional providers were up to 67.8 per cent lower than those offered by Bell, Telus and Rogers. Following the report, then-innovation minister Navdeep Bains gave the Big Three two years to cut rates by 25 per cent. Concerns over access and affordability have become particularly acute during the pandemic, as people rely more on data for work, school and socializing. 

Who’s affected: The decision affects the national wireless carriers in the areas where they “exercise market power.” Regional providers that already own Tier 4 spectrum or higher are eligible to become MVNOs. “Investment in spectrum demonstrates that a provider is committed to maintaining and expanding its operations, including its networks,” the decision reads. 

More than network access: The CRTC is also requiring the national wireless carriers to implement seamless roaming to help prevent dropped calls and data sessions when customers move from one area to another. And the regulator is requiring Bell, Telus, Rogers and SaskTel to offer low-cost plans to seniors, low-income earners and those who use their cellphones only occasionally “as well as promote them on their websites, in person and over the phone.” 

The reaction: Algis Akstinas, chief executive of Data on Tap—which was approved as a full MVNO in January—said he was disappointed that companies must already own and operate network facilities to be eligible for mandated access. Data on Tap doesn’t, which means it will have to continue to negotiate with regional providers.

“It’s not the full potential we would have expected, or what’s best for competition,” Akstinas said. “It’ll take us a longer time to address the underserved customers we see in Canada.”

Jonathan Holmes, executive director of the Independent Telecommunications Providers Association, said the decision was “a start.”

“But it’s not a major help for small service providers. On that front, we’re a bit disappointed,” he said.

In a statement to The Logic, Telus spokesperson Richard Gilhooley said the company is still reviewing the CRTC’s decision in detail. “We continue to leverage our vast network infrastructure to bridge the digital and socio-economic divides with our low cost, high speed Internet and Mobility for Good programs to support low income Canadian seniors, families, and youth,” he said.

“As we study the decision and consider our options, Bell’s focus remains on serving our wireless customers with a full range of affordable pricing options,” said Bell spokesperson Jacqueline Michelis.

In response to the ruling, Rogers spokesperson Andrew Garas called investment in digital infrastructure “critical,” and said the company is “focused on continuing to deliver affordable options for all Canadians, and building out our 5G network to offer reliable service no matter where they live.”

What’s next? Bell, Rogers, Telus and SaskTel have 90 days to file proposed terms and conditions on the decision to the CRTC. Eligible MVNOs will review the CRTC’s decision and begin negotiating with national providers on rates to access their networks.