incumbent providers’ wholesale customers or MVNO’s (Mobile Virtual Network Operators) (Beaudry, 2014). In addition to having their own network infrastructure, the Big Three are also able to outbid other players in spectrum auctions since they are financially stronger (Beaudry, 2014). Their well-established network and financial strength therefore gives them an added advantage in the marketplace. This can explain why the Big Three have nearly 90.1 percent control over the market share (Urquhart, 2012).
When it comes to services such as buying a car or grocery shopping, Canadians have a variety of options. However, when it comes to picking internet providers, people are short of options. For example, in Vancouver one would be limited to three premium choices, Telus, Shaw and Novus (NewsDesk, 2014). This is very worrying for a liberal pluralist society, especially one as developed as Canada. The lack of consumer choice becomes an even greater problem as the internet encroaches the running of our day to day activities.
Data from comScore shows that “Canada is ranked 3rd behind the United States and the United Kingdom in terms of the number of hours visitors spend online on average every month” (Beaudry, 2014). Online services such as YouTube and Over The Top Services like Netflix have taken over the internet by storm and have been blamed for the sharp increase in bandwidth demands and network congestion (Crawford, 2013). Internet Service Providers have therefore claimed that data caps, a part of their pricing model, are even more necessary than before. They claim that data caps help regulate network congestion and recover the new costs of bandwidth increase (Lyons, 2013). Data caps are limits on bandwidth and depend on the internet plan one chooses. In addition to data caps are surcharges, which are charges for exceeding ones data cap. While it is true that the Internet Service Providers’ are incurring new bandwidth costs, Micheal Geist argues that these costs are disproportionally reflected on the new charges placed on consumers (Geist, 2011). Some of the incumbent providers such as Bell and Telus also offer cable television, which is being threatened by these new online services since people are often using their phones or on their computers. The data caps would therefore limit people’s time on the internet, forcing them to stick to cable television for entertainment purposes. This introduces the anti-competitive nature of Canada’s telecommunications sector. This is one of the biggest challenges facing Canada’s internet industry, and one that is unfavorable in any liberal pluralist community.
The oligopoly of Canada’s telecommunication sector is directly translated into the wireless service. This is because the big companies that control Canada’s media are the same incumbent Internet Service Providers. For a country and economy as big as Canada, only having Telus, Rogers and Bell as the main contenders shows how concentrated the wireless service is. This can be attributed to poor policy making (Centre, 2014). Policies that were set up to protect Canada’s telecommunication industry from foreign involvement and help the country maintain its sovereignty have had the negative effect of discouraging foreign investment (Corkum, 2014). This negatively affects competition because the only companies that would have the network facilities and financial power required to challenge the Big Three would be other large foreign corporations . The Telecommunications act in particular, before amendments in 2012,”precludes foreign takeovers by requiring that carriers have at least 80 percent Canadian ownership and control.” (Corkum, 2014). Some carriers can even be accused of taking steps