Time for a rant.

I love Canada.  Really, I do.  I think it's the greatest place in the world to live.  However, I'm not delusional.  Canada does have its share of short comings.  I'm not talking about the crazy winters or the seperatists in Quebec.  No, I'm talking about cell phones.

For those of you who are not familiar with the Canadian mobile phone landscape, there are basically three service providers: Telus, Bell, and Rogers.  (I won't include Fido because it is part of Rogers, and Koodo is part of Telus.)  Other lesser players include Virgin Mobile and Solo, which basically buy capacity from and operate on Bell's network.  Only Rogers & Fido operate on the GSM standard.  All the others use CDMA.

This limited number of carriers has meant that Canadians have been paying too much for mobile phone service.  It's Economics 101: when you have an oligopoly (a market dominated by a few sellers), the lack of competition generally results in higher prices and a lack of innovation.  This is particularly true in Canada where within the oligopoly, Rogers is the only carrier to have a GSM network.  This means that cell phone manufacturers that want to sell their GSM phones in Canada, such as Nokia or Sony Ericsson, either have to work exclusively with Rogers, or adapt their models to work on CDMA networks.  Some, like Motorola and RIM, have chosen to do work with all carriers.  It also means that, with the exception of RIM, most manufacturers bring their phones to Canada much later than they do to countries in Asia and Europe.  For example, the Sony Ericsson phone I came back to Toronto with in 2005 was introduced in Canada in 2006, or about 18 months after I got it in Taiwan.

Where am I going with this?  You'll see.

Enter the Apple iPhone!

Steve Jobs annouced that the new 3G iPhone would be sold in a number of countries around the world, including Canada, starting July 11, 2008.  People got excited!  Finally, a state of the art phone is coming to Canada!  It didn't surprise anyone that Rogers got the phone since it has the only network that can support the iPhone.  But what did shock people were the price plans and the contracts.  I won't go into details, but basically if you want an iPhone, you have to sign a THREE-year contract with Rogers for monthly service that starts at $60/month.  However, if you add in the "System Access Fee", taxes, and basic features like call display, you're looking at close to $100/month for three years.  There is no other option.  If you want an iPhone, you're stuck with Rogers for 36 months, and if you cancel the service early, you get hit with a cancelation penalty of up to $400.  The clincher is that none of the Rogers service plans include unlimited data plans, unlike in other places, so if you're not careful with your iPhone, you could end up paying a whole lot more.  Oh the joys of having a monopoly! 

So if you're set on an iPhone, have fun with your long term relationship with Ted.

What do you do if you're mad as hell at this injustice?  Do what 50,000 other people have done: sign an online petition that Rogers seems to be unphased by and unconcerned with.

An alternative: switch to another carrier.  Bell and Telus are trying to compete with the iPhone by introducing alternatives, like the Samsung Instinct and the HTC Diamond.  They are even offering unlimited data plans.  But watch out for the fine print.  Bell's SAF is almost $9/month, and today Bell & Telus announced that they would be charging for incoming text messages.

What about Virgin?  Solo?  Koodoo?  Sure, you can go with them if all you want is a basic cell phone.  But if you want a Blackberry or iPhone or equivalent, you're stuck with the big three and their outrageous fees.

So why do I care?  Because three year bond to Rogers is almost up and I'm thinking about what to do next.  Do I tie myself to Rogers for another three years just to get a discount on a new phone?  I think not.  I'm going to wait and see what happens with the spectrum auction that's been going on here in Canada.  In theory, new entrants will come into the cell phone market meaning more competitors, which means prices will come down.  Again, this is in theory.  The new entrants will want to differentiate themselves from the existing players, and will likely be aggressive in their efforts to attract customers (read: steal) to their company.  The big players will have to respond.  Or maybe they won't.  It all remains to be seen.

For now, I'm just curious to see if the rumours are true: Did Apple give Rogers a slap on the wrist and limit the number of iPhones to Canada in time for the launch on Friday?  Curious minds want to know.  I want to know!