ARCHIVED - Transcript, Hearing February 6, 2017

Attendees and Location

Held at:

Terrasses de la Chaudière
Gatineau, Quebec
C.R.T.C.
Commission Headquarters

Attendees:

• Chairman: Jean-Pierre Blais
  
• Vice-Chairperson, Telecommunications: Peter Menzies
  
• Commissioner: Christopher MacDonald
  
• Legal Advisors: Adam Balkovec, Megan Maloney
  
• Secretary: Lynda Roy
  
• Hearing Manager: Meghan Wawryk
  

Transcript

Gatineau, Quebec

--- Upon commencing on Monday, February 6, 2017 at 9:01 a.m.

1 LE PRÉSIDENT: À l’ordre, s'il vous plaît. Order, please.

2 Alors, bonjour, mesdames et messieurs, et bienvenue à cette audience publique qui se déroule du 6 au 9 février.

3 Tout d’abord, je tiens à souligner que la rencontre d’aujourd’hui se tient sur les terres ancestrales des Premières Nations. Je les remercie et rends hommage à leurs Aînés.

4 On peut difficilement exagérer l’importance des services sans fil pour les Canadiens. Les services sans fil de téléphonie et de données mobiles améliorent la qualité de vie des citoyens, des créateurs et des consommateurs canadiens.

5 En effet, les Canadiens utilisent ces services pour toutes sortes d’activités: trouver un emploi, mener des activités, se tenir au courant des événements de l’actualité, suivre et utiliser les médias sociaux et, bien sûr, pour se garder en contact avec leur famille et leurs amis.

6 The Wireless Code was originally created three years ago in response to significant concerns brought forth by individuals, consumer groups and

7 wireless service providers regarding the clarity of contracts for mobile wireless services.

8 One of the principal objectives was to make it easier for individuals and small business owners to obtain information about their wireless contracts, and their associated rights and responsibilities as mobile

9 customers.

10 The Code addresses things like limiting early cancellation fees to enable consumers to take advantage of competitive offers at least every two years, requiring trial periods for wireless contracts, and setting default caps on international data roaming and data overage charges.

11 Le Code établit aussi des normes relativement au comportement de l’industrie en vue de contribuer à l’instauration d’un marché plus dynamique.

12 Depuis l’entrée en vigueur du Code, des services sans fil sont devenus les principaux services de téléphonie des Canadiens. La couverture LTE permet de desservir actuellement plus de 97 pour cent de la population.

13 L’importance et l’utilisation des données sans fil a augmenté. Plus de 22 millions de Canadiens ont maintenant des forfaits de données sans fil, comparativement à 13,2 millions en 2011.

14 Nous le savons parce que le Conseil a réalisé une recherche sur l’incidence qu’a eue le Code sur les services sans fil pour les Canadiens depuis son entrée en vigueur.

15 Nous savons aussi que les dépenses moyennes mensuelles des ménages consacrées aux services de communication ont continué d’augmenter et que les services sans fil comptent pour la majorité de ces dépenses.

16 It appears clear at that time -- it appeared clear at that time that the wireless landscape would change significantly over three years through developments in technology, the economy, and the marketplace, which would require a re-examination of the Code.

17 The Commission committed to review the Wireless Code’s effectiveness within three years of its implementation as it would allow enough time to, first, monitor compliance with the Code; second, collect data about the Code’s effectiveness; and third, identify and correct any issues that may have developed during the implementation process.

18 So here we are, three years later doing precisely that.

19 Based on the Commissioner for Complaints for Telecommunications Services, the CCTS, annual reports, wireless complaints have decreased since the

20 Code was first created. However, wireless services remain the most complained about communications service.

21 We also heard from Canadians who participated in an online discussion forum last fall or submitted interventions to this proceeding about whether they think the Code is working for them. Here's some examples.

22 On the overall effectiveness of the Code, Jacob Dagenais, intervention number 53, stated, and I quote:

23 "I believe the wireless code of conduct has done well in ensuring Canadians know what to expect from carriers."

24 Mr. Dagenais went on to say that he would like to see changes overall to the Code to make it even more effective for consumers.

25 Similarly, Philippe Léveillé, intervention number 80, stated, et je cite:

26 "Je crois que le Code a permis de résoudre des manquements dans le marché des télécommunications sans fil, en particulier en ce qui concerne les frais d’annulation et la clarté des contrats de service. Mais le Code ne va pas assez loin."

27 There were also some concerns and frustrations expressed by Canadians such as by Gordon Graff, intervention number 81, quote:

28 "What is of great concern to me is whom do the cell phone companies contact in case of overages. In some cases, the companies allow CHILDREN [in capital letters] to make financial decisions, which could greatly impact hard working families."

29 Le choix des Canadiens dont nous discutons à l’audience repose sur les observations comme celles-ci et sur les rétroactions que nous avons reçues des

30 Canadiens, de l’industrie et des groupes de consommateurs depuis l’entrée en vigueur du Code.

31 Les Canadiens ont une place importante dans cette instance. Votre apport est précieux pour nous.

32 This proceeding provides another opportunity for Canadians to engage with the Commission on how the Wireless Code is working for them. Your

33 feedback will help us make informed decisions relating to any changes or amendments to the Code going forward, to ensure it continues to be effective today and in the future.

34 We must be forward-looking if the Code is to remain relevant, so we are listening.

35 You can participate by taking part in our online discussion forum launched this morning. It will run from February 6^th to February 14^th, 2017 and you can log on to our website at www.crtc.gc.ca.

36 The purpose of this proceeding is to ensure the Code continues to effectively meet its objectives through: first, reducing the risk of bill shock; second, eliminating barriers to switching service providers so consumers can take advantage of competitive offers; and third, improving contract clarity so Canadians can make informed choices about their wireless services.

37 Je tiens à remercier les personnes qui ont pris le temps de participer, celles qui interviendront lors de cette semaine, et celles qui participeront à distance.

38 Deux cent deux (202) parties ont participé à ce jour, dont des particuliers, des fournisseurs de services mobiles, des groupes de défense des consommateurs, des groupes qui militent pour l’accessibilité, des étudiants et des professeurs d’universités, ainsi que le Commissaire aux plaintes relatives aux services de télécommunications.

39 Avant de commencer, j’aimerais faire quelques présentations.

40 Le Comité d’audition se compose des personnes suivantes: à ma droite, monsieur Peter Menzies, vice-président des télécommunications au CRTC; à ma gauche, monsieur Chris MacDonald, conseiller de la région de l’Atlantique et du Nunavut; et moi-même, Jean-Pierre Blais, président du CRTC et je présiderai l’audience.

41 The Commission team assisting us includes: Meghan Wawryk, Hearing Manager; Adam Balkovec and Megan Maloney, Legal Counsel; Lynda Roy, Hearing Secretary.

42 Before we begin, I would like to invite Ms. Roy to explain the procedures we will be following.

43 Alors, Madame la secrétaire, s'il vous plaît.

44 LA SECRÉTAIRE: Merci, Monsieur le président. Bienvenue à tous. Welcome to all.

45 Before we start, I would like to go over a few housekeeping matters to ensure the proper conduct of the hearing.

46 When you are in the hearing room, we would ask that you please off your smartphones as they can cause interference on the internal communication systems used by our translators and court reporter.

47 We would appreciate your cooperation in this regard throughout the hearing.

48 Interpretation services will be available throughout the duration of the hearing. We would like to remind participants that during their oral presentations, they should provide for a reasonable delay for the interpretation while respecting their allocated presentation time.

49 Le service d'interprétation simultanée est disponible durant cette audience. Nous désirons rappeler aux participants d'allouer un temps raisonnable pour la traduction lors de leur présentation à vive voix tout en respectant le temps alloué pour leur présentation.

50 Please note that the Commission will also be tweeting the documents during the hearing at @crtchearings using the hashtag #crtc.

51 Veuillez noter que les documents seront disponibles sur Twitter sur le compte du Conseil à @crtcaudiences, au pluriel, en utilisant le mot-clic #crtc.

52 There is a verbatim transcript of this hearing being taken by the court reporter sitting at the table to my right. Please note that the transcript of each day will be posted on the Commission's website the following business day.

53 Just a reminder, that pursuant to section 41 of the Rules of Practice and Procedures, you may not submit evidence at the hearing unless it supports statements that you have already made on the public record. If you wish to introduce new evidence as an exception to this rule, you must ask permission of the Panel of the hearing before you do so.

54 Please note that if parties undertake to file information with the Commission in response to questioning by the Panel, these undertakings will be confirmed on the record through the transcript of the hearing. If necessary, parties may speak with Commission legal counsel at the break following their presentation to confirm these undertakings.

55 And now, Mr. Chairman, we'll begin with the presentation by the Coalition, composed of the Consumers' Association of Canada, Counsel of Senior Citizens' organizations of British Columbia, National Pensioner Federation, and Public Interest Advocacy Centre.

56 Please introduce yourselves for the record, and you will have 20 minutes for your presentations.

PRESENTATION

57 MR. LAWFORD: Thank you, Madam Secretary.

58 Good morning Mr. Chairman, Mr. Vice-Chairman, Commissioner MacDonald.

59 My name is John Lawford, and I am Executive Director and General Counsel at PIAC, and counsel to the Coalition.

60 The Coalition is an association of four public interest and consumer groups: the Consumers' Association of Canada, the Council of Senior Citizens' Organizations of British Columbia, National Pensioners Federation, and the Public Interest Advocacy Centre, formed for the purpose of this proceeding.

61 With me today is Alysia Lau, PIAC Legal Counsel, and Ben Segel-Brown, my articling student.

62 This is a proud and happy moment for the Coalition. We love the Wireless Code. We thank the Commission for creating it, and we are here to make sure it continues to help consumers for years to come.

63 Think back to five years ago, a Wireless Code was an impossibility. Almost four years ago, the decision, a new hope; three years ago, full implementation of the Code and the court battle; and since, wireless companies -- wireless complaints have dropped, excuse me, because the Code has made the market change. The Code has removed long-time consumer irritants like unknowable, intimidating termination charges, lengthy three year contracts, massive data and roaming bills, and impossible to read terms and conditions. How far we've come.

64 The Wireless Code also has made it easier for consumers to switch providers at all stages of the contract. The 2016 Wireless Code Public Opinion Research shows that 79 percent of consumers found it easy to switch providers. That is a staggeringly good statistic.

65 However, there is more to be done. The world moves on and the Code must adapt to protect consumers in new ways. And there is some defence to be played. Certain wireless service providers have actively or passively, knowingly or unknowingly, avoided or violated or attempted to change clear Wireless Code requirements, and have not largely been stopped. This must change, and our remarks focus on those needed changes.

66 But make no mistake; the Code has done great things for wireless consumers.

67 Alysia?

68 MS. LAU: The Wireless Code should continue to protect consumers from bill shock. As the Commission rightly pointed out in its most recent Communications Monitoring Report, it is all about the data. Three quarters of wireless subscribers have a data plan and wireless data usage grew 44 percent from 2014 to 2015 alone.

69 According to the Wireless Code Public Opinion Research, overall bill shock has declined slightly over the last two years. However, almost half of Canadians cited data overage fees as the main reason for bill shock. Eighty-three (83) percent also said they use Wi‑Fi when available instead of wireless data in order to manage their data use.

70 This means at least two things: One, data is now central to a consumer's wireless subscription. It is a key term of the contract, not just an option or add-on.

71 And two, the Wireless Code needs to have built-in protections from data bill shock which benefit the consumer first. This would promote the Wireless Code objectives of making it easier for customers to obtain and understand information, and to establish consumer-friendly business practices.

72 Some wireless providers have treated data limits in a customer's monthly plan as an add‑on or optional service rather than a key term in a wireless service contract. Some even consider voice as an add‑on.

73 In our view, treating core data and voice as optional services is not only vastly inappropriate and skewed against the consumer, but clearly contradicts the spirit and letter of the Wireless Code, which specifies that the key contract terms and conditions consist of:

74 "The services included in the contract and any limits on the use of those services that could trigger overage charges or additional fees."

75 Data and voice services clearly form part of the key terms of a wireless contract. Optional services are already clearly defined in the Code and apply to cases where a customer decides to subscribe to data as a true add‑on.

76 The Wireless Code also needs to have built-in protections from data bill shock. First, the Commission should maintain the $50 and the $100 data overage suspension caps, which apply to all wireless data subscriptions, not just phone plans.

77 Individuals in this proceeding generally did not complain about losing access to data or being disrupted by the cap. Rather, some individuals thought the cap should be set at zero dollars so that they did not incur any overage fees at all.

78 One of the most prominent issues raised in this proceeding has been family share plans and bill shock. The Wireless Code Public Opinion Research shows a higher percentage of subscribers to shared data plans tend to experience bill shock compared to those subscribed to individual plans, 28 percent versus 19 percent. Share plan subscribers also generally find it more difficult to manage data usage.

79 These challenges are not necessarily made easier by wireless providers. The CCTS has identified multiple cases where service providers apply the suspension caps in ways not favourable or beneficial to their customers.

80 Therefore, the Commission should address these challenges by making the following determinations:

81 One, the data suspension caps apply per subscriber account, not per device activated on the account; and once data usage is suspended by the cap, consent must be obtained from the account holder, not from individual device users, to permit further data usage, unless those devices are expressly designated by the account holder in advance.

82 Some parties have also suggested the cap should not apply where a customer who exceeds their original data limit is upgraded to the next tier or data bucket, common with so-called flex plans. We disagree.

83 The suspension cap allows a customer to understand when they would be charged $50 for data in addition to their minimum monthly charge. It gives customers control over any additional data for which the customer is charged beyond their original package.

84 Notification and the suspension caps also work hand-in‑hand. Updated notification rules should be included in the Wireless Code.

85 Finally, we urge the Commission to explore ways in which wireless data usage can be independently and accurately measured.

86 Ben?

87 MR. SEGEL-BROWN: A second key benefit of the Wireless Code is that it has made it easier to switch providers. The Code limited cancellation fees, gave consumers a trial period so they could try other providers, and required service providers to unlock devices.

88 Today, our comments will focus on two proposals made by service providers which would undermine these rights. We would also like to identify two adjustments, which need to be made to these rights so consumers can continue to enjoy them for years to come.

89 Service providers have made two novel proposals which would make switching more expensive, hurting consumers and competition.

90 The first proposal would allow companies to include the cost of inducements in the early cancellation fee. However, including inducements in the early cancellation fee would make it more expensive to switch providers, more difficult to calculate the early cancellation fee, and more difficult to compare offerings.

91 The value of inducements can be artificially inflated. Service providers could inflate the value of inducements by offering overpriced accessories, promotional pricing, or free trial subscriptions.

92 For example, suppose a carrier gives out free headphones which theoretically retail for $200, but the carrier – but only cost the carrier $50.

93 If the customer needs to leave after a year, they will have to pay $100 extra, creating a substantial barrier to switching and a windfall for the carrier.

94 The second proposal allows service providers to charge a nominal re-stocking fee to customers who return devices during their trial period.

95 Consumers generally return devices because they’re disappointed with their device or coverage.

96 Restocking fees would punish customers who receive unsuitable devices or don’t have coverage where it is promised.

97 CCTS data suggests there are real problems with devices and coverage, with hundreds of complaints about intermittent or inadequate service.

98 If the Commission is concerned about trial period abuse and re-stocking fees are allowed, such fees would have to be made clear in advance and limited to a low dollar amount. We suggest a maximum of $10.

99 The Commission should also address two current practices which undermine the rights set out in the Code making it harder for consumers to switch providers, specifically making unlocking expensive and setting unreasonable limits on trial periods.

100 Device locking makes it more expensive and onerous for customers to switch to other providers. In addition to adding an extra arbitrary expense when leaving a provider, device locking limits customers’ ability to use foreign SIM cards instead of roaming and customers’ ability to resell their used phone.

101 Locking does not have to be the norm. Japanese regulators ordered all wireless carriers to unlock phones upon request at no cost in 2015.

102 The initial Wireless Code required service providers to provide unlocking to customers who request it, but didn’t limit the unlocking fee. Unfortunately, this has now been used to disadvantage consumers. Service providers continue to charge unreasonably high unlocking fees, usually $50, to deter switching.

103 The Commission should require service providers to unlock devices for free once the consumer has paid for their device, whether through upfront payment, completion of a contract, or payment of the early cancellation fee.

104 Where a customer has not paid off their subsidy, unlocking should be available for a reasonable fixed fee, which the Commission should mandate and which should be considerably less than $50.

105 Another practice which is undermining the Code’s switching rights is setting unreasonably low trial usage limits to effectively void the trial period.

106 Consumers are not always informed of the trial period. The studies submitted by Pavlovic and Union des consommateurs confirm this.

107 Consumers who attempt to return devices are caught off guard by time and usage limits, leaving them trapped with a defective device, deficient coverage, or plans which don’t meet their needs.

108 The CCTS noted some customers may not even receive key documents describing the trial limits within the 15 day trial period.

109 What actually happens is that consumers port their number to the new device and use at least as much data as they normally use.

110 Assuming they accurately predicted their own usage, a user with a 5 GB data plan would probably exceed Bell and TELUS’s 50 MB caps in a few hours.

111 At average speeds on Bell and TELUS’s LTE networks, a user could exceed that usage limit in fifteen seconds.

112 We therefore support the Union des consommateurs’ proposal to fix the usage limits for trial periods at half the subscriber’s monthly usage limit.

113 MR. LAWFORD: Awareness of the Wireless Code is important for a few reasons.

114 Awareness helps consumers negotiate fair resolutions to disputes directly with their service provider.

115 Secondly, awareness helps consumers resolve disputes using the CCTS and thirdly, awareness promotes systemic compliance with the Code.

116 Wireless Code awareness, that is the aided awareness, including only vague recollection, is well under half the population and is decreasing and this is disturbing.

117 We therefore propose that the Commission add some new, concrete measures for WSPs to raise awareness, including firstly requiring regular, periodic bill notifications of the Wireless Code.

118 Secondly, requiring WSPs for every subscriber to send a text message at key points in the relationship, like starting a new plan -- reading, for example, as follows: “you have rights under the Wireless Code”, with a link to the Wireless Code.

119 Thirdly, requiring WSPs to play an automated message on customer service hold lines saying:

120 “You have rights under the Wireless

121 Code. If you are unable to resolve a dispute with us, you may file a complaint with the Commissioner for Complaints for Telecommunications Services. Check online or ask a customer service representative for more information.”

122 Some service providers argued that the CCTS and Commission alone should be responsible for awareness of or promoting the Code.

123 Our recommendations put responsibility for public service announcements on the Commission and the CCTS already raises Code issues where appropriate whether the consumer is aware of the Code or not. It also publishes the Annotated Wireless Code.

124 However, wireless service providers also must be involved as they have the most direct access to customers at the times they need relevant information.

125 It is shocking to us that WSPs, who are the primary information source for consumers at these key times, should seek to do the absolute minimum required to make consumers aware of the Code.

126 The CWTA says that awareness of specific rights is more important than awareness of the whole Code. We disagree. You can’t know what you don’t know.

127 Consumers will only be able to find the rights that they need to rely on in a dispute by finding them in the whole Code.

128 Who is to say the WSP, even if they do mention the Code, will point the customer to the right part of the Code?

129 It is also much less efficient to try to educate consumers on myriad rights in myriad situations when the simple course is simply to refer them to one complete code.

130 Some parties have raised concerns with our suggestions that text messages mentioning the Code should be sent to customer handsets or that recorded messages should be played while consumers are on hold.

131 They fear this would cause consumers to complain directly to the CCTS without attempting to resolve the complaint with the wireless service provider.

132 We think that consumers who learn more about the Wireless Code – excuse-me, may be able to better express their case to their wireless service provider and may actually have less need of the CCTS.

133 And frankly, we don’t think contacting the CCTS directly is a significant risk. In 2015 to 16, only one out of more than eight thousand CCTS complaints was closed because the customer tried -- had not tried to resolve the issue with their service provider. The CCTS makes this procedural requirement, believe me, very clear.

134 Turning now to compliance and enforcement, compliance and enforcement under the Wireless Code is a shared responsibility of the CCTS and the CRTC.

135 The CCTS is responsible for applying the Wireless Code when it arises within a consumer complaint to the CCTS -– and this responsibility is reflected in the individual resolutions and decisions of the CCTS, as well as in the Annotated Wireless Code.

136 The Commission, meanwhile, has retained responsibility for systemic enforcement of substantive obligations.

137 The original Wireless Code decision states:

138 “The Commission will enforce the

139 Wireless Code by addressing issues related to delayed implementation; and [to] systemic non-compliance.”

140

141 In addition, the Commission has indicated that it is responsible for assessing the effectiveness of the Wireless Code and reviewing it going forward.

142 The CRTC also remains responsible for oversight of disputes over interpretations of the Code through the Commission’s Part 1 process.

143 However, there are issues with systemic compliance. For example, Bell’s contract states:

144 “Recurring Charges billed in advance will not be refunded upon the cancellation of your Agreement.”

145 Consumers are entitled to a refund for the remainder of the billing cycle when they cancel their services. This is clear in the Wireless Code, which states that cancellation takes effect immediately, and has been affirmed by decisions of this Commission and the CCTS.

146 We believe that the Commission should take the following additional steps to exercise the above-noted systemic compliance monitoring and enforcement.

147 Firstly, reinforce -– sorry, excuse-me, reinstitute the wireless service compliance self-reports and publish them on a yearly, continuous basis.

148 Two; better articulate the Wireless Code’s three objectives, then develop benchmarks for how to measure those objectives and then set performance goals.

149 And three; ensure that upon Application by Part 1 or on its own motion, that wireless service provider policies and contracts are changed to comply with the Code, and that all affected consumers are compensated or there is another appropriate sanction.

150 Regarding point one, you can’t supervise or evaluate without data. Regarding point two, you can’t supervise or evaluate without defining and measuring success.

151 Regarding point three, we believe that the Commission needs to move on from Measuring and reviewing the effectiveness of the Wireless Code, now that it is established and working, to add systemic enforcement, along with, in appropriate cases, meaningful sanctions.

152 MS. LAU: In sum, the Wireless Code was a monumental regulatory shift towards empowering consumers and ensuring wireless customers across Canada can benefit from a standard set of rights and protections.

153 This was a step which we applaud. Not only are we here today to say those protections are now as important as ever, but that we should continue to work to ensure they will benefit consumers moving into the future.

154 Thank you for the opportunity to appear today and we look forward to answering your questions.

155 THE CHAIRPERSON: Thank you very much for your presentation.

156 I’m tempted to re-read paragraph 4 into the record, because, human nature being what it is, it’s very rare that the Commission gets thank you’s, but I’ll resist that temptation.

157 So I have a number of areas that I’d like to explore with you, but keep in mind that there’s a lot of articles in the Code and this may seem a bit disjointed.

158 But before I get to specific questions about the Code, I’d like to get your general view about the retail wireless market in Canada as you see it today.

159 Obviously the Code is part of that ecosystem but it is not the sum total of that ecosystem.

160 So what is your view, particularly if you look back, I don’t know, to 2012 compared to today and how that wireless retail market has evolved?

161 MR. LAWFORD: Some others may add, but it’s interesting because I think there was a hope in 2012, still some new entrants around, still some threat of entry from the United States, that perhaps there would be some structural changes. We had a different government. We had more pressure, if you will, more focus on pricing, and that has drifted away unfortunately, in my view.

162 There is an acquisition on the table now for another wireless carrier. There are a couple that have gone down in that time and so we have a more concentrated market.

163 From our point of view, I think we argued in our initial comments that prices were going up and that service was fine but that we had pricing issues in Canada.

164 So the market hasn’t evolved price wise. It probably won’t on its own. The demand side of the market, if you want to put it that way, has proven itself to be stubborn.

165 I think that the companies have been quite fortunate in having a wave of data increase, as you see, so that keeps people more loyal to their carrier.

166 They’ve also had more expensive smartphones, which we pointed out in our submission, so with an expensive smartphone you’re going to be stuck with a higher -- even with the Commission’s 24-month amortization you’ve got a higher leaving fee all the way through. So that’s also changed things quite significantly.

167 In terms of the Wireless Code, we do think, as we said, that it helped an awful lot in terms of getting rid of what I would call unfair practices and irritants, bill shock obviously being the number one, but also unlocking and other service fees.

168 So overall it’s frustrating because the Commission never talks about price regulation in wireless anymore, and we’re not here to do that today either, but honestly I think that’s -- that would be the number one consumer complaint would be pricing, but it’s off the table.

169 So that’s my view of the market. It hasn’t evolved. It’s actually regressed.

170 THE CHAIRPERSON: When you look at the next five years, the likelihood of new more expensive devices being available from what I’ve seen it’s not likely that that trend has occurred. The prices may go up but we’re not going to have an iPhone revolution like we may have had in the past. There has been some consolidation, and you’re right, there’s some of it that’s still up in the air, but there has been some consolidation but there appears to be a limit to that at one point, one would expect.

171 Do you -- so your major concern there for being the retail prices, is it your view that -- because we’re here to discuss the Wireless Code -- whether that Code has at least some monitoring or downward pressure on the retail prices?

172 MR. LAWFORD: The -- I think the full effect of the Wireless Codes intended market dynamism hasn’t really come through yet, and that’s a large part of what we’re saying at the end of our oral remarks is that the awareness as it grows should have that effect, and it’s been frustrating that the churn has become so low. So, I mean, it’s ridiculously low in Canada, it’s under two percent. That’s not a vibrant market. So that’s frustrating.

173 THE CHAIRPERSON: Some might argue that a low churn rate -- I know you’re making conclusions that a low churn rate leads you to a conclusion that people are I guess in a framework that is very sticky, that they can’t possibly change or there are barriers to change. But some might argue -- like your views on this -- that its -- they might be actually satisfied with their service provider and the quality of the service they get from that provider.

174 MR. LAWFORD: We would have more information on that if there were -- if this had been a hearing into wireless pricing.

175 But even in the public comments that you did have you saw a number of individuals complaining about pricing as part of their other comments.

176 So without, you know, verifiable data it’s hard to say what people think of the pricing in Canada, but I look at the OACD reports, I look at the most recent one that Nordicity did, and I think the evidence is compelling that prices are high and people know it. I’m not in a position here to prove it today but that’s our view on whether prices are high.

177 The Wireless Codes I guess I’ll call them demand side of the CCC put it changes have been very helpful though and it should work. So I guess what’s frustrating is why is it not working and is it the structure of the market, is it because we have no foreign competitors. I would lay it more at the feet of that then at the feet of the Wireless Code.

178 THE CHAIRPERSON: Because one, in theory, would think that reducing the barriers to switching, as the Code attempted to do -- maybe it hasn’t gone far enough and maybe that’s the question we will be asking in the context of this hearing -- should help discipline the market because ---

179 MR. LAWFORD: M’hm.

180 THE CHAIRPERSON: --- people could switch. They can take their device and go to the competitor.

181 Why do you think that theory has not worked in practice?

182 MR. LAWFORD: Because we have three providers with well over 90 percent in almost all markets, a few with four, but very small percentages, so who are you going to switch to? I think that the public comments say they’re all the same. Why bother switching? Why not just call up and threaten to leave and then get a better deal and stay where you are? I think that’s the modus operandi of the average person.

183 THE CHAIRPERSON: Right.

184 MR. LAWFORD: So to the extent that there is missing wireless competitors to go to then you have apathy or consumer barriers that I guess there’s not enough of incentive for people to switch.

185 THE CHAIRPERSON: I was struck last night when I was watching the Super Bowl that there’s advertising outside of our market that shows a great deal of competition and people are trying to convince consumers to move to alternative suppliers.

186 I don’t think those sorts of ads are often seen in Canada. I mean, everybody offers their own service but there’s barely -- maybe I’m wrong, but there seems to be very little advertising where people are saying we offer better prices.

187 MR. LAWFORD: Well, we -- hopefully we’ll see when WIND ramps up some efforts, but it’s hard to see whether anyone’s going to cobble together a national fourth player or some sort of coalition that does that.

188 And our view -- and we’ve put it on the record in other proceedings I think in the Wireless Wholesale Proceeding -- is that a national fourth carrier is what brings down prices, and regional ones have effects on regional markets but the market follows the national market and there are three big providers there and that’s that, and that’s inadequate.

189 THE CHAIRPERSON: But you would agree with me, wouldn’t you, that even whether it’s two or three if they’re actively trying to get market share from each other it could also -- it’s not the number per se that leads to a more dynamic marketplace, can it?

190 Because you can have 10, if they’re all doing their prices in lockstep that’s not very dynamic either, is it?

191 MR. LAWFORD: No I agree with you, and I don’t want to get into economics here because I’m not an economist, but the number of players certainly affects that ---

192 THE CHAIRPERSON: It hasn’t prevented in broadcasting procedures lawyers to file economic evidence?

193 MR. LAWFORD: Yes, that can be done and -- but, you know, there’s monopoly pricing and there’s oligopoly pricing and our view, I think, has been pretty clearly stated that we have an oligopolistic market and it tends to price at a level that benefits all the players and they are well aware of that.

194 THE CHAIRPERSON: At paragraph 51 and your chapter “Compliance and Enforcement”, you refer to an issue of systemic compliance and you gave an example with respect to Bell’s contract. So I note that you’ve listed that as an example. Are there any other cases of systemic compliance that you have identified that you wish to have the opportunity to put ---

195 MR. LAWFORD: Well, for starters, there’s practice in the share plans. As far as we’re concerned it’s systemic non-compliance of allowing the account holder -- sorry, allowing any device to authorize overages. There’s also an issue with share plans. I can’t recall it right now. What’s the other one?

196 MR. SEGEL-BROWN: Multiplying the cap.

197 MR. LAWFORD: Yes, multiplying the cap. So ---

198 THE CHAIRPERSON: Okay.

199 MR. LAWFORD: --- the cap is 50 but if you have 3 devices, some providers or at least 1 thinks that’s 150. So ---

200 THE CHAIRPERSON: Okay. Those are two subjects I plan to explain. Are there others?

201 MS. LAU: Well, I think as we point out in our oral remarks, identifying data or voice services as non-key terms of the contract I think we would view to be non-complaint with the Code.

202 THE CHAIRPERSON: Okay. I’ve got questions on that. So is there anything else just to make sure that your example is -- there are other -- that’s an exclusive list of areas that ---

203 MR. LAWFORD: Well, I’m sure it’s not an exclusive list but ---

204 THE CHAIRPERSON: --- of systemic compliance. It’s three already.

205 MR. LAWFORD: Well, we can keep going. They -- the -- there are problems with people getting suspensions, not getting the notice 2 weeks ahead and then not getting the notice 24 hours ahead. So there’s another area.

206 I guess I should look at the Wireless Code because I can just go down the list.

207 THE CHAIRPERSON: I perhaps can give you the opportunity to do it through an undertaking if you, you know ---

208 MR. LAWFORD: Yes, certainly ---

209 THE CHAIRPERSON: --- that’s ---

210 MR. LAWFORD: --- we can take that away.

211 THE CHAIRPERSON: Because I realize that there’s limit in the oral part of the hearing and when I see somebody saying an example it begs the question that there -- it may not be an exhaustive list.

212 MR. LAWFORD: Correct. We’re happy to take that undertaking.

213 THE CHAIRPERSON: For the 16^th of February?

214 MR. LAWFORD: Yes, please.

215 THE CHAIRPERSON: Thank you.

216 UNDERTAKING

217 THE CHAIRPERSON: Now, as you know, the Code makes a major difference between post-paid and prepaid. Yet we seem to be seeing an increase of complaints with respect to prepaid. Do you think the fact that the Code makes a threshold distinction between prepaid and post-paid, does that still remain the way to go?

218 MR. SEGEL-BROWN: We don’t think that the distinction between prepaid and post-paid is relevant anymore because there are a number of plans which are in every other regard post-paid plans where the individual is paying in advance. For example, if you’re a Telus subscriber you’re going to pay for your monthly fee billed in advance but you pay for usage on your next bill. So do we consider that a prepaid or a post-paid? And on the other hand, those prepaid plans where you might have automatic top-ups, so you’re potentially incurring large overages or prepaid plans where you buy a year of service in advance, so you’re making a substantial commitment, should they be able to change the key terms on you.

219 So, when we initially did -- in the initial Wireless Code proceeding we made certain assumptions about the characteristics of prepaid plans that they couldn’t incur overages, that they didn’t involve a substantial commitment. And I don’t think that those assumptions are tenable anymore.

220 Our solution to that is that the rights should apply wherever they’re applicable and we’re going to have to look through the rights and figure out what is the characteristic that makes this right relevant. If it’s overages, does the person have the ability to incur overages?

221 THE CHAIRPERSON: When you refer to “prepaid”, do you make an important distinction between prepaid cards, which I think was prevalent or at least available in the marketplace last time we did this, as opposed to what you’re referring to here as “prepaid plans”, so as that there are plans but they happen to be prepaid as opposed to post-paid?

222 MR. LAWFORD: I think Alysia might add something but, yeah, they -- the model with prepaid card and fewer services, if you will, seems to be dying out, as you point out. They likely, as Ben said, would have fewer issues because they’re not committing for a longer time or they have less opportunity to add on, that sort of thing, so they may still be in their own category. For the moment there may have to be a transitional.

223 I mean, it’s easy to say there’s been a C-change, as Ben pointed out, but there are still some folks that are on those types of card plans, so we have to think about that.

224 MS. LAU: I think right now you can perhaps draw a distinction between the prepaid cards and the prepaid plans, but the trend that we’re seeing is that, yeah, this distinction between prepaid and post-paid, prepaid being you pay in advance, is really blurring, so we want to make sure the Wireless Code can adapt to new plans or new services that may be offered moving into the future.

225 THE CHAIRPERSON: Okay. If I put it to you that perhaps the thinking at the time was -- between prepaid and post-paid was that prepaid probably because many of us have the prepaid cards in mind, they by definition were shorter term commitment, that if you were unhappy with a prepaid card situation you could easily change providers and therefore, maybe, you know, not as tied in. Would it be correct in your view if that’s -- my assumption is correct that now the distinction between prepaid and post-paid isn’t so much pre or post but whether the duration of your commitment? Not when you’re paying but the fact that you’re in a contractual relationship that you might not as easily be able to step away from, even though it’s prepaid.

226 MR. LAWFORD: Yeah, I think that’s exactly what we’re saying. And do you want to add?

227 THE CHAIRPERSON: And so your view would be that in prepaid arrangements -- that might not be prepaid cards but a more plan-type situation, that they should be dealt with in the same way as a post-paid plan; is that correct?

228 MR. LAWFORD: Largely, I mean, devil is in the detail on these things, so ---

229 THE CHAIRPERSON: Unfortunately, this hearing is about details.

230 MR. LAWFORD: Yeah, and we’re happy to think about the details. I don’t want to take a lot of undertakings but I’m happy to look at this. Because we thought that by saying you have to carefully go through each of these that’s a lot of work. But you may have to go through each of these because it’s a lot of work because we’re in a transitional period.

231 But generally, the essence of what you’re saying is correct. So if you’re committing for a longer period of time you should really have the same rights as somebody who’s “post-paid”. So that would be maybe not as hard a job as it sounds, but don’t want to -- don’t want to create a situation which will be a lot of work for carriers for nothing and/or not benefit consumers so.

232 THE CHAIRPERSON: Right. So that’s probably why you would be supportive, I don’t know, of a -- of entering a Critical Information Summary for somebody who is on a prepaid plan, for instance?

233 MR. LAWFORD: Yes.

234 THE CHAIRPERSON: Just for efficiency, maybe I could ask you to do an undertaking, go through the Code and see what else you think ought to be moved to a more -- the same regime as post-paid because it’s a plan as opposed to a card; would you undertake to do that?

235 MR. LAWFORD: We will do that, yes, please.

236 UNDERTAKING

237 THE CHAIRPERSON: But would you agree that for prepaid card users the terms and conditions on the card suffice to inform and protect that particular type of consumer? I’m -- on the assumption that it’s not a plan; it’s a card that has a life.

238 MR. LAWFORD: Right. Yeah, we’ll have to think about that but probably yes. And the answer maybe would be as well that, you know, we have to think about the consumer protections, whether those cards are terribly clear for people. And there may have to be if we’re going to shift, you know, some rights to prepaid people, a little education for folks so that they don’t think they have the same rights as their other prepaid colleagues and if the cards are a quite a different regime. So it might just have to be thought about a little bit but, generally speaking, yes.

239 THE CHAIRPERSON: Would a consumer -- a CIS be redundant for prepaid cards, in your view?

240 MR. LAWFORD: Don’t know about that. Our view of the Critical Information Summary is it hasn’t been used as the tool that it could be used, which is as a firm offer to go shopping with. So in that case, even for a prepaid user, if there were standard terms that let’s say they weren’t printed on the card because they’d probably be too long but at least there are websites to look it up or a number you could call, then maybe that would actually let them decide between two different prepaid products, which might be a function that would be helpful. If you're just going to include it with the contract, it's less important for those users.

241 THE CHAIRPERSON: Why do you think that, because you've made the point, that the Critical Information Summary has not worked as a tool for consumers that are in the market to shop around?

242 MR. LAWFORD: Yeah, I think that's quite a true statement. They don't get it until the contract is signed, so to the extent that Australia allows this, it seems to be quite helpful, and in terms of market dynamism, it seems to us that that's a simple fix.

243 It's something that likely for most customers and most plans it's pretty easy to run off from the provider, either at the store or online. There's no reason why you should have to ---

244 THE CHAIRPERSON: When I'm saying a coalition of consumers here, when Canadians go out to negotiate, for instance, their mortgage, I mean, they shop around, they get a list. When you do any major, minor, in fact, a car purchase.

245 Now, I don't want to compare a cell phone, although it, you know, it's an important household expense, it's not quite in the level of the mortgage or your car, although in some households it's the fourth or fifth largest consumer amount. You may not see it because it's monthly.

246 But why do you think that Canadians aren't shopping around as much? It would seem to me quite easy. Most malls, you can go from all the wireless providers, from counter to counter, and that doesn't seem to occur as much as one would think it should.

247 MR. LAWFORD: Wireless contracts are particularly complicated. There are, you know, data plans, there is the voice aspect, there is add‑ons, there is terms, there is the amortization of the phone. It's a complicated market. There's coverage. It's not quite as simple as a mortgage, even.

248 So to be honest, people need a little leg up, and I think that the social sciences research has shown that consumers in this market struggle. And that's what people were saying before the last Wireless Code is they didn't understand the contract, and even since, we're not sure that the new supposedly clear wording is really helpful to them.

249 And in any case, they don't get the contract until they sign. They don't have the critical information sheet until they sign, so how can they shop around without terms?

250 It's -- I mean, you go to the bank, you ask them for the mortgage rate, they tell you, and you don't have to sign on the dot. But it's -- with the Critical Information Summary, that's kind of what you're asking for. You're asking for the rate and what's included in this thing, and they won't tell you until you sign. It seems backwards.

251 THE CHAIRPERSON: But there's no prohibition. They could. If consumer demanded.

252 Are you aware of any evidence that if a consumer were to ask, you know, give me what -- your offer, I will go across the street and compare prices, but you've got to give me the best. Is that happening?

253 MR. LAWFORD: No, it's not happening, and that's what ---

254 THE CHAIRPERSON: But ---

255 MR. LAWFORD: --- there's the Pavlović Study, although it's small, shows that.

256 THE CHAIRPERSON: --- what's the barrier? Why aren't' consumers stepping up and doing it? I realize it's complicated, but ---

257 MR. LAWFORD: You don't ---

258 THE CHAIRPERSON: --- you'd think that in a level distrust that there is, as there used to be -- maybe there still is -- but there certainly was more a number of years in the new car market. You know, you'd demand the price and then you'd cross the street and try -- I mean, there was an obligation on consumers to step up a little bit. Why aren't they doing it as much here?

259 MR. LAWFORD: There is -- first of all, they're missing the information they need. Secondly, they're often in another contract already and it's a matter of feeling trapped.

260 But consumers don't feel empowered at the moment because they don't feel like they're in control of what the offer is. Canadians, I hate to say it, culturally are also not great negotiators, so they have to be confident that what they're doing is going to work.

261 And you know, again, the studies that we've done, the mystery shopping that we've seen on this -- on the record of this hearing, you cannot get the company to give you the offer. They will not give it to you. They don't do it.

262 So if you go in and try to talk to a retail person in a mall, they will not give you a copy of this thing or they have to find the contracts in the locked drawer. I mean, honestly, that's a lot of work. It's a high barrier to shopping, if you will, to have that kind of, sort of arms-crossed-we‑can't-help-you attitude.

263 THE CHAIRPERSON: Would it not then be sufficient to prohibit that practice, the refusal to provide a Critical Information Summary, as opposed to requiring everyone to provide it? In the pre‑contractual phase?

264 MR. LAWFORD: Sure. You can leave it on request, and I believe that's what we asked for in our written remarks, that the critical information summary should be provided upon request.

265 THE CHAIRPERSON: Well, I'm going a little further than on request. I'm saying that it would be contrary to the Code to refuse to provide it.

266 MR. LAWFORD: That's a fine sanction.

267 MS. LAU: Hi, I just wanted to add to what John is saying, which is we are not saying that consumers shouldn't shop around; they shouldn't do their own research. We are seeing that there are many, many aspects and details to a wireless service contract, and the number of provisions in the Wireless Code show that.

268 And to the extent that the objective of the Code is to make it easier for individuals to obtain and understand information about the wireless service contracts, that giving them the ability to obtain a Critical Information Summary before signing the contract we think would be very beneficial to them.

269 And there are examples of CIS forms, which were -- in Australia which were put on the record, and we thought that they were very well done. Very clear, tables, yeah, fairly easy to compare. And we think that that would be beneficial for Canadian wireless customers as well.

270 THE CHAIRPERSON: Thank you.

271 With respect to bill shock. Of course, bill shock was one of the original -- well, to prevent bill shock was one of the original purposes of the Code.

272 Do you think it's been successful in this respect? I have heard it said that in terms of data overages and international roaming that it may not have done as good a job as it may have been hoped to have done. That in fact, still 1 out of 5 Canadians still experience bill shock, and nearly 50 percent of those are reacting to data overages.

273 MR. LAWFORD: However, the number of complaints to the CCTS has gone done, and a large portion of that, I think, is on data overage being removed. So the volume of calls on for that particular type of complaint has gone down, and that helps show why their overall complaint volume has dropped.

274 It's not to say that there is still -- aren't still problems. A lot of the problems with data overages, sorry, with overages, excuse me, aren't roaming they're now voice. So people don't realize their voice isn't included in the package.

275 Could more be done? Yes, and that's why we urged you to keep the limits and also to be pretty clear with the providers that you can't keep, you know, either multiplying it by number of devices or letting the kids say yes.

276 THE CHAIRPERSON: Right.

277 MR. LAWFORD: So it could get better.

278 But overall, actually, I believe the carriers would tell you the front line service people -- and maybe you can ask them when they come up -- have the issues with people calling in frantic waves that they have their huge data or roaming gone down, I think they would say yes.

279 THE CHAIRPERSON: Okay.

280 So you mentioned the multi-user situation. Would you agree that the last time we looked at the Code that practice of multi-user plans was less prevalent?

281 MR. LAWFORD: Yes, far less prevalent.

282 THE CHAIRPERSON: And since they're more prevalent today, do you think the Code should be changed? Yes, you do. You want it to -- that we consider that if there are five devices on a plan, for instance, that the cap would be defined by still $50 and not 5 times 50, for instance. Is that correct?

283 MR. LAWFORD: That's right.

284 THE CHAIRPERSON: And that we, for the purpose of the Code, should always deem the multi-user plans as a single plan? In other words, there should only be one account user in every instance?

285 MR. LAWFORD: Is there one account on -- like that's been created to support those five devices? Yes. If there's two in the house and there's, you know, a spouse has one child and the other spouse has another child, if there's two plans, then there's two limits. But if there is just one account holder, then yes.

286 THE CHAIRPERSON: But do you foresee the possibility of having more than one account holder with respect to a single account?

287 MR. LAWFORD: Not really thinking that way, no. I'm just saying if people have say two different carriers in the house ---

288 THE CHAIRPERSON: But let's say it's not a reconstituted family, which I think you were presuming in ---

289 MR. LAWFORD: No, no, I'm not presuming that.

290 THE CHAIRPERSON: No, no ---

291 MR. LAWFORD: Lots of families split it up so they don't have to hammer over us ---

292 THE CHAIRPERSON: Right.

293 MR. LAWFORD: --- to that extent.

294 THE CHAIRPERSON: Let's say it's a household of five people, two parents, three kids and the two parents -- should the two parents be able to be account holders?

295 MR. LAWFORD: I think you can get around that without tying yourselves into knots by saying there's one account holder, and if the account holder clearly and explicitly authorizes another person, likely the spouse, to also authorize overages, that can be done. I see Rogers has this type of control already in the market, so it can be done.

296 THE CHAIRPERSON: But always that whoever is the primary account holder was that they hold the control as to who else should be allowed?

297 MR. LAWFORD: If that's the name on the account for paying the bill, yes.

298 THE CHAIRPERSON: Now, in terms of data allotment, there's various practices in the market as to when people get notified as to when they're about to reach their cap or their allotment. Some, for instance, notify you when you reach 95 percent and others when you reach 100 percent.

299 What do you think the right approach is? Should you be told as you're creeping up to the amount or when you actually hit it?

300 MR. LAWFORD: I believe our written submissions said at 50 percent and at 100 percent.

301 THE CHAIRPERSON: Okay. Why 50 percent? That seems a long way. What's the rationale for you in that?

302 MR. LAWFORD: Not really, no. I think in a post-paid situation that's monthly billed, if you hit 50 percent well before the 15^th, you get a pretty good indication of what's going on here. And the 100 percent has to be sent because you're going to start being billed more after that.

303 The question would be whether, you know, the providers might also give you a hat tip at your at 90 or 95 percent which may make sense as well.

304 We are not wedded to the idea of 50 percent and 100 percent. If there's an extra step in there, that might even be better.

305 THE CHAIRPERSON: But at least 50 and 100?

306 MR. LAWFORD: I think the 50 percent one is -- I mean perhaps others will say the opposite but it's our view that then it gives people a chance to measure, especially with a large number of devices on an account, like how things are going early so they can take steps to fix their -- fix their usage or manage their usage for the rest of the month, or even maybe shop around for a better plan that gives them more data.

307 THE CHAIRPERSON: But you're not willing to agree that 95 percent is the right number in lieu of 100 percent in the spirit of because you see it coming?

308 MR. LAWFORD: No, no, no. I mean the thing about the 100 percent though, as I say, people may be managing. So if you give somebody a 95 percent and then they go over and you don’t tell them when they hit 100 percent and they thought they were doing really well managing, that's a problem.

309 So if there's a 95 percent and a 100 percent, that's the ideal solution. The 100 percent is there just so the account holder knows we're into the red.

310 THE CHAIRPERSON: Okay. Setting aside the case, and I don’t think this occurs a lot today in society, of emancipated minors being booked to contract but let's use whatever the provincial laws allow children to contract, do you think children should be allowed to be able to do the consents required in the Code to go above the levels?

311 MR. LAWFORD: I know what you're saying and the -- again, the account holder is the one paying. So if they wish to authorize adult children in their house or those that they feel are mature enough, they should have that say.

312 If someone has an account and they are 16 or 17 and there is no one else on the account and they are paying it, there's no problem. I don’t know if the carriers let people do that. I don’t know how many emancipated minors there are out there but generally speaking, if you keep the account holder and have it negotiated within the family ---

313 THE CHAIRPERSON: Although one would think that maybe a cellphone these days is a necessity of life like breath.

314 MR. LAWFORD: You could sure make the argument if you come to court I suppose an emancipated minor that you need that as well, that's great. But see, if the account holder can explicitly authorize any other person in the household, then if there's somebody who is 17 and the parent -- let's say parents thinks that person is -- that child is responsible, they will authorize him. If they don’t believe they're responsible, they will not.

315 THE CHAIRPERSON: So if the account holder consents to somebody, the Code shouldn't have a window in how old that person might or might not be, as long as the account holder holds the control?

316 MR. LAWFORD: As long as the account holder holds the control and has expressly and, you know, knowingly authorized that person to have overages, then yes, that account holder has to live with the consequences.

317 THE CHAIRPERSON: Right. And it's their risk whether the authorized person is 11, 15, 17, or 25 I guess?

318 MR. LAWFORD: Okay. Now, well, here we get into if someone is under 12, do you really think that they're going to have that kind of maturity? Why would you allow them to authorize? I imagine people will come up with reasons but I think it's getting a little far to say that no child can ever authorize if the parent wants to have that authorized. So we're saying if they -- yes, doesn’t make this device which actually attaches to an 11-year-old, yes, they have to live with the consequences.

319 THE CHAIRPERSON: So it may be unwise from a parenting perspective but not necessarily a regulatory matter?

320 MR. LAWFORD: Yeah, I think that that can be left to be decided within the household.

321 THE CHAIRPERSON: And assuming your framework, that is, you know, there's an account holder that controls the consents, nevertheless we talked about notifications. Should notifications -- and I mean a multi-user scenario. Should notifications be sent to all device holders, only the account holder?

322 MR. LAWFORD: It has to go for sure to the account holder, should also go to the device holder because then it will spark the conversation from that device holder to the account holder if they need to have data and then the account holder can authorize them to go over.

323 THE CHAIRPERSON: Now, multi-user plans can also occur beyond family situations and small businesses. As you know, the Code applies to small businesses. Should the approach you articulated and advocated for today be the same for small businesses? And if not, what would be the nuances?

324 MR. LAWFORD: I believe the same setup. It's quite similar to most business expenses where the business is paying for the employee. If the employee is authorized by the business to debit an account or to add to the bill, then they are, and if they aren't, they aren't.

325 THE CHAIRPERSON: Okay. You're advocating for the overage caps and the roaming caps to remain largely unchanged.

326 MR. LAWFORD: Yes.

327 THE CHAIRPERSON: You neither want them increased or decreased, yet the environment has changed, has it not? What people are consuming, the value of the amounts has risen. Why would they not be adapted to the new environment?

328 MR. LAWFORD: I'm not sure we have a lot of data on how much people can afford to lose.

329 When we did the first Wireless Code hearing, we had survey results I believe from our evidence that said people were more comfortable at less that $50. I think it was 25. I don’t recall seeing evidence on the record that people are more comfortable going over and spending $100 every time they go over. I don’t think anyone has put in the evidence like that on the record.

330 So I would say yes, although you might be using your phone more and travelling more, that there's no evidence that people can absorb extra costs above $50 a month or $100 a month, plus they've been habituated to having that as a maximum overage.

331 THE CHAIRPERSON: Right. Is there -- when we redo and consider changes to the Code, do you think we should be concerned about making as few changes as possible in some respects to avoid confusion in the consumer protection marketplace?

332 MR. LAWFORD: The last part of our oral remarks and some of our written I think imply that the Code is probably effective in many places and just needs a little policing. So, generally speaking, yes, there is a value in having things say stable. I believe our recommendation to review the Code only now after five years to line up also with the CCTS also anticipates that the Code would remain fairly stable.

333 So yes, I think there's an assumption in our remarks in our evidence that that's a good thing but there are some necessary tweaks and changes and I'm sure other parties will tell you about theirs that you may want to consider.

334 THE CHAIRPERSON: You've picked up on the fact that people are perhaps misunderstanding that the roaming regime does not apply to voice roaming and that people are therefore shocked. In fact, CCTS submitted that last year customers raised issues regarding roaming charges about over 200 times and 71 percent of those, so largely skewed in part due to voice roaming. Is that sufficient justification for us to change the Code?

335 MR. LAWFORD: Well I don’t think we went that far in our written remarks. I know that the companies will tell you that they don’t get all of their voice roaming bills in for 30 days or something.

336 So you could run up some huge thing abroad and they would be on the hook if there was a limit, because they can’t stop it. Not as quickly as data, for whatever reason.

337 Things may have changed. You may wish to ask WIND or Bell about that, to see if things have changed, but there’s always that issue. I’ll let them explain it. However, I think with that number, 200 is a lot of complaints, and the amounts for the voice overage can be very high.

338 So there has to be some middle ground and what that could be I’m not sure I would like to speak about it today. I’d be happy to put forth a proposal and an undertaking.

339 THE CHAIRMAN: Well, as you say we’ll be asking the other parties the facts, so I’m not sure what your undertaking will be about in the absence of the facts.

340 (LAUGHTER)

341 MR. LAWFORD: True.

342 THE CHAIRMAN: So ---

343 MR. LAWFORD: Around that well if we had a reply round then we’d be able to use, you know, their answers to give our answer, but I think it’s problematic that people can have $1,000 voice bill and something should be done.

344 Perhaps you could come up with a limit that is higher than data because of the delay problem, but again we don’t know what the evidence is for peoples’ capacity consumer to absorb – excuse-me, overages, and I think it’s probably close to where you have it for data.

345 THE CHAIRMAN: Right.

346 MR. LAWFORD: Whether it’s voice or data.

347 THE CHAIRMAN: One of the objectives the Commission had was to reduce to the extent possible barriers to switching, to create a more dynamic marketplace. We talked about this earlier, saying – seing that the turn rates were not as high as – well they’ve actually gone down.

348 There is less turn today than when -– is the fact that there is less churn per se in your view cause for concern? I mean I asked you this earlier. I mean there could be over reasons the churn rates are not as high.

349 MR. LAWFORD: No.

350 THE CHAIRMAN: Is there a straight line relationship between churn rate and barriers to switching?

351 MR. LAWFORD: Who knows exactly what causes churn, but generally speaking if there are barriers in the marketplace that is indicated by a very low churn rate or if there’s inadequate competition because there’s no point in leaving and going to another provider, then you’ll see low churn. That’s what we see in Canada.

352 There’s been the smartphone revolution and that’s also aided the low churn, so people stick with their device and their carrier, but, you know, there could be other factors.

353 Did you want to add anything?

354 MR. SIEGEL-BROWN: In our comments we identified four factors that we thought were pushing down churn. They were higher value phones, family share plans, improved customer service and reduced bring your own device discounts. So some of those are good and some of those are bad, but another factor with them is that it’s more expensive to switch providers and there’s less impetus to switch providers because consumers are being treated a little better so it’s hard to say that the reduced churn per se is a bad thing, but overall we want to contribute to competitiveness by reducing, switching barriers.

355 THE CHAIRMAN: One of the measures the Commission put in place to sort of support people shopping around was the trial period – the general – here I’m just asking a question about the general trial period as opposed to the one for people with disabilities.

356 Your view is that the trial period usage limits are two low and therefore not reasonable within the language of the Code, I take it?

357 MR. LAWFORD: That’s correct.

358 THE CHAIRMAN: What would you think if – because, you know, the word reasonable in legislation, that open-ended drafting helps deal with ambiguity, but it actually creates ambiguity and you’ve proposed a model on how we could do that.

359 If I were to put it to you a different way, that carriers know on average how much – maybe not the first month, but on average how much usage average Canadians that are customers of that company make of their devices, that we use that as a baseline and – or 50 percent of that as what is reasonable. It would be a flexible amount. It may change over time as usage goes up or down, but it would be a more fair market based representation of the usage that one would expect.

360 MR. LAWFORD: I think – we’ll think about it. Maybe a little more for final written reply. However, I would be resistant to that, because I think it matters to the individual more and so we were happy with l’Union des consommateurs suggestion that half of a normal month’s usage or allowance would be a fair way, especially since it kind of lines up with the timeline which at the present time is 15 days, so.

361 If you get into these market ones you’re going to have a mismatch with individual consumers who are not the average. I mean it’s a pretty heterogenous market actually and it’s going to depend on how many devices there are. It’s – it would maybe be a little harder than it sounds, so I think to the individual they need to – it’s a very personal thing to get a phone and see whether the coverage works and if it’s the one you like and it fits your usage habits and all of that stuff that the marketing people talked to you about, it really does matter so half of the – half of a month is what we believe is a fair stick and it is individual to the – to the person. That would be more fair, we believe.

362 THE CHAIRMAN: I’m not questioning the half of the month. I’m questioning how one comes to what is reasonable. I think your point is that what is being used now is not reasonable usage for 15 days.

363 MR. LAWFORD: It’s miniscule.

364 THE CHAIRMAN: And ---

365 MR. LAWFORD: It’s miniscule. It doesn’t even give you a chance to ---

366 THE CHAIRMAN: What I’m putting to you is instead of trying to have different levels for each customer, that we find a formula based on what average Canadians overall with that company use, perhaps divided by the number of devices, but actually come up with a way of actually – of figuring out what the average use in a particular company is and using that as the reasonable amount.

367 MR. LAWFORD: You can do that. It’s another way to do it. It sounds like a lot of work. It sounds way easier to just go half of what you just contracted for.

368 THE CHAIRMAN: Sorry?

369 MR. LAWFORD: Half of what you just contracted for is like you have 5 gigabytes of usage for that month so you’re allowed to use up to 2.5 gigabytes.

370 THE CHAIRMAN: And you’re confident that a consumer, a new subscriber, would know what that is?

371 MR. LAWFORD: If they have a properly written critical information summary on top of their contract they should know.

372 THE CHAIRMAN: And you believe that most Canadians understand what data consumption looks like?

373 MR. LAWFORD: I believe they’re shopping for plans and they have a rough idea of how much data they need know, yes. If we need to think about some consumers who have no clue at all about how much data they’re really going to use, then you could consider the other option you’re talking about.

374 THE CHAIRMAN: In the basic service hearing we’ve heard lots of evidence about people who might be able to understand usage of voice, because that’s been around for many years, but data consumption did not seem as obvious and I can speak from my own personal view. I wouldn’t know, you know, how much a video actually consumes and it may vary from one place to the next and one device to the next.

375 MR. LAWFORD: Hey the experience will vary per person, but I mean either way is an approach and either method the main thing what we’re looking for here is extra time to give people a reasonable chance to see if their device and coverage is adequate. So ---

376 THE CHAIRMAN: Right, because you’re saying the way -- the reasonableness of the data allowance, for instance, is being used it in fact de facto reduces the 15 day that was provided in the Code?

377 MR. LAWFORD: Yes, to less than a day really.

378 THE CHAIRMAN: There’s been some folks that have suggested that gifts provided with a purchase should -- or rather promotional incentives, should be part of what needs to be returned in the case of a cancellation after the trial period or during the trial period. Why do you think that would be in the public interest?

379 Because you seem to suggest in your submission that yeah, it would be okay if it was, you know, anything but nominal.

380 I was actually a bit surprised at your position, that you would accept the return of gifts with purchase. One would think that if somebody wants to give a gift or some sort of incentive or other marketing gimmick that it’s up to the wireless service provider to manage that risk.

381 MR. LAWFORD: That’s true.

382 THE CHAIRPERSON: Actually not giving it over until the 15 days is over.

383 MR. LAWFORD: Gifts would be fine if they didn’t come with strings attached. But what the carriers are asking for here is gifts with strings attached, oh, look here’s your free gift, oh, but it counts against how much you’ve got to pay us back if you leave. You know, like that is not a true gift.

384 If they want to take the risk to lay out money to attract me to their service, let them lay out the money, don’t ensure them. Because this is what we’re talking about with inducements being able to be recovered through the early termination fee, they’re ensuring that outlay, and we don’t think that’s fair.

385 THE CHAIRPERSON: But you do seem to suggest in your submission, unless I misunderstood it, that in certain circumstances certain gifts could be required to be returned.

386 MR. LAWFORD: After the trial period?

387 THE CHAIRPERSON: Well, before -- as a result of the cancellation within the trial period.

388 MR. LAWFORD: So probably that relates to very high value gifts.

389 MR. SEGEL-BROWN: Yeah, I guess the example we had in mind was the promotion offered by Vidéotron where they were giving away speakers of significant value, and I guess our initial impression was that it was less offensive to require that those gifts be returned within the trial period, because we don’t want people to abuse the goodwill that comes out of something like that by just receiving the gift and then promptly returning their device.

390 THE CHAIRPERSON: That’s precisely why I’m surprised about your position. Why do you want to provide yet more opportunities the wireless service providers to compete on everything except telecommunication service pricing?

391 MR. SEGEL-BROWN: I mean, we’re opposing including gifts in the cost of the early cancellation fee. I guess we would be -- we just didn’t oppose it as strongly as excluding it from the ---

392 THE CHAIRPERSON: But if they want to give away expensive gifts, let the -- why don’t they do it after the 15 days?

393 MS. LAU: Yeah, and I think if the Commission were to determine that a gift is a gift and a customer shouldn’t have to return it even if they cancel within the trial period, we would be fine with that.

394 THE CHAIRPERSON: With respect to unlocking, is it your view that unlocking fees are in the public interest?

395 MR. LAWFORD: No, our unlocking fees are not in the public interest. I understand ---

396 THE CHAIRPERSON: In every circumstance?

397 MR. LAWFORD: I understand why the carriers say they need to have some control over locking devices for fraud. I’ve heard that before. There may be some actual cost to unlocking. I don’t think it’s very great. I don’t believe there’s any evidence on the record of how much it really costs. But overall there are few reasons why you want to charge consumers, and that’s why we’re saying especially once you’ve paid off the device or finished your term there is absolutely no rationale for charging for that. And in the United States the carriers have agreed to allow unlocking once the device is paid for for no charge.

398 THE CHAIRPERSON: Do you consider that unlocking fees are a barrier to a more dynamic marketplace?

399 MR. LAWFORD: Absolutely. Absolutely. The -- as has been pointed out on the record, a number of the smartphones last longer now and people get used to them. They want to shop around. They want to bring that device with them a lot of the time. They want to go roaming. They don’t necessarily want to use whatever carriers roaming program they may have. They prefer to get a SIM card foreign places. They want to hand a phone off to another member of the household. All good reasons. All somewhat dampened by $50. Or if you’re unfortunate enough to want to unlock after you leave sometimes you have to call back and face an even higher charge than $50. So, yes, that is absolutely a barrier to switching.

400 THE CHAIRPERSON: And you haven’t seen competitive suppliers stepping up and saying “Yeah, we know you’ll have the unlocking fee if you come over to our services and we will pay for the unlocking for you so you can come over”? Have you seen any of that in the marketplace?

401 MR. LAWFORD: There may have been a little bit. I’m not totally aware of it. I know it’s happening in the United States. And that would be a nice market development, but it doesn’t really solve the problem.

402 And given the market structure here, I don’t see people -- sorry -- companies doing that just to pick up market share. They might. But that’s why we were asking for the unlocking rule they have in the States. At the very least, if you’ve paid this thing off, there is no rationale for it.

403 THE CHAIRPERSON: I don’t understand that. If you’re saying that I’m -- it’s a barrier to a more dynamic marketplace that we’ve set up -- the fact that your phone is subsidized doesn’t make you any less the owner of the phone.

404 MR. LAWFORD: Absolutely, at least on our view, but ---

405 THE CHAIRPERSON: So why would you compromise and suggest that there should be unlocking fees even when there is a subsidy?

406 Because you’re supposed to be able to walk away, it may cost, but you’re supposed to be paying off a certain amount of money.

407 MR. LAWFORD: If you ---

408 THE CHAIRPERSON: And that’s provided for in the Code based on a straight line -- 24-month depreciation period.

409 MR. LAWFORD: Sure. That’s an argument. And if the Commission is leaning that way, we would be quite happy that there was no charge for unlocking your phone at any time.

410 There is a number of consumers who made similar comments in the public comments, didn’t understand why there has to be any charge because they already paid for their phone, and they’re amortizing it, and they believe they own it.

411 I think some of the companies think they still have some kind of security interest in phones and they make other arguments about fraud and so on that may have to be addressed.

412 But, you know, if the Commission is leaning towards that, or if you’re thinking about it, then we would be supportive of zero dollars at any time.

413 THE CHAIRPERSON: What if the cost of unlocking was part of the amortization -- the cancellation calculation?

414 MR. LAWFORD: It gets complicated now, because you’re raising the -- you’re raising -- anything that raises the early termination fee again is going to act as a barrier for more people. Not everybody unlocks. It’s going to start getting in calculus now about how many people unlock and how many people don’t, who benefits and who loses if you do that.

415 THE CHAIRPERSON: Right.

416 MR. LAWFORD: So I’m not sure.

417 THE CHAIRPERSON: Well, perhaps I should have just laid some groundwork beforehand. I mean, do you think that the eventual unlocking fee, in the assumption that, you know, you can unlock once the subsidy period is over, should be disclosed in the Critical Information Summary?

418 MR. LAWFORD: Yes.

419 THE CHAIRPERSON: And since its disclosed in the Critical Information Summary, in that hypothesis it can be added to the value of the subsidy, could it not, and ---

420 MR. LAWFORD: You could ---

421 THE CHAIRPERSON: --- amortize over 24 months?

422 I’m not sure how you will know at every moment how much it will cost to get your unlocked phone.

423 MR. LAWFORD: This is getting messy.

424 We oppose having extra costs on the early termination fee. Not everybody unlocks, as I said. There seems to be no actual carrier. Costs are very low to this thing. So unless you couple that ---

425 THE CHAIRPERSON: I’m not looking it as a cost of a telecommunication service. I’m looking at it as a barrier to switching.

426 MR. LAWFORD: And so am I. And so what I’m saying is maybe you can do that if you say it’s $10. Because WIND used to charge $10 for unlocking. If it’s $30, no; if it’s $50, no way, that’s way too much. So if it goes into the Critical Information Summary and into the amortization as $10 over 24 months I think that’s fine.

427 THE CHAIRPERSON: But, by the same token, I know you don’t want to pay that, but a company could raise the price on the device and -- as well, right?

428 MR. LAWFORD: There’s that possibility as well.

429 THE CHAIRPERSON: And some would argue that it’s exactly what they did.

430 MR. LAWFORD: Already?

431 THE CHAIRPERSON: Well, when the Code came into effect, right.

432 MR. LAWFORD: So ---

433 THE CHAIRPERSON: And we were blamed for that.

434 MR. LAWFORD: Right. And is this double-dipping then if they do it again?

435 I mean, this is the trouble, if you don’t price regulate ---

436 THE CHAIRPERSON: Apparently the CRTC has wide shoulders. Every behaviour in the marketplace is ours.

437 MR. LAWFORD: I know, but ---

438 THE CHAIRPERSON: Pretty soon we’ll be blamed for the war in the Middle East.

439 MR. LAWFORD: Well -- but lots of weird things happening these days. I agree with you.

440 It’s hard. Unless the Commission is in the game of price regulation, if you -- a fee here it can squeeze out over there and there’s not much we can do about it.

441 But what we’re looking for is the same as what you’re looking for with the Wireless Code, increasing dynamism. So adding extra to the early termination fee seems to reduce that, and also having a high unlocking fee that has no relation whatever to the actual cost of unlocking also seems to be another barrier. There has to be a way to get around this.

442 THE CHAIRPERSON: It’s been suggested by Professors Middleton and Shepherd that the Commission should request reports on practices and policies and fees in respect to unlocking. Are you supportive of that? Is that sufficient, assuming we don’t adopt your proposal, is that sufficient?

443 MR. LAWFORD: Not sufficient. I think having data allows you to decide whether the rule that we’re asking for is helpful or not. I guess I’m belt and suspenders, so both. Just the data alone, as each day ticks by there are more people paying $50 to unlock their phone, so that’s what we’re trying to remedy. So just data alone when in two years we think you’d find that you’re going to have to regulate the price anyway, why not just do it now?

444 THE CHAIRPERSON: I don’t think I’d put it quite at “regulate the price.” We’re here to decide whether it is a barrier to a more competitive dynamic.

445 MR. LAWFORD: Right. I misspoke.

446 THE CHAIRPERSON: And that would be your position even if those reports were published and that people knew what others were charging for unlocking and might be able to see that their own carrier is being unreasonable?

447 MS. LAU: I think additional data is always beneficial, but if we just look at unlocking fees today compared to what they were three or four years ago, they’re either the same or they’ve in fact gone up, in the case of Freedom Mobile. So we think that there is enough evidence to urge the Commission to be more prescriptive when it comes to unlocking fees today.

448 THE CHAIRPERSON: Thank you. Even if more reporting may have the effect of increasing the operating cost of carriers and, lord knows those costs are never passed on to shareholders, they are passed on to consumers.

449 MR. LAWFORD: Always a risk, but the benefit we’re looking for here is, to the individual we would hope, less than the amount they’re going to add on. You never know. Like again, I guess we get into this game of price regulating everything.

450 THE CHAIRPERSON: Right.

451 MR. LAWFORD: You’re never going to know; right? But ---

452 THE CHAIRPERSON: But what I’m saying is your price -- your belts and suspenders approach may actually cost more to the carrier and therefore consumers that maybe we should attack the issue more directly. Yes, there may be loss of revenue if you prevent because it’s a barrier to a more competitive marketplace, prevent unlocking fees in certain circumstances, or maybe all circumstances, and not requiring the carriers to spend the money to do reports.

453 MR. LAWFORD: Okay. That’s fine then. But you know what? There has to be components monitoring. Somebody has to look and see if they’re doing what they are -- have been told to do.

454 So the extent that the CCTS has already been set up and those costs are ongoing so there wouldn’t be extra costs because they could check up on it, to the extent they have complaints on that issue, and -- and, as we recommended, you know, there has to be some kind of oversight by the Commission. So if, despite the fact that you say, for example, we want to have the unlocking fee lowered to $10 because we think it’ll make the market more dynamic, somebody has to check up to make sure that nobody’s charging 15 or 50.

455 THE CHAIRPERSON: Right. But regardless of the norm that you get to because you want to encourage a more dynamic marketplace and matter of policy, that becomes a standard in the Code and would be implemented. I’m not getting your point. Are you ---

456 MR. LAWFORD: Yeah, no, my point is simply that there are some things in the Code that say X or say black and people do white, you know, like so you have to have some compliance. So if you say this is the unlocking rule and people don’t follow it, then all we’re saying is there has to be a mechanism to check up on them and to stop them from doing that.

457 THE CHAIRPERSON: Yeah. We used to say in tax law there’s a loophole in every 10 words. I guess you’re saying that there -- your concern that despite what would appear on the face to be a clear rule that it may not be actual practice in the marketplace or that people would find ways to get around it.

458 MR. LAWFORD: Yes.

459 THE CHAIRPERSON: One of the objectives of the previous -- when we set up the Code was to improving contract clarity. If you had to prioritize one change to enhance clarity of the wireless contracts and their related documents, what would that be?

460 MR. LAWFORD: We’ll be right with you. Clarity of contracts. Well, the Critical Information Summary is the most clear part of that contract, as far as we’re concerned. So to the extent that you can make that absolutely clearly be the first two pages that are given to people and ideally separately, that would assist.

461 The one thing. No one has gone through these things, although it would be a bit of work, to see what the reading level is and whether terms are friendly and understandable. So I guess I would agree with some of the submissions I’ve seen that there needs to be some thought about actually going through standard contracts with the providers and coming up with language that’s more accessible.

462 THE CHAIRPERSON: It has been the subject of differences of opinion as to whether or not data services are a key contract term or an add-on or optional service. I take it your view is that in light of the current market how broadband has become essential, basic in fact, that it must be -- whether it should have been in the past, let’s not have a debate as to what the past said, but going forward it should be seen as a key contract term?

463 MR. LAWFORD: That’s our submission. Also, yes, as you may have alluded to the basic service. Hearings happened and the day that -- whether wireless or wire line is basic service now so, yes.

464 THE CHAIRPERSON: Whether or not it is currently going forward you think it should be?

465 MR. LAWFORD: We have thought it always has been a key term. I mean, unless there’s very rare circumstances where the carrier can show that it’s truly a very tiny add-on to an otherwise ---

466 THE CHAIRPERSON: Well, the CCTS has actually noted that wireless service providers are selling data services as add-ons.

467 MR. LAWFORD: Yeah, and that’s a problem. And as we said before, we thought that was an example of systemic non-compliance with the Code because of the wording of the Wireless Code and because of just the general sense, I believe, in how consumers view their contracts is data to them is essential. It’s the reason why they get cell phones. And to say that it’s not a key term is cheating, to be honest. It’s not lining up with expectations of consumers. It doesn’t line up with the words of the Code. The CCTS has said it doesn’t line up with the words of the Code. How much clearer do we have to make this?

468 THE CHAIRPERSON: It’s been suggested and I guess you’ve hinted at it as well that devices should be completely sold separately from the wireless plan. What are the implications and benefits for consumers for having -- for doing so?

469 MR. LAWFORD: Theoretically, consumers could shop for the best device and then the best service. Practically, the way the market is structured in Canada, those are never offered separately and that makes it extremely difficult. So to some extent, that submission was premised on let’s say a division of service and device that is hard to get to.

470 And theoretically, as I said, it helps to give consumers a clarity of how much they’re paying for the service, which is a really interesting problem in Canada because we really can’t tell what the cost of service is. But practically speaking, I think it would -- maybe we couldn’t get there quickly. I mean, we’ve suggested that this might be something the Commission would want to think about but it’s not an easy job.

471 THE CHAIRPERSON: Why don’t you think it’s an easy job?

472 MR. LAWFORD: The -- I can just hear the companies writing stuff down right now. There’s probably a million arguments as to the economics of wireless service and how that interacts with device subsidy and the way that the economics has been worked out for the next few years for the iPhone 8 and the Note 8 or whatever it’s going to be. That you will hear about in spades.

473 There is no reason why, again, theoretically, this couldn't be broken out, but I guess it's unfortunate that that proposal ends up being for looking at pricing and in a way that the Commission is not doing price regulation. So costing, that sort of thing.

474 THE CHAIRPERSON: But one could, without getting into setting what the price would be, at least requiring that the charges be separated on the monthly bill?

475 MR. LAWFORD: Yes, and to the extent I think that some carriers are pretty clear about how your amortization is going down, that's a good practice and we support that. So I believe Telus does that, some others as well.

476 And that, I think, really assists consumers to see what, at least notionally, they feel what portion is going to their device and what portion is going to their service so they can at least get a sense of that service price so they can shop around. Getting deeper than that, it gets complicated.

477 THE CHAIRPERSON: Right, even though it may actually have carriers competing on telecommunication services as opposed to accessories around the telecommunication service?

478 MR. LAWFORD: Yes, that would be a benefit of at least asking them to clearly show the amortization of a device on each bill. That would be a benefit. Getting more granular than that might take some thought.

479 THE CHAIRPERSON: Okay.

480 The last time around there was a lot to do about the implementation. Assuming that we are modifying the Code in some part, when do you think those changes should come into effect, and should they apply across the board regardless of the state at which the contracts are?

481 MR. LAWFORD: Right. Yeah, we did make some submissions on this towards the end of our written remarks, and this time around, it may be wiser to give a going forward date. So from the decision, going forward two years, or a year, or whatever you decide is an appropriate on ramp, all contracts will have to have the following changes.

482 And I just -- it comes from hard experience. I mean, perhaps you'd like to put a drop dead date in there, but most of the Wireless Code, what we're suggesting are changes, maybe it would be beneficial but it's not crucial, crucial to have everybody have it within six months. Unless you feel otherwise, but you know, you're sticking your neck out there because we'll be right back in the Federal Court of Appeal again probably, and why go there.

483 THE CHAIRPERSON: Why do you say that? When we adopted the Wireless Code, yes, there was some litigation, but when we said we would be reviewing the Code, was there any expectations that the Code would remain unchanged as a result of that review ---

484 MR. LAWFORD: No, no. We're just saying that ---

485 THE CHAIRPERSON: --- to want people on notice that that's a possibility and they should have planned accordingly?

486 MR. LAWFORD: Absolutely, but I'm just saying if there are a number of changes that need to be made, and you get a sense from the other intervenors of how long that's going to take, it just may be less rancorous to have it come into effect, as long as it's not too long, on a prospective basis.

487 THE CHAIRPERSON: Right, although I'm not aware of any principle in law that says that you can contract out of your regulatory obligations?

488 MR. LAWFORD: Absolutely not.

489 THE CHAIRPERSON: So why would you agree to delay, perhaps up to a period of, it's unclear what your position is, perhaps two years the benefits of changes, which you are saying, are critical to certain consumers?

490 Aren't we creating two classes of consumers? Depending on when they contracted? Despite the fact the companies have been put on notice that there might be changes?

491 MR. LAWFORD: I don't know. I mean, the result of the Federal Court of Appeal was that the Commission appears to, at least at one time, have authority to set a date when it's your view that consumers need to have that in order to have a more dynamic market, and you can do it; you can do it.

492 I do not know the effects of, for example, our request on the companies to have unlocking limited to zero. I do not know the effect of the -- any other restrictions we're putting on them that might cost money, so you'll have to hear and make that decision. You have the authority, if you wish, to set a drop-dead date if you think consumers need it, then sure.

493 I'm just saying -- I'm stopping there.

494 THE CHAIRPERSON: Okay.

495 My last area of questioning, before I turn to my colleagues, is around awareness of the ability to seek recourse to the CCTS.

496 And I take it from reading your submission, you know, you have concrete ideas at paragraph 42 as to when that awareness making should occur. Yet at paragraph 44, you do admit that it's when they have the most direct accesses through the wireless service providers that they need the relevant information.

497 But when we did the review of the CCTS, there was a concern that consumers need that information when they're more likely to put it into use. In other words, when they are in the context, or about to be in the context of a dispute and there's a risk of communicating information too early or at a time when it's not really useful for the individual consumers.

498 MR. LAWFORD: There are two types of awareness. There is general and specific.

499 General awareness is, oh, I think there is something out there that protects me. I've heard about it, it's called the Wireless Code. Oh, I think there is someone who looks after this free and takes my complaints without me having to do anything, really, except complain, CCTS or somebody; I can find it.

500 That's the general awareness we're talking about. That's when we were saying the Commission should run ads, you know, and there should be more on the bills, that sort of general awareness, so that when people say, oh, no, I have a problem. Oh, yeah, there is something. I don't have to just despair and pay the bill.

501 That's what we're talking about. They'd go and they'd find the Wireless Code because they, oh, yeah, I saw something on my bill last month about that. Oh, yeah, I heard on the, you know, on the news or I heard in a public service announcement there's this body called CCTS.

502 Then there's specific, and that's what we're realty speaking to at the end of our remarks is the specific situation. It's when you have a chronic sudden need, because you're on the line for a consumer issue, and you're taking time out of your day to call these guys and stay online for a half an hour. When you get there, if you can't resolve it, that's exactly when you need to know or be reminded of the exact process.

503 So that's what we're trying to cover, general knowledge, specific. That way you can cover more people at the right time with the right tool.

504 THE CHAIRPERSON: It's been stated that only 32 percent of wireless service providers actually inform your customers of their right to recourse to CCTS, I guess after the -- following the second level escalation within the company.

505 Do you agree with me that that is contrary to the CCTS Participation Agreement?

506 MR. LAWFORD: Yes, and it's a big problem because theoretically the industry should be supportive of CCTS and they should be enjoying the fact that they have a system set up to deal with their most difficult complaints that they can't resolve, but they seem to erring to the side of hiding it. And it's frustrating, so yes, I agree with you.

507 THE CHAIRPERSON: So why not put the obligation to inform customers of the CCTS recourse, following the second level intervention -- escalation – sorry, in the Code itself?

508 MR. LAWFORD: that would be a fine idea. The way that the -- the way that it ended up happening with this second level of escalation was that it was kind of downloaded to CCTS to set that.

509 If the Commission is willing to put it into this Code as a way to enable customers to use the Wireless Code, we would support that.

510 THE CHAIRPERSON: And what of the obligation on wireless service providers to report to the CRTC on the number of customers who have reached the second level of escalation within those respective companies; is that a useful thing?

511 MR. LAWFORD: That is a very useful thing. It's interesting because in the banking system, the Minister of Finance requires the banks to provide their own figures on complaints internally for their internal ombudsman. So it’s not unprecedented. And it’s interesting to compare the number of complaints to the bank’s internal ombudsman with the OBSI, so the Ombudsman for Bank and Services Investments, the federal one that’s set up, because there is a 10 to 1 relationship.

512 So it would give the Commission a sense of are consumers being -- are they complaining? How much are they complaining all the way through a CCTS? And then, how much percentage of that is Wireless Code violations? And, you know, it would give some evidence, to be absolutely honest on the record, as to how companies are dealing with complaints. If they’re resolving 90 percent of them -- I’m sure they’ll come up here and say they are, well, we’ve got some proof if then. You’ll know for sure. And if there are problem spots, for whatever reason this carrier is not reaching anywhere near what the others are, perhaps it would help the Commission help that carrier.

513 THE CHAIRPERSON: Is it your view that such a provision would actually help achieve the outcomes that we’re looking for to achieve in this proceeding?

514 MR. LAWFORD: Actually, yes.

515 THE CHAIRPERSON: How so?

516 MR. LAWFORD: The outcomes that we’re hoping to achieve in this proceeding is not that there’s a super tough Wireless Code and the companies will get nailed every time that they violate it. That’s not it. It’s to have a telecom system where customers are respected, they get their rights vindicated and the companies are already following the rules without even having to get to the CCTS. So as long as consumers are happy, we’re happy.

517 THE CHAIRPERSON: Seems like a simple principal, although there’s different views of what consumers want and don’t want.

518 My colleagues apparently have no additional questions for you, nor does legal. So thank you very much for your appearance. It’s very useful and we’ll adjourn a bit late for our mid-morning break, but we’ll come back at 11:05 to continue. Thank you.

--- Upon recessing at 10:53 a.m.

--- Upon resuming at 11:06 a.m.

519 THE SECRETARY: Alors, s’il vous plaît.

520 THE CHAIRPERSON: Yes, order, please at the back of the room.

521 Alors, madame la secrétaire.

522 THE SECRETARY: Mr. Chairman, the Commission would to enter into the record a document called -- that will be called CRTC Exhibit 1. It is a list of questions for parties to answer by February 16, so copies are available in the examination room and it should be on the website shortly as well.

523 THE SECRETARY: Sorry. We’ll now hear the presentation by Eastlink. Please introduce yourselves for the Panel first, for the record, then you have 20 minutes.

PRESENTATION

524 MS. MacDONALD: Thank you. Good morning, Mr. Chairman, Mr. Vice-Chairman, Commissioner MacDonald and Commission staff. My name is Natalie MacDonald. I’m VP Regulatory for Eastlink. And with me today is Denise Heckbert, our Director of Wireless Regulatory.

525 It is almost four years to the day that we appeared before the Commission under the proceeding that led to the creation of the Wireless Code. Later that same week, Eastlink launched our wireless business in Halifax. Since our launch in February 2013, we have expanded our operations throughout Nova Scotia and PEI, and have begun offering voice over LTE wireless service in northern Ontario and New Brunswick, on Canada’s only 100 percent LTE wireless network, with more service launches to come this year in predominantly rural areas across Canada.

526 We said at the time of our launch that the proposed Wireless Code was in line with our business approach and our philosophy of earning our customers’ business each day. For example, we did not require term contracts, 30-day notice requirements for service cancellation, or large early-termination fees, even before the Wireless Code was established.

527 Today, we have maintained our commitment to putting customers first. Our innovative easyTab device subsidy model separates the cost of the device from the cost of the monthly service plan, so that once customers pay off their device, which they can do at any time, the monthly device fee is removed from their account and they pay only the service fees. In addition, this flexibility allows customers to pair any device with any plan available in -- with Eastlink, rather than requiring them to select larger monthly plans simply because they want the latest premier smartphones.

528 We have also recently launched our Worry-Free Data service which allows account holders to set, manage and remove caps on each device on their account separately. For example, account holders can cap data use at the amount included in their plan, they can cap data use at the $50 overage amount established in the Wireless Code, or they can remove caps altogether, as they choose for each individual device on their account. Eastlink sends the device user notification at 75 percent and 100 percent of the included use, and when the $50 overage amount is reached. However, only the account holder can authorize additional use above the cap they have established. This ensures that account holders receive the bill they expect to receive, and helps them to effectively manage the wireless data used by each person on their account.

529 At the same time, Eastlink has released our self-care application, available for free download and for which we do not apply mobile data use charges. The app has received excellent reviews in the application stores, and allows each device user to monitor their voice, data, SMS use, while enabling account holders to manage Worry-Free Data settings and monitor use for all phones on their account, as well as add travel packs for U.S. and international roaming, and make other account updates.

530 Eastlink has launched these customer-friendly features and services in response to feedback from our customers in an effort to help them better manage their accounts. We remain committed to listening and responding to customer feedback in innovative ways as part of our ongoing effort to earn our customers’ business each day.

531 MS. HECKBERT: Eastlink supports the provisions of the Wireless Code that have made it easier for consumers to switch providers and that have helped ensure that customers fully understand the terms and conditions of their wireless service agreements. These provisions have helped consumers to choose the wireless plan and service provider that best suit their needs, and to more easily take advantage of competitive offers in the marketplace.

532 The positive impact of the Wireless Code for consumers is clear. The CCTS annual report statistics indicate a 17.6 percent decrease in wireless service-related complaints per 10,000 subscribers between 2013 and 2015. The Code has ensured that all wireless providers offer clear contract terms to consumers, and customers can take advantage of new wireless service offers in the market, encouraging providers to offer increasingly competitive customer-friendly services. As a result, Eastlink expects that this trend of decreasing complaints is likely to continue.

533 We submit that one of the key reasons for the Wireless Code’s success is that it focuses on requiring that service terms and conditions be clear, and reducing barriers to switching service providers. The Wireless Code generally avoids being overly prescriptive regarding the language service providers use to describe their terms and conditions, the structure of our plans and device subsidy models, and what tools we provide to help our customers effectively manage their monthly usage.

534 The Commission’s approach provides wireless service providers the flexibility to be innovative in the service plans and features we offer our customers, and does not favour one approach over another. For example, the Wireless Code does not inherently favour term contracts over indeterminate term contracts, plans that separate the cost of the device and plan over those that do not, or any particular data usage management tools.

535 Eastlink submits that this is the right approach and that any changes that may be made to the Wireless Code should seek to maintain this important balance. Eastlink is a relatively small, rural provider and is, in some areas where we operate, the only competitive network that offers an alternative for consumers. We are competing against much larger service providers with substantial urban subscriber bases, which they can use to lower their average cost of serving each of their customers. We further pay these urban providers large monthly fees for wholesale services.

536 Eastlink submits it is critical that we continue to have the freedom under the Wireless Code to offer new and innovative services and plan models to Canadians living in our operating areas, and that our approach not be inadvertently disadvantaged or limited in the market.

537 MS. MacDONALD: As we stated earlier, Eastlink supports the Wireless Code, which continues to be consistent with our consumer-friendly, customer-friendly approach. The Wireless Code has reduced the barriers to switching service providers and helps ensure that Canadians can fully understand the terms of their service arrangements. It has generally done so without inadvertently limiting service providers’ ability to be creative in offering new services that benefit consumers and without favouring particular business models over others. Insofar as any potential changes resulting from this proceeding maintain the important balance, we expect that the Wireless Code will continue to benefit Canadian consumers in the years to come.

538 This concludes our presentation and we welcome any questions.

539 THE CHAIRPERSON: Thank you very much.

540 Vice-Chair Menzies will start us off.

541 COMMISSIONER MENZIES: Thank you.

542 Much praise for the Code.

543 How has the market changed in terms of incentives for better customer service, do you think, in the last few years?

544 Mr. Lawford made the point that the Code had changed the market, and it, no doubt, had an impact, but there’s also a point to be made that the need to retain customers as opposed to acquire them may have changed some behaviours in the market, but I’d just like to hear your comments on that.

545 MS. McDONALD: Okay. Sure.

546 Well, first of all, we heard what Mr. Lawford said, and we don’t necessarily agree. I note that he does rely on the -- you know, the fact that Public Mobile and Mobilicity are no longer here.

547 But, you know, since the Wireless Code came into effect Eastlink, as we noted, we launched the year it came into effect and Eastlink is -- well, you know, we’re a strong regional provider, we’re expanding our business, and we’ve done quite a bit over the year since the Code came into effect.

548 We’ve noticed, you know, impacts in our market in terms of competitive response to our entry, and we also know that, including ourselves, there’s three strong regional providers that are doing the same in their markets and continue to build their service.

549 And just to speak about some of the innovations that have come since the last Wireless Code, I can refer to -- Denise can speak to some of the things we’ve done.

550 MS. HECKBERT: Yeah, the -- for example, I think there’s been a series of launches since we -- Eastlink launched just during the Wireless Code proceeding in 2013, and even just in the few years that we’ve been in service since the Code came into effect we have separated the cost of the device from the cost of the plan and changing our easy tab model and we’ve seen recently some other carriers trying new things with their tab models. We have launched our worry free data, which provides the notifications and cap -- customized -- well, caps that can be applied or removed at various levels across different devices on the accounts. Shared plans in general are a new feature that have really come out since -- and been developed and elaborated since the Wireless Code came out.

551 All of these are examples of carriers -- what Eastlink’s been doing to be additionally customer friendly, to keep customers not just through rates, which our rates are obviously competitive, but also in services and features that provide better value that are certainty for customers and a better experience of using their wireless services. And we’ve certainly seen some other carriers doing some comparable things in some cases in the market.

552 And that’s not even to mention the massive buildouts that have been happening over that period. We’ve seen large LTE expansions. Eastlink launched the first 100 percent VoLTE network in northern Ontario in rural areas just this past summer.

553 So it’s kind of a -- you’ve got to look at the competition across three factors, which is the technology, the network build, competition, the consumer friendly features like worry free data and those other data management tools, and then ultimately on pricing as well.

554 COMMISSIONER MENZIES: So those are all features that -- you listed there the number of different things you offer, but those are -- are those all efforts to differentiate yourself in the marketplace to make your -- you’re finding a competitive edge with those changes?

555 MS. HECKBERT: Yeah, I would say worry free data certainly was something that took a while to build to make sure we had it working properly and that it was meeting the customer concerns and questions that we were hearing from our own subscribers and the potential customers that were coming to our store. We certainly see it as a differentiator for us in the market.

556 You could hear from the presentation this morning about how some consumers want to have -- account holders want to have additional control over how their data is capped, whose capped, and how they can manage it, and so we definitely see that as a major differentiator for us in the market.

557 MS. McDONALD: And, of course, striving to be a differentiator and to fulfil consumers, you know, needs and demands. The ultimate motivation is that we want to acquire customers and expand and we want to keep our customers happy. So it’s all, I think, connected, you know, becoming a differentiator and offering those services.

558 COMMISSIONER MENZIES: Right. And those are all in addition to price competitive ---

559 MS. McDONALD: That’s right.

560 COMMISSIONER MENZIES: --- in terms of that.

561 In terms of -- you mentioned here that the Code was designed to make it easier for people to switch providers in terms of that. But, as we’ve heard earlier today, there doesn’t seem to be a lot of churn in the marketplace. What -- how can you help us understand that a bit more in terms of overall?

562 Obviously as a relatively new competitor you are the beneficiary of churn, I would think, more than the -- you’re gaining more from what churn there is then you’re losing from it. But the churn numbers mentioned this morning were very low. Comment?

563 MS. McDONALD: And I think the comment on that, and I think as Mr. Lawford also said, he can’t speak to the cause, and we can only say that, I mean, we’ve been providing our services and doing all kinds of things and building out at the same time for the past -- over the past three years and when the Code came into effect it was sort of at, you know, the beginning of consumers having the ability to switch and change services in the sense that they weren’t tied to the longer term contracts anymore.

564 And so we’re three years out. Of course as we acquire customers we’ve got, you know, services that are attractive to them so we like to think that, you know, low churn means customers are finding that they’re finding plans that meet their needs and are satisfying them.

565 So I don’t know that we could speak to the cause of the churn. I would say any service provider is certainly interested in keeping their customers happy and limiting the churn out as well.

566 But with the two-year period that was offered for the contract period in the Code, I think that that allowed for some movement to the new entrants and gave consumers a little more flexibility to make changes.

567 COMMISSIONER MENZIES: I’m just going to touch on a few more specific items now.

568 The consumer groups seem to be concerned about the issues around prepaid services. Why do you think they’ve made that determination?

569 MS. HECKBERT: Do you mean about separate -- or considering pay in advance monthly plans ---

570 COMMISSIONER MENZIES: Yes.

571 MS. HECKBERT: --- the same as post-paid?

572 I’m not sure why they’ve made the determination they’ve made. We do offer the pay in advance prepaid plans. Basically we offer them because sometimes it’s easier for prepaid customers to understand the amount they’re paying for or their remaining balance in terms of minutes, megabytes, and messages -- although ours are all unlimited on our pay in advance plans -- then it is for them to understand remaining dollars and cents.

573 But the underlying principles of a prepaid pay per use type plan, the traditional, and the prepaid monthly plan are the same. People top up -- customers top up their account via prepaid card, or vouchers, or by setting up automatic top ups. They can never use any amount they haven’t already paid for. All they need to do to terminate is to simply not top up their account one month. Similarly, you know, they don’t have to provide the same level of personal information that you may for a post-paid service. They are on month-to-month. All that sort of stuff is the exact same, the same limitations.

574 In Eastlink’s case, we don’t offer subsidized devices on the prepaid whether it’s the pay per use or the monthly plan so there’s no need for deposits, there’s no early termination fees.

575 So from our perspective prepaid is the same underlying principle whether you’re stepping down a monthly usage by megabytes and minutes or by dollars and sense.

576 COMMISSIONER MENZIES: Right. Because you did seem in your submission -- your November submission -- to see it as kind of a non-issue.

577 But do you only do month-to-month prepaid? Because I could see it being -- there being a bit more of an argument if, you know, you were pre-paying for, say, 12 months, or six months, or a lengthier period of time.

578 MS. HECKBERT: Well, we do have -- there’s two issues. So if you’re looking at the traditional pay per use where you get a prepaid card and top up, we do offer dollar amounts that will cover a year-long period so that customers don’t have to come in every month and top up their account, but we don’t consider that a year-long contract. We don’t have term contracts at all, but they could use that $100 in the first day if they wanted and that would be the end of that term. It’s simply that we’ll allow that balance to carry over month to month without the customer needing to do anything, but those have been around for years.

579 And then for the monthly plans, a customer has to keep the account topped up, so if it reaches the end of a 30-day period that they have pre-paid for, either they have to go into self-care or get a pre-paid card or get a voucher and top up their account again for, say it’s a $25 monthly plan, they would have to have that $25 in their pre-paid account balance or else the account would end. That’s it. The term would end.

580 But as long as they have that $25 in their account, whether they do it by automatic top-up, or voucher, or pre-paid card, then it would roll-over and continue month to month, but it’s always month to month. We don’t have any term contracts at all. Not even on post-paid.

581 COMMISSIONER MENZIES: So I could pre-pay say a couple hundred dollars into it and then want to leave before I’d spent that and my money would be refunded? How does that work or not?

582 MS. HECKBERT: No it would be similar to how pre-paid – a traditional pre-paid is, where account balances are not refundable. But what the – what they typically would do is just put in the amount and then maybe $5 overage protection or something in case they want to use a little extra or they want to -- the amount in their account -- in their pre-paid balance could also be used to add a data top-up if they wanted to use a little extra data in a month or a text messaging package to text the U.S.

583 So they would traditionally keep more -- an amount more in line with what their monthly plan is going to cost.

584 COMMISSIONER MENZIES: So I’m taking it the people who take advantage of this plan are probably people who are very sensitive to their usage and keep track of it very closely? Is that correct? Is that the sort of person that this appeals to or is it more a case of people with credit issues? I’m trying to understand the -- that market.

585 MS. HECKBERT: Yes, there’s a few types of different users. Some are very low volume users. You could get a -- keep your phone active month to month for less than $9. A month with Eastlink via pre-paid and that’s going to end up being much less expensive than any other plan you’ll find. So there’s the -- just the very low volume users who kind of keep it in their cars as backup.

586 There’s new Canadians or very young Canadians who may not have a credit history. This is a good way for them to get access to service without, you know, having to provide too much personal information.

587 There’s also users who simply do not want to provide too much personal information for a variety of reasons. So pre-paid is good for them. So you kind of get a mix of different people with different needs.

588 COMMISSIONER MENZIES: Would it do any harm to require providers to offer a Critical Information Summary to pre-paid customers?

589 MS. HECKBERT: Well I can say from Eastlink’s perspective, we do provide all pre-paid customers -- our Critical Information Summary is the first two pages of content in our service agreement and we do provide all pre-paid customers a service agreement and therefore the Critical Information Summary with the key terms of their – of our service and what they’ve purchased from us.

590 So from our perspective that would have no impact on us.

591 MS. MacDONALD: And the other thing I would add is on our website we have quite a bit of detail about pre-pay, for anyone looking for information or any customers who are considering it and there’s also pre-paid sections in our terms of service, our standard consumer terms of service. So there’s lots of information out there for pre-paid customers.

592 COMMISSIONER MENZIES: Okay, so that’s what -- you were already doing that, so if we were to make that a requirement it’s non-contentious from your end?

593 MS. HECKBERT: I think the only -- it wouldn’t be for us, but I think the only comment we would make to that is we can’t speak to, you know, systems and processes and establishing them, whether that creates an unnecessary or an undue burden, given the nature of perhaps other pre-paid plans.

594 So we can’t really comment but we are already doing that.

595 MS. MacDONALD: Yes and I would also clarify that in our service agreement that all pre-paid customers receive it separates out -- there’s a pre-paid section in there that explains for example their termination provisions are different than a post-paid customer’s termination provisions. Their -- how their account balance is managed is subject to slightly different provisions, so there is a carve out for them.

596 So wouldn’t want -- I just want to make clear that providing them with a Critical Information Summary doesn’t mean we consider them to be subject to the same terms and conditions in every case as a post-paid customer.

597 COMMISSIONER MENZIES: Okay, thank you.

598 The issue of bill shock, it appears to be in retreat but still present for many people. What is -- and as you’ve described you’ve been relatively new into the industry, what is -- what is your take on bill shock and what has been your experience with your customers and how do you -- what have you done to attempt to manage it?

599 MS. HECKBERT: Well first I would say that even in hearing some of the discussions, I mean it’s great to hear that issues and incidents of bill shock seem to be going down.

600 I did note that in the 2016 public opinion survey in the fall there was a reference to bill shock and I noted that it seemed to have occurred most often for consumers who were surprised in the amount of -- the overage was in the less than $100 range.

601 And it’s hard to know exactly what the reason for that was, but you know I would suggest that it may be attributable to the fact that the Wireless Code has established a $50 cap for on-network and a $100 for international and perhaps the bill shock might just have to do with customers not -- perhaps being as clear in terms of the relation with their service provider or how those -- those terms were communicated, because I’ve -- it struck me that the bill shock amount, the overage, was -- seemed to be primarily in the less than $100 range versus significant, you know, overages, although I recognize there are some.

602 From our perspective, we have really worked to ensure that our customers have all kinds of opportunities to manage the bill and to decide how they want their data shared and I’d like Denise to describe some of the different scenarios that we offer for customers to select from.

603 COMMISSIONER MENZIES: As you’re doing so -- because it was going to be my next question -- you’ve segued into it already, can you just let us know how you came to establish these protocols?

604 MS. MacDONALD: Sure, ah well since Eastlink launched we have – our philosophy -- well since Eastlink launched our wireless business in 2013, our philosophy has been to protect the account holder. They’re the one whose credit history, their payment history affects. They’re the ones who are committing to us to pay the bills.

605 So we -- our philosophy has always been to make sure that they are getting bills that they expect, charges that they expect and taking responsibility only for credit that they have expressly consented to themselves.

606 So for example, right from when we launched, even on an account with multiple devices, we had a very strict rule that only the account holder is allowed to authorize additional devices being purchased on the account or different additional lines being added to the account.

607 Because sometimes prices can cost up to $1,200 and we want to make sure that that account holder in whose name the account is, is the one authorizing that additional $1,200 debt or easy tab as we call it, to be applied to their name.

608 So when we -- when we looked at worry free data, which was our approach to addressing bill shock, to helping customers manage their bills and -- it’s just stuck in the same vein of protecting that account holder. To make sure that they’re getting a bill they expect to receive. That they’re the ones authorizing additional charges.

609 And so that’s how worry free data works. We -- there’s three different kinds of data share plans that would modify how and in what way the data is capped and we work with the customers to make sure they’re choosing the one that they want, but the underlying premise is always that our default position is that we cap it at in-plan use. That every new customer is automatically capped at in-plan use. Then they can either modify via the self-care portal we have on our website or via the app that we have for free download or just by calling Eastlink.

610 The account holder can authorize that certain devices be able to incur up to the $50 that some end-users or devices may not have a cap at all and they can choose the setting that works for them or an authorized other. An account holder can give us a name and -- of anyone else, whether it’s their kid or their spouse or anyone really. It’s -- and they can expressly authorize them to make similar changes. That authorized other still can’t add devices, because that’s a big single charge, but they could authorize additional data use.

611 COMMISSIONER MENZIES: So only the account holder may authorize others in a -- to certain -- to authorize certain changes but it's all very -- it's very limited in terms of that. So is that correct? It's very specific I guess?

612 MS. HECKBERT: Yeah, basically, and also an account holder would have to call or visit a store. It's the only way to add an authorized other so that they're speaking to an Eastlink representative and they would have to give the person's name and then we would tell them expressly what that authorized other would be able to approve, not approve, what changes they would be able to make.

613 COMMISSIONER MENZIES: Okay, and you developed those -- that sort of structure for everything. So it's -- and to the extent that there is a $50 limit, it's to the account, not to -- not per line?

614 MS. HECKBERT: Well, that's where it gets into the three different kinds of share plan and we work with the customer to figure out what makes sense for their -- for their needs. And this is where we think the flexibility is -- retaining the flexibility under the Code to offer these different models is important because different consumers want different things.

615 So the first option would be you have a data share plan. There's one bucket of data, say 2 gigs, and four lines on the account. All four of those lines can equally access that 2 gig of data. And then the user can -- sorry, the account holder can then authorize either each of those four lines to incur $50 of overages each, or they can authorize only one, and it's up to them to decide how many of those lines can incur additional use.

616 The second kind is each line on an account would have their own data plan but they can all share each other's data plans. Similarly, an account holder could say, okay, these two accounts can incur $50 in overage, these two can't. But in those cases, the ones that are capped and not able to incur $50 overages would still be able to access the other two lines data because it's all shared data and there's no -- we don’t interfere in that. They're all able to share each other's data but at least then the account holder knows the maximum overage they're going to have is $100, just the two $50 charges they authorized on those two lines.

617 And then the final kind is each plan has their own data and it's not shareable between each of the lines. And in that case, there'd be no overlap. It would be strictly these two lines can get $50 in overages, these two can't. And so it could be up to -- on an account with four lines, it could be as high as $200 or it could be as low as zero dollars, depending on what the account holder wants.

618 MS. MacDONALD: So simply put, we leave that decision up to the customer within the framework of the different options we are able to provide them and they decide whether it's the account or the device and they pick what they want per device.

619 COMMISSIONER MENZIES: So that becomes a specific conversation that you have with the new customer, perspective customer where they are taken through those options and they decide. There is no default position that you offer. They have to make a specific decision regarding these overages authorizations.

620 MS. HECKBERT: Well, the default, as I said, would always be that it's capped in plan, so there is no overages. So every new customer, no matter what they're capped at, we default that they -- no one can incur additional usage. And then if they want to go into the portal or online or talk to Eastlink, then yeah, we would walk them through the different options they have of how to structure that to make sure they're doing exactly what they want.

621 COMMISSIONER MENZIES: And at what point do you notify them regarding their approach to their usage limit?

622 MS. HECKBERT: We send text message notifications to the device itself that is nearing the limit of its usage at 75 percent and then at a 100 percent of in-plan usage and if they are authorized to go up to the $50 cap, we would send it again at the $50 cap to let them know that their data is being suspended. They've reached 100 percent.

623 But the account holder remains the only one that's able to authorize additional use and the account holder also via our self-care app can monitor use on all the lines on the account at any time, free of charge. There's no data charges for use of that app. So they can monitor at any time but they -- and they're the only ones that can authorize usage.

624 COMMISSIONER MENZIES: Why did you choose 75 percent as opposed to say 95 or 90 or 85?

625 MS. HECKBERT: Well, we chose 75 percent as opposed to 50 percent because ideally customers are choosing the data plan that best suits their needs which means ideally they're using -- to make sure they're getting the value for their money, ideally they're using at least half of their plan every month.

626 So sending them a notice at 50 percent just might be too many notices too frequently and we thought might irritate customers. Seventy-five (75) percent though is meaningful. It gives them an opportunity to adjust their usage if they want to stretch out the remaining 25 percent over the remaining days.

627 It also gives them plenty of time to explore their options for -- we have one-time data top-ups that customers can add at any time. So they could explore those options. It doesn't force them to make a decision in real time if they happen to be travelling for business or away at a hockey tournament over the weekend. They might not have an opportunity between 95 and 100 percent to make those corrective decisions.

628 COMMISSIONER MENZIES: Thanks. What extent is voice roaming overages and charges an issue for you? CCTS pointed out that there was about 70 percent of the issues raised by customers last year had to do with voice roaming charges. Is that managed? Is that an issue for your customers?

629 MS. HECKBERT: I mean we -- in our self-care app and in the portal, customers can manage -- they can track as real time as we can get it. As the Coalition noted and as it came up in the proceeding in 2013, there are some challenges for getting real-time voice and SMS tracking data with roaming. But to the extent that we have the information, the customers can access it in self-care and on the app.

630 So I think that helps with the issue. I am not really aware of any major issues we've had with voice roaming. I certainly know we haven't had any complaints to the CCTS on it but I would have -- maybe we could take that away if you wanted to know.

631 MS. MacDONALD: And I think as well with the increase in more travel packages and that sort of thing that, you know, it's a fair statement to say that there's more options out there as well for consumers if they're going away to know, well, if I'm going to be using my phone a lot, then maybe I should investigate my options for travel packs and that sort of thing. And I think that there are -- all providers offer some attractive options in that regard.

632 COMMISSIONER MENZIES: You think there is greater consumer awareness regarding the need to manage roaming issues?

633 MS. MacDONALD: It's hard to give an opinion on what the consumer awareness per se is. I suppose one could say that consumers in the early days of wireless service were probably very sacred about the roaming charges because they, you know, started out being extremely high. And, you know, there's been some improvements since then and so many other options available and the cost of international roaming has come down with these packages that -- I can't speak to consumer awareness per se but we can say that, you know, there's plenty of people who when they're making travel arrangements are making contact to top up and add a travel package.

634 MS. HECKBERT: Yeah, and I would just add that I think consumers have probably always wanted to manage their roaming costs but maybe didn't always have the tools available. But things like self-care apps for which we don’t charge, their ability to call Eastlink for which we don’t charge while they're roaming makes it -- and on our online portal make it possible for them to keep informed to monitor their usage in a way maybe they hadn't always been able to do.

635 COMMISSIONER MENZIES: Okay. As you heard this morning, some issues regarding the raise regarding whether the trial period is sufficient, that perhaps should be longer, that any promotional gifts should be perhaps -- not have to be returned, issues surrounding that.

636 What do you -- what is your response to those submissions and do you think the current trial period is sufficient?

637 MS. MacDONALD: We were -- based on our own, you know, experience, we really were surprised to hear that the trial period was a real area of concern for consumers. We set what we believe to be a very reasonable trial period in that customers -- first of all, WiFi of course doesn't count at all toward the usage and so there's all kinds of data that they can try on WiFi to test the device, experience a device. We have a 30-minute of voice minutes and 100 megabits of data and in the 15-day period, we've really not seen any -- any indications in our own experience that that's ever been really an issue for us.

638 So we were rather surprised to see that and we think it really does -- at least the periods that we've set we think provide a very fair and reasonable basis, yet also avoid or limit, you know, issues of concern around abuse of trial periods and that sort of thing so.

639 MS. HECKBERT: Yeah, and on returning the gifts, we do think it’s reasonable where a customer is going to return a device and not have to pay anything for that device and not have to pay for the amount that they did use testing the device, we do think it’s reasonable and we typically require them to return other things like accessories as well. So for us, a gift with purchase is just another part of the purchase that is -- another part of the transaction that’s being reversed during a trial period return.

640 COMMISSIONER MENZIES: Okay. Thank you. And what about unlocking fees? Do you charge unlocking fees?

641 MS. HECKBERT: Yes, we charge $50. It’s been the same since we launched our business. We’ve always had that fee. We may waive it in certain cases but we do -- typically how the process works is someone calls customer care, that customer -- or visits a store. That representative has to escalate to our tier 2 customer care in order to get the code. Sometimes there’s some coordination between that representative and the OEM, and then a follow-up with the customer. So we do incur costs in going through that process, so we’ve applied the $50 to recover those costs.

642 COMMISSIONER MENZIES: So how many do you unlock in a year?

643 MS. HECKBERT: I don’t have those numbers. We’d have to get them to you. But I know it’s not every customer. Some customers never ask to have the device unlocked. Some of our devices, as we said in the proceeding in 2013, some OEMs provide the devices locked and some don’t and we don’t always have a ton of control over that. So in some cases, consumers buying certain devices just don’t need them unlocked so we just notify them that they’re fine. They’re all set.

644 COMMISSIONER MENZIES: But if you could provide that, if you could undertake to provide that ---

645 MS. HECKBERT: Yeah.

646 COMMISSIONER MENZIES: --- to us, that would be terrific because we’re -- some of us anyway are struggling to get a sense of how large this issue is.

647 UNDERTAKING

648 COMMISSIONER MENZIES: And there is -- and I’d like you to comment on it, the point of view that states if this is my phone, if this is my device, why do you get to keep, in essence, the keys to it and charge me for them at some point? I don’t quite understand. And I’d like to get your comment on that that, I mean, if this is my device that you have sold to me, why do I need to make another contractual agreement with you to open up a part of it?

649 MS. HECKBERT: Yeah, and really we may -- where our customer has purchased a device outright and fully has paid for the device and does own the device, we may in many circumstances choose to waive the fee and -- or like I said, it may not even apply where the device itself has come to us unlocked. But in cases where the customer is still repaying for the device or may in some cases owe several hundred dollars on the device, it’s just to make sure that we are -- we’re covering the costs at least of unlocking it, knowing there’s a risk that we might not recover the full cost of the device.

650 COMMISSIONER MENZIES: Sounds a little bit like a mortgage cancellation fee to me. I mean, if I -- just because I owe money -- I mean, if I buy a house, just because I owe the bank money for it, it doesn’t necessarily mean that I can’t do whatever I want with the house; right? So I don’t -- that’s what I’m trying to get at. I either own it -- even if I owe money on it, I still own it if it’s the device; right?

651 I mean, I get -- I appreciate your honesty in terms of the exposure that you’re trying to prevent, but -- avoid but ---

652 MS. MacDONALD: And ---

653 COMMISSIONER MENZIES: --- I’m trying to get a -- it just seems that -- $50 is not much for a lot of people but it’s a lot of money for some people.

654 MS. MacDONALD: And we can speak to that when we provide the details but, you know, just as we noted, there is a cost, like the customer care cost on at least two occasions and the interactions with the OEM. And where many customers don’t seek those unlocking service, then we’re not incurring those costs for those customers. So it really is to address the cost but we can certainly speak to a little bit more of that as well in our submission with the number of devices that people are looking to have unlocked.

655 COMMISSIONER MENZIES: Okay. And thank you. I look forward to that.

656 Is the -- would there be any cost or financial consequence of making sure that the unlocking fees are disclosed in Critical Information Summaries or do you do that already?

657 MS. HECKBERT: We do that already. We have it in the first two pages of our service agreement and we also have a more detailed summary later on in the terms and conditions of our service agreement spelling out what the fee is.

658 COMMISSIONER MENZIES: I’d like your comment on the proposal -- what the implications might be for consumers of -- the Coalition proposes that devices should be sold independently from the wireless plan.

659 MS. MacDONALD: I suppose our comment on that is, you know, devices are sold independently at many retail outlets and stores. You know, as a -- the core business that we provide is the wireless service and the services over our network. And the device, selling the device is part and parcel of selling the service but it isn’t our core business in terms of engaging in just straight retail sales of devices. So there are lots of opportunities for consumers to purchase those devices outright through other retail outlets.

660 MS. HECKBERT: That said, of course, our business model is that we separate the cost of the device from the cost of the plan for transparency for consumers. Again, it’s something that we think is a differentiator for us in the market. So consumers -- customers can match any plan with any device. They know exactly how much of their monthly fee is going to their device. If they want to make a lump sum payment on the device of any amount at any time, that will lower their monthly fee for that device. So, we do not offer the devices on their own without a service plan but we do try to offer as much clarity and transparency as possible.

661 COMMISSIONER MENZIES: Well, assuming that an outcome of this process would be modifications -- some modifications to the Code, what do you think would be an appropriate timeframe to implement those modifications?

662 MS. MacDONALD: I think it’s difficult to say without knowing the extent of the modifications. We’re here before you saying -- today, saying that we think the Code has worked and it’s -- it is working well. I think that over the last three years -- I’m going to go on a little bit of a tangent I think, but over the last three years, you know, the new entrant regional providers continue to build and expand. And we’re willing to see more just pressure in the markets through competition as well that ensure that there’s a response to consumer demand through innovation and clarity.

663 So we wouldn’t necessarily, you know -- or see the need for major changes to the Code. But if there are, I think that if the nature of the changes require significant systems modifications, then those may need to be considered in terms of the actual period of time to get those implemented.

664 Now, we’re hopeful that given the types of consumer services that we’re offering and the flexibility that we already offer that we might not face that much and we would probably be able to implement changes rather quickly but I can’t speak for the other providers.

665 COMMISSIONER MENZIES: And we’ve heard from the Coalition and CCTS, for that matter, that -- I think CCTS said only 32 percent of wireless providers were living up to their obligation -- their participation obligation to inform customers of their right to access CCTS after the second escalation. So do you think this requirement should be made part of the Code to address that because there seems to have been some disappointment in terms of the provider’s performance in that obligation?

666 MS. MacDONALD: Well, in terms of the awareness of the CCTS, if I could just start with that, we include provisions in our -- in the first two pages of the Information Summary to consumers about the CCTS and it’s also in the last part of our service agreement. The CCTS is also described in our Terms of Service, our Consumer Terms of Service, and also when you -- and you can find that just in one click on every single page of our website. So if you go at the bottom of the page, Legal and Regulatory, you’ll access a link to both the CCTS and to the Wireless Code.

667 A new customer with any questions or concerns about their services, of course, would first go through Eastlink Customer Care, and on our website we also have a link to customers who want to contact us and it takes them through the process, and the escalation process.

668 That process actually starts with a contact to customer care, and then they can escalate at the second stage to the office of the President and those complaints are reviewed with the President. And then, after that, if they're unhappy with that, the -- our website link as well communicates to the customers that they can go to the CCTS as well.

669 Does it need to be in the Code? I'm not sure. You know, we don't feel in our case that it's a necessity. Certainly, if the Commission feels that it's necessary we would, you know, we would abide by that, but we don't necessarily feel that it needs to be in the Code, written into the Code.

670 COMMISSIONER MENZIES: I just have one more thing to ask of you, and that's an undertaking. And that is, would you please undertake to answer the questions for wireless service providers that were set out in the CRTC, Exhibit 1.

671 MS. MacDONALD: Yes.

672 UNDERTAKING

673 COMMISSIONER MENZIES: Thank you very much. Those are my questions.

674 THE CHAIRPERSON: Just a few questions.

675 Perhaps in the undertaking you've provided -- you've said you would do on the unlocking, if you could provide total revenues per year that you draw from unlocking.

676 MS. MacDONALD: Yes.

677 THE CHAIRPERSON: And you also mentioned that you waive it in certain circumstances. Can you explain to me in which circumstances, or maybe you want to do that through the undertaking?

678 MS. MacDONALD: Yeah, if -- we would prefer to communicate that as well in the undertaking.

679 THE CHAIRPERSON: Right. Is this a complete policy that you would -- it might be confidential? Is that ---?

680 MS. MacDONALD: Yes, that's right. It's ---

681 THE CHAIRPERSON: You wouldn't want to know when you would actually waive -- you wouldn't want customers to know when you would actually waive?

682 MS. MacDONALD: Well, the -- this -- there is an unlocking fee, it's established in our terms of service, it's the $50 as we described.

683 THE CHAIRPERSON: Right.

684 MS. MacDONALD: And so that is the standard. There may be some exceptional situations that warrant, so we can speak to that in ---

685 THE CHAIRPERSON: Right.

686 MS. MacDONALD: --- the undertaking.

687 THE CHAIRPERSON: In light of the fact the Commission stated when it adopted the Code that it would reviewing it in three years, would it come to you as a surprise that there may be modifications that come out this Code -- this proceeding to the Code?

688 MS. MacDONALD: No, I mean we are here and we're revisiting all of the different issues, and of course ---

689 THE CHAIRPERSON: Right.

690 MS. MacDONALD: --- the consumer groups have raised issues. So it wouldn't necessarily be a surprise if there are changes.

691 THE CHAIRPERSON: Right. Nor would it be a surprise that that might actually have an impact on your systems and your costs of operations?

692 MS. MacDONALD: Well, we would certainly -- you know, typically, I guess we would be concerned about significant impacts on systems and operations.

693 THE CHAIRPERSON: Yeah, I'm sure it wouldn't -- I think you're concerned about it but would it come as a surprise that there might be impacts on your costs and -- if we were to make ---

694 MS. MacDONALD: I suppose we've, you know, dealt with other decisions where there's impacts, and so it wouldn't be necessarily a surprise. We would be hopeful that it would be nominal or minimal, but ---

695 THE CHAIRPERSON: Right.

696 Since the coming into force of the Code, have you in 100 percent of the cases been compliant with the Participation Agreement that requires you to inform customers of the CCTS recourse following the second level escalation?

697 MS. MacDONALD: I'm not sure that I could say 100 percent compliant because I, of course, we have practices and we train our customer care reps and we can, you know, certainly always ensure that we train them properly and communicate these processes, but there's often human error, there's new staff. So certainly, that's always -- it's not something that I can say 100 percent no, because there's, at times, human error or ---

698 THE CHAIRPERSON: Right, but you have systems in place to ensure to the extent possible that you're complying ---

699 MS. MacDONALD: Yeah, sure.

700 THE CHAIRPERSON: --- with that?

701 MS. MacDONALD: Yes, yes.

702 THE CHAIRPERSON: Would you agree with that in the almost totality of the cases you are complying with that obligation?

703 MS. MacDONALD: I would like to think that our customer ---

704 THE CHAIRPERSON: Short of 100 percent, so they might be 99 percent of the cases, or something like that?

705 MS. MacDONALD: We would expect that to be the case, yes.

706 THE CHAIRPERSON: And would you agree with me that were we to put that obligation in the Code as opposed to in the Participation Agreement that the burden on you would be minimal because you're already complying in most of the cases?

707 MS. MacDONALD: I think that's a fair statement.

708 THE CHAIRPERSON: Okay.

709 MS. MacDONALD: Yeah.

710 THE CHAIRPERSON: Thank you.

711 I believe those are all our questions. Thank you very much.

712 MS. MacDONALD: You're welcome.

713 THE CHAIRPERSON: Since it's exactly noon, I think what we'll do is take a break here for lunch and come back at 1:00.

714 Donc en ajournement jusqu’à 13h00. Merci. Thank you very much.

--- Upon recessing at 11:59 a.m.

--- Upon resuming at 1:00 p.m.

715 LE PRÉSIDENT: A l'ordre, s'il vous plaît. Order, please.

716 Madame la secrétaire.

717 THE SECRETARY: We'll now hear the presentation by TELUS Communications Company.

718 Please introduce yourselves first for the record, and you have 20 minutes.

PRESENTATION

719 MR. SCHMIDT: Good afternoon Mr. Chairman, Vice-Chair Menzies, Commissioner MacDonald.

720 My name is Stephen Schmidt, and I am Vice-President, Telecom Policy and Chief Regulatory Legal Counsel at TELUS.

721 With me today, from my left to right, are Arleen King, Senior Vice President, Customer Experience; Kevin Banderk, Vice President, TELUS Mobility Marketing; and Eric Edora, Director of Regulatory Affairs.

722 In addition, in the second row are Daniel Stern, Senior Regulatory Legal Counsel; and Isabelle Morneau, Senior Regulatory Advisor.

723 Canada's mobile market performance is strong, both in absolute and relative terms. This success results from vibrant facilities-based competition. Canadians have a choice of multiple national and regional wireless service providers, offering an array of devices, rate plans and services that are attractive across a variety of customer segments.

724 Wireless unit prices compare favourably on an international basis. Canada's wireless networks are world-leading in terms of levels of capital investment, which drives network quality, speed and coverage. These are remarkable accomplishments given the challenges posed by Canada's vast geography and small population.

725 The Wireless Code is an important element of the successful wireless landscape in Canada. In particular, the Wireless Code sets minimum standards that all service providers must meet, based on the principles of clarity and transparency.

726 Since its inception in 2013, the Wireless Code means that customers in most provinces and territories benefit from consistent and effective baseline standards, no matter their chosen wireless service provider.

727 The Wireless Code has provided tangible benefits to customers. For instance, customers can trial their service to ensure that it meets their expectations. Customers on term contracts will not be subject to changes of key terms, such as monthly service rates. And it means that customers can end a contract prior to the term expiry date, based on a cancellation fee that has been clearly defined in the contract and declines in a defined manner every month.

728 These are just some of the benefits of the Wireless Code for customers.

729 Importantly, while the Wireless Code mandates standards for the conduct of WSPs, it does not prevent service providers from offering the differentiated products, services and pricing crucial to a healthy, competitive marketplace. Service providers must still have the opportunity to compete based on all dimensions, including price, features, network quality and customer service. In other words, regulation should not impede the benefits of full competition and dynamic innovation.

730 Whatever action the Commission takes in this proceeding, preserving the scope for full competitive differentiation is a critical objective. Over-reaching prescriptive rules prevent WSPs from distinguishing themselves through innovative products and services. This is bad for customers and bad for Canada in that it would limit choice and innovation.

731 Instead, the operation of competitive market forces must be the primary mechanism that -- to ensure that customers benefit from reliable, affordable and high quality telecommunications services throughout Canada.

732 Having said that, the effectiveness of the Wireless Code has been eroded in some instances by overlapping provincial legislation. While Nova Scotia repealed its legislation shortly after the Wireless Code was introduced, intrusive provincial wireless legislation still exists in Manitoba, Ontario, Quebec and Newfoundland.

733 It is the CRTC, not the provinces, that has the expertise in telecommunications, and it is Parliament, not the provinces, that has undoubted and exclusive authority over both telecommunications in general, and wireless services in particular. Given the care and consideration taken by the CRTC in the 2013 consultation process and the drafting and finalization of the Wireless Code, it makes no sense that the Wireless Code is not the sole governing standard for customers in these provinces.

734 Having additional provincial legislation increases the costs of compliance for WSPs, costs that are ultimately borne by customers. Overlapping regulatory regimes also create confusion for customers, both as to their entitlements and as to how they can pursue complaints.

735 At its worst, provincial consumer protection legislation can prevent service providers from effectively managing their networks and it can undermine the objectives of the Telecommunications Act.

736 As an example, the Quebec Government has issued infraction notices to service providers alleging that the provisions of their wireless contracts permitting them to change their coverage maps are essential elements of the contract that cannot be modified according to the Quebec’s consumer protection legislation.

737 If this is correct, then the coverage maps could be not modified during the term of consumer contracts. This prevents service providers from reconfiguring their network for the benefit of all their customers, making even the most minor network reconfigurations practically impossible to effect.

738 While the Commission initially believed that conflicts between provincial legislation and the Wireless Code would be minor, three years of experience have proven that this is not the case.

739 Existing provincial legislation frustrates the intent of the Wireless Code and creates serious conflicts. These conflicts can exist not only where compliance with provincial regimes necessitates a violation of the Wireless Code, but also where compliance with provincial regulations interferes with the intentional silence of the Wireless Code on a particular matter.

740 For example, TELUS currently offers a roaming service called Easy Roam, where customers can access Canadian voice minutes, text messages, and data included in their smartphone or tablet plan, instead of incurring roaming charges, for $7 per day in the U.S. and $10 per day in other countries.

741 This is an attractive service and one of the single best tools to combat roaming bill shock. It would be better still if this were the default roaming service available to our customers. However, the legislation in Manitoba and Quebec prevents TELUS from making these changes to its roaming services without express customer consent. This means that it is impractical for TELUS to offer Easy Roam as the national default roaming for all of its customers. But for this provincial legislation, bill shock associated with roaming charges could be further attenuated.

742 As a result, TELUS asks that the Commission declare that the Wireless Code is the sole governing national standard, regardless of any provincial law. To do so would be consistent with the reality of Parliament’s exclusive authority and would properly fulfill the Commission’s aspiration that the Wireless Code apply to all individual Canadian consumers of wireless services equally, wherever they reside.

743 MR. BANDERK: The Commission has asked for comments on how the wireless marketplace has evolved since 2013. Competitive rivalry in Canada’s wireless marketplace continues to thrive.

744 Throughout the country, national and regional wireless services providers aggressively attract, pursue and entice customers with their wireless offers, with Canadians being able to choose from a variety of providers and service plans, picking the offer that meets their needs.

745 Competition in wireless services takes place across many different dimensions. It takes place at the network level, with wireless companies building and expanding their facilities to increase their geographic reach and to ensure reliability within buildings and in dense urban areas. WSPs also strive to deliver the fastest speeds to satisfy Canadians’ thirst for mobile broadband connectivity.

746 This technology race was documented in a report issued in January by OpenSignal. OpenSignal states that Canada excels in both 4G speed and availability in comparison with global peer countries. Canada’s three largest wireless carriers each stood out on the world stage, with nearly 80 percent LTE availability and speeds approaching 30 megabits per second.

747 Typical speeds in Canada are double those in the US and the lowest reported Canadian speed is 10 megabit per second faster than the global average. OpenSignal also identified TELUS as a leader in network speed and in fastest network reaction time, a measure of latency.

748 Competition is also intense at the product and service level, with all WSPs selling a variety of different plans, packages and services to Canadians.

749 Marketing innovations are a common occurrence, as each service provider introduces new and compelling offers to customers. Recent examples include the introduction of shared data plans, easy roaming packages and worry-free data by various wireless providers.

750 Technological developments also mean that more products are connectable. Tablets and watches are the most recent examples, with the trend being that virtually any product will be able to send information over a mobile data network.

751 Competition also takes place at the customer service level. On this dimension, TELUS has been an industry leader with its Customers First approach. Customers First is not just a marketing slogan; it is a critical differentiator for TELUS versus our competitors. The success of our efforts is exemplified by the lowest churn rate in the industry. Clear and simple pricing, plans and services have been cornerstones for the company and its brands, drawing upon a differentiated and transparent service approach as a means to attract customers and retain their loyalty.

752 It is within this vibrant competitive marketplace that the Wireless Code operates. TELUS certainly understands why all customers in Canada, regardless of chosen service provider, should be entitled to baseline protections on customer service and transparency.

753 Importantly, the Wireless Code as cast in 2013 struck the right balance between regulation on one hand and service differentiation on the other, allowing the service providers themselves to position their offers in the marketplace. This maximizes options and choice.

754 Prescriptive rules that might help one customer segment could alienate another. Lighter touch regulation also means that service providers maintain their ability to adapt to the sweeping changes that are occurring throughout this industry.

755 The Wireless Code must be carefully designed so that WSPs still have full opportunity to compete across all dimensions, to design solutions that are targeted at individual customer segments and to offer new and compelling solutions across a variety of different types of wireless products.

756 First, consider the difference between prepaid and postpaid plans. The Wireless Code has some provisions that apply to both prepaid and postpaid plans, and others that apply only apply to -- that apply only to postpaid plans.

757 There’s a good reason for this. The provisions that apply only to postpaid plans, such as caps on data overages, are largely inapplicable to prepaid plans. After all, if a customer purchases a fixed amount of data on a prepaid basis, there is no possibility of any overage or bill shock.

758 The essence of prepaid service is its simplicity. The more stringent the requirements on a prepaid plan, the less simple it becomes as a product offering, and the more it disappears as a useful value proposition.

759 Service providers need the flexibility to offer both types of plans, each with their advantages, disadvantages and different sets of customers, and regulation needs to be sufficiently flexible to allow for this.

760 Consider as well how the Wireless Code deals with data usage overage and alerts. The Wireless Code mandates a $50 data overage cap, but does not require that usage notifications be provided at stipulated times.

761 This means that all customers benefit from a consistent $50 data usage cap, but that each service provider can design its systems to provide usage notifications based on how and when it wishes to alert their customers.

762 TELUS has proposed some changes to the Wireless Code to increase choice for Canadians. Many Canadians in this proceeding have asked for longer term contracts. Allowing WSPs to offer customers the choice to have their cancellation fees reduced over more than 24 months would mean that larger device subsidies would be possible, giving customers lower upfront device costs.

763 This is particularly important in 2017 given the dramatic increase in the Canadian cost of iconic devices since 2013, which costs have been exacerbated by the decline in the value of the Canadian dollar. Importantly, TELUS’ proposal would only allow for longer term contracts for those devices where a 24-month option is also being provided. This guarantees that customers will have the ability to obtain a 24-month contract should they wish.

764 TELUS has also asked for early cancellation fees to include additional inducements, beyond the device subsidy, that may be provided to customers to entice them to enter into a term contract.

765 These include port-in credits, promotional gifts such as gift cards or any other valuable incentives that were provided to the customer. Right now, because only the device subsidy can be included in the early cancellation fee, WSPs have little incentive to offer alternative inducements that could be attractive to customers.

766 Even though some promotional gifts are still being offered, the Wireless Code has a dramatic effect that causes some promotions to not be offered at all, because WSPs choose not to expose themselves to additional risk of loss in the event of early cancellation by the customer. Allowing for recovery of other contract inducements could actually increase the volume of promotions offered as incentives. This is the key point. The opportunity is for the Commission to refine the Wireless Code to ensure that customers are still getting the full benefits of Canada’s competitive wireless marketplace.

767 MS. KING: Le Conseil demande si d'autres outils ou approches de sensibilisation sont nécessaires afin d’informer les consommateurs au sujet du Code sur les services sans fil. Les fournisseurs sont déjà tenus d’entreprendre des mesures de sensibilisation du public. Par exemple, le Code doit être divulgué dans chaque entente contractuelle. De plus les fournisseurs doivent inclure à leurs sites Web des liens dirigeant les clients vers le Code. Selon TELUS, les exigences actuelles sont suffisantes.

768 In any event, customer service and transparency mean a lot more than simply telling customers about the Wireless Code. The commitments we make to prospective customers through our advertising, contracts and communications become obligations to fulfill at every touch point throughout the customer journey.

769 TELUS takes care to educate and train our customer service representatives so that they can explain the full breadth of our service offerings and the benefits they obtain by choosing TELUS. Our representatives are also equipped to inform customers of their rights and entitlements under the contracts -- their contracts and the Wireless Code.

770 Compliance of the Wireless Code supports our Customers First principles. Compliance ensures that customers enjoy the benefits of the Wireless Code, no matter whether they have direct knowledge of the Wireless Code itself. This is why the focus of the Commission should not be about more awareness tools of the Wireless Code. Instead, the focus needs to be on whether the Wireless Code has the right provisions in place to protect customers.

771 The Commission’s existing approach, where service providers are required to inform customers of recourse to the CCTS at the time of escalation of a complaint, strikes the right balance, in that a customer is made aware of the CCTS if a complaint has not been resolved by the service provider. This is far more important than the general awareness of the Code itself.

772 Customer complaints are an important part of ensuring Wireless Code compliance. Our job as a service provider is to use this insight and to find out what needs to be fixed and to put those solutions into action. We have internal teams that meet weekly to discuss customer escalations so that we can learn from these experiences and implement any lessons learned. This includes understanding whether there are any areas where we could more fully comply with the intent of the Wireless Code, and taking immediate action to remedy any such situation.

773 MR. SCHMIDT: Given the ubiquity of wireless networks and the importance they have to Canadians, the Wireless Code benefits customers every day, whenever and however they choose to use their wireless services, and no matter their chosen service provider.

774 The changes that TELUS has proposed maintain the principles developed by the Commission in the Wireless Code decision. They build upon the already dynamic marketplace by giving customers the power to select from an even greater array of plans and services and offers that suit their needs.

775 Finally, the most meaningful impact that the Wireless could have is to set national baseline standards that give customers in Canada equal benefit, wherever they reside. This requires that the Commission declare the Code to be the sole governing standard for the provision of wireless services across Canada.

776 This concludes the TELUS presentation. We would be pleased to take any questions that the Panel might have. Thank you very much.

777 THE CHAIRPERSON: Thank you very much for your presentation.

778 So I’m going to ask you a few questions that flow from your presentation here and then I’m going to move on to some other questions I have.

779 You stated at paragraph 3 but you didn’t really elaborate on it, and I think Canadians would have been surprised by your statement. And maybe I’m going to give you an opportunity to provide more context to your statement on -- in paragraph 3 and I quote: “Wireless unit prices compare favourably on an international basis.”

780 MR. SCHMIDT: So that would -- there’s material that’s been filed with the Commission in the course of numerous proceedings including the wholesale wireless proceeding where Dr. Eisenach, for example, filed international comparative mobile market performance evidence and we looked at per -- or permanent unit pricing and found that it compared favourably in an international basis. That’s exactly what we said.

781 THE CHAIRPERSON: Wouldn’t you agree with me though that the public perception is otherwise? In fact, the record of this proceeding demonstrates individual Canadians are quite frustrated with your prices and perceive that retail prices are lower in other jurisdictions.

782 MR. SCHMIDT: I agree that there’s a -- I think both statements are true, absolutely, that there’s a public perception that there might be something wrong with pricing and that when you look at FCC reports or other reports filed with you on your docket in proceedings, the -- on an international comparative basis we’re actually doing not bad on unit pricing.

783 THE CHAIRPERSON: And since you’re experts in marketing, what are you doing to change the public perception? Because you’ve just said that, in your view, the evidence is otherwise but the perception -- the popular perception is that it’s not favourably comparable. What do you do to compare that -- to correct that, sorry?

784 MR. BANDERK: So I -- we look to combat that on a basically brand by brand basis on a customer segment by customer segment basis. So as much as we would love the entire Canadian population to change that point of view, advertising at that point wouldn’t make a whole lot of sense.

785 For us, we target specific customer segments with -- to specific brands to make sure that we are demonstrating the best value proposition for each customer. And we have in the TELUS family four different brands that we go to market with, each targeting a different customer segment.

786 Part of our challenge, for sure, is price comparison can often be specific to a user’s needs and each brand is targeting a different customer segment and different use cases. With TELUS we very much focus on the family and share that as well as sort of corporate space. We have the Koodo brand, which is much more focussed at individual subscribers. And then we have the Public Mobile brand, which is an online only BYOD and one of the lowest priced players in Canada.

787 THE CHAIRPERSON: Do you think it’s the job therefore of your association, the wireless association to perhaps correct the misperception about the per unit price which you say is a misperception?

788 MR. BANDERK: No, I think it’s our job to change that over time and we do that by continuing to provide exceptional value.

789 The other challenge we do get into for sure is it’s not about price necessarily; it’s about the value we provide. And Canadians don’t have the same comparator. They can compare price very easily. It’s hard to compare the experience you get, the network speeds, the coverage. So our focus is on demonstrating the entire value proposition to Canadians.

790 THE CHAIRPERSON: At paragraph 7 you refer to you don’t want “overreaching prescribed rules”. And at paragraph 20 you also talk about “prescriptive rules”. I’m not sure why we have the qualifier “prescribed” and “prescriptive rules”. It would seem that -- I can’t imagine an unprescriptive rule but let that go.

791 What do you mean by “overreaching”? Help us what -- what would be the indicia of an overreaching rule?

792 MR. SCHMIDT: Font size.

793 THE CHAIRPERSON: Sorry?

794 MR. SCHMIDT: Font size or something on a contract. And we start -- all of our comments here start from that baseline position that the Code is great and it’s been good for Canadians and we’re only proposing focus changes.

795 So even if we drop the word “prescriptive”, so what might be an overreaching rule? It might be mandating font size, perhaps extending protections to pre-paid where the nature of the service doesn’t justify it. But the Code itself we fundamentally support.

796 THE CHAIRPERSON: So let’s just unpack that. Maybe from your perspective font size doesn’t -- isn’t important but for disabled Canadians this is not a consumer issue. This is a citizenship issue, might actually benefit from having larger font size to actually know the content of the contract.

797 MR. SCHMIDT: That’s fine. We accept that proposition. We don’t ---

798 THE CHAIRPERSON: So how does it become overprescriptive there?

799 MR. SCHMIDT: I’ve dropped the adjective in responding to you.

800 THE CHAIRPERSON: But you still described it as “overreaching”.

801 MR. SCHMIDT: No, I’ve dropped the adjective. So it’s a rule without a qualifier and ---

802 THE CHAIRPERSON: But you said we should not have -- let’s take out prescribed. Overreaching rules. What’s an overreaching rule in your view? What is the indicia from the Commission when we go forward, when other parties come to this table, to this hearing and say we should adopt X, Y, Z or modify this, what in your view becomes an overreaching rule?

803 MR. SCHMIDT: Well, the parliament central tasked in the Act would be if you can’t - if you can otherwise rely on market forces to take care of it, you don’t need regulation. So if we were supplanting something that market forces could take care of with rules, then that might be overreaching. But provided that you make the claim of factual finding that it’s justified, then that’s fine.

804 THE CHAIRPERSON: With respect to the jurisdictional issue as to whether it’s federal or provincial, and you give the example of an area where you think a province has overreached constitutionally. Why don’t you just go to court? You didn’t hesitate to bring the CRTC to court when the Code was first promulgated.

805 MR. SCHMIDT: We can certainly go to court, but you have a role as the guardians of federal jurisdiction that you’re entrusted with under your legislation, and you can make the process of the vindication and the implementation of that jurisdiction easier or harder through your statements or your decision.

806 THE CHAIRPERSON: We certainly have the powers of a superior court in some respects but we are not a Section 96 court. Why don’t you go and get the declaratory relief at your costs from the provinces if you’re so convinced that you are correct? Why do we have to do your work?

807 MR. SCHMIDT: You can assist with the vindication of the federal jurisdiction that’s demonstratively yours and demonstratively federal or you cannot.

808 So a good -- a good practical illustration of the question you’re asking -- and will we be vindicating it in court, absolutely it will fall to us, hopefully with the help of the Attorney General for Canada.

809 But a good practical illustration of this would be the Irwin Toy case in the Supreme Court which concerned the interaction of consumer code provisions -- and you’re probably familiar with it -- and a CRTC broadcasting code which was imposed as a condition of licence. And the Supreme Court in the end let the Quebec Consumer Code provisions apply in a demonstrably federal space broadcasting because they said there was no evidence that the CRTC intended their Broadcasting Code to be the sole governing standard. So they didn’t let a paramountcy argument operate. They said on the contrary the Commission indicated that their Broadcasting Code was intended to be supplementary to all federal and provincial laws.

810 So we would be in an easier space in court protecting and vindicating federal jurisdiction if we had language that said this Code is intended to be the sole governing standard across the country, we’re still going to court, you’re not, but it would better set up a paramountcy argument.

811 THE CHAIRPERSON: But in the end in the Irwin Toy the Quebec residents have more protection. Why should we be against that?

812 MR. SCHMIDT: It -- protection and the Code displays an acute awareness of it. It’s not -- rules and restrictions aren’t exhaustive of what you do here. Enabling innovation is also very important. And so the Wireless Code struck a balance that support innovation. Optional service, pay per use services, non-key terms, they could be changed unilaterally with notice because the Commission felt that that supported innovation.

813 Well, that’s not actually happening, so in provinces like Manitoba, like Quebec where they take a far more embracing view of what a key or essential term is, so we’re not being able to introduce services like the easy roaming package in those provinces.

814 THE CHAIRPERSON: I put it to you that your problem if not in the courts is at least with those provincial legislatures, and I’m sure they -- amount of lobbying budgets available to TELUS if you do have a compelling case should be directed to them, don’t you think?

815 MR. SCHMIDT: Everything you’ve articulated is -- they are all tools in the toolbox. But you’re a stakeholder too and your decision, like the decision you recently issued on the PIAC application about challenging the Quebec ISP legislation, your ruling on the Section 36 issue there is extremely meaningful and will be extremely consequential in the court process later as the courts will look with some deference towards your construction of that power and how 36 interacts with other laws, provincial, municipal, or whatever.

816 So you have a meaningful role to play even if our role is -- you know, we’ve got to go to court, we’ve got to do our stuff too.

817 THE CHAIRPERSON: Yeah, but we don’t -- I don’t think we declared the Quebec statute inoperative.

818 MR. SCHMIDT: We are not asking -- we haven’t come here and asked that. But you can certainly make declarations about the reach, scope, and application of your own law.

819 THE CHAIRPERSON: You may not have used those words but what you’re asking us to do is equivalent to rendering the Quebec statute inoperative in this space.

820 MR. SCHMIDT: You have no power to do that so that’s not what we’re asking. We’re asking you to take steps that would evenly implement the Code nationally and better support a paramountcy argument if and when it comes to that.

821 THE CHAIRPERSON: Let me now turn to a few other issues. Your prepaid customers currently, do they get a CIS?

822 MR. BANDERK: No, they do not currently. What we do have is all of the information readily available on the Web.

823 THE CHAIRPERSON: So why have you chosen not to provide them with the Critical Information Summary?

824 MR. BANDERK: At the end of the day this is a -- by this nature, prepaid is focused on very simple transactions, relatively speaking one-off. It also is a burden of cost and systems and complexity that the customers -- the prepaid customers generally aren’t looking for that level of protection.

825 THE CHAIRPERSON: Do you have any prepaid plans that are actually plans that are multi-month?

826 MR. BANDERK: Yes, we do.

827 THE CHAIRPERSON: That is that somebody would sign a multi-month contract ---

828 MR. BANDERK: Yeah, we have ---

829 THE CHAIRPERSON: --- that happens to be prepaid for whatever reason?

830 MR. BANDERK: Sure. We have different offers on different brands. So a Public Mobile brand has a 10-day, a 30-day and a 90-day option, all of which, you know, we are very upfront about what you get during that period of time, and then we ensure that that isn’t changed during that duration.

831 THE CHAIRPERSON: So there can be no changes during that period?

832 MR. BANDERK: We do not institute any changes to their rates during that period of time on what’s included in the plan that they bought for 90 days.

833 THE CHAIRPERSON: Both in terms of what it cost and what they get?

834 MR. BANDERK: Correct.

835 THE CHAIRPERSON: If someone’s on a multi-month pay in advance plan ---

836 MR. BANDERK: M’hm.

837 THE CHAIRPERSON: --- why wouldn’t they get a CIS? Because you’ve just made the case that those elements are important to them because you yourself provide it to them.

838 MR. BANDERK: I think we see that the specific CIS not being required in that we do make sure that the information they need is upfront and available via the Web. You know, it’s a good thing to provide, I’m not disagreeing with that. It would be a good thing for us to provide in certain cases.

839 The challenge you may get into is there are a lot of very small prepaid services out there. The burden of costs to implement a structure like that might be very expensive. So there are players out there like 7-Eleven, Sears for -- I’m not even sure if they still have one, but Sears for a while had a prepaid service. They were very small players in that space. Because it is a net market you can enter in a fairly low cost way.

840 THE CHAIRPERSON: Currently are there any prohibitions in your arrangements with your agents or even restrictions in your manuals that would prevent a frontline employee from providing a would be subscriber with a Critical Information Summary?

841 MR. BANDERK: Did you say is there anything to prevent them?

842 THE CHAIRPERSON: Yes, because -- not in the context of a contract but their shopping around.

843 MR. BANDERK: H’m.

844 THE CHAIRPERSON: Is there any rule that you’re aware of either directly at TELUS or through your agents that would prevent somebody from receiving at least the Critical Information Summary so that they could at least shop around and see if there’s another provider that could do as good a deal?

845 MR. SCHMIDT: Our reaction would be that it’s a poor tool for facilitating comparative shopping. There’s richer tools out there, whether it’s on retail websites or provider websites.

846 You know, the CIS is a precis of a legal document, and price -- promotional comparisons, et cetera, it’s a much richer range of information you can get out there when you’re comparison shopping, whether it’s on a retailer’s website like Best Buy, or COSTCO, or whatever. So we’d suggest that the CIS isn’t going to fulfil that purpose very adequately.

847 THE CHAIRPERSON: What if that particular shopper actually wants to have that information, are there any rules that prevent you from providing it within your company or with your agencies?

848 MR. BANDERK: So, as far as I’m aware, there are no rules that would prevent this. There are system constraints of making it easily accessible from a -- you know, if I wanted to email it out to them, we don’t have that necessarily capability, but we can always show the customer where they can find that information and we will have merchandising pamphlets and things like that that will identify those things, but there’s no rules that I’m aware of.

849 THE CHAIRPERSON: So you shouldn’t have an objection that the Code might be modified to provide that you must not refuse to provide the CIS ---

850 MR. BANDERK: In ---

851 THE CHAIRPERSON: --- as an informational pre-contractual negotiation?

852 MR. BANDERK: In saying must not means that we have to in certain situations.

853 THE CHAIRPERSON: No. You couldn’t prevent. Not that you have to but you couldn’t say no if somebody asked.

854 MR. BANDERK: If I don’t have the capability to do so -- I’m not quite understanding the circumstances I would be in. If I don’t have the capability to provide that then that would be the challenge. We would have to make sure we have been billed the capability to ---

855 THE CHAIRPERSON: So you’ve got a customer in front of you that are negotiating or shopping around for a telecommunication wireless service. It’s a crowded marketplace. And what you’re saying is that you will not -- because of a system you will not provide basic information about costs?

856 MR. BANDERK: No, what we do have ---

857 THE CHAIRPERSON: Other than going to a website when this person might actually want to prefer to deal ---

858 MR. BANDERK: Sure.

859 THE CHAIRPERSON: --- with you with a, you know, an offer of some sort.

860 MR. BANDERK: Yeah, so we have merchandising -- basically merchandising tools available to our agents, whether a is the website, which is, to be honest, to Canadians the major -- the majority of Canadians go online first. In our stores we do have, you know, physical brochures or digital brochures that explain and outline those services.

861 THE CHAIRPERSON: With respect to multi-user plans, can you -- and data overages in that context, what’s your current practice with respect to who may consent to overages? Is it just the account holder?

862 MR. BANDERK: So in -- specifically in shared services, our default is that each subscriber, so each customer on the account can approve data overages.

863 THE CHAIRPERSON: So on a family of five any one of the five, if they have separate devices, could be the ones consenting?

864 MR. BANDERK: So by default, yes. However, we do have a number of protections in place and customizable tools so the account holder can manage to their discretion. So we basically -- first and foremost we notify all devices on the account at the 75 percent and 90 percent thresholds, as well as the $50 block.

865 THE CHAIRPERSON: So by default a 12-year-old could be consenting?

866 MR. BANDERK: Yes. But that is specifically because we don’t actually know that a 12-year-old is using the device. But we ---

867 THE CHAIRPERSON: Well, then that suggests maybe your default should be just the account holder unless the account holder decides to switch out.

868 MR. BANDERK: So we have it in the other way around where the account holder can change it and specifically on accounts designate who can and who cannot.

869 THE CHAIRPERSON: What would be the ---

870 MR. BANDERK: We’re using a fairly similar system for families with children, families without children, small businesses. So it’s very customizable for the specific use case of a specific customer demographic.

871 THE CHAIRPERSON: What would be the implications including the cost implication to change your practices from a default situation where only the account holder can consent and then the account holder can add additional parties to consent?

872 MR. BANDERK: Sure. So from a systems’ perspective it would not be a significant undertaking. It would mean a change in how we approach other customers impacted by the same thing, so small businesses, and other users. And we, at this stage, haven’t seen complaints in that we do give all those tools to our customers to manage as they see fit, both on customizing the notifications, customizing who can get blocks and we even actually have added the service that if you aren’t an account holder. So there are situations where maybe both parents, for instance, have phones provided by work but they want their three children on a shared plan. Well, there’s no one there that’s going to be on a device that can approve so we’ve added email options so that that account holder can add their email as the clear notification mechanism.

873 THE CHAIRPERSON: So I take it currently you have no plans to implement a system to ensure that the account holder would be the consenting party as a default?

874 MR. BANDERK: We currently do not have a plan as default, no.

875 MR. EDORA: Mr. Chair, if I may add? The principle of putting the control of the account in the customer, it’s obviously a principle that we want to follow and we do follow. What we do is we inform the account holder at the time of the contract in terms of how the consents work. That’s a direct term in our contract. That account holder must initial that particular provision so it’s brought right to the attention of that particular person so they know that other devices could consent to additional data and we tell them in that provision that they can set up the account management tools so that they can take that consent away.

876 And so our position -- I understand your position about the default. Our position is the default ---

877 THE CHAIRPERSON: I have a position. I’m just asking questions.

878 MR. EDORA: I apologize. I understand the questions about the default situation. Our default is we tell the account holder how it actually operates and we let that particular person figure out how they want to manage their particular account.

879 THE CHAIRPERSON: How many complaints have you gotten from multi-user plan situations, setting aside business -- small business, just in family or groups of friends, I guess, would also be possible but a family situation where you’ve had to deal with one user consenting to the shock and horror of the account holder?

880 MR. BANDERK: So I’m not sure on the numbers. Arleen may have some more insight into the specific numbers. But one of the things we do do very much proactively is that especially with new customers on new accounts, we proactively pay attention to those customers that are seeing overage right away. We proactively call them and help them manage if they haven’t already set up those things. So we prevent those calls in the first place.

881 THE CHAIRPERSON: What would be the trigger for you to call in you ---

882 MR. BANDERK: Well, we’d love to call everyone but what we leverage is the trigger around the data overage.

883 THE CHAIRPERSON: At -- so coming close to whatever the data overage is? Is it 50 percent? At 80 percent? Or is it a fixed number of data? How do you do it?

884 MS. KING: Well, I’d say we’re testing numerous ways to see what is too much for customers and what is not and what is not enough. So some -- we have tested, you know, $10, or if we’re looking at them using up some data very quickly early on in the contract. But we haven’t got a set amount of rules because we’re -- it’s something that we’re experimenting with to make sure that we understand what the customer elasticity is on that one.

885 THE CHAIRPERSON: So what would you do if, I don’t know, a family on a shared plan goes like to the U.S. and inadvertently one of the non-account holder is streaming a great deal of video and racks up a big bill and actually consents and all that, what would you do in that circumstance?

886 MS. KING: Well, we do have lots of notifications which would ensure that the account holder is well aware prior to them ---

887 THE CHAIRPERSON: Yes, but in the circumstance they haven’t put in -- that your default situation is that, you know, 14-year-old Johnny has approved.

888 MS. KING: Correct. But they still -- the account holder would still be notified. They don’t have -- by default the account holder is notified.

889 THE CHAIRPERSON: Right.

890 MS. KING: So there -- for sure the account holder would know at all times. And I would say if there ---

891 THE CHAIRPERSON: To the extent that they look at their phone and log in and do all that.

892 MS. KING: To the extents that there ---

893 THE CHAIRPERSON: Which they may not do because they know how much it costs to do that when they’re roaming.

894 MS. KING: Correct. But they would be notified. So, yes, if they have -- if their phone is turned off, yes, maybe perhaps they wouldn’t get the notifications. So in that situation, if a customer complained we would review with the customer what the notifications were -- how they were sent and who received them. And then if there was a, you know, a certain situation that was beyond the customer’s control, then we would take that into consideration, if it was the first time it happened and they’re a new user and didn’t understand, then as a good service provider we would take that under consideration with the customer on a case-by-case basis.

895 THE CHAIRPERSON: And waive part of the overage?

896 MS. KING: Exactly.

897 THE CHAIRPERSON: I asked PIAC earlier and you’ve seen some of the information probably filed, there seems to be customers frustrated that voice roaming charges aren’t necessarily covered by the data roaming regime and maybe experiencing some bill shock with respect to voice roaming.

898 MR. BANDERK: So ---

899 THE CHAIRPERSON: Is that your experience in your company?

900 MR. BANDERK: --- so we don’t see that as a prevalent complaint but we can see the situations where that would occur, for sure. And I’m sure ---

901 THE CHAIRPERSON: Well, are we talking 50 cases per year? A hundred cases? Two hundred (200)?

902 MR. BANDERK: I’d have to go back -- we’d have to go back and take a look. But what I can say is there’s a couple of things. One is, with our easy roam product, that product is, you know, a pay-per-day and that allows you to access all voice, text and data services as if you were in Canada for I believe it’s something around 150 countries. So with that product you can easily avoid any kind of shock on that front.

903 Our challenge does come in to the -- and it was made I think by Eastlink is there are some countries where the service providers take longer to basically send us the records, so we don’t have any visibility into the usage until after the fact.

904 And secondly, unfortunately, there are some countries where the costs for roaming to us are very expensive, and that in some ways needs to be passed on to that customer. We’re very up front with those countries. We would love to bring those things down and we love our easy roam product to be for every country around the world. We’re actively working to negotiate. In certain countries, we don't have the same negotiating power. Cuba, for instance, there's a lot more Canadians going to Cuba than there are Cubans coming to Canada, and that makes for a tough negotiation around roaming.

905 THE CHAIRPERSON: Would you be able to, perhaps from an undertaking, identify how many such cases you've had to deal with on a complaints basis since the coming into force of the Code?

906 MS. KING: Yes, I think we could do that to the best efforts, yes, for sure.

907 THE CHAIRPERSON: For the 16^th?

908 MR. SCHMIDT: Yes.

909 UNDERTAKING

910 THE CHAIRPERSON: Thank you.

911 So how do you notify customers that are roaming? So you notify all of them, if I'm -- is that correct? If in a multi-user situation?

912 MR. BANDERK: Yes. By default, every device on the account gets all modifications, then it's customized also. You can turn them off or on by subscriber.

913 We also have instituted a second level of protection. So there is the $100 roaming cap. We've instituted for ourselves a second level of protection at 500 with which we actually mandate a call-in.

914 THE CHAIRPERSON: So somebody can't just click and get that?

915 MR. BANDERK: No, they actually have to call in, verify that they are the right person and that they approve those.

916 THE CHAIRPERSON: Right.

917 And trial periods were an important factor to help support a more dynamic marketplace to allow people to test the device, see if it's working, both where they live and where they work, and whether the functionalities are there.

918 In your view, what are your current limits that you, implicitly I take it, consider to be reasonable for voice, text, and data?

919 MR. BANDERK: So our current limits are outlined in our Critical Information Summary at 50 minutes, 50 text messages, and 50 megabytes.

920 THE CHAIRPERSON: Sorry, 50 minutes for voice?

921 MR. BANDERK: Fifty (50) minutes, 50 texts, and 50 megabytes.

922 THE CHAIRPERSON: For 50 minutes?

923 MR. BANDERK: Five-zero (5‑0).

924 THE CHAIRPERSON: Five-zero (5‑0), yeah, yes, I heard you.

925 Yeah, how does that compare -- has that always been your practice since the coming into force of the Code?

926 MR. BANDERK: Sorry, I was wrong -- sorry, I'm just correcting myself. It's 30 minutes, 50, and 50.

927 THE CHAIRPERSON: So 30, 50 and ---

928 MR. BANDERK: Fifty (50) megabytes.

929 THE CHAIRPERSON: --- 30, 5‑0, 5‑0?

930 MR. BANDERK: Correct, yes; sorry.

931 THE CHAIRPERSON: How has that changed since the coming into force of the Code?

932 MR. BANDERK: As far as I'm aware, we have not changed that since the coming of the Code. We think it still makes sense for a kind of balance between giving a customer the ability to go and make sure they have network access, that their voice works, that their texting works, that the data works where they need to, so whether it's at home or their workplace.

933 But also ensuring that we don't see abuse of the trial period as a temporary phone user. So we're ensuring that there is not a second market for, you know, travellers to Canada for two weeks taking advantage of a trial period to get free service to the full extent.

934 THE CHAIRPERSON: Right, so somebody travelling to Canada without an address in Canada getting access to one of your phones after signing all the Critical Information Summaries. Is that the hypothesis you're putting forward?

935 MR. BANDERK: Through their family or friends? Yes.

936 THE CHAIRPERSON: Okay. How often has that occurred?

937 MR. BANDERK: Well, with this it doesn't occur.

938 THE CHAIRPERSON: Right.

939 How does -- do you think 50 for data compare to what actually most Canadians use in a 15 period -- 15 month period -- 15 day period in a given month?

940 MR. BANDERK: It's going to vary significantly by user, but it is definitely below the average usage in a 15‑day period. But as -- our perspective is it's -- the intent isn't for this to be a full service for 15 days, it's supposed to be a period in time to make sure it's going to meet the needs of that customer, that the network works and the device works when and where they need it.

941 THE CHAIRPERSON: And notwithstanding the dramatic change even in a three year period about the importance of data, you haven't thought important to meet the reasonable tests that the -- your current -- the standard you used three years ago was not increased?

942 MR. BANDERK: So you know that's a good point that we should probably put in a mechanism to revisit, but at the end of the day, we use this internally as a guideline. So it's something we communicate, we do not necessarily enforce it.

943 And I don't believe there are, you know, areas of complaints where we have enforced it, so we use this as a guideline to prevent abuse. But at the end of the day, it's going to be on a customer-by‑customer basis. They'll explain to us what's happening, why it's happening, and if it makes a whole lot of sense to us, then we generally waive that -- any kind of view of this trial period and return -- refund the money.

944 THE CHAIRPERSON: But it comes down to somebody knowing that you're negotiating on those sorts of things and coming in and dealing with you?

945 MR. BANDERK: I wouldn't say it was a negotiation. It's looking for an explanation as to what isn't right. So what we're looking for is the opportunity to make it right if we can. If there truly is this phone does not work in a critical area for them, then absolutely we're going to refund that.

946 THE CHAIRPERSON: Did you have a trial period before the coming into force of the Code?

947 MR. BANDERK: Yes, we did.

948 THE CHAIRPERSON: And how different is your current practice that you've outlined to what existed beforehand?

949 MR. BANDERK: From a practice perspective, not very different. From what were the limits, I'd have to go back and check to see if we changed the limits as the Code came into place.

950 THE CHAIRPERSON: Could you undertake to do that?

951 MR. BANDERK: Sure.

952 THE CHAIRPERSON: Yes?

953 UNDERTAKING

954 THE CHAIRPERSON: Prior to the Code coming into force, did you actually have concrete examples when you had your own internal trial period definition that led you to set the levels at whatever they will be?

955 MR. BANDERK: Did you actually have ---?

956 THE CHAIRPERSON: Foreign visitors coming in and abusing the trial period? Is there any evidence of that?

957 MR. BANDERK: We did have situations where we had people using it as a rental service, yes, and reselling it and leveraging that.

958 THE CHAIRPERSON: How many instances?

959 MR. BANDERK: Off the top of my head, from that long ago, I don't know.

960 THE CHAIRPERSON: Ten (10)?

961 MR. BANDERK: Enough that it hit our radar screen and we felt we needed to ensure that there was ---

962 THE CHAIRPERSON: I'm not familiar with your radar screen. So is it 10, 50, 100, 1,000?

963 MR. BANDERK: I don't know the answer to that.

964 THE CHAIRPERSON: Could you undertake to ---?

965 MR. BANDERK: We can see what we can ascertain on a best efforts basis, yes.

966 THE CHAIRPERSON: What brought you about to put the caps, before the Code came in, for the trial basis?

967 UNDERTAKING

968 MR. BANDERK: The other thing I would top up is sometimes it's not necessarily about the number that are up front, it's about ensuring that it doesn't pick up steam. And one of the things we have seen in this industry is when there are loopholes they grow and they grow over time and they can become quite substantial quite quickly.

969 THE CHAIRPERSON: You know the consumer groups will say the same thing about the practices of wireless service providers.

970 MR. BANDERK: Fair enough.

971 THE CHAIRPERSON: Let me now turn to promotion incentives and -- so do you currently use gifts with purchase or other promotional incentives, and could you describe them if you do?

972 MR. BANDERK: Sure. We do use some gift with purchase incentives. Generally speaking, more -- they are on our more -- our higher end devices, where there is the protection of that device subsidy and the device repayment. Where we don't have a lot inducements, because of this -- the ability to not add this to a sort of a device balance is on the BYOD or for our lower end devices. So call it $100 phone.

973 THE CHAIRPERSON: So what would you do currently if there is a cancellation within the scope of the trial period?

974 MR. BANDERK: So for -- on a cancellation within the trial period we will ask for the gift with purchase back.

975 THE CHAIRPERSON: And what are the gifts?

976 MR. BANDERK: It can vary device. So I think with the launch of -- the last launch of the Samsung it was a free VR headset, virtual reality headset.

977 THE CHAIRPERSON: Got it. Not a fire extinguisher? No.

978 MR. BANDERK: No.

979 THE CHAIRPERSON: Why don't you deliver it after the trial period, the gift, to protect your risk?

980 MR. BANDERK: For sure.

981 THE CHAIRPERSON: Why do you give it immediately?

982 MR. BANDERK: At the end of the day, customers want instant gratification; they want it right away.

983 THE CHAIRPERSON: Well, I know that's part of your marketing, but why, to protect your commercial interests, don't you wait?

984 MR. BANDERK: Because at the end of the day what we are in the business of is trying to provide and service our customers as they want us to serve them. They want that right away. So if I do buy that nice device, I want the toys that go with it as soon as possible.

985 THE CHAIRPERSON: Well ---

986 MR. BANDERK: The other is ---

987 MR. BANDERK: --- it's not essential to the use of the device; it's an add‑on, isn't it?

988 MR. BANDERK: Correct. No, you're right, it's not essential. But the other is it's much simpler and easier to execute on a gift with purchase there and then in a physical situation than to follow up and ship it later.

989 And what we actually end up doing when there are problems if we have -- we do have -- occasionally have a mail in, we end up getting a significant number of calls, inquiries, trying to find out where it is, when is it coming to me.

990 THE CHAIRPERSON: And do you ever use gift cards, like a cash version? Is that something you have done, or intend to do, or might consider doing going forth?

991 MR. BANDERK: We do, and it's very prevalent in third party retailers ---

992 THE CHAIRPERSON: Okay.

993 MR. BANDERK: --- where we compete as well.

994 THE CHAIRPERSON: And are you of the view, based on your proposal, that those cash incentives should also be reimbursed after the trial period?

995 MR. BANDERK: Yes.

996 THE CHAIRPERSON: Before the trial -- well, within the trial period?

997 MR. BANDERK: Yes, it's part of the return, yes.

998 THE CHAIRPERSON: So how many within trial period cancellations do you have in any given years?

999 MR. BANDERK: We can get that number for you.

1000 THE CHAIRPERSON: On an annual basis since the coming in force of the Code?

1001 MR. BANDERK: Yeah, we can bring that to you.

1002 THE CHAIRPERSON: Do it as an undertaking?

1003 MR. BANDERK: Yes.

1004 UNDERTAKING

1005 THE CHAIRPERSON: Some might argue that this is just the price of doing business and that if you choose to market in this way instead of competing on telecommunication prices, that that's the cost of doing business and you should bear it, and it is up to you to organize your affairs according.

1006 MR. BANDERK: We see, I guess, telecommunication services inclusive of up-front service, up-front devices, up-front things you get, inducements as well as the ongoing payment, so it's a full -- we look at the full value.

1007 I say secondly, I think in some of the earlier ---

1008 THE CHAIRPERSON: You do agree that you could use it without these add-on toys.

1009 MR. BANDERK: We can always market in different ways in different -- you know, based on what the rules are in play, but we tend to like to bring to customers what they ask for and what they respond to.

1010 THE CHAIRPERSON: With respect to unlocking, what are your current fees for unlocking phones?

1011 MR. BANDERK: Our current fee is $50.

1012 THE CHAIRPERSON: Five zero.

1013 MR. BANDERK: Five zero.

1014 THE CHAIRPERSON: Is that a negotiable fee?

1015 MR. BANDERK: It's a standard fee. I think in certain situations I'm sure we've been known to waive it.

1016 THE CHAIRPERSON: What are those circumstances?

1017 MR. BANDERK: It's based on empowerment of our agents, but it is an automatically-charged fee, and we enable all of our front lines with tools that they can, based on the specific circumstances ---

1018 THE CHAIRPERSON: Would you use it to entice a customer who's using another service provider, saying "Your service provider's charging you an unlocking fee; we'll do it for you for less or nothing?"

1019 MR. BANDERK: We can't unlock someone else's phones.

1020 THE CHAIRPERSON: But you could reimburse the $50 that they ---

1021 MR. BANDERK: We could reimburse, and so I would say it'll come down to we do have up-front offers and inducements that we would position in that way, but they wouldn't specifically be necessary. You know, there are things. Gift cards will often -- sometimes be positioned as a way to bring that over. But for the most part, we actually are struggling with inducements on BYOD, which is why you would want to unlock -- want someone to unlock their device and bring it over because we don't have the ability to protect ourselves from that loss should the customer decide to take that and then leave within days.

1022 THE CHAIRPERSON: And your $50 fee for your own subscribers, is your policy the same whether the device was subsidized or non-subsidized?

1023 MR. BANDERK: Yes, for our own. Yes. We sell very, very few unsubsidized devices on our post-paid.

1024 THE CHAIRPERSON: And are there any reasons why -- is this a restriction that comes from the manufacturer or is it really to control or support your own risks or diminish your own risks?

1025 MR. BANDERK: So you mean locking?

1026 THE CHAIRPERSON: Yes.

1027 MR. BANDERK: I think it's a combination. So it's a -- it's a fairly common global standard to lock put in place for the protection of carriers and to avoid fraud -- fraudsters from basically being able to easily take, buy phones, not pay for them and then ship them overseas.

1028 One of the challenges we actually had in early 2013-2014 in Canada was Canada was actually the lowest-priced place to get an iPhone outright, and so we were seeing -- well, we had very few -- very small inventory of iPhones and iPhone launches. There would be line-ups and people would buy them outright and ship them overseas. So there's scenarios like that we're trying to protect ourselves from.

1029 THE CHAIRPERSON: Right. Would you be able to undertake to provide the number of unlockings and the revenues associated with those for each of 2013, '14, '15 and '16?

1030 MR. BANDERK: Yes.

1031 UNDERTAKING

1032 THE CHAIRPERSON: Again for the 16th of February. Yes?

1033 Do you consider your unlocking policies consumer friendly?

1034 MR. BANDERK: Consumer friendly. Yes. At the end of the day, we give the customer choice. Not very -- I would say not all Canadians ---

1035 THE CHAIRPERSON: If that's the case, why do you sometimes waive the fee?

1036 MR. BANDERK: Circumstances. I think, in -- a specific situation ---

1037 THE CHAIRPERSON: Because that's more consumer friendly, is it not?

1038 MR. BANDERK: One could argue always charging less is more consumer friendly, yes. But we also have to ensure that we are allocating the costs of our service to the customers that bear that service. And so for a lot of Canadians, they don't -- aren't interested in having their phone unlocked. They're handing it down to that family member on the share plan and they don't need it unlocked, so they don't need to bear the cost of that.

1039 We're ensuring we're only charging those consumers that leverage that service and not spreading that cost across all of our customers.

1040 THE CHAIRPERSON: Right. Why would imposing an unlocking fee at the expiry of the commitment period not be considered equivalent to or a form of cancellation fee?

1041 MR. BANDERK: I think it -- because it's not required to cancel your service. You do not need -- you are not required to unlock your phone. You can take another service with another provider with a new device.

1042 THE CHAIRPERSON: But somebody who's either gone through their 24 month to the end or has paid the cancellation, well, one could easily argue they're owning it from the beginning. You have no ownership interest in the phone, even a subsidized phone. Correct?

1043 MR. BANDERK: Correct.

1044 THE CHAIRPERSON: So even less so at the end of the period, the commitment period.

1045 MR. BANDERK: And then we don't basically have any obligations on what they do with it. They can go to third parties sometimes to unlock the phone if that's what they so choose ---

1046 THE CHAIRPERSON: Right.

1047 MR. BANDERK: --- and to go down that path.

1048 THE CHAIRPERSON: And put in jeopardy their warranty.

1049 MR. BANDERK: Warranties are not in jeopardy from a proper unlocking. A jailbreaking, I think is the term, that would void the warranty, potentially. And generally speaking, warranties are already done after two years anyways.

1050 THE CHAIRPERSON: Do you consider unlocking fees more likely or less likely to contribute to a more dynamic marketplace?

1051 MR. BANDERK: I'm not sure, to be honest. I would assume that -- I'm not sure. It's going to vary by customer.

1052 THE CHAIRPERSON: You're answering that because you actually know that it would contribute to a more dynamic marketplace, but it's not consistent with your position. Is that correct?

1053 MR. BANDERK: That's because we're not sure.

1054 MR. SCHMIDT: But we'd be happy to take a chance to reflect on it, if you wish.

1055 THE CHAIRPERSON: As an undertaking?

1056 MR. SCHMIDT: If you'd like that.

1057 THE CHAIRPERSON: I’m asking you, do you want that opportunity?

1058 MR. SCHMIDT: We'll undertake.

1059 UNDERTAKING

1060 THE CHAIRPERSON: What do you think of the suggestion on the record that you'd have to report annually on your unlocking practices, policies and fees to the Commission?

1061 MR. SCHMIDT: My reaction would be that transparency measures are a good light touch, but effective measure in the circumstances.

1062 THE CHAIRPERSON: And should we be able to publish those unabridged?

1063 MR. SCHMIDT: Less sure. It all depends on what we're reporting, but should you be publishing, absolutely. That can't hurt.

1064 THE CHAIRPERSON: Well, you just made the case that it has to be transparent, so how transparent can it be if it's abridged?

1065 MR. SCHMIDT: Section 39 of the Act gives us certain rights to file, you know, information in confidence, so we'd have to see whether it's by provider, by industry or whatever. Your monitoring report is a very useful tool, but it has a lot of aggregated information, so that's the balance that would have to be examined.

1066 THE CHAIRPERSON: Are you of the view that unlocking fees should be included in the critical information summary for all devices, whether you've brought your own -- you know, whether it's subsidized or not subsidized?

1067 MR. BANDERK: So we're comfortable with that. We include it in ours. We actually even bold the price.

1068 THE CHAIRPERSON: Sorry?

1069 MR. BANDERK: We also bold the price. It's ---

1070 THE CHAIRPERSON: Okay.

1071 MR. SCHMIDT: It's there now, in other words, prominently.

1072 THE CHAIRPERSON: Right. And you cannot change that fee at the end of the period, can you? Is it considered an add-on, or is it considered key and immutable?

1073 MR. SCHMIDT: Well, I don't think it has the status of a key term under the Wireless Code now, but we -- and it's not a rate regulated item, but we've elected to give it greater prominence and put it -- voluntarily put it in the CIS for the benefit of the customer.

1074 THE CHAIRPERSON: Right. What would you think of the suggestion that we take -- this assumes that the unlocking fee is in the Critical Information Summary and that it would be part of the calculation for the cancellation fee according to the formula, assuming we're not -- and going down to zero, presumably, after 24 months?

1075 MR. BANDERK: So I think it's an interesting idea. I would say we wouldn't be in favour of it only because unlocking is, as I said before, something that only a certain number of customers are interested in, and we would then be putting that obligation on all of our customers and including that in that fee.

1076 So actually, I mean, we would manage either way, but I would say from a customer fairness approach, it doesn't make sense to put something obligatory into that that customer may not be benefitting from.

1077 THE CHAIRPERSON: Now let me move to other issues. How many of your current wireless customers have data as part of their plans?

1078 MR. BANDERK: Probably around 75 percent. I know -- don’t know it off the top of my head but the majority.

1079 THE CHAIRPERSON: And is that a growing number?

1080 MR. BANDERK: Yes, it is.

1081 THE CHAIRPERSON: Wouldn’t you agree therefore that data constitutes a key contract term?

1082 MR. BANDERK: Yes, we do. We think it is both a -- can be a key contract term and an additional service depending on how it’s bought.

1083 THE CHAIRPERSON: Tell me more.

1084 MR. BANDERK: So for the majority of our plans there’s an included set of data that is a key service term that someone’s signing up for. Sometimes you can add boosters or other things that are optional services on top of that. So we would look at that and say, no, not necessarily.

1085 One of the things we do offer, for instance, is customers as we -- they get to 75, 90 percent notifications, we allow them to buy one-time data top-ups that are good for the end of that billing period. Clearly that would be an additional service.

1086 THE CHAIRPERSON: So how would you react and I understand your point about maybe some top-ups but -- that the Commission prescribed that data usage in light of the current environment, in light of the basic service decision that it would be part of the Critical Information Summary?

1087 MR. SCHMIDT: We would completely support it and it broadly accords with where we’re going now.

1088 THE CHAIRPERSON: Now, we often hear and including in this proceeding -- and I’m going to give you an opportunity to explain to Canadians -- I wouldn’t want to put words in your mouth -- that go to you, get a subsidy, understand that the monthly charges on the subsidy contributes to subsizing [sic] the phone and getting telecommunications service and they just don’t understand why, at the end of the period that you’ve recouped presumably the subsidy you’ve provided, the monthly charge does not go down.

1089 MR. SCHMIDT: I can start off on that.

1090 So, the device subsidy decrementing that we see under the Wireless Code is a regulatory construct of, you know, permissible termination fees. It’s not at all exhaustive of the capital or operating costs that we assume to serve these customers. There’s all sorts of other incentives. There’s spectrum, there’s all sorts of things that are recovered over the total lifetime of the customer that’s measured in multi-months.

1091 But I think more fundamentally and more practically in that fact situation that’s being posited we’re chasing a ghost. Most of these customers, the vast, vast majority of customers renew their plans and take another subsidized device either prior to the end of the 24-month period or promptly thereafter. And it is a tiny subset of customers who elect to stay on the plan without a new subsidized device. So that’s the only group you’re talking about really practically. And they’re often doing so to temporarily -- either to preserve option value because it’s a good plan and they’re waiting for a promotional window like Black Friday, Christmas, whatever to get a new phone, or alternatively they’re on a grandfathered plan that’s better than other plans out there now.

1092 And I think Kevin wants to ---

1093 MR. BANDERK: So we also see in the marketplace a number of different approaches to this. So even within the TELUS organization we have a different approach from the TELUS brand as we do from the Koodo brand.

1094 On the TELUS we view our monthly pricing as an inclusive bundle of services that include ongoing subsidy, access to subsidy, voice, text, data, potentially other services therein. At any point in time a customer can choose to make sure they’re taking part of those services or not. The key is that what we try not to do is force them to change that. It’s up to their -- they can.

1095 So we do offer BYOD pricing. At the end of a customer’s contract term they are more than able to switch to the -- our BYOD pricing. We don’t force the change mostly because that also will change potentially services and what’s included in those -- in their current plan.

1096 As well, to Stephen’s point, very different construct and more similar to I would say -- or Eastlink I would say copied the Koodo approach where we have a fixed monthly fee and then the device is paid on top of that and it does drop off at the end of the 24-month period.

1097 You’ll have different approaches in market and we think that’s the right thing for consumers to -- based on what they want and what they value.

1098 THE CHAIRPERSON: Do you consider the Koodo approach or the Eastlink approach more transparent?

1099 MR. BANDERK: No, we don’t see it as any more transparent. We see it as different. And one of the challenges we actually have with it is once the price drops off, customers actually, you know, complain a little bit when the price goes back up when they want a new device.

1100 THE CHAIRPERSON: When -- in the TELUS shop somebody comes in and you’re providing a subsidized device, do you tell them that they could go to the Koodo brand and non-subsidize and have a separate item on their line item?

1101 MR. BANDERK: So generally that wouldn’t be our best marketing practice to ---

1102 THE CHAIRPERSON: I’m sure it’s not good for your shareholders but it might be good for consumers.

1103 MR. BANDERK: No, I think at the end of the day we try and position each brand on its own merits and allow customers to make the choice. We ---

1104 THE CHAIRPERSON: So you’re saying it’s consumer choice but they really have to figure out buyer beware.

1105 MR. BANDERK: Well, customers have to shop around. We all also compete in multi -- basically multi-branded retail locations where a significant portion of Canadians shop. They have all the -- they have the majority of choices available to them in those spots and they can make decisions and talk to someone who can help them sort through ---

1106 THE CHAIRPERSON: But you’d rather have them on the TELUS brand than on the Koodo brand; correct?

1107 MR. BANDERK: It actually depends.

1108 THE CHAIRPERSON: Depends on what?

1109 MR. BANDERK: Depends on the customer and what they’re looking for.

1110 So, for instance, they can actually have a cheaper price on TELUS than on Koodo when you have three or more subscribers in a shared plan. Koodo will be, generally speaking, a slightly less expensive for a single subscriber, but they have less service available to them. TELUS has more stores, learning centres and other value-added services on top. So it all depends on what’s important.

1111 And we actually have a third brand, as I stated, which is Public Mobile, which is at -- if you wanted to look at the absolute lowest price for us but there’s a trade-off. There’s no call centre. There’s no phone subsidies and there’s no stores.

1112 THE CHAIRPERSON: The Coalition have proposed that devices be sold by wireless service providers independently from the wireless plan and even billed separately. So I take it you disagree with that?

1113 MR. BANDERK: We think it’s happening in certain situations and it’s something that the market should dictate based on where customers want and what they’re looking for. So we see it happening in certain brands and we see it not happening in others.

1114 THE CHAIRPERSON: With respect to the national blacklist for lost and stolen handsets, have you ever -- your company or your brands ever used it in a way to protect your economic interests?

1115 MR. EDORA: There are guidelines with respect to how we use that blacklist and we follow all the guidelines. So I’m not sure exactly what you’re referring to but ---

1116 THE CHAIRPERSON: Would you ever use it in a collection context ---

1117 MR. EDORA: No, we do not.

1118 THE CHAIRPERSON: --- to add a phone on to ---

1119 MR. EDORA: We cannot.

1120 THE CHAIRPERSON: --- that list?

1121 MR. EDORA: The blacklist is for lost and stolen devices and we follow all those procedures.

1122 THE CHAIRPERSON: And solely for that purpose?

1123 MR. EDORA: Yes.

1124 THE CHAIRPERSON: As I mentioned earlier, you decided to bring us to court on the implementation of the Code last time around. So I want to give you an opportunity to help us understand what the implications of implementation would be for you.

1125 Would you agree that we were quite clear when we adopted the Code that we would be reviewing the Code within three years and that that might result in certain modifications?

1126 MR. SCHMIDT: Yes.

1127 THE CHAIRPERSON: So you were put on notice that that might occur, modifications might occur?

1128 MR. SCHMIDT: Yes.

1129 THE CHAIRPERSON: And that some of those modifications may actually impact your system design and the cost of implementing any of those changes?

1130 MR. SCHMIDT: We will know the modifications required the day you release your decision. Right now everything’s open. You’re asking questions, as you said. You don’t have a position. You haven’t decided anything. So, we can’t ascertain the precise scope of any changes right now, whether they’re permissive or mandatory or whatever.

1131 THE CHAIRPERSON: So -- because we aren’t going to play cat and mouse, would you rather tell me and look at the entire record under an undertaking and look at all the proposed changes and tell me which ones you can implement within a period of time? Or would you rather just help me understand what guidelines we should use to implement them?

1132 MR. SCHMIDT: I think it’d be more productive initially to speak in terms of guidelines and then if you don’t find it helpful then you can direct us further or encourage us further.

1133 In my business unit colleagues may wish to join in as well, but I mean, there are -- in a huge company with it operating across multiple geographies with multiple systems, it's not -- you know, changes are not simple and it takes time. There's defined windows in the year. We are operating a critical infrastructure serving governments, serving communities with an obligation to serve. There are defined windows in the air when we can change things and when we cannot. It's not simple. It has to be done carefully. So things take time.

1134 THE CHAIRPERSON: And how much time do you think? Is it two years, one year, six months?

1135 MR. SCHMIDT: In the -- in the record of the prorating clarification, part 1, we suggested six months would be a reasonable period and again, you know, depending on the scope of the changes, that might be a workable baseline to start from.

1136 THE CHAIRPERSON: Would it be a more workable approach to say six months as a general rule unless you can establish some particularly onerous consequences in your company because of where you are in your system updates or whatever?

1137 MR. SCHMIDT: That's very fair and nuanced.

1138 THE CHAIRPERSON: And should the changes apply across the board regardless of the state of individual subscriber contracts?

1139 MR. SCHMIDT: Well, if you were -- instead of looking at this solely as benefits, if you were imposing additional burdens on customers, et cetera, not looking at it from the provider perspective, if you are imposing burdens on customers or raising their rates or whatever, you'd probably let those contracts run their course and impose them prospectively to new contracts or at the conclusion of contracts that renew.

1140 It may be that if you're imposing certain absolutely essential obligations, life safety, whatever, you would impose them more rapidly.

1141 THE CHAIRPERSON: Nothing prevents you from implementing a Code sooner rather than later; correct? I'm not certain where this proceeding would lead to more onerous terms for consumers.

1142 MR. SCHMIDT: I'm just giving an example, you know.

1143 THE CHAIRPERSON: I'm not sure I understand your specific example.

1144 MR. SCHMIDT: Okay. So ---

1145 THE CHAIRPERSON: I have difficulty understanding where a consumer-friendly Code would suddenly be more burdensome on consumer.

1146 MR. SCHMIDT: Okay. So to the degree that we're taking on additional obligations or additional burdens or additional expenses, it's reasonable to give us time to reconfigure our affairs and make sure we can execute on them in a compliant manner. That benefits customers.

1147 THE CHAIRPERSON: Your ability to comply benefits customers?

1148 MR. SCHMIDT: Absolutely.

1149 THE CHAIRPERSON: How so?

1150 MR. SCHMIDT: Delivering a service to customers that does not comply with the Wireless Code, that doesn't meet your minimum requirements isn't customer beneficial, doesn't further the interest. Giving us the time to configure our systems to meet any new changes is good for our customers.

1151 THE CHAIRPERSON: Okay. Well, I think we're speaking to cross-purposes. My question was quite simply I don’t know if it's six months, eight months, whatever. Do we apply the changes across all the subscriber base at that date or not, in your view?

1152 MR. SCHMIDT: No, I think you should allow to -- no, I mean just to be clear. So it should apply to new and renewing contracts and let the existing contracts that are in market run their course.

1153 THE CHAIRPERSON: Why?

1154 MR. SCHMIDT: It may not make sense to open certain -- you know, we have to look at the specific facts but it may not make sense to open some of the contracts up. TBD, this is a very abstract conversation because we don’t know what you're going to decide and we won't know until the day that the decision comes out.

1155 THE CHAIRPERSON: But why would certain subscribers benefit less protection than others going forward?

1156 MR. SCHMIDT: It's not -- you know, there have been staged implementations for other services. There was a staged implementation of the Wireless Code itself in 2013. So that is a policy decision at the end of the day that you can make whether it's a flash cut from a defined point or not, whether it applies to all services from a date forward or not. We've expressed our view. You may take a contrary view.

1157 THE CHAIRPERSON: I'll be referring to that part of the transcript in the future I'm afraid.

1158 In the wireless public alerting file, the issue of liability of indemnification was raised should wireless providers give -- push notifications and there's a discussion on the record about you're afraid about your own liability although the messages would come from public service officials.

1159 And I was wondering are there, in your view, any barriers in the Code as currently drafted that would prevent you from limiting your own civil liability, if there is any, to the extent permitted under laws of general application through contract?

1160 MR. SCHMIDT: My reaction to that as a general question, and my colleague Eric may wish to supplement my response, is that the Code doesn't speak to liability at all that we control it through other contractual mechanisms to the degree that we are under a compulsion to provide a tariff service and if the 9-1-1 example is tariff, there are typically protections against liability that are in commission approved tariffs and they're there for good public policy reasons because we're under a compulsion to be out there to provide service no matter what.

1161 So those protections exist independent of contract.

1162 THE CHAIRPERSON: Right, as a matter of tariffs but I'm asking you as a matter of general contract law, would you not be able to legally limit your liability permitted under general laws of provinces I guess to protect yourself against somebody perhaps suing you for inappropriate -- I can't imagine in what circumstances but let's assume theoretically somebody tries to engage your civil liability for having sent a notice of imminent life to property or danger?

1163 MR. SCHMIDT: I'm having a little bit of trouble understanding the fact situation you're contemplating but I'll just try to answer it in a legal way.

1164 THE CHAIRPERSON: Yeah.

1165 MR. SCHMIDT: Strangers ---

1166 THE CHAIRPERSON: It's about wireless public alerting.

1167 MR. SCHMIDT: Okay.

1168 THE CHAIRPERSON: So presumably the way that works is a public authority duly authorized sends a warning which you have to push down the wireless system.

1169 MR. SCHMIDT: Okay.

1170 THE CHAIRPERSON: Replete in that proceeding is there is noise about, as we had heard on the broadcasting side for years about your -- you know, you object to this in part -- I'm not saying you but some wireless providers.

1171 MR. SCHMIDT: M'hm.

1172 THE CHAIRPERSON: Although you may have, it doesn't really matter -- object because it may engage their civil liability if by doing so.

1173 MR. SCHMIDT: Okay.

1174 THE CHAIRPERSON: I would have thought, yes, tariffs are able to protect your liability. That's one way but assuming not a tariff, why is there any barrier in the Wireless Code that would prevent you as a matter of contract from adding some sort of exoneration admissible under laws of general application?

1175 MR. SCHMIDT: The Wireless Code isn't a barrier in this situation but private law is probably not an opportunity either if we're seeking to protect ourselves from a liability to strangers to the contract.

1176 So to the parties to the contract that the issue is as between TELUS and its subscriber A or B or C, we're fine, private law can more than protect us. But if it's a stranger to the contract that is suing us, well, this horrible alert was sent out by TELUS, and they're not our consumer, they're completely outside of the scope of any liability on a private law basis. So we'd probably again be looking ---

1177 THE CHAIRPERSON: I have difficulty imagining a third party getting an alert on a cellphone of one of your subscribers.

1178 MR. SCHMIDT: Well, if it was an alert about a third party or something, you know, so I'm explaining to you a situation that might be outside of the scope of the protection.

1179 THE CHAIRPERSON: Okay, but with respect to the subscriber with whom you have a contractual relation, there's nothing in the Code that prevents from limiting your liability.

1180 MR. SCHMIDT: There's nothing in the Code that prevents it and private law would protect us. If for some reason we're in a fact situation where a third party says all of these horrible messages were sent everywhere by TELUS in their whatever, whatever, whatever, we wouldn't be protected.

1181 THE CHAIRPERSON: Right. CCTS awareness, so what is your current practice with respect to informing complaining customers of their rights to escalate their complaint to the CCTS?

1182 MS. KING: So our current practices, we -- as a member of CCTS, we abide by all of the obligations which are to put it on our bill messages to inform customers at the point of escalation. We also have it on our website and as well as we have it on our CIS form. So we use all of the available tools to us to promote it at the relevant time when it's important to our customers.

1183 THE CHAIRPERSON: And could you describe your practice in terms of monitoring compliance? You may have heard Eastlink's testimony earlier that humans make mistakes, oversight. How do you monitor incorrect course if it's not occurring 100 percent of the time? And I take it it's not occurring 100 percent of the time.

1184 MS. KING: Well, I would say that we endeavour to make sure that it’s done 100 percent of the time. We invest in making sure every single one of our team members is well trained on the Wireless Code, understands our obligations.

1185 We audit that training. We make sure that as many times as possible we integrate the Wireless Code and any other obligations that we have as a member of CCTS into our policies and practices so that we don’t rely on humans remembering things, as much as possible.

1186 And very shortly we’re going to be introducing a re-certification process to ensure our team members are being re-certified on our obligations and then we also have a team of team members that every week review our CCTS escalations and get as much learning from that as possible.

1187 So we put as many fail-safes as possible in place and including our new recertification process to make sure that all team members are aware.

1188 THE PRESIDENT: So I’m hearing that you strive, to the extent possible, with methods in place, to reach the 100 percent obligation --

1189 MS. KING: Yes.

1190 THE PREISDENT: -- of participation agreements.

1191 MS. KING: Yes.

1192 THE PRESIDENT: Is that correct?

1193 MS. KING: That is correct.

1194 THE PRESIDENT: So would you agree with me therefore it would not be an additional burden to put that obligation less so in the CCTS participation agreement, but in the Code itself? The duty to second level escalation to inform the customer of the recourse to the CCTS?

1195 MS. KING: Yes, I don’t -- I don’t know if it’s necessary to have it in the Code. We -- I think the way the Code ---

1196 THE PRESIDENT: That was my question. My question was does it create an additional burden since you’re already doing it.

1197 MS. KING: We’re already doing it to comply as a member of CCTS.

1198 THE PRESIDENT: What -- I’m looking forward and I bet I can’t find it. The -- today PIAC put in their presentation additional requirements to accentuate the awareness of the CCTS and I was wondering if you’d like to have a shot at dealing with that proposal, which seems to go beyond what the current requirements are?

1199 MS. KING: We think the current requirements meets the needs of our customers. We certainly think that, you know, how we treat our customers through escalations is not -- and how we value our customers through complaints is a way we differentiate our service from other competitors and the requirements of the CCTS are very clear and we don’t see the need to go beyond that.

1200 THE PRESIDENT: Do you think there’s any benefit to -- I mean they had suggestions of texts out, pushing not necessarily in the context of somebody having a complaint, but general awareness of the CCTS. Do you think that’s -- there’s an advantage to that?

1201 MS. KING: Well we do have general awareness already on the bills and we think it’s more important for a customer to know the information at the time when it’s relevant to them, rather than always continuing to send them all sorts of texts about things that are not -- not important at the time.

1202 And we pride ourselves on our ability to resolve issues with customers and we think customers expect us to take accountability and resolve their issue and not make it the problem of CCTS. Although that is their right and we promote that when it’s appropriate.

1203 THE PRESIDENT: Right, but the survey evidence that we conducted and put on the record suggests there’s a very low awareness of the CCTS.

1204 MS. KING: I think awareness of the CCTS is important at the right time. If you’re not experiencing an issue, then maybe that is not important at the moment.

1205 It’s important to know that we’re complying by the Code and the CCTS holds us accountable to that.

1206 THE PRESIDENT: Mr. Lawford says “you don’t know what you don’t know”.

1207 MR. SCHMIDT: You do know when at crucial escalation points. When you know -- when your -- when the complaint isn’t getting resolved.

1208 So our sense is you’ve chosen the right inflection points. They -- we make them aware when they sign-up with us, we make them aware when the complaint isn’t being resolved to their satisfaction.

1209 So it’s a focus number of inflection points that seem right and proportional and it’s not all of Canada, it’s rather someone who has a complaint, who is worried and who is seeking redress. So our sense is we -- you’ve struck the right balance right now.

1210 THE PRESIDENT: All right. My last question before I turn to my colleagues in Legal is -- I think you have a copy of Exhibit 1 that we announced earlier.

1211 I just want to make sure that you agree to undertake to provide those answers -- the answers to those undertakings by the 16^th.

1212 MR. SCHMIDT: I would like a Critical Information Summary of this, but I don’t ---

1213 THE PRESIDENT: We might ask one of your lawyers to provide it for us.

1214 THE PRESIDENT: Fair enough we’re ---

1215 MR. SCHMIDT: Or one of PIAC’s lawyers.

1216 THE PRESIDENT: Okay but the ones ---

1217 MR. SCHMIDT: Yeah.

1218 THE PRESIDENT: The ones that apply to you, not PIAC. You’ll see they’re divided up.

1219 MR. SCHMIDT: Okay so ---

1220 THE PRESIDENT: Not first page. It’s probably more the second page.

1221 MR. SCHMIDT: Okay. So we will –- and this is undertaking for the 16^th as well?

1222 THE PRESIDENT: Yes.

1223 MR. SCHMIDT: We so undertake, thank you.

1224 UNDERTAKING

1225 THE PRESIDENT: Thank you. Thank you very much.

1226 Apparently, we’re done. Thank you very much. It’s almost like clockwork. It’s 2:30. Thank you. Thank you very much. Nothing to add?

1227 MR. SCHMIDT: It’s -- I’ve had a lot of fun but thank you.

(LAUGHTER)

1228 THE PRESIDENT: I’m not sure about that. Luckily, you’re not under oath. We’ll take that 15 minutes break and come back at 2:45. Thank you.

--- Upon recessing at 2:30 p.m.

--- Upon resuming at 2:45 p.m.

1229 THE PRESIDENT: À l’ordre, s’il-vous-plait. Order, please. That’s very loud. Sorry about that. Madame la secrétaire?

1230 THE SECRETARY: We’ll now hear item 4 on the agenda. It’s a group of academics from the University of Ottawa. I would ask that you first introduce yourselves for the record. You have 20 minutes.

PRESENTATION

1231 MS. PAVLOVIĆ: Thank you. Good afternoon, Mr. Chairman, Vice-Chairman Menzies, Commissioner MacDonald, Madam Secretary.

1232 My name is Marina Pavlović. To my left is Dr. Mary Cavanagh, to her left is Lora Hamilton and to my right is Sean Grassie.

1233 We would like to acknowledge that we are on un-ceded Algonquin territory. Thank you for the opportunity to present and bring research perspective to the Wireless Code Review.

1234 Mary and I are professors at the University of Ottawa, at the School of Information Studies and Faculty of Law, respectively. Lora and Sean are JD students at the Faculty of Law.

1235 Our intervention is based on our 18-month research project that explores consumers’ everyday information seeking practices using consumer rights in mobile telecommunications as a case-study.

1236 The main goal of the project is to map everyday information seeking practices of mobile telecom consumers and create a toolkit for core information intermediaries, which are directly engaged in information seeking and access services.

1237 As a seed project, it is the first step in developing evidence-based information needs, access, and uses frameworks, and creating an appropriate responsive infrastructure to build and strengthen consumers’ legal capacity and consumer education.

1238 In our project, we have identified three key stages of a consumer transaction: pre-purchase information seeking, purchase of the wireless services, and post-purchase problem solving.

1239 Each of these stages raises distinct, but inter-related information needs. Given the scope of our project, perhaps it is not surprising that some of our data collection revolved around the Wireless Code.

1240 However, we would like to emphasize that our research was neither driven by nor exclusively focused on the Wireless Code.

1241 We would like to briefly outline the data collection we have completed so far, some of our findings and their implications, and finish with some recommendations for the Wireless Code Review.

1242 With respect to data collection, we have completed four main data collection exercises.

1243 First, a comprehensive scan and assessment of publicly available resources that explain consumers’ rights in mobile telecommunications.

1244 Second, a survey of organizations that provide information, referrals or advocacy around the broad topic of consumer rights in mobile telecommunications.

1245 In February and March, we will conduct follow-up interviews with selected organizations.

1246 Third, mystery shopper research study that explored information flow from service providers to consumers at the pre-purchase stage. The background and details on this study are in our intervention in paragraphs 3 to 23.

1247 And fourth, to date, two focus groups in Ottawa, with two more focus groups scheduled later this month.

1248 I will turn to Sean and Lora to provide a background on the Mystery Shopper project and its findings. Sean?

1249 MR. GRASSIE: Thank you.

1250 We selected six telecommunications providers using a number of factors and using two different scenarios for a total of twelve visits.

1251 One visit per scenario per provider, between July and September 2016 in the Ottawa-Gatineau area.

1252 Two realistic scenarios presented a typical interaction between a consumer and telecommunications service provider regarding a new plan in a retail outlet.

1253 Scenario one involved only a service plan, while scenario two involved both the subsidized device and a service plan.

1254 The scenarios replicated common in-person consumer interactions regarding wireless service contracts, such as inquiries about different cell phone plans, price points, data limits, and information about devices.

1255 Depending on the nature of the interaction, the scenarios also included problem-solving queries at the point of sale, for example posing a hypothetical to the employee and asking for information to resolve the issue, understand next steps, etc.

1256 In our intervention, we have identified several primary findings of the mystery shopper research study. We would like to briefly review them again here.

1257 Our first finding is that during our 12 mystery shopper visits to the wireless service providers not one provider mentioned the Wireless Code. From this finding, we make the obvious but still critical observation, consumers cannot use information they do not know exists.

1258 Our second finding is that generally, contracts were unavailable to consumers prior to purchase. In our study contract terms and critical information summary were relevant information sources applicable in all 12 visits. None of the providers discussed a Critical Information Summary. Only one out of 12 providers briefly showed the shoppers a copy of the contract, however, they did not allow them to look at it closely or to keep a copy.

1259 Our work illustrates a distinct informational gatekeeping role currently being played by frontline wireless service providers’ customer service representatives. Again, it bears repeating, you cannot use information you do not know exists.

1260 And I’ll just pass off to Lora who will review some more of our findings.

1261 Thank you.

1262 MS. HAMILTON: Thank you.

1263 Third, none of the providers mentioned or discussed trial periods which were also applicable in all 12 mystery shopper visits. Unless consumers have otherwise become aware of the trial period, the first time they are likely to assess whether the service meets their needs is when the first bill arrives. By then, it is too late to cancel a subsidized device plan without incurring penalties. You cannot use information you do not know exists.

1264 Our fourth finding relates to security deposits and credit checks. These applied to all 12 visits. One out of 12 providers mentioned credit checks. Not a single provider discussed security deposits to determine whether or not they would apply to these shoppers. In our view, security deposit and credit check policies disproportionately affect low-income individuals and students without extensive credit records. Again, you cannot use information you don’t know exists.

1265 Our fifth finding relates to unlocking of devices. Unlocking of devices would have applied to six visits, so the scenario with a subsidized device. Four out of six providers did not discuss unlocking at all, while only one provider fully explained how to unlock the phone and how much it would cost. In our view, consumers cannot have the means to unlock their device if they do not fully understand the unlocking process and the benefits of an unlocked device. You cannot use information you do not know exists.

1266 MS. PAVLOVIĆ: Next we highlight several findings from the focus groups.

1267 First, in our mystery shopper studies we found that data caps were not a significant issue. Ten (10) out of 12 providers explained data caps with varying degree of detail. However, while data caps were not an issue in mystery shopper studies they presented a significant issue for our first two focus group participants.

1268 These scenarios illustrate an essential information asymmetry, whereas in pre-purchase contexts data caps are readily discussed, in post-purchase contexts once consumers have incorporated their wireless phone usage into their everyday lives, and when data usage information becomes critically important the information they receive about these caps may be only a brief text message informing them that the consumer has already or is about to exceed their data cap.

1269 We ask ourselves how and when these consumers might more effectively benefit from more detailed information about their individual data usage patterns and the consequences on their mobile data plans.

1270 Our second highlight again concerns consumer awareness of the Code. Not a single individual, among 22 participants in our first two focus groups, indicated any awareness of the Wireless Code, nor of any specific rights described in the Code. You cannot use information you do not know exists.

1271 Mr. Chairman, we acknowledge and echo your comment from the hearing on the Renewals of Terrestrial BDUs where you asserted that information provisioning is a “shared responsibility ecosystem.”

1272 The wireless marketplace can be a diffused and disjointed landscape for everyday consumers. Building on the organizational review and survey, we have begun an exercise to identify and map the network relations across this ecosystem with a related goal to assess interest, financial capacity, expertise, and suitability to provide consumers with appropriate information.

1273 We have repeatedly said you cannot use information you do not know exists.

1274 Next we’d like to suggest a few practical measures to broaden wireless consumers’ access and opportunities to learn more about the Code, about their rights and obligations in the marketplace.

1275 It is clear many consumers are largely unaware of the Wireless Code. As we continue to informally poll participants in our research and teaching communities we get the same results, it is the rare and exceptional individual who indicates any awareness of the Wireless Code, never mind the possibility of using CCTS to resolve unresolved complaints with a provider.

1276 We are not, however, suggesting any change to the scope of the required information disclosure or making Critical Information Summary or contracts longer. Anecdotal evidence and rigorous behavioural research have demonstrated that people do not read contracts and that increasing disclosure requirements does not increase information comprehension or retention, nor does it change consumer behavior.

1277 The key issue, from our perspective, is how to get the information to consumers when they need it most. The Commission’s checklist Do You Know Your Rights as a Wireless Consumer is a starting point. However, since consumers’ information needs are situational and contextual, the checklist must be more robust and inclusive. It should include additional issues, brief descriptions and explanations, and problem solving pathways, and an interactive checklist, either on a website or through an app, or both, could serve many consumer needs.

1278 The B.C. Civil Resolution Tribunal’s Solution Explorer, which focuses on consumer issues under the jurisdiction of a small-claims court, or LegalSwipe, an app that informs people of their rights during interactions with police, are excellent examples. The key, however, is that the consumers need to be aware of such a source and be capable of using it effectively as required. Introducing such a resource to consumers in their pre-purchase market research could arguably improve their overall in-store transactions with wireless service providers’ frontline sales representatives and assist them in any future post-purchase problem solving.

1279 I will now turn to Mary to outline our final key messages. Mary.

1280 MS. CAVANAGH: Thank you.

1281 Our own subject knowledge of consumers’ information seeking and use behaviours, taken together with our project findings so far, suggests leadership, coordination, and broad sectoral collaboration are among the critical elements underwriting a robust and still innovative consumer-empowered Canadian wireless marketplace.

1282 First, only the Commission can ensure an evidence-based planning and decision making/evaluation framework is put in place to monitor the development of the Wireless Code. Only the Commission has the leadership responsibility on behalf of all Canadians.

1283 And in that capacity, the Commission should establish and implement a comprehensive 360-degree performance assessment framework to regularly review the Code’s effectiveness based on a variety of key performance indicators and drawing data and input from all ecosystem stakeholders.

1284 Secondly, we strongly suggest initiating a process to identify and organize the various players in Canada’s wireless ecosystem, the Commission and other relevant regulatory partners, the wireless service providers, individual consumers, and also, importantly, all of the various organizations that support consumer information and empowerment in this area, for example, public libraries, consumer groups, legal clinics, referral centres, health centres, municipal 211 centres.

1285 We see an opportunity for the Commission to exercise its leadership in developing and coordinating such a rich ecosystem of providers, regulators, consumers and informational intermediaries.

1286 We also see potential benefits in looking to other regulated areas with significant disclosure requirements and consumer information needs for strategies to extend the Commission’s active outreach to all Canadians, for example, in Canada’s consumer financial sector.

1287 The federal Innovation, Science and Economic Development Ministry’s Your Money Matters Program incorporates information, awareness, communication and marketing into a comprehensive outreach to all Canadians and may offer relevant best practices.

1288 The Office of the Privacy Commissioner has implemented a comprehensive program evaluation framework that may also be a useful reference.

1289 In addition, since 2014, the Financial Consumer Agency of Canada has appointed a Financial Literacy Leader whose role is to coordinate various stakeholders in order to “strengthen the financial literacy of Canadians.”

1290 As Peter Lunn, an economist specializing in neuroscience and consumer behaviour, recently noted the telecom market is an especially complex, highly dynamic system whose unique structural features encourage consumers to frequently opt for suboptimal wireless service contracts and services. In Canada the Wireless Code is arguably the critical information provision mechanism.

1291 We want to be very clear in some that we are not suggesting responsibility for awareness and information provision should rest solely with wireless service providers; to the contrary, we advocate a shared ecosystem with coordinated leadership from the Commission. We have outlined several ways consumers can become more empowered by becoming more informed regarding their rights outlined in the Code in each of the pre and post-purchase scenarios, and including a post-purchase problem solving context.

1292 Thank you for the opportunity to present our research, and we would be pleased to answer your questions.

1293 THE CHAIRPERSON: Thank you very much for your presentation. I'll put you in the hands of Vice-Chair Menzies.

1294 COMMISSIONER MENZIES: Thank you.

1295 Maybe we could start with whether we -- let me put it this way. This is a cause of frustration for many in terms of awareness of rights and responsibilities and obligations, and I just want to put it to you that maybe -- maybe most people are happy and have other things to do with their lives.

1296 I mean, within this room these are matters that cause all of us to lay awake at night, but outside of this room, there may be another world where this is not among peoples' priorities in life.

1297 No matter the ubiquity of the devices, it's -- for one reason or another, people don't seem as engaged as perhaps is in their own best interests to be in these matters. You kind of refer to that yourself in here.

1298 So what I'm trying to get at is I don't think the information is difficult to find. What could we do to inspire people to find it directly? I mean, apart from the engagement of groups and that sort of stuff? Because we be engaging groups but how would those groups engage citizens is the question?

1299 MS. PAVLOVIĆ: So I'll start and then I'll pass it on to Mary, because she has expertise in working in public libraries for 30 years, and so these are perennial issues, just in a different context.

1300 And I think I will start with what we said. You cannot use the information you do not know exists. So for a lot of consumers, the issue of unawareness is that they don't know it exists outside of the four walls of this room.

1301 And a lot of -- so we have done a survey of resources that are available. We've looked at them in terms of their usefulness as well. In a lot of the resources, the only way you can get to them is if you Google words "Wireless Code", but if you do not know that the Wireless Code exists, you cannot really get to the resources that actually explain user rights.

1302 So I think there are different pathways that need to be built, and Mary can talk about that. And you've identified correctly as well, which is something that we found in focus groups that training these information intermediaries is a very powerful tool and they can pass on the information to their users.

1303 So we'll just give you an example. That in one of the focus groups that we have done, zero awareness of the Wireless Code, zero awareness of CCTS, very high awareness of the Office of the Privacy Commissioner and privacy rights under PIPEDA.

1304 So we asked why, and they said well there was a workshop organized by the Office of the Privacy Commissioner where we learned about what actually constitutes for personal information, when we're supposed to disclose it and when not. And when we were asked to disclose our SIN number actually, incidentally in the purchase of a phone, we declined. We were declined service, and then we launched a complaint with the Office of the Privacy Commissioner.

1305 So there are different intermediaries who can play a role, and I'll pass it to Mary to sort of elaborate on some of these issues.

1306 MS. CAVANAGH: Okay, I also just want to clarify, if I'm understanding you correctly, that the information is there and people don't need it until they need it.

1307 COMMISSIONER MENZIES: Yeah, I just Googled Canada, phone complaints, and CRTC comes right up at the top, and the next item is ---

1308 MS. CAVANAGH: So ---

1309 COMMISSIONER MENZIES: --- the two CRTC sites, and then there is the Commissioner for Complaints for Telecommunication Services.

1310 MS. CAVANAGH: Absolutely.

1311 COMMISSIONER MENZIES: I mean, albeit, there's not Wireless Code, and you would have to know about the Wireless Code in order to search it, but it's not like it's invisible, and there's never been a time in human history where it was easier to get in -- to push information out and to pull it in as well.

1312 MS. CAVANAGH: Well, you know, in our focus groups, we asked people if they'd ever had a problem with their phone in a very specific that -- using that have you ever had a problem with your phone, your phone plan, and one or two people -- 2 people put up their hand out of 16.

1313 Then they started to talk. We said could you please elaborate on your problem and how did you resolve it, and so on. And then almost to a person, every other person in the room figured out that they'd had a problem.

1314 So part of the issue is you don't know that you have a problem, and you don't know what the language means, and you don't know that the CRTC actually regulates and provides rights on your phone. I mean, I can Google phone and complaints and go CRTC and go, okay, well, that's good, and then I can start reading, but it requires a fairly high degree of sophistication on information provision on one hand.

1315 I mean, I'm sure we can all agree in the room, we -- there is oodles of information available and Google provides answers to all the questions, but we also understand that the Internet is not a fair and even playing field in terms of quality of information. So I think there is some obligation in terms of the institutions funded by public money to be a little bit more proactive than to say it's on a website.

1316 In terms of organizations, there are many organizations that do provide that intermediary role, and can, and do on various types of public, you know, ordinary citizenship issues, be it health, be it legal, be it tenant -- landlord/tenant problems, or be it I just want to find out about the Food Guide so that I can properly, you know, direct my children. Vaccinations, for example.

1317 I mean, if you look at Public Health, I mean arguably the information is all there. I mean, is this -- I mean, this is not Public Health but I guess my point is passively I would argue that's just not enough.

1318 COMMISSIONER MENZIES: Well, what about this then in terms of Wireless Code. When in the times leading up to the creation of the Wireless Code -- and part of its genesis came about in an atmosphere in which multiple provinces were bringing in consumer legislation -- there was a high, seemed to be a high -- which was inspired by political reaction, which is -- typically means people are getting a lot of phone calls and a lot of complaints from people. So it had a fairly high profile. And it's post the introduction of the Wireless Code, which brought some conformity to the rules and regulations of these interactions, things seemed to be better. Right?

1319 There is fewer -- most people participating in this process have sort of said that the Code has been a success. The CCTS has relatively -- the number of complaints it had, there's a submission here regarding here, I think it was roaming, it was 215 complaints that they'd received.

1320 There's 28 million phone subscribers. That's -- what's that, 1 out of every 135,000 subscribers filed a complaint. Maybe it's working.

1321 MS. PAVLOVIĆ: So I'll start off and then Mary will add.

1322 COMMISSIONER MENZIES: Notwithstanding your evidence of Telco's behaving badly, which we have -- we've had before in terms of the presentation at the retail sales end, I'm not discounting that at all.

1323 MS. PAVLOVIĆ: So in my other life as a professor, I teach dispute resolution and I do a lot of research in consumer dispute resolution. So I would like to say that the number of complaints is not necessarily a sole criterion and indicator whether people are happy or not.

1324 So in order for a complaint to be reported by CCTS -- and before I go there, I have to read the mandatory disclaimer.

1325 That I'm a consumer groups appointed director at the Board of CCTS, and I'm participating in this proceeding in my capacity as a researcher, and not as a director of the CCTS, and that all information contained in my submission is based on my role as a researcher, and not in any capacity as the director of CCTS. No confidential or proprietor information of CCTS was used in the preparation of my submission.

1326 So -- just so that's on the record.

1327 So in order for CCTS to record and actually include the complaint in their annual report, the person has to have experienced a problem, recognized it as a problem, called their telecom provider and asked to fix it.

1328 The provider will not -- should not face it at the first level, it has to escalate, then if it it's not fixed there, it has to go to CCTS. Then the CCTS, if it's not able to mediate it at that first level, it goes to the investigation where the Code bridge is actually diagnosed or confirmed by CCTS.

1329 So there are a number of steps and there is considerable attrition along the way. So the way normally people perceive when they have a problem there’s that language code in dispute resolution literature naming, blaming and claiming. They have to recognize that they have experienced an injury. They have to name it as such. They have to blame a third party for it and they have to claim it, they have to address it.

1330 So in this space, a lot of the complaints people may have are over relatively low monetary value and people may actually do the calculation that it is not worth their time to pursue the complaint. Those who get to CCTS are generally more extreme circumstances where people have found the time, for whatever reasons, to actually get there.

1331 So I would caution against using the number of complaints as a sole indicator of the success of the Code because it’s really just at the tip of the iceberg in terms of the problems people may have.

1332 COMMISSIONER MENZIES: Just continuing and then I’ll move on to something else. But in terms of that, the part of the purpose of the CCTS is that it -- I mean, it’s sort of at its core in terms of information is that it is there as a last resort, not as a first resort. And so that the best thing, the happiest relationship or the closest relationship or the unhappiest relationship, whatever, should be between the service provider and the consumer, that ideally they behave -- that’s a relationship where issues get resolved there.

1333 So in -- I mean, in the perfect world the CCTS would not be necessary, it would only be -- it would only -- and part of its creation purpose was to be a safety net for when the normal -- and a -- yeah, safety net for when the normal commercial relationship fails.

1334 MS. PAVLOVIĆ: Right. And I agree with that. And generally the purpose of industry-based or industry-funded ombudsmen is really to be the last resort, but we’re seeing a trend in a number of other regulated industries, both in Canada and elsewhere, that industry ombudsmen are put in place because the public civil justice system is really not capable of resolving these kinds of -- these are not complaints that are ever going to go to the small claims court. Because filing $50 with small claims court is probably larger than, you know, whatever over charge people may have had.

1335 But -- and again, I’m just saying the number of complaints alone -- so fewer complaints therefore the Code is working are not necessarily the only indicator. I think that’s just one of the indicators.

1336 And we agree with everybody else that the Wireless Code is a very good and very positive development but it needs tweaking. And so our contribution is really how do we bridge this gap between people in this room who know about the Code and people out there who could benefit from their rights in the Code but are unaware of the rights.

1337 Mary?

1338 MS. CAVANAGH: I just wanted to add that the Code has the word “rights” in it. It’s not about complaints. So I think it behoves all of us to think of it from that point of view and not just how many or how few number of complaints come that we have to deal with.

1339 And just to follow up on Marina’s comment that it is -- it is a framework that provides some basis for people and they need to understand it. They -- whether they need to use it every single day or once a year or every five years I think it’s a responsibility of the leadership and the Code itself that it needs to be made available. And we know that providers are not necessarily all the time fulfilling their requirements. So in that event, what are we supposed to do?

1340 COMMISSIONER MENZIES: Right. Which is my next question to you, what are we supposed to do because we have the Wireless Code open in front of us for modernization or update, what can -- what would you have us do specifically? There’s, for instance, the matter of I think it was in the CCTS evidence that it was only 30 percent, 32 percent roughly of wireless service providers were living up to their requirement as CCTS participants to inform customers about the Wireless Code -- or sorry ---

1341 MS. PAVLOVIĆ: The CCTS itself.

1342 COMMISSIONER MENZIES: Part of the internal complaint handling process following the second level of escalation that they should notify folks. So should we put that sort of requirement ---

1343 MS. PAVLOVIĆ: So I think there are two distinct issues. One is the information about the rights in the Code and the Code itself; and the second one is the complaint route. So, if you don’t mind and with respect, I’d like not to discuss the complaint route because I sit on the Board of CCTS.

1344 COMMISSIONER MENZIES: Well, that’s fine because, I mean, I agree. We’re here to discuss the Code ---

1345 MS. PAVLOVIĆ: And ---

1346 COMMISSIONER MENZIES: --- and how we may improve the Code, add to it to strengthen it.

1347 MS. PAVLOVIĆ: I think from the research that we’ve done, adding more disclosure requirements to the Code itself may not necessarily produce the desired results and increase awareness. Because then we move into territory of regulatory compliance and then we move into the territory of how do we monitor regulatory compliance. And I think those are the suggestions that we were working towards more that if it is, and it is a shared ecosystem, there needs to be some coordination between the parties in the ecosystem where everybody will do their bit.

1348 So currently a lot of the emphasis is on the providers providing information to the consumers because of they have requirements in the Code that they have to disclose information. And a lot of the pressure is on consumers to inform themselves but there are very few resources may actually be useful for consumers. So we need to bridge that gap in some way and we think that coordination between the players in the ecosystem is essential for that actually to happen.

1349 Mary?

1350 COMMISSIONER MENZIES: I understand that but I don’t understand how to write that into the Code. Do you get my point?

1351 MS. PAVLOVIĆ: I ---

1352 COMMISSIONER MENZIES: Like I mean, I heard ---

1353 MS. PAVLOVIĆ: --- and I understand the query. I -- and again, I’m going to repeat that increasing those obligations in the Code is not necessarily going to produce increased awareness unless the Commission takes on a robust compliance enforcement.

1354 So unless the Commission goes and does mystery shoppers that we’ve done and comes up and publicly names and shames providers who do not comply, I don’t necessarily see that as a resource. But perhaps you can introduce a fund that would have -- like the Office of the Privacy Commissioners annual fund that awards grants to public interest organizations and consumer organizations to create training and different kind of outreach mechanisms.

1355 So it’s not really a Code requirement per se, it’s really something that we’re doing to bridge that divide between the Code itself and the people who actually need their -- to know about the rights in the Code.

1356 COMMISSIONER MENZIES: Okay. I understand that and I appreciate your position on that and I think you’ve made your case for that. What I want to do is -- in the time we have today is take the most advantage we can of your expertise and your viewpoints built from your studies regarding what we can do with this matter right now in terms of the Wireless Code. So maybe I can just go through a few areas and ---

1357 MS. PAVLOVIĆ: Sure.

1358 COMMISSIONER MENZIES: --- you can give us your thoughts ---

1359 MS. PAVLOVIĆ: Yeah.

1360 COMMISSIONER MENZIES: --- on what might be the best way for us to go. And that way we can deal with this first and then if there are bigger matters you wish to -- that we need to deal with eventually outside of that we can consider those at another time.

1361 So you talked about credit checks, for instance, security deposits, and I was wondering how that does or does not relate, for instance, to the issue of prepaid services versus post-paid in terms of consumer treatment and how we might tweak the Wireless Code to make that better.

1362 MS. PAVLOVIĆ: So I’ll start with the limitation that our mystery shopper study included only post-paid services, that we didn’t really mystery shop for prepaid services. In the focus groups, the participants we talked to had both pre and post-paid services.

1363 We haven’t really thought about that distinction a lot and partly because we’re trying -- so I’m trying to not have my lawyer brain turned on all the time and sort of be very open to information studies.

1364 And I think the fundamental issue is that you do have two classes of consumers. So the Wireless Code currently, by design, by accident, or whichever reason, has two classes of users and that users themselves don’t necessarily see -- so prepaid versus post-paid users don’t necessarily see themselves as people in different classes with different rights.

1365 And the issues that you particularly mentioned in particular credit checks are incredibly important for people who are users of post-paid services because they usually do not have required credit for a -- sorry -- for a prepaid service, they do not necessarily have a required credit for a post-paid service.

1366 So that is something that we have seen in our focus groups but we don’t necessarily have specific recommendations other than recognizing that it really puts those who are vulnerable or who are already vulnerable in a more vulnerable situation.

1367 MS. CAVANAGH: Just from a very practical information point of view -- and, Mr. Chairman, you referred to this in the previous line of questioning with TELUS -- the Critical Information Summary is not available and why could it not be made available for the prepaid consumers.

1368 People -- I mean, our goal I think is just to see that people have as much quality information, and it’s not -- we certainly do not see that the obligation is only in your hands or in the providers hands, that the individual obviously has a responsibility to inform themselves, but they need a framework and they -- the framework of I need a phone, or I need a new phone, or I’ve got a problem with my phone is not an informational policy rich -- public policy rich framework for informing themselves and making the best decisions.

1369 So we need to break down that process and at each of those steps I would say find ways to insert not yourselves necessarily but your -- but the instrument itself as an information tool not just -- there are many various ways, an app, an app that has information that can guide people. I mean, there are lots of ideas if you want ideas.

1370 MS. PAVLOVIĆ: But I go back to the Critical Information Summary we think is a very good tool. And so you might want to talk to Sean and Lora. They were the mystery shoppers. So you might want to talk to them about their experiences in the store in terms of whether they felt that they were really informed going into these purchases.

1371 But ---

1372 COMMISSIONER MENZIES: Sure. Well tell me ---

1373 MS. PAVLOVIĆ: But having something again more tangible for prepaid -- sorry -- for prepaid users I think would -- and sort of evening that playing field amongst the different classes of users I think would be a good step forward.

1374 COMMISSIONER MENZIES: Go ahead please, sir.

1375 MR. GRASSIE: Yeah, I mean, we can speak from experience a little bit. I think the main thing for us the wireless service providers love pamphlets, and they love giving out pamphlets, and pamphlets are an okay source of information, but the way that they’re given out at the point of sale they’re designed in such a way to entice you to purchase a product and not necessarily to inform you of your rights.

1376 And, in our view, we don’t see why there’s any reason that there can’t be one more additional pamphlet at the point of sale that just really clearly delineates your rights as a wireless consumer. It doesn’t have to be branded in any certain way. It could be, you know, an official CRTC piece -- document, or attached to one of the pricing brochures that they already produce. That would at least put some information in your hands right away at the time that you need it rather than, you know, you can go Google it after. It’s -- and I don’t think it would be a particularly onerous thing to require as well.

1377 So that’s just one idea that comes to mind based on our experience.

1378 COMMISSIONER MENZIES: So you would -- when a pamphlet -- a sales pamphlet is handed out a copy of the -- or information regarding where to access the Wireless Code would be part of that, is that what -- that would be the ask?

1379 MS. PAVLOVIĆ: I think we’re now going into the territory that Mary identified as passive versus active information. So if somebody gets a piece of paper that says oh, by the way, there is this piece of -- there is something called Wireless Code that regulates your right and go and check it out, chances of people following up on that lead may not necessarily be high, but if there -- so the -- that’s what we said, the Commission’s checklist is a good starting point.

1380 So people need some concrete information in terms of here are your rights with respect to data caps, here is -- so little blurbs, a couple of sentences on each specific point. So it’s -- it can still probably fit on a sheet versus just oh, go and check a particular website.

1381 COMMISSIONER MENZIES: Okay. I understand. I’m struggling a little bit to get my head around how you convince a salesperson to do that in that sort of setting. I can understand having a requirement that within this there is information doing that but I have a tough time imagining them being highly motivated to -- no matter how many rules you make around that to actually follow them, because it’s almost -- it’s counterintuitive in a sense.

1382 MS. CAVANAGH: And in that case -- and I completely understand that. In that case, from a practical point of view, that’s where the only other way that the instrument can be inserted is through your office, and that -- and it has to be -- well, through some -- or your delegates who you, you know, help support people to organizations in terms of training, or education, or have you bought your wireless, or have you consulted -- you know, have you checked the Wireless Code, are you thinking of buying a phone, or have -- I mean, you know, whatever, there are all kinds of things.

1383 I take the point that you can’t ask the wireless service providers necessarily to do a review of the Code, but if you’re using Critical Information Summary as a tool there could be, you know, a parallel, a preamble, there could be links directly to each element in that Critical Information Summary directly to the Code itself and so on.

1384 COMMISSIONER MENZIES: Well, what you’re saying is would it be sensible to have -- I mean, part of the critical information would be the Wireless Code itself, right ---

1385 MS. CAVANAGH: Absolutely.

1386 COMMISSIONER MENZIES: --- within that?

1387 MS. PAVLOVIĆ: And I think we also generally agree with other intervenors who have proposed a more uniform format for Critical Information Summaries.

1388 And again, Sean and Lora were the shoppers so they’ve done 12 visits, and it was -- even in that environment it was very difficult to actually compare.

1389 So having a more uniform document -- and I understand that there may be costs and providers -- or there may not be a desire for them to actually all have the same document, but that would definitely help consumers actually, first of all, be better comparison shoppers, which was again one of the policy objectives of the ---

1390 COMMISSIONER MENZIES: Help me understand what you mean by more uniform, because, you know ---

1391 MS. PAVLOVIĆ: Because the Critical Information Summary ---

1392 COMMISSIONER MENZIES: --- part of the purpose of it is to allow people to differentiate ---

1393 MS. PAVLOVIĆ: Right.

1394 COMMISSIONER MENZIES: --- between ---

1395 MS. PAVLOVIĆ: But if you -- but then you cannot do one-on-one comparison because everybody’s Critical Information Summary -- if we’re using that as a comparison tool -- is somewhat different.

1396 It’s almost like, you know, when they say when you’re buying a mattress you can never actually do a comparison because every brand is different so you can’t really never truly compare.

1397 So I think we’re in the territory that everybody’s Critical Information Summary has their branded look or the content so that consumers cannot truly compare because not everything fits into the same heading or category so it’s very difficult to actually compare how much you would pay in the end and what particular line item cost, et cetera.

1398 COMMISSIONER MENZIES: And in terms of the similarity, you say the similar template ---

1399 MS. PAVLOVIĆ: Yeah, exactly ---

1400 COMMISSIONER MENZIES: --- not ---

1401 MS. PAVLOVIĆ: No, not ---

1402 COMMISSIONER MENZIES: Not the information?

1403 MS. PAVLOVIĆ: No, no, no. But the template -- so the way in which information is presented if that could ---

1404 COMMISSIONER MENZIES: The type of information ---

1405 MS. PAVLOVIĆ: Yes.

1406 COMMISSIONER MENZIES: --- that would be included? Okay, I understand.

1407 What are your thoughts regarding trial periods within the Wireless Code?

1408 MS. PAVLOVIĆ: So I’ll preface this with that we haven’t, for a number of reasons, made specific concrete recommendations on certain rights in the Code because we felt that our contribution would really be better in terms of bringing things that other parties have not brought.

1409 I’ll just pass it to Sean and Lora who were again our mystery shoppers if they might have some.

1410 But I think again what we’ve already said that people really need to know that the trial periods exist and what are the implications and what has already been said today in terms of how much data they can use, et cetera.

1411 Lora, Sean?

1412 MS. HAMILTON: Well, I think what we noticed from mystery shopping is there wasn’t any reference to trial periods, which I think is something that is important for people to be able to know that they can evaluate the service before the bill comes and before there are financial consequences.

1413 Because once your bill comes and you think was this actually a good service for me you’re already in the contract.

1414 So I think it comes back to information provision and if people know that this is an option available to them then they can make a better choice.

1415 COMMISSIONER MENZIES: How would you have us ensure that that took place?

1416 MS. PAVLOVIĆ: Well the requirement to disclose it is already in the Code, so I guess we’re going back to monitoring compliance with -- monitoring providers’ compliance with the Code and ensuring -- and again, other than doing -- these are types of things where unless you really do a mystery shopper you don’t necessarily know what’s going on.

1417 And providers may –- may train their staff but there may be somebody who is untrained or somebody who is new or -- I think there is a lot of -- there are a lot of opportunities along the way, where a human element may play a role.

1418 I think that there are a lot of opportunities also for improvement, that that human element does not necessarily fail, but succeed to the best of their abilities.

1419 COMMISSIONER MENZIES: Why do you think there isn’t more -- something that I was struck by when I was reading your submissions and others, why isn’t there more activism on social media regarding items like this?

1420 Like it seemed to me that a few years ago, before the Code, there was and there are some groups that can organize a pretty good petition, or protest, or whatever, or reaction, on social media in no time at all.

1421 And I’m just –- I mean I take all the things that you think that we should do, but I’m looking for more evidence of spontaneity among consumers regarding this sort of stuff.

1422 I mean whether it was -- whether it’s a Twitter -- dedicated Twitter accounts, Facebook pages or whatever where, you know, things are pushed out to people that -- know your rights in terms of that. Why isn’t -- why don’t we see more evidence of that or are we just blind?

1423 MS. CAVANAGH: Absolutely, I don’t think you’re blind at all. I think you’re here and asking questions and I think it’s a good -- I think it’s a great question.

1424 These are the smallest of the small, everyday interactions and unlike the world’s -- you know, why isn’t there a Twitter movement?

1425 Well if there were the right kind of savvy people got together and pooled their problems and could develop a campaign or just had an injustice story, but the injustices are, you know, in world terms, in Canadian terms, probably small, but they are injustices nevertheless if people don’t know.

1426 They don’t know the tool exists and they don’t know that they can use them to solve their problem.

1427 We have a, you know, public health system that has a whole bunch of steps. I’m not saying this is public health, but at the same time it’s solid infrastructure for Canadian Citizenry, your phone and your telecom services and in this case your wireless services and -- so getting it right and your interaction with your provider and the rights in the Code, they have huge implications.

1428 But, you know, one person at a time I don’t think you’re ever going to find it. I mean we could go and try to stir one up, but I don’t think you really want that.

1429 I think it’s more recognizing that the granularity is so small you will never -- it will never appear here. It won’t -- you know, where are the citizens here? You just -- the nature of the concerns will not -- they won’t come.

1430 MS. PAVLOVIĆ: Can ---

1431 COMMISSIONER MENZIES: Just to test an idea on you, could it be -- and hold that thought for a second before I lose mine.

1432 It’s just -- could it be that there’s -- the issues have become too granular? I mean when we put this together that three-year, versus two-year contract issue for instance was something that people could grasp and they were pretty noisy about it at the time.

1433 So my question is that have the issues become too granular for people to grasp?

1434 MS. CAVANAGH: I think also and very, very individual.

1435 So my situation in any whatever particular moment in time is so different from yours they don’t lend themselves to comparison, they don’t scale very well.

1436 I think the three year to two year was a very clear one that was -- had universal or you know widespread understanding in terms of that, but these are very small steps and I think your point is well made.

1437 MS. PAVLOVIĆ: I’d like to also add that consumers are not a uniform group. They’re very different sub-categories of consumers and organizing consumers has always been a problem of a consumer movement.

1438 So from 1960’s onward and some of the consumer groups can certainly speak to this more than I do.

1439 So -- and there is in this increasing information overloaded society increased apathy as well and I also think the organisations who are capable of organizing consumers may not necessarily have the capacity and bandwidth to do that.

1440 But -- and again I don’t necessarily have to tell you this or people in this room, that funding for consumer organizations over the years has dwindled and that it is very difficult for them to sustain themselves let alone have large campaigns that may actually -- not necessarily cost a lot of money, but cost a lot of resources.

1441 And if they have limited resources then they have to really split them into actions that would produce the most results.

1442 COMMISSIONER MENZIES: What are your views -- one of the issues that does seem to pop up a little bit that among a certain constituency anyways, the issue of unlocking in terms of that do you have any thoughts as to any actions that we should be taking regarding unlocking fees or whether they should be charged, changed or not charged at all?

1443 MR. GRASSIE: I personally don’t believe they should be charged. I think the only purpose they serve right now is, like we have seen, as to protect or decrease the risk that’s felt by the wireless service provider.

1444 I think it in general diminishes mobility just by its very nature; it’s designed to do that. It’s designed to keep you within one service providers service offerings and to prevent you from exploring different options, from being flexible and to responding to service that may be inadequate by moving to a different service.

1445 I think in another sense it prevents other consumers from taking advantage of beneficial services as well.

1446 For example, for roaming if you didn’t want to say partake in the roam like home or these easy roam sort of services that the service providers offer within Canada, if you did have an unlocked device and you were in a foreign country you could piggyback on their cell service which may be cheaper by simply popping a SIM card for the month while you’re there. So that also adds a level of flexibility and would be cost effective for Canadians as well.

1447 So I believe in general that we shouldn’t be charging for such a key service, especially $50 is quite a high fee as well.

1448 MS. PAVLOVIĆ: On a micro level I think the suggestions that were asked as questions earlier this morning to include the fee in the critical information summary would be a good first step again, so that people would know how much that costs.

1449 And again, you don’t -- you do not regulate the prices so we’re not going to go there, but $50 might seem a lot.

1450 COMMISSIONER MENZIES: And in terms of your broader -- and I’m going to take it that because we’ve touched on a few of these items, that in terms of some of the specific issues here, that as a group you have chosen not to make specific recommendations around those.

1451 So I’m not going to nag you to make them or to have to repeat that, but if you do individually have anything that you wish to contribute, a point of view on any of these topics feel free to jump in; okay?

1452 In terms of the broader consumer agenda I just have -- want to get a bit more specific information from you in terms of the role you think we should play in herding all these cats around this, and I want to know how you see that, the process that might best be used to get an efficient and effective outcome? Because the less optimistic side of me looks at it and sees endless conversation and handwringing and, to be blunt, many platitudes on behalf of the consumer, and no great outcome. Right? Lots of meetings, lots of agendas, et cetera, et cetera, but what do you -- what firm action would you like to see come out of that that would actually change the world ---

1453 MS. PAVLOVIĆ: I'll ---

1454 COMMISSIONER MENZIES: --- to your liking?

1455 MS. PAVLOVIĆ: --- start off and then Mary might add. And I'll start off with the -- again, even though I said I'm not going to talk about CCTS, CCTS is actually a very -- the board structure of CCTS is a good example that people with different interests on the different sides can actually come around the table and contribute to the organization that has worked really well for the last year. So the constructive conversation is possible.

1456 And –- so were trying to figure or think about modalities. So CRTC already has CISC as a particular group that is gathering different stakeholders and talking about specific issues. So CISC, like body or a subcommittee, which would focus exclusively on consumer awareness, would be one suggestion. I think there would have to be funding somewhere. So again, we're going back to the Office of the Privacy Commissioner where not a lot of annual funding, a lot of our consumer organizations, so contributing to their sustainability as well, are creating educational materials for various groups.

1457 But that the adjudication of that funding is done by a committee of all stakeholders to ensure both the quality and also ensure, if you will, a fairness in adjudication but also ensuring that particular views, you know, that there is not just a particular view that is positioned, it's basically neutral view here is what the Code is and here is actually communicating about it.

1458 So I think Commission has that ability to gather these various stakeholders into some sort of an organization. So that would be one suggestion.

1459 And I think another one, and the reason why we mentioned the civil rights tribunal is that they have actually -- everything that they have developed, developed in conjunction with the communities information is supposed to serve. So that they have done a lot of pilot testing with consumer groups, and particularly, vulnerable consumer groups, to ensure that the materials that are produced actually meet those needs.

1460 So I think there are different aspects in terms of that collaboration, and it can be topped down, it can be bottomed up, but I think both together in some form would work well.

1461 Mary?

1462 MS. CAVANAGH: Good.

1463 COMMISSIONER MENZIES: Okay, I just have one final question regarding that.

1464 What did you think and do you support the Coalition's proposal too -- that wireless service providers be required to send a text to all of their subscribers informing them of the -- about the existence of the Wireless Code?

1465 MS. PAVLOVIĆ: On the principled level, I think that's one of mechanisms how information can be communicated. I think there are others, but if that is the easiest and the most cost effective, that may be, again -- I think from our perspective, it's a step, not the step. There may be other ways of how to communicate that information, but in principle, yes.

1466 COMMISSIONER MENZIES: Thank you very much. Those are my questions.

1467 THE CHAIRPERSON: Are you familiar with CRTC Exhibit No. 1, and there were specific questions on page 1 of that document ---

1468 MS. PAVLOVIĆ: Yes. The undertaking?

1469 THE CHAIRPERSON: --- focused on what I'm calling academics? I think that ---

1470 MS. PAVLOVIĆ: Yes, that's us.

1471 THE CHAIRPERSON: --- might be you?

1472 MS. PAVLOVIĆ: Yes.

1473 THE CHAIRPERSON: Among others, yes?

1474 MS. PAVLOVIĆ: Yes.

1475 THE CHAIRPERSON: Are you willing to undertake to provide those answers?

1476 MS. PAVLOVIĆ: Yes.

1477 The questions to which we have answers, we will ---

1478 THE CHAIRPERSON: Right.

1479 MS. PAVLOVIĆ: --- have the answer.

1480 THE CHAIRPERSON: Well, if you have no answer, then if it's helpful for you to tell us that you have no answers, that would be useful.

1481 And particularly with Question 6. There is a suggestion there that there would be some sort of -- well, there it's the leaflet. Now, I'd like you to turn your mind particularly to a document we published at the time of the original Code, and it was called -- well, it's another communication document and it was entitled, Do You Know Your Rights As a Wireless Consumer.

1482 MS. PAVLOVIĆ: Right.

1483 THE CHAIRPERSON: You're probably aware of that?

1484 MS. PAVLOVIĆ: That's the checklist that we've been referring to, yes.

1485 THE CHAIRPERSON: Okay, so that's the checklist, because even we, when we were publishing the Code, realized unless people are or have insomnia they will not look at the Code until they need it to a certain degree, and we wanted to equip them with something easy, something fast, and that was how we did the checklist.

1486 So if you -- in context of Question 6, if you could address whether that would be an appropriate leaflet and what's missing in it.

1487 MS. PAVLOVIĆ: As we said in our oral remarks, we think that's a good first step. It would probably need some information and we can try our best to address that as well.

1488 THE CHAIRPERSON: Right, keeping in mind that it's -- it can't be too long.

1489 MS. PAVLOVIĆ: Not more than two pages, yes.

1490 THE CHAIRPERSON: Yeah.

1491 MS. PAVLOVIĆ: We understand.

1492 THE CHAIRPERSON: And just from a common-sense perspective, there's a limit to what people are ready to absorb. We know that, and the irony is on the French side it'll be longer, for some reason it's always longer.

1493 MS. PAVLOVIĆ: It's always about a third longer.

1494 THE CHAIRPERSON: I don't -- unless we can do a full interpretation that is, rather than a translation, that starts off and is shorter in the first instance.

1495 MS. PAVLOVIĆ: And I will just say, and we will put that in the undertaking as well, that again, leaflet is a method. And so one of the things that we suggested, either an app or a website where people could actually expand on specific issues and get more information. So while we can't really fit on the two pager, you would actually have ability to get more information when you need it.

1496 THE CHAIRPERSON: If you so choose? Right.

1497 MS. PAVLOVIĆ: Yes.

1498 THE CHAIRPERSON: And just to be clear, for your undertaking, you're okay with the 16^th of February? That doesn't create an issue for you?

1499 MS. PAVLOVIĆ: I have 80 papers to mark, but I will try to actually submit it by the 16^th of February.

1500 THE CHAIRPERSON: Well, this is your opportunity to make a case if the 16^th is ---

1501 THE CHAIRPERSON: No, it's fine. Thank you.

1502 THE CHAIRPERSON: Right. Okay, good.

1503 UNDERTAKING

1504 THE CHAIRPERSON: Thank you very much. Those are our questions, I believe, from the Panel and legals. So thank you very much for participating.

1505 Those are all our intervenors, Madam Secretary for today. So we're adjourned until 9:00 tomorrow morning. Thank you.

--- Upon adjourning at 3:47 p.m.

Court Reporters

Sean Prouse

Mathieu Bastien-Marcil

Lyne Charbonneau

Marie Rainville

Suzanne Jobb

Jocelyne Lacroix

Janice Gingras

Jackie Clark

Renée Vaive

Nadia Rainville

Mathieu Philippe