Lack Of Competition Turns Inconveniences Into Debacles
The Saturday Huddle is a weekly column that features opinion, analysis and reflections on Huddle stories, podcasts and business news in the region. Derek Montague is a Huddle reporter based in Halifax.
It seems like every summer gets its own unique name based on a person or a theme. It could be “The Summer of Love,” “Summer of George,” or “Summer of Sam.” In Canada, the Summer of 2022 will go down as the “Summer of Service Disruption.”
Whether you’re just trying to fly somewhere for a wedding or pay for your groceries on a Friday afternoon, this was not a good season to be a customer of gigantic Canadian corporations.
Just last weekend I was on a road trip from Halifax to Saint Andrew’s, New Brunswick, where we were lucky to be able to buy gas. We had hit the road Friday morning just as the Rogers outage disaster was taking place.
At first, I thought it would be a minor hiccup. Sure, internet and mobile were down for Rogers customers across the country, but I was sure at least half of businesses would be with someone else, like Bell, Telus, Eastlink or…um… the other ones!
But that weekend you would swear every business ran on the one network that was down. At one place we had to pre-pay for gas because you couldn’t pay at the pump. Sometimes credit cards worked, but if you were someone who only uses debit (like me) you were out of luck. If I didn’t have travelling companions I would have hitchhiked to the golf tournament in Saint Andrews, leaving a vehicle with an empty fuel tank behind.
And thank God for generous people. During our stopover in Fredericton, some friends and I went out to some bars and a restaurant. Once again, no debit. But people with cash were quick to help us plastic peasants out of a bind.
It’s hard to imagine how much business was lost nationwide because of one company’s failure. But an entire concert had to be cancelled in Toronto due to the fiasco, so it’s fair to say it ranges in the millions of dollars.
There were also fears that the Andrew Bartlett Memorial Golf Tournament, which I was in the province for, would be affected. Everyone pre-paid for their registration but there were still other fees to be paid that day, like food, beverages, and golf club rentals. Luckily everything was working by the time we arrived.
But man, what national anxiety caused by one company.
During that weekend it dawned on me, and likely many of you, how utterly ludicrous it is that complications in one network could cause such havoc. It highlights, once again, the sad state of competition in Canada’s telecommunication industry.
It’s now a very old joke that Canadians hate their phone and internet companies but it’s hard to find an alternative. Rick Mercer once did a great sketch on the spectrum of anger Canadians go on as they bounce between Bell and Rogers.
The lack of competition can even turn into a fiery public debate. Check out this Toronto Star article about Rogers’ plan to sell Freedom Mobile to New Brunswick-based Xplornet.
In a country that has a good dose of competition, the network outage faced by Rogers is an inconvenience, not a crisis.
Yet, here we are, living in a country where one Roger’s outage created calls for an inquiry and for a backup plan so future incidents do not prevent people from calling 9-1-1.
It’s hard to imagine many other industries that have such a tight grip on the country. I once wrote a scathing column on the state of food inflation which is caused, in part, by the lack of healthy competition in the grocery industry. Yet, even if every Sobey’s closed down overnight, we wouldn’t starve because we would all just go to Superstore.
Telecommunications is a different beast. It’s not as easy to switch on a whim from provider to provider. But the fact that there is so little diversity in internet carriers for our businesses should be a wake-up call. Canada needs to attract more competition into this industry. Right now, two or three have a digital stranglehold on the economy of the nation.
At least last weekend only one of my friends had to catch a plane to the golf tournament. If too many of us needed to fly on Air Canada or West Jet there may not have been enough golfers to play.
This summer, there have been outrageous stories of passengers having their flights delayed for multiple days. Then, when looking for compensation they are owed under federal law, the airlines try to skirt responsibility.
I’m sorry for sounding so repetitive, but in a country with healthy competition in this industry, the failings of two airlines would be a major inconvenience, rather than something that has become a national debacle.
The sad part is that it feels hard to hold these companies accountable in a meaningful way. Because of the lack of competition, many angry customers will stay, even when it’s only sane to choose to spend our money somewhere else.
Canada is quickly becoming the land of giant corporations that care little about customer experience. The food we eat no longer comes from the mom and pop stores, it comes from national giants competing with other nation giants.
When it comes to an industry as complex as telecommunication and air travel, there are few localized or regionalized options. Although some are starting to crop up. In Nova Scotia, for example, we have Purple Cow as an independent internet provider. But there’s still a long way to go across the country in that regard.
We’ve all companied about lack of competition before in Canada, but this summer has shown how ridiculous the problem has gotten.
Derek Montague is a Huddle reporter in Halifax. Send him your feedback and story ideas: [email protected].