An unusual thing happened in Canada over the last five years: wireless prices dropped. Canada’s notoriously high cell phone service prices declined by 40 per cent during that period, according to the 2026 Canadian Telecommunications Market Report.

While this is welcome news, the lack of competition in Canada’s telecommunications sector is still a big problem. More action is needed from the federal government and the Canadian Radio-television and Telecommunications Commission (CRTC) to prevent prices from rising, a rebound that has already begun.

As part of the federal government’s conditions for allowing Rogers Communications’ takeover of Shaw Communications in 2023, Shaw’s Freedom Mobile was sold to Vidéotron. In turn, Vidéotron agreed to offer wireless plans for 20 per cent less than those offered by the major carriers at the time for ten years.

The measure does seem to have boosted competition somewhat. Long considered one of the worst countries for cell phone prices, Canada now hits the still-humble rank of 14th most expensive in a recent Rewheel ranking of 50 countries.

But that momentum is already fading, with Statistics Canada data showing that last fall, prices began rising again. It’s also important to note that when the price of a typical plan is measured by how much data can be used, costs have dropped in recent years. But Canadians have been choosing bigger data plans, so overall bills have been rising.

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In addition to high prices, the lack of competition also results in poor customer service. Last year, for the third consecutive year, the Commission for Complaints for Telecom-television Services saw a record number of complaints. Wireless issues, in particular regarding billing, are subject to the most complaints. Customers know they have few alternatives, says Open Media’s Matt Hatfield, so they put up with poor service rather than switch to another carrier.

In the recent spring economic update, the federal government promised to launch a “whole-of-government competition plan” to boost affordability and productivity. The plan, which is set to include a “Telecommunications Competition Roadmap,” is a chance for the government to shake up the sector by facilitating the launch of mobile virtual network operators.

These MVNOs, as they are called in industry parlance, are companies that offer cellphone service. Instead of spending billions to recreate the existing cell tower networks, they use the infrastructure of the existing telcos. Under the current rules, the CRTC only requires carriers to grant wholesale access to companies that have some of their own infrastructure, and even then, access lasts for just seven years.

The big telcos have been vigorously fighting to avoid being forced to allow more competitors on their networks. Most smaller brands in the marketplace are actually “flanker” brands run by the big three – Rogers, Bell and Telus – to attract different customer groups.

These companies should be compensated fairly for the use of their networks, which have been built with help from government subsidies. The CRTC should also make sure the rates that the upstarts pay are reasonable enough that they have a fair chance at running profitable businesses, says Keldon Bester of the Canadian Anti-Monopoly Project.

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It might not be as bad for the bigger players as they think. Historic patterns show that high telecom prices encourage customers to lower their consumption. More competition could ultimately boost wireless spending.

The government should also loosen foreign ownership rules. Currently any Canadian telecom entity with more than 10 per cent of the market must have 80 per cent of board seats and 80 per cent of voting shares held by Canadians.

Care needs to be taken so foreign players don’t just gobble up existing players without adding competition, and national security issues need to be addressed, but allowing in more foreign dollars could provide a much needed capital boost for upstarts.

Affordability remains a top concern of Canadians, and while there is currently more attention on grocery and gas prices, the federal government shouldn’t grow complacent on wireless. It needs to stop micromanaging the market to create the illusion of competition, and allow true competition to take root. That’s the path to sustained lower prices.