Industry takes issue with report showing high revenues on low data use

Canadian operators drive the highest revenues per wireless gigabyte in the world among a subscriber base that uses little data, a new report from Tefficient suggests, but an industry association is protesting some of the report’s conclusions. The report, dated Tuesday, noted that operators in Canada, along with Greece and Belgium, had a total revenue per gigabyte that is more than 35 times higher than India, which had the lowest revenue per gigabyte. But it also found that data consumption didn’t scale up with those revenues. It said Canadians, regardless of whether or not they were on a data plan, used an average of 1.1 GB a month in 2016, and 1.2 GB in 2017. That made for a 6.5 per cent growth rate between 2016 and 2017, on the low end of data usage growth. “Low data usage doesn’t necessarily mean that the is low,” the report said. “Canada, Switzerland and USA have the highest ARPU levels among the countries in our analysis and the Canadian consumers should be particularly unsatisfied with that -- given how few gigabyte they can consume for that ARPU.” The report has caused a disturbance since its release. The point of contention is Tefficient’s data. For Canada, Tefficient used 2016 data from the CRTC’s Communications Monitoring Report and 2017 data from the Organisation for Economic Co-operation and Development (OECD). For one, the use of different data sources is problematic, a spokesperson for the Canadian Wireless Telecommunications Association (CWTA) said in an email, adding that other studies project higher increases. However, the OECD data is also based on CRTC numbers. OECD spokesman Frederic Bourassa confirmed over email that the organization received full data for 2017 from the CRTC when it requested it last month. CRTC spokeswoman Patricia Valladao, though, said in an email Friday that the CRTC supplied the OECD with "limited and preliminary 2017 data," provided before the publication of the CRTC's telecom Communications Monitoring Report for 2017, which is still forthcoming. The CWTA spokesperson also pointed to other, bigger, growth projections, including a Cisco Systems Inc. study that found a 35 per cent increase in data consumption per Canadian smartphone from 2015 to 2016. It projected mobile data traffic in Canada between 2016 and 2021 will grow five-fold at an compound annual growth rate of 36 per cent. The CWTA spokesperson also brought up CRTC data that showed mobile wireless subscribers with a data plan averaged 1.57 GB in 2016, up 12.9 per cent compared to the previous year. That figure, according to the OECD, was 1.54 GB in 2017, which the spokesperson said seemed comparatively low. But a Tefficient spokesperson said those differences could come down to definitions and criteria. The use of machine-to-machine SIM cards -- those “non-human” mobile connections found in sensors, cameras and alarms -- use very little data, but because there are millions of them that are included in Tefficient’s calculation, it brings down the average usage. Without those M2M SIMs, the average usage in 2016 among all Canadians with a cellphone, whether or not they had a data plan, was 1.2 GB and in 2017, 1.3 GB. The 6.5 per cent growth rate that is ruffling industry feathers builds in Tefficient’s assumptions and estimations, which include M2M SIMs, it said. However, if M2M connections weren’t included, the growth rate would only be slightly higher at seven per cent. Tefficient also said it doesn’t expect “full visibility” until the CRTC releases those numbers, perhaps later this year. The CWTA spokesperson also said that a discussion on revenues should consider OECD data showing Canada leads among all G7 countries in investment as a percentage of revenue, making it the fourth highest among all OECD nations. — With reporting by Ahmad Hathout at ahathout@thewirereport.ca and editing by Anja Karadeglija at akarad@thewirereport.ca

Industry takes issue with report showing high revenues on low data use

News | July 13, 2018

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Industry takes issue with report showing high revenues on low data use

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