23rd June 2011

Nordicity Reviews OECD Wireless Rankings

nordicityThe wireless rankings released today by the OECD (Organisation for Economic Co-operation and Development) are based on a limited sample of wireless providers and plans from each of the profiled countries. Although the OECD’s revised methodology better captures the variety of mobile usage patterns in different countries, the rankings should still not be considered representative of International wireless costs.

Therefore, if using the OECD rankings as part of an overall comparison of international wireless markets, the following limitations must be considered:

  • The OECD rankings typically only consider a couple of wireless plans from two different carriers – Canada’s complete OECD wireless price ranking across six different calling profiles is based on fees from only four different wireless plans (two each from Bell and Rogers).
  • The OECD compares post-paid, pre-paid and ‘friends and family’ plans to develop rankings within a single calling profile.
  • The OECD rankings do not recognize that nearly half of the wireless subscribers in the OECD countries outside of North America pay for more than one mobile plan.
  • The OECD rankings do not measure the affordability of wireless service by considering average incomes in each of the profiled countries.

Typical Canadian mobile calling patterns are also not reflected in the OECD calculations. In fact, the OECD calling profiles closest to the average Canadian cell phone usage profile are based on 187 less, or 194 more, minutes-of use per month than the average Canadian usage. Consequently, Canada ranks as having above-average wireless costs in four of the OECD’s six Calls Baskets.

International wireless cost comparisons that address the omissions of the OECD rankings reveal that Canada’s average per-minute wireless costs are in reality $0.02 below the international average, 11th– lowest of all OECD countries. Also, as a percentage of average income, Canadian’s pay 10 per cent less for wireless voice service than the international average and 12 per cent less for wireless (voice and data) service overall.

Nordicity’s International Wireless Market Comparison (PDF) report analyzes other key wireless market conditions. In doing so, it reveals that Canada has the least densely subscribed network of any developed wireless market with only 12 subscribers for every square kilometre of coverage. This density compares with 37 subscribers per square kilometre in the United States and 312 subscribers per square kilometre in the United Kingdom.

Canada is now served by three national wireless providers and six regional providers, resulting in one of the most competitive market structures of any developed wireless market. In fact, Canada is one of only six OECD countries where the two leading providers serve fewer than 70 per cent of all subscribers and the top three providers serve less than 95 per cent of all subscribers.

This entry was posted on Thursday, June 23rd, 2011 at 10:18 am and is filed under Business News, National News, Research Studies. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

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