CBC's News Network business correspondent Jeannie Lee told us this morning that consumers were angry because they don't like to lose a service or pay for a service that they are now getting for free, as though the only real concern over the terrible CRTC decision was that consumers are a bunch of cheapskates. Another one of the CBC News Network reporters (I don't remember her name) was taking about Tony Clement's decision to review the CRTC ruling as being ostensibly motivated by the fact that the opposition would use it as an election issue. Now this might be true but the way she worded her report further implied that the only real issue was consumers' demand for cheap bandwidth.
The fact is that Canadian consumers pay more for tele-communications, cable television, and internet services than most other developed countries. The reasons for this are pretty simple. While I am obviously not a big supporter of the so-called 'free-market,' it is ridiculous to have a sector of the economy in which one or two private, for profit, institutions control the entire market share. I am all for having certain parts of the economy being provided for by non-profit, or public companies. But a private company or an oligopoly of private companies controlling one sector is ridiculous simply because they will have such a powerful incentive to gouge the consumers for larger and large profits. In other words, if you are going to have a private market, it makes sense to have a real market in which consumers have a choice and the choices that they make will drive prices down to a reasonable point.
But in cases like this, the pro-marketeers and right-wing are in a sort of double bind. They want to appear to be in favor of the 'market forces' but at the same time they have to regulate the market extremely tightly in order to stop private enterprise from profiteering so broadly that there will be an extreme consumer backlash against the companies in question and potentially against the whole idea of the 'free market.' Meanwhile the companies involved in an oligopoly such as that being effectively run by Rogers and Bell here in Canada are immensely powerful and integral to the business community that supports the right-wing Harper government. The Haper government, which claims to be all in favor of "free markets" is going to do little to actually open the market in this sector because their friends at Rogers and Bell want to keep control of most of the market and the last thing that they want is any real competition. The Harper Government has to appear to be protecting the consumer in this case because if they didn't, it would become clear very quickly that consumers are suffering under the weight of a de facto monopoly which the government and their friends are eager to maintain. Once again, if you are paying attention, it should be clear that so-called "free-marketeers" are by no means actually in favor of the free market. Instead they are in favor of regulating the economy in such a way that large corporations can continue to dominate and engage in extreme profiteering, while at the same time they are at pains to ensure that they can maintain the illusion of the market so that the majority of voters and consumers do not wake up to the almost complete farce that has become modern capitalism.
An aside to this whole story is that in the US where there is a great deal more competition in the fields of tele-communications and internet, many people can get three or four times as much bandwidth as we can at half the price. That is why an internet movie service like Netflicks makes sense in the US and not here. Any active use of Netflicks on your Rogers account will quickly cause you to go over your monthly allotment of bandwidth and you will find yourself paying huge usage fees. And none of this will change in the near future because companies like Rogers are desperate to hold on to the cable model and the internet threatens that model. More or less unlimited internet service coupled with the development of things like AppleTV would allow me to eliminate my cable TV altogether and that would be a game-changer.
Good Morning America ....
3 months ago