A report detailing the effects of deregulation in the telecommunications industry finds Canada's three largest telephone companies have benefited at the expense of consumers.

A report by the Public Interest Advocacy Centre finds that Canadians have not benefited from deregulation in the telecommunications industry. (Charles Rex Arbogast/Associated Press)The Public Interest Advocacy Centre, a non-profit consumer protection organization, prepared the report.

Its author, Michael Janigan, told CBC News that four years after deregulation, Bell, Telus and Rogers are making "super-normal profits," while consumers are paying too much and getting too little in terms of service.

"We still have three big players with over 90 per cent of the market, and they're pretty fat and happy," Janigan said in an interview with CBC News.

"We're still seeing the incredible clout of the big telcos in relation to their ability to swing competition in their favour."

Government policy decision blamed

The report points to a policy decision in December 2006 by then Industry Minister Maxime Bernier that ordered the Canadian Radio-television and Telecommunications Commission to use market forces to the maximum extent possible, and ensure that regulation was minimally intrusive.

'You don't put a policy direction in place that tells your regulator to do everything but regulate.'—Michael Janigan, Public Interest Advocacy Centre

The results promised at the time, including lower local telephone rates, have failed to materialize, the report says.

"You don't put a policy direction in place that tells your regulator to do everything but regulate," Janigan said. "There's no reason why deregulation has to be the priority in telecommunications. The priority in telecommunications is trying to bring as many innovative products to the fore and serve as many people in as affordable way as you can."

The report does not advocate a return to regulation in the telecommunications industry. Rather, it recommends the government allow foreign competition and more liberal rules for small market players.

"Effectively what you're trying to do is establish new competition."

Three new wireless services have recently launched in Canada, Wind, Mobilicity and Public Mobile, but none has captured any substantial share of the market.

"Good start, but the fact of the matter the most aggressive of those has been Wind, and now after a year-and-a-half of hard work they have one per cent of the wireless market," Janigan said.

In addition to encouraging more competition, the report suggests mandatory licensing for all phone companies with appropriate codes of conduct and meaningful enforcement.