Rogers to credit customers 5 days of service for outage
Telecommunications company says it's the 'first step'
Rogers Communications says it will credit its customers for five days of service following its massive network outage last week that affected cellular and internet service for millions of Canadians.
The outage, which started Friday and lingered for many into the weekend, also disrupted government services and payment systems, prompting criticism and questions from the federal government and telecommunications regulator.
"We have been listening to our customers and Canadians from across the country who have told us how significant the impacts of the outage were for them," Chloe Luciani-Girouard, a spokeswoman for Rogers Communications, said in an email to CBC News.
"We know that we need to earn back their trust."
She described the credit as a "first step."
Rogers blames the outage on a network system failure following a maintenance update in its core network.
The company previously said it would be "proactively crediting" all affected customers and that this credit would be automatically applied to their accounts.
But there were reports Rogers would credit customers for just two days of lost service — working out to $4 to $6 per cellular and internet service, industry analyst Vince Valentini with TD Bank wrote in a TD Securities note.
Some had suggested that was not enough, given the scope of the damage.
David Soberman, the Canadian national chair of strategic marketing at University of Toronto's Rotman School of Management, said earlier that the company needed to rebate customers for at least a week of service.
"That would probably be the bare minimum," he said.
He suggested Rogers needed to learn a simple rule of business: If customers don't feel they are being treated the right way, they leave.
"If they lose five, six, seven per cent of their customers, that's going to be way worse than [paying out] a week's worth of [compensation]," Soberman said.
Last week was the second time in as many years Rogers has been rocked by a major outage; the company's wireless and cable networks went down in a similar fashion in April 2021. At the time, Rogers blamed a software update at one of its equipment suppliers.
In 2021, the company offered customers rebates for their services, which ended up working out to a few dollars per customer.
The Toronto-based communications giant reported a quarterly net income last January of $405 million.
Rogers says it provides services to around 11.3 million subscribers in the Canadian wireless market.
'Huge financial hit'
According to Rogers residential service agreement, if an outage lasts longer than four hours, customers are entitled to a day of credit to their account for each service they have, Marina Pavlović, interim co-director at the Centre for Law, Technology and Society at the University of Ottawa, told CBC News Network anchor Aarti Pole.
A customer with home internet and a cellphone from the company, for example, would be entitled to compensation for the cost of a day of service for each product, she said.
"Most people haven't really read that contract so they didn't even know that that's there."
In its terms of service, Pavlović says Rogers has an elaborate limitation of liability clause, reducing its obligations on a number of fronts, including service outages.
"And that clause actually says 'we don't guarantee uninterrupted service,'" she said. "Whether that's right or not is a completely different issue."
Among big telecommunications firms, Rogers is not unique in limiting its own liability for outages, she added. "Every telecommunications service provider has clauses like this."
David Finch, a professor of marketing at Calgary's Mount Royal University, who previously worked for Rogers, says that if he was still working at the company, he would advise them to offer every affected customer a month of free service.
Such a move would likely be a "huge financial hit," he said, but it could end the anger now, "as opposed to drip, drip, drip."
Dan Kelly, head of the Canadian Federation of Independent Business, said on Monday that he feels business owners should be given a free month of Rogers service to make up for the outage, which came as companies are still recovering from the COVID-19 pandemic.
"There are businesses in Canada that have been closed down for over 400 days … over the last two years, and so every single day of sales is absolutely critical in this recovery period," he told The Canadian Press.
"It was just brutal ... and far more than an inconvenience. This was cutting into very limited income at a very critical period."
With files from Pete Evans, The Canadian Press