Telus slapped by advertising watchdog for claim high Canadian wireless prices are a 'myth'
Ad Standards says company misled consumers by conflating affordability and price in newspaper ad
Canada's advertising watchdog says Telus misled consumers with an advertisement that claimed "it's a myth that Canadians pay some of the highest wireless prices in the world."
In a recent decision from Ad Standards Canada, the industry regulator found that a full-page Telus newspaper campaign in Quebec mixed up issues of affordability and price to give the impression wireless prices were lower in Canada than other countries.
The claim was based on a 2019 PricewaterhouseCoopers study on wireless affordability in Canada.
But members of the self-regulating advertising industry council said in a unanimous decision that the study didn't back up the claim.
"There was no support in the cited study for the claim that it is a myth Canadians pay some of the highest prices in the world for wireless," the council said in a decision posted on its website.
"The study discussed affordability, rather than price, and it only addressed four countries in total, rather than most, or all, countries in the world."
According to the decision, Telus did not provide a response to the complaint, which came from a member of the public.
Claim still part of public campaign
The "myth" claim is still prominent on a Telus website critical of government policies and regulations around the telecommunications industry.
The Vancouver-based firm also argues the same point in a form letter available on the website. Telus urges Canadians to send their politicians the letter to express "concern regarding the erroneous depiction of the telecommunications industry in Canada" as part of a political campaign.
"When it comes to wireless affordability, third-party studies have confirmed that Canada offers some of the most affordable wireless prices in the world," the letter says.
The PricewaterhouseCoopers study compared wireless expenditures in 2016 in Canada, Australia, the United Kingdom and the United States.
Average household expenditures on wireless and devices for that year totalled $977 in Canada, $1,124 in the U.S., $808 in Australia and $612 in the U.K..
The study then compared the affordability of wireless in all countries except for the U.S. based on five different levels of income and found wireless more affordable in the U.K. across the board.
Canada beat Australia for affordability for all but the lowest category of wage earners.
Leap in logic
The Ad Standards council said Telus could legitimately cite the PricewaterhouseCoopers study to say Canadians spend less on wireless than Americans.
But the council said the "myth" claim about pricing was a leap in logic.
"Council determined that if Canadians are spending a smaller percentage of disposable income on wireless than Americans, it does not necessarily follow that the prices for wireless are lower in Canada than they are in the U.S.," the regulator said.
"In council's view, the advertisement incorrectly conflated affordability and pricing, and in assessing the truthfulness and accuracy of the advertisement, this claim strongly impacted the general impression conveyed."
In response to the CBC, Telus spokesperson Richard Gillhooley said the company is "confident that the advertisement is fair and accurate."
Gillhooley cited a study by the U.S. mobile wireless trade association, which he said showed Canadians receive "some of the highest value for their cellphone spending."
The Ad Standards council does not discuss details of its deliberations, which happen before panels which are generally made up of seven people — four from the industry and three from the general public.
In an email, the council said that if an ad is found to contravene the Canadian Code of Advertising Standards, the advertiser is asked to amend or permanently withdraw the ad. The council doesn't have the ability to levy fines, but they can report violations to the Competition Bureau.
Earlier this year, the Liberal government gave Canada's biggest three wireless providers two years to cut basic prices for cell phone service by 25 per cent.
A 2019 price comparison study released in conjunction with that announcement found that Canadians have been paying more overall for wireless than people in other G7 countries and Australia.
The government told Bell, Telus and Rogers to reduce the cost of their two to six gigabyte data plans by 25 per cent within the next two years. That would mean offering a talk, text and data plan costing less than $40 monthly.