Pay phones too expensive? Call someone who cares

The cost of a mild convenience is doubling to $1

by From the editors

Here’s a loonie, call someone who cares

CP

Pay phones once held a special place in both popular culture and interpersonal communications. The corner phone booth not only gave Superman a place to change, it offered everyone else the opportunity to check in at home, get messages from the office, conduct business, call a cab or arrange a rendezvous with a lover. It was the original pay-as-you-go plan. But Superman’s modesty aside, everything a pay phone once did a cellphone can do better.

And so today the fate of Canada’s pay phones now hangs in the balance.

Earlier this year, Bell Canada, Bell Aliant and Télébec, dominant pay phone providers throughout Ontario, Atlantic Canada and Quebec, applied to double the cost of a pay phone call—from 50 cents to a dollar. The cost of using a prepaid debit card would rise to $2 a call. These prices were previously doubled five years ago.

In the face of criticism from various social justice groups, last week Bell filed new documents with the Canadian Radio-television and Telecommunications Commission (CRTC), warning that if its price hike is denied, it may begin to dismantle its entire network of pay phones. Tough talk, for sure. But even if Bell carries out its threat, will anyone notice?

According to the CRTC, less than one per cent of Canadian households currently lack access to their own phone. Nearly 80 per cent of us have a cellphone. For the overwhelming majority of Canadians, pay phones have thus evolved into a rarely used emergency tool—of interest only if your cellphone battery dies. Most pay phones these days seem to get more attention from graffiti artists and litterers than hurried callers.

Once reliable money-spinners, the profitability of pay phones has been dropping for decades. Between 1999 and 2002, revenue per phone fell at the rate of 12 per cent a year. Figures filed recently with the CRTC now contemplate revenues declining in the future at approximately 20 per cent annually. Those same filings suggest a quarter of Bell’s pay phones are losing money right now. Adding a further burden for owners of Canada’s 75,000 pay phones is the need to upgrade every phone to accept the new, lighter 2012 loonies. There’s no money in pay phones these days, literally and figuratively.

With the telecommunications business in Canada supposedly based on market principles, it seems obvious pay phones must either evolve to become profitable once more or disappear completely. Bell wants to charge a price that reflects the new, rarely used, call-of-last-resort nature of pay phones. They say they may also choose to vary prices across the country—a call from downtown Toronto might cost more than one from Rimouski—as is already the case with hotel rooms and haircuts. If it’s denied, Bell warned in a filing last week that it “may proactively start removing its most unprofitable pay telephones.”

Fighting the idea that pay phones ought to pay their own way are anti-poverty groups such as Canada Without Poverty and the Public Interest Advocacy Centre. They argue that pay phones remain well-used by the poor and thus constitute an essential service requiring federal protection. “A 100 per cent price increase in pay phone rates will disproportionately affect lower-income Canadians who are least able to afford sudden large increases in expenses,” the groups stated in a brief to the CRTC.

While consumer groups once defended the importance of a pay phone every 100 m, the only stricture the CRTC currently places on pay phone owners is that they provide 60 days notice prior to removing the last pay phone from a community. In other words, Bell and other firms could disconnect the vast majority of their pay phones immediately if they so desired. The controversial rate increase request is simply an effort to keep the dial tone humming.

Ultimately, it should be up to consumers to decide for themselves whether a price hike is appropriate. The economics of pay phones is clearly deteriorating faster than buggy whips at the dawn of the automobile age; no amount of federal diktats is going to change this. And regardless of sympathy for low-income Canadians, guaranteed access to street corner pay phones is most certainly not a corporate responsibility. If Bell thinks they can make a buck by doubling the price of a call, let them try. And if they can’t, the door is always open to other competitors.

Whatever nostalgia Canadians may have for pay phones, it’s time to face reality. You’ll have to insert more coins if you want this call to continue.




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Pay phones too expensive? Call someone who cares

  1. Being a true cheap-ass luddite, I only recently finally relented and got a cell phone, like literally just over one year ago. And 3 times in the past ten years I’ve used a pay phone when out in public to call 911 because I observed a legitimate emergency (1. a transformer box on fire, 2. an unconscious security guard on the floor of a bank at night and 3. a 40-kid rumble of opposing teens with baseball bats in a McD’s parking lot.) All 3 times the fire dept/cops showed up and solved the issue before any blood-shed/property damage occurred. So, now that I have a cell that’s all moot, but I bet you anything if all payphones are ripped out then there will be at least a temporary spike in unreported emergencies that get out of hand. Make of it what you will.

    • I believe that 911 calls are free (or at least, the fee is built into the existing rate structures) anywhere in Canada, even for cell phones that are currently not active. With 80% of the population carrying a cell phone, there really ought to be many fewer unreported emergencies now than there were formerly, when people had to run off to a pay phone. Further, many cell phones have cameras, so that photographs are often available to document the emergencies that are reported. I don’t think that the risk of unreported emergencies will carry much weight when the decision is made to keep or terminate pay phone service.
      While it will be kind of sad to see pay phones disappear, I think that they are now in the same category as water troughs for horses. That is, there will continue to be a few for decorative purposes, but no one will seriously imagine that they serve a vital need any longer.

      • You have obviously never been in Granville, NFLD where there is NO cellphone service! The Irving gas-station and restaurant luckily has 2 payphones or there would be no communicating with the outside world.

      • This is just another assault on the poor.

  2. We have a pay-as-go non-iPhone here in the Netherlands that we top up 10 euros at a time and that credit is good for up to 9 months before the it expires. My mom pays $10 a month for a 35¢/minute which she never uses up because it so expensive and then pay $10 every month to keep any credit alive.

    OK – dump the pay phones – but have a reasonable back up plan in place. Bell and Telus don’t have that now. $2 for a debit card call – gimmie a break. Thieves.

    • 7/11 speakout is decent here in Canada. It is only $20 month for 100 minutes and unlimited texts, all credit last 1 year also. Also one can get ‘unlimited data’ for only an extra $10 dollars a month by using a proxy on a rooted Android.

      • Thanks for the tip. I have used Virgin (owned by Bell now?) on my visits to Canada but he last customer experience one of the most bizarre and unpleasant I’ve had. And their credit expired in 30 days.

  3. The need for emergency communication is still critical. I have not used a pay phone for a couple of decades, but the municipalities should budget-in the solar powered phones that call only one number and drop regular pay phones altogether. A substantial savings for the service providers that could reflect back to us with lower bills – HA HA.
    Seriously, I lose my cell phone, battery dies, it’s stolen, whatever, a phone that auto-dials EMS, is necessary. If it’s not available in public spaces, we take a giant leap backwards into the cave.

  4. Worth nothing the editorial baord of Macleans is owned by Rogers.

  5. I still don’t have a cell phone, and in all of this time I wished I had one only about once or twice. What a waste of money. How crazy is it that people are willing to throw away money for something that offers such a little improvement over payphones.

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