Why Sasktel Will Keep Charging The System Access Fee

The System Access Fee is as Canadian as maple syrup, beavers and lumberjacks.  That extra fee 6.95 that gets charged on top of cell phone plans that Canadians know and hate is on it's way to becoming a part of history.  It started when subsidiary brands such as Fide, Koodo and Solo from the national cellular carriers started dropping the fee.  At the end of 2009 Rogers dropped the system access fee on new activations and contract renewals, Telus followed suit eventually Bell and MTS have done the same leaving Sasktel as the only carrier to charge the system access fee. 

The revenue typically generated by the system access fee went to pay for the phones that carriers offered to subscribers for free or at a deep discount.  Since Rogers, Bell and Telus are the large cell carriers they buy handsets in the largest volumes which allows them to get lower prices than smaller regional carriers such as Sasktel. 

Sasktel operates a large number of towers in very sparsely populated areas of Saskatchewan which adds cost to operating their network, revenue from the system access fee charged to subscribers in more densely populated areas goes to subsidize the operation of cell towers in the middle of nowhere. 

In order to update to newer technology so that Sasktel can offer phones that don't suck as bad as the phones they offer now is in the process of upgrading to a UMTS/HSPA network (sort of the son of GSM technology).  The cost of this network upgrade is being financed on the open market and has put Sasktel in debt.  The days of network upgrades paid by Saskatchewan taxpayers has come to an end under the Brad Wall government.  

Cell phone subscribers in Saskatchewan who may find system access fee objectionable do have alternatives such as Rogers and Telus.  There is word that Bell Mobility will be coming to the land of living skies within the next couple of years.  Wind Mobile and Mobilicity are also going to be coming to Saskatchewan as well.  Cheaper alternatives are here now with more on the way.

Telus Sort Of Dumps The System Access Fee

One of the most annoying things about subscribing to contract post-paid cell phone service is paying the System Access Fee that $6.95 a month that does nothing more than fatten the profit margins of the cell phone industry.  In anticipation of new competition coming just weeks from now, Vancouver based Telus Mobility is dropping the system access fee and the 911 fee.  Dumping the fees started last year when Telus' discount brand Koodo Mobile launched without the fees and Rogers' owned Fido dropped the fees.  This move follows Rogers' dropping the fees from their main branded service back in September.  That leaves Bell Mobility as the only national carrier and regional carriers MTS and SaskTel as the only cell phone service providers that still charge the fees.

Consumers hoping to bag big savings are going to be let down, when the fees come off the prices charged for cell phone plans will rise five dollars a month.  Average savings will only be about two to three dollars a month.  The savings won't be automatic, new subscribers will be put on the new plans without the fees.  Existing subscribers will get to switch to a new plan without the fees when their current contracts expire.  It's encouraging to see cell carriers ending this bait and switch practice of offering plans for one price and then tacking on fees that raise the total cost of the service by twenty percent or more.  If one of the effects of the upcoming competition is honesty in cell phone plan pricing, then imagine what it will be like when the new guys get their services off the ground and really giving the big guys a real run for their money.