Canada's telecommunications landscape is dominated by three major players—Bell, Rogers, and Telus—who collectively control over 90% of the market. Independent internet service providers (ISPs), in contrast, serve a fraction of Canadian households, struggling against the pricing power and infrastructure control of these giants.

The U.S. telecom industry, while also featuring large corporations, presents a more competitive dynamic. Companies like Comcast, AT&T, Verizon, and Charter operate in overlapping markets, with regional ISPs creating additional pressure on pricing and service quality. In Canada, the lack of similar levels of competition translates into fewer choices for consumers and higher costs.

Market concentration among a few carriers limits innovation, slows network improvements, and reduces pricing incentives. Independent ISPs attempting to offer alternatives face wholesale access barriers, restrictive policies, and increasing costs. As a result, service variety and affordability remain stagnant, leaving Canadian consumers with fewer options and higher bills.

Barriers to Independent Success

Legal and Regulatory Hurdles for New ISPs

New independent Internet Service Providers (ISPs) in Canada face a legal framework that favors established telecom giants. The Canadian Radio-television and Telecommunications Commission (CRTC) regulates market access, but its policies often reinforce the dominance of major providers. Complex licensing requirements, prolonged approval processes, and restrictive wholesale access rules create significant barriers for smaller players.

Wholesale access rates, set by the CRTC, determine how much smaller ISPs pay to lease infrastructure from incumbents. These rates have historically been a point of contention. In 2019, the CRTC attempted to lower wholesale prices to encourage competition, but major telecom providers successfully appealed the decision. In 2021, the CRTC reversed its stance, leaving smaller ISPs struggling with high costs, limiting their ability to offer competitive pricing.

Financial and Operational Challenges of Competing with Telecom Giants

Building and maintaining a broadband network demands immense capital. Independent ISPs often lack the financial backing required to lay fiber-optic cables or establish a countrywide infrastructure. Meanwhile, large telecom corporations benefit from economies of scale, government subsidies, and historical ownership of existing networks, making it nearly impossible for smaller providers to compete on a level playing field.

• Initial investment for infrastructure exceeds tens of millions of dollars.
• Securing financing remains difficult, as lenders view telecom startups as high-risk ventures.
• Incumbents leverage existing subscriber bases to secure recurring revenue, creating a cash flow advantage.
• Advertising budgets of telecom giants overshadow independent providers, reducing visibility for new entrants.

Service reliability presents another challenge. Large telecom firms benefit from well-established maintenance and repair networks, while smaller ISPs must navigate longer repair times and greater dependency on third-party technicians. This difference in operational efficiency reinforces consumer hesitancy in switching providers.

Comparison to Startup ISP Conditions in the US

The landscape in the United States offers a useful comparison. While major telecom firms dominate the market, regulatory frameworks in certain regions provide greater access for independent ISPs. Municipal broadband initiatives in cities like Chattanooga, Tennessee, illustrate how local governments can facilitate competition by investing in publicly owned infrastructure.

Additionally, independent ISPs in the U.S. leverage regulatory advantages such as open-access fiber networks in states like Utah. By contrast, Canadian ISPs struggle with federal policies that limit their ability to expand through network-sharing agreements. The Federal Communications Commission (FCC) in the U.S. has generally maintained policies that allow small ISPs to lease infrastructure at reasonable rates, while Canada’s CRTC decisions have consistently favored incumbents.

Independent providers in the U.S. also benefit from a more dynamic investment environment. Private equity firms and venture capital funds have backed disruptors such as Starry Internet, which focuses on fixed wireless technology. In Canada, fewer investors show an appetite for funding independent ISPs due to regulatory uncertainty and high capital requirements.

The combination of regulatory bias, financial pressure, and operational challenges reduces the competitive viability of independent ISPs in Canada. Without substantial policy shifts, smaller players will continue to struggle against the entrenched dominance of major telecom corporations.

Regulated Roadblocks: The CRTC's Role

The CRTC's Rules and Their Impact

The Canadian Radio-television and Telecommunications Commission (CRTC) establishes regulations that dictate how internet service providers (ISPs) operate. Its mandate includes promoting competition, ensuring fair pricing, and expanding broadband access. However, its regulatory framework frequently favors established telecom giants over smaller independent ISPs.

One of the most consequential rulings came in 2021 when the CRTC reversed its 2019 decision to lower wholesale internet rates. This move directly benefited major telecom companies like Bell, Rogers, and Telus while making it more expensive for independent ISPs to lease network access. Higher costs on wholesale rates reduce the ability of independents to compete on price, leading to higher costs for consumers and fewer market options.

Uneven Regulatory Burdens

Major telecom operators own the bulk of Canada's broadband infrastructure. Independent ISPs rely on mandated wholesale access to these networks to provide services. While the CRTC is supposed to foster competition, its policies tend to reinforce the dominance of incumbent carriers.

• Price-setting disputes: Wholesale rates fluctuate due to prolonged hearings and extensive lobbying by major telecoms, leaving independent ISPs with unpredictable business costs.
• Network access limitations: Large providers control access speeds and infrastructure upgrades, forcing independents to deal with outdated connections or throttled speeds.
• Regulatory delays: The CRTC takes years to address appeals, keeping smaller ISPs in limbo while larger competitors continue to expand networks and subscriber bases.

Policy Reform and Industry Advocacy

Independent ISPs and consumer groups have pushed for reforms to rebalance the competitive landscape. TekSavvy and other independent providers have actively petitioned the federal government and the CRTC for fairer regulations. Organizations such as the Competitive Network Operators of Canada (CNOC) advocate for predictable, cost-based wholesale pricing to prevent major telecoms from leveraging excessive market power.

Despite these efforts, changes have been slow. Large players continue influencing policy, backed by extensive lobbying power and legal resources. In response, consumer advocacy groups have called for stricter enforcement of competition laws and direct government intervention to prevent anti-competitive behavior.

The Costly Game of Wholesale Internet

Wholesale Internet Pricing: A Stacked Deck

Independent Internet Service Providers (ISPs) in Canada rely on purchasing wholesale access from major telecom companies. The rates for these wholesale connections determine whether small providers can compete or not. The Canadian Radio-television and Telecommunications Commission (CRTC) sets these rates, but the results heavily favor the largest industry players.

Wholesale internet costs in Canada rank among the highest in the world. In 2019, the CRTC attempted to lower these rates by 43% to encourage competition. Major telecom companies, including Bell and Rogers, aggressively pushed back, delaying implementation through appeals and legal challenges. By 2021, the CRTC reversed its decision, keeping wholesale prices high and eliminating expected price relief for independent ISPs. The result: smaller providers struggle to offer competitive pricing while dominant telecom players maintain control over both wholesale and retail markets.

Access to Infrastructure: Controlled by the Few

Owning and maintaining telecom infrastructure is expensive. Large companies like Bell and Telus control the majority of fiber-optic and DSL networks, forcing independent ISPs to lease access at regulated wholesale rates. However, even when leasing, smaller competitors face additional obstacles.

• Negotiation Delays: Large telecom companies frequently prolong access negotiations, preventing newcomers from entering the market quickly.
• Technical Barriers: Infrastructure sharing agreements often result in slow access to necessary network upgrades, keeping independent ISPs at a technological disadvantage.
• Limited Fiber Access: While copper-based DSL networks remain accessible to independent providers, fiber-optic networks—critical for high-speed internet—remain tightly controlled by big telecom companies.

Even with regulations in place, enforcing fair access becomes a challenge when the companies controlling the infrastructure also hold significant influence in regulatory decisions.

How Canada Compares to US FCC Policies

Unlike Canada, the United States Federal Communications Commission (FCC) promotes broader wholesale competition, granting independent ISPs easier access to advanced network infrastructure. Policies in the U.S. encourage last-mile fiber sharing, enabling smaller providers to offer competitive broadband services without relying on outdated DSL lines.

Another key difference is pricing intervention. While Canada has reversed attempts to lower wholesale rates, the FCC continues to enforce price regulation that prevents large telecom companies from exploiting market dominance through inflated leasing costs. The result: U.S. consumers often pay less for high-speed internet while enjoying more service options.

The Canadian market, by contrast, remains tightly controlled by incumbents benefiting from restrictive wholesale pricing structures. Without regulatory reform or structural separation—where network infrastructure operates independently from retail services—competition will remain artificially constrained.

Tactics on the Tightrope: Anti-Competitive Concerns

Case Studies of Alleged Anti-Competitive Practices by the Big Three

Canada’s telecommunications market is dominated by Bell, Rogers, and Telus, collectively known as the Big Three. Their control extends beyond market share, influencing wholesale pricing, infrastructure access, and competition itself. Cases of alleged anti-competitive behavior have surfaced repeatedly, often prompting regulatory scrutiny.

In 2021, TekSavvy accused Bell and Rogers of leveraging their dominant position to drive up wholesale rates while undercutting retail prices, effectively squeezing independent ISPs out of the market. The company filed a complaint with the Competition Bureau, citing “predatory pricing” tactics. Bell and Rogers denied any wrongdoing, but the complaint highlighted structural challenges facing smaller players.

Another example involves the delayed implementation of regulated wholesale rates. In 2019, the Canadian Radio-television and Telecommunications Commission (CRTC) lowered the rates big telecoms could charge independent ISPs for network access. However, Bell, Rogers, and others challenged the decision in court, delaying cost reductions for smaller providers. In 2021, the federal government overturned the CRTC’s ruling, reversing the rate cut entirely.

The Role of Government Oversight and Legal Implications

The Competition Bureau and CRTC play key roles in overseeing telecom practices, but their actions often favor the incumbents. The CRTC’s 2021 decision to reverse its own wholesale rates ruling reinforced the perception that regulatory authorities prioritize the stability of big telecom profits over fostering competition.

The federal government has also faced criticism for its handling of major telecom mergers. In 2022, competition concerns dominated discussions around Rogers’ $26-billion acquisition of Shaw Communications. The deal proceeded despite opposition from consumer advocacy groups, raising questions about how aggressively Canada enforces antitrust policies in the telecom sector.

Legal challenges remain a tool for independent ISPs, but the costs of prolonged litigation act as a deterrent. While the Competition Bureau occasionally investigates claims, enforcement rarely results in structural change significant enough to alter market dynamics.

Potential Paths to Leveling the Playing Field

Addressing anti-competitive concerns requires stronger regulatory enforcement and policy reforms. Several options could promote fairer competition in the broadband market:

• Mandatory structural separation: Splitting wholesale and retail operations within major telecom companies would prevent self-preferential pricing and ensure fair access for independent ISPs.
• More aggressive wholesale rate reductions: If wholesale costs align more closely with actual network maintenance costs, independent providers could offer more competitive pricing to consumers.
• Stronger merger regulations: Blocking acquisitions that reduce competition—rather than approving them with concessions—would help prevent further telecom market consolidation.
• Investment in alternative infrastructure: Publicly funded broadband expansion projects could reduce dependence on incumbent-owned networks, allowing smaller providers more direct control over service delivery.

Policy changes alone won’t resolve the competitive imbalance, but restructuring regulatory intervention can shift market dynamics. Independent ISPs continue pushing for reforms, but without decisive action, Canada’s telecom sector remains tilted toward its largest players.

The Consumer Conundrum: Choice and Pricing

Limited Options, Higher Bills

Big Telecom's dominance forces many Canadians into a narrow selection of providers, often reducing competition to a handful of nearly identical options. Independent ISPs, which historically introduced competitive pricing and innovative service models, struggle to survive in a landscape dictated by national giants. The result: fewer choices and inflated costs.

According to the Canadian Radio-television and Telecommunications Commission (CRTC), the average monthly price for internet in Canada surpassed $70 in 2023, significantly higher than in countries with stronger independent competition. In urban centers, some consumers can access marginally lower prices due to multiple providers, but rural users face near-monopolistic pricing structures with little room for negotiation.

How Canadian Consumers Compare to the US

Canadian internet prices regularly outpace those in the United States, despite similarities in geography and infrastructure challenges. A study by the Canadian Internet Registration Authority (CIRA) found that Canadians pay nearly 30% more on average for equivalent broadband speeds compared to US consumers.

• In Canada, a 100 Mbps plan often costs around $80 per month.
• In the US, a comparable plan from a competitive market may come in under $60.
• Gigabit speed plans in Canada frequently exceed $120, whereas US providers in regions with strong fiber competition offer the same service for under $90.

Municipal broadband projects and local competition in the United States keep prices down, while in Canada, regulatory protections for Big Telecom prevent similar independent growth.

Market Consolidation Shrinks Consumer Power

With fewer independent ISPs in operation, consumer leverage diminishes. When dominant players control both retail and wholesale markets, switching providers offers little financial relief. Even in major cities, where multiple brands appear to exist, a deeper look reveals the same parent corporations behind them.

Customers locked into restrictive service agreements often find little alternative when price hikes occur. Promotions targeting new customers offer temporary relief, but long-term affordability remains an issue. Without regulatory intervention or significant independent expansion, the cycle of limited choice and inflated pricing continues.

Canadians face a stark reality: without structural change in the telecom sector, options will remain scarce, and prices will stay high.

Subsidizing the Goliaths: Government Policy in Question

How Government Policies Favor the Telecom Giants

Federal and provincial governments allocate significant funds to broadband expansion, yet a disproportionate share flows to major telecom corporations. Programs like the Universal Broadband Fund (UBF) and the Connect to Innovate (CTI) initiative direct billions into expanding rural connectivity, with the bulk of contracts awarded to Rogers, Bell, and Telus. In 2021 alone, the UBF pledged $2.75 billion, much of which was granted to these established players rather than independent ISPs.

Regulatory support further cements their dominance. The Canadian government has repeatedly backed policies that weaken independent ISPs. In 2021, the Canadian Radio-television and Telecommunications Commission (CRTC) reversed a 2019 ruling that would have lowered wholesale internet rates, effectively ensuring that large telecom companies maintained premium pricing power over smaller competitors. This decision directly benefited the major incumbents while straining the financial viability of alternative providers.

Resource Allocation: Who Really Benefits?

Government-backed funding models are structured in ways that disadvantage independent ISPs. Large telecom providers receive substantial subsidies to build rural infrastructure, yet many still fail to deliver meaningful improvements in service or affordability. Smaller ISPs, despite demonstrating efficiency in deploying competitive networks, struggle to secure funding due to restrictive eligibility criteria and opaque selection processes.

• Major telecoms control rural expansion grants. Programs such as the Canada Infrastructure Bank’s broadband investments favor large corporations due to their existing infrastructure and lobbying power.
• Independent ISPs face financial roadblocks. While funding technically exists for smaller providers, restrictive application requirements prevent them from accessing these funds at scale.
• Public investment rarely leads to competitive pricing. Even after receiving subsidies, major telecoms continue charging high rates with minimal regulatory intervention.

Long-Term Consequences for the Industry and Consumers

Continued policy favoritism towards dominant telecom companies stifles competition, discourages innovation, and maintains inflated consumer prices. Studies by the Competition Bureau of Canada highlight that increased market concentration leads to fewer service options and higher costs. A 2022 study found that Canadian internet and mobile prices remain among the highest in the world, largely due to the lack of competitive pressure.

The repercussions extend beyond pricing. Independent ISPs drive technological advancements, from flexible network models to innovative pricing structures. When these smaller providers struggle, progress stalls. The federal government’s current approach prioritizes expanding network reach by funding major carriers but ignores the benefits of fostering a competitive landscape. The result: a telecom industry controlled by a few corporate giants, with consumers shouldering the cost.

An Open Internet: The Net Neutrality Debate in Canada

What Net Neutrality Means for Internet Access

Net neutrality ensures that all online traffic receives equal treatment, preventing internet service providers (ISPs) from blocking, throttling, or prioritizing specific content. Without net neutrality, dominant ISPs can manipulate data speeds and charge premium rates for reliable connections, disadvantaging both consumers and independent competitors.

CRTC vs. FCC: Two Paths to Regulation

Canada and the United States take different regulatory approaches to net neutrality. The Canadian Radio-television and Telecommunications Commission (CRTC) maintains a formal stance in favor of net neutrality, prohibiting ISPs from unduly influencing access to content. However, enforcement has been inconsistent, and loopholes allow significant market influence by large telecoms.

In contrast, the Federal Communications Commission (FCC) in the U.S. has seen policy reversals. The 2017 repeal of net neutrality protections under the Trump administration deregulated internet providers, allowing them to engage in paid prioritization and throttling. The Biden administration later moved to restore the policy, reinforcing regulatory oversight.

The Innovation Chokehold on Independent ISPs

Net neutrality fosters a level playing field, allowing independent ISPs to compete without artificial barriers imposed by telecom giants. When net neutrality protections weaken, large ISPs can favor their own services, limit bandwidth for competitors, and create additional costs that make it difficult for small players to survive.

• Content and Service Restrictions: Without neutrality rules, ISPs can control consumer access to certain websites, benefitting their own content platforms while marginalizing independent services.
• Artificial Data Caps: Large ISPs can impose restrictive data limits while exempting their own content from these caps, making competition unsustainable for startups.
• Higher Operating Costs: Independent providers end up paying more for equitable network access, reducing their ability to innovate or offer competitive pricing.

Regulatory clarity determines whether Canada's digital market continues to evolve or remains under the firm grip of the dominant telecom giants. Net neutrality remains a pivotal force in shaping competition, consumer choice, and technological progress.

A Call to Arms: Supporting Independent ISPs and Consumer Rights

Advocating for Competitive Practices and Consumer Rights

Independent ISPs face structural disadvantages, but consumer advocacy can shift regulatory and market dynamics. Policymakers respond to public pressure, and a well-informed consumer base increases scrutiny of anti-competitive behaviors. Organizations such as the Canadian Internet Policy and Public Interest Clinic (CIPPIC) and the Public Interest Advocacy Centre (PIAC) consistently push for fair regulations to prevent monopolistic control.

Legal challenges and policy submissions remain critical tools. Independent providers and consumer rights groups have repeatedly argued before the Canadian Radio-television and Telecommunications Commission (CRTC) for equitable wholesale rates. These efforts pressure regulators to enforce competitive pricing structures, ensuring that smaller ISPs can viably operate without undue financial burdens.

The Role of Public Support and Awareness Campaigns

Direct consumer engagement amplifies the call for fair competition. Awareness initiatives spearheaded by advocacy groups and independent ISPs draw attention to pricing disparities and service limitations caused by telecom monopolization. Campaigns such as #InternetForAll and similar grassroots efforts have raised awareness, mobilizing public support for more equitable digital policies.

• Petitions targeting policy changes put measurable pressure on decision-makers.
• Social media campaigns expose anti-competitive tactics, ensuring broader visibility.
• Public consultations create opportunities to directly influence CRTC proceedings.

Consumer choice extends beyond selecting an Internet package; it includes demanding policies that allow for fair market participation. Telecommunications consolidation reduces options, and continued consumer inaction enables further market contraction. Supporting independent ISPs requires sustained public discourse and structured advocacy.

Independent ISPs Advancing Their Standpoints

Despite unfavorable regulations, independent ISPs continue pushing back. Many smaller providers actively participate in policy hearings, collaborate with advocacy groups, and engage in direct lobbying efforts. Organizations such as the Competitive Network Operators of Canada (CNOC) provide industry-wide representation, challenging price hikes and restrictive CRTC decisions.

Several independent ISPs have also invested in regional infrastructure to reduce dependency on wholesale rates dictated by large telecom companies. Community-driven broadband solutions, co-operative models, and local fiber deployments offer alternative pathways to bypass monopolistic pricing schemes.

By backing independent ISPs and supporting consumer advocacy, Canadians influence the regulatory landscape. Direct engagement with elected officials, participation in public consultations, and financial support for independent providers all contribute to a diversified and competitive market.

Charting the Future: Investment in Tech and Infrastructure

The Role of Technological Advancement in Competition

Canadian independent ISPs face an uphill battle against telecom giants that control vast network infrastructures. Innovation in fiber-optic deployment, last-mile connectivity, and wireless technologies remains key to leveling the playing field. Without rapid investment in cutting-edge solutions, smaller providers risk falling further behind dominant players that dictate market terms.

According to Innovation, Science and Economic Development Canada (ISED), only 57% of rural households had access to high-speed broadband (50/10 Mbps) as of 2022, while urban areas boasted 99.3% coverage. Independent ISPs targeting underserved regions drive technological expansion, but without sufficient capital, network rollout remains sluggish.

Independent ISPs and Infrastructure Investment Strategies

Smaller ISPs lack the financial muscle of telecom giants, but strategic investments help them carve out market share. Several strategies emerge:

• Partnering for Network Expansion: Collaborations between independent providers and municipalities support fiber-optic network growth in rural areas, reducing deployment costs.
• Leveraging Fixed Wireless Access (FWA): Instead of expensive fiber trenching, FWA technologies like LTE and 5G allow independents to bypass relying on incumbents’ last-mile networks.
• Investing in Open-Access Fiber: Some independents build shared infrastructure models, where multiple ISPs can operate on the same fiber backbone, fostering sustainable competition.
• Optimizing Data Transit Agreements: Negotiating favorable transport deals with upstream providers reduces operational expenses, improving pricing flexibility for customers.

Balancing Investment Policies for Market Stability

Government investment plays a decisive role in broadband expansion, but policy direction impacts who benefits most. Programs like the Universal Broadband Fund (UBF) allocate billions in infrastructure grants, yet independent ISPs often struggle to secure funding against established telecom entities. A more balanced approach would ensure targeted investments enhance competition rather than reinforcing market monopolies.

Regulatory reforms that incentivize independent ISPs—such as fair wholesale access pricing and grant prioritization for underserved regions—create a healthier marketplace. Without these adjustments, telecom giants will continue consolidating control, limiting consumer choice and innovation.

Reshaping Canada’s Telecom Future

Independent ISPs operate in a system designed to favor Big Telecom, facing wholesale rate manipulation, regulatory barriers, and anti-competitive tactics. The consequences extend beyond these businesses, affecting consumer choice, pricing, and internet accessibility across the country.

Regulation must evolve to reflect a competitive market, not just preserve the status quo. The CRTC holds the authority to enforce fair wholesale pricing and prevent monopolistic practices, but past decisions have frequently leaned toward protecting major telecom interests. Policymakers and advocacy groups must push for reforms that prioritize competition over consolidation.

Consumers can exert pressure by demanding better policies and supporting independent ISPs whenever possible. Public engagement in CRTC consultations, direct feedback to elected representatives, and raising awareness about the telecom market’s structural imbalances can contribute to long-term change.

Large telecom companies benefit disproportionately from government incentives and subsidies that were originally designed to bridge connectivity gaps. Redirecting these funds toward infrastructure investment in underserved areas, rather than reinforcing market dominance, could level the playing field and encourage greater innovation.

With ongoing discussions on net neutrality, fair competition, and investment in digital infrastructure, the direction of Canada’s telecommunications policies remains uncertain. The debate must continue until independent ISPs have a genuine chance to thrive.

Take Action

• Support independent ISPs: Choosing independent providers where possible helps sustain competition.
• Engage with policymakers: Write to local representatives and demand fair wholesale pricing reforms.
• Participate in CRTC consultations: Provide feedback on regulatory proposals impacting internet pricing and access.
• Spread awareness: Share this article to inform others about the challenges facing independent ISPs.