Letters: Big Business Blues
Canadian Anti-Monopoly Project
CAMP is fighting for a more democratic economy
Welcome to Letters from CAMP, a newsletter on anti-monopoly activity in Canada and abroad, brought to you by the Canadian Anti-Monopoly Project. In this installment we have:
Let's dive in.
When Bell is Mad, You’re Doing Something Right?
The Business Council of Canada, an industry association composed of the CEOs of monopolists like Bell, Loblaws and RBC, is not impressed. In an open letter sent to the Minister of Innovation, Science and Industry, Fran?ois-Philippe Champagne, the association has rallied its big business buddies to express that they are “surprised and disappointed” at the legislative action the federal government has taken to update the Competition Act and address competition issues in Canada.?
Though the business groups complain of not being adequately consulted on the changes to the Competition Act, their real issue is that the law is being changed at all. Under its previous name the Business Council on National Issues, the Business Council of Canada was given an effectively free hand in the 80s to write a Competition Act that was friendly to the interest of big business. The result was the ineffective competition law that has dogged Canadians for decades, and that Bills C-56 and C-59 are finally strengthening. That Canada’s new law is garnering this reaction from big business is confirmation that changes to the law that polices concentrated economic power is headed in the right direction.?
We encourage the Minister to see these complaints as a signal that the legislative changes he has brought in are a material improvement from the status quo and set the stage for a more vibrant and competitive Canadian economy.?
CRTC Hears Arguments on the Future of Internet Competition in Canada
This week, Canada’s telecom regulator, the Canadian Radio-television and Telecommunication Commission (CRTC), hosted telecom stakeholders to decide whether large incumbents must provide access to next generation fibre assets to competitive internet service providers (ISP).
Since the early 2000s, Canada has mandated access to wireline telecom networks, giving internet users in Canada options beyond the incumbent owners of legacy telecom infrastructure. This system allowed independent operators to offer distinct internet services beyond simple resale offerings from the large incumbents. Unsurprisingly, incumbents oppose this mandated access while competitors have pushed for improvements to the system, including access to fibre infrastructure offering higher quality services.?
Alongside the fibre access debate the CRTC was also called on to ban the use of “bulk-billing” arrangements between incumbent ISPs and apartment building developers. These agreements transform apartment buildings into “monopolistic islands” where the cost of internet access is hidden in building fees, depriving residents of the ability to choose their own provider.??
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Though the outcome of the hearing remains to be seen, new CRTC leadership has brought a needed urgency to their regulatory actions. Before the conclusion of the regulatory proceeding, the CRTC gave interim fibre access to competitive ISPs to allow them to compete in the meantime, insulating them from the delay tactics of the incumbent providers. We hope to see this much-needed focus on competition continue in the CRTC’s ultimate decision.
Mausoleum Monopoly: Toronto’s Cemetery Consolidation Crisis?
Even in death we are not free from the effects of monopoly. An article from The Local last week delved into the transformation and consolidation of Toronto's death care industry, particularly focusing on the Humphrey Funeral Home and the Mount Pleasant Group of Cemeteries. Kim Hunter, owner of Humphrey Funeral Home, shows how the relationship between funeral homes and cemeteries has soured as cemetery operators morph into one-stop-shops for funerary services, shifting from a collaborative partner to a formidable competitor.?
Despite being not-for-profit, the Mount Pleasant Group commands some of the priciest burial plots and wields significant lobbying power, shaping the industry to its advantage. As major players in the burial space like Mount Pleasant have expanded, the cost to say farewell to a loved one has risen, with the Loewen Funeral Group reported to have raised prices by 15% at every independent funeral home it acquired. The reason for the cost increases? To cover the cost of the acquisitions.?
Beyond industry consolidation, Ontario’s death care industry is also facing supply constraints. Urban planner Nicole Hanson warns of a looming crisis of dwindling burial space, with Toronto cemeteries projected to run out of space within decades. Though likely not on the minds of policy makers today, cemetery competition may be a sleeper monopoly issue in the years to come.?
Research Shows Range of Harms from Concentrated Industries?
A new report by researcher and writer Denise Hearn out of the Columbia Center on Sustainable Investment provides a concise and comprehensive summary of the trend of market concentration and its associated harms. While often sold as providing benefits like scale efficiencies, concentration generates a number of negative outcomes and creates the conditions for anticompetitive conduct and marketplace abuse.
The report synthesizes global research on how high concentration leads to harms such as higher prices for consumers, lower wages for workers lacking? bargaining power, and decreased innovation by challenger firms. New data also shows the top 20 global firms enjoy prices 50% above costs on average compared to 25% for others, effectively imparting a concentration tax on their customers.?
The report paints a concerning picture of the current global market environment and the motivation for the growing global anti-monopoly movement. Left unaddressed, concentrated markets foreshadow a future defined by stagnant innovation, sclerotic economies, and widening inequality.?
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