Fido puts per-second billing into the doghouse.

Canada, home of the three-year mobile phone contract, “service access fees,” high activation fees, unlock phone fees, $10 for 10MB of data, and $8 extra for “caller-ID” has had one thing going for it that American cell phone companies don’t offer — per-second billing.

Not anymore.

Our regular reader Alex writes to inform us that Fido (owned by Rogers Communications) has joined the parade of Telus’ Koodo and Bell’s Virgin Mobile Canada eliminating the money-saving billing feature for all new activations starting yesterday.

These prepaid customers will now pay by minute when they start new service or change an existing plan.

Mobile Syrup reached out to Rogers and obtained official confirmation and their explanation:

“Fido will adopt the common billing practice in Canada: per-minute billing beginning July 4th. This means that calls are rounded up to the nearest minute. This change will apply to new customers signing up with Fido. All customers who are on current plans with per second billing will retain this feature unless they change their monthly plan. The majority of customers should not notice any impact to their monthly bills. Fido offers several great plans with various call, text and data allowances that are designed to meet any need.”

The billing change further discourages Canadian consumers looking for a better deal in the prepaid market. It is the best alternative available from the handful of national carriers that charge considerably higher prices tied to an extra-long service contract and expensive data pricing.

Maybe not

Alex notes per-second billing was one of the great advantages Telus’ Koodo offered, and other competitors were initially forced to match that innovative pricing.

“Koodo’s new plans are simply the old plans, but with a $5/month increase for two calling features,” Alex notes. “Koodo found another way to gouge their customers: per-minute billing. They also removed 50 minutes from the $30/month (previously $25) plan, which used to have 150 minutes. At a time when Internet is the main demand, while talk and text cost virtually nothing to provide, Koodo is gouging.”

Koodo, Fido, and the other carriers are probably noticing that cell phone customers are talking on their cellular phones less than ever, and per-second billing can save an average of 25% off per-minute billing, especially for short conversations.

Alex has a petition up on Koodo’s website asking them to reconsider, but we’re doubtful they will. Rogers’ is not well-known for responding to customer desires for better, more cost-effective service.

Bell Mobility and its parent company, Bell Canada are facing a $100 million class action lawsuit that claims expiration dates on Bell’s prepaid wireless service are illegal.

Ontario’s Consumer Protection Act bans expiration dates from gift cards.  The Toronto law firm of Sack Goldblatt Mitchell LLP alleges that prepaid wireless services, often topped up with prepaid cards, should be treated just like gift cards and not subject to expiration dates that wipe out available balances.

The suit was filed on behalf of Celia Sankar of Elliot Lake, Ont.

Sankar is founder of the DiversityCanada Foundation, a non-profit group that fights for diversity, inclusion and harmony among Canadians. Sankar had her Bell Mobility prepaid balances wiped out on two occasions because she did not use her available balance or “top-up” her account with additional funds within the time window specified by Bell.

A $15 Bell Mobility prepaid top-up card expires in 30 days. A $25 top-up card expires in 60 days. Customers can buy a $100 card and avoid losing their balance for one year. Accounts with a $0 balance for 120 days will be terminated.

“Because the prepaid wireless service is the least expensive way to have a phone, and does not require a credit card or a bank account, it is often the only option for youth, new immigrants, workers on minimum wage, the unemployed, people on disability and seniors on fixed incomes,” Sankar said. “These are the people who can least afford to have their funds forfeited or to have their mobile services cut off.”

Bell declared the suit was without merit and intends to fight it.

If the case is certified as a class-action suit, Bell faces the prospect of defending itself against all Ontario residents who have used Bell’s prepaid services since May 4, 2010. Those brands include Bell Mobility, Solo Mobile, and Virgin Mobile Canada.

Next time you wonder why you are paying substantially higher cell phone bills than your neighbors abroad, take note: just three cell phone companies control 94 percent of the wireless marketplace in Canada, with more than 23.5 million combined subscribers.  The four other significant carriers have a combined subscriber base of around 1.5 million, hardly worth noticing by the largest three:

Rogers Communications

The telecom giant Rogers controls the largest share of the Canadian wireless market with 9,127,000 subscribers as of the end of June.  Nearly 7.5 million of those customers are on two year contracts and pay an average bill of $70.07 per month.  Prepaid customers pay substantially less for their occasional-use phones: $16.14 a month.  Rogers adds more subscribers than it loses, picking up 591,000 new customers during the first quarter, while losing 456,000 current customers, winning a net gain of 135,000.

Data revenue is becoming increasingly important for Rogers, now constituting 35 percent of earnings for the company’s wireless division.

Bell

Coming in at second place is Bell Canada, with 7,283,000 customers.  Over 5.7 million are on contract, 1.6 million are using Bell prepaid phones.  Bell added just under 38,000 new customers last quarter, the smallest net add among the three largest providers.  The average contract customer pays Bell $63.18 a month; prepaid customers pay $16.88.

Telus Mobility

Telus, western Canada’s largest phone company, sells wireless service across the country and has become the third largest wireless provider with 5.8 million contract customers and 1.2 million prepaid clients.  Together, they pay an average of $58.88 a month.  Telus picked up 94,000 net additions last quarter, which is better than Bell but worse than Rogers.

Everyone Else

Among the rest, Saskatchewan’s phone company Sasktel had managed to reach 568,000 subscribers, mostly in the province, as of late March.  MTS Allstream Inc., a wholly-owned subsidiary of Manitoba Telecom came in with 489,722 customers.  Videotron, Quebec’s biggest cable company, had 210,600 clients, mostly in Quebec.

Among the newest entrants, Wind Mobile, subject to considerable controversy for its foreign financial backing, may one day be a much larger player in Canada’s wireless marketplace, but not today.  It had just 271,000 customers as of March 31st.

Even fewer customers rely on some of Canada’s regional providers, which include companies like Thunder Bay Telephone, Lynx Mobility (co-owned by an aboriginal partner with a mission to serve rural Canada), Calgary-based AirTel, which is popular with oil/gas workers for its “push to talk” service, and Ice Wireless, which is the largest GSM carrier in northern Canada, reaching 70% of the population of Nunavut and the Northwest Territories.

Canada’s largest three providers also own or control several “competitors” that mostly sell prepaid service.  Customers thinking they are escaping the big boys often really are not:

• Fido is owned by Rogers;
• Virgin Mobile Canada is owned by Bell;
• Koodo Mobile is owned by Telus