Consumers turn to black market for cellphone deals

Pricey cellphone plans in many Canadian provinces appear to be driving consumers toward a booming black market business.

At last search, online ad site Kijiji in Toronto was crawling with advertisements for a bargain Koodo or Fido phone plan just $48 a month for unlimited Canada-wide calling, texting and a big 5GB data package when you buy through a third party.

Rogers' Fido offers the same phone deal for more $95 a month in most provinces.

But both companies charge only $48 a month for the same cellphone package in Saskatchewan and Manitoba, where the telecoms face more competition.

The theory is, somehow these third-party dealers secure the cheaper phone plan out of Saskatchewan or Manitoba and then switch over a customer's phone number from another province.

As compensation, dealers ask for a one-time set-up fee ranging from $40 to $150.

Last year, CBC News brought you a story about the cheap underground cellular industry. At the time, the ads we highlighted had disappeared and telecom Telus said it was looking into the practice.

But almost a year later, advertisements for these $48 plans abound on the internet, targeted at customers outside Manitoba and Saskatchewan. And those involved tell CBC News that business is thriving.

Gary Ng, editor of the tech site iPhone in Canada, believes high cellular service prices in most provinces are helping fuel an underground business.

"Because our Canadian wireless prices are some of the most expensive in the world, some people will always want to find a better deal and they might do whatever it takes to get it," he says.

Tech writer Ng says telecoms may be reluctant to crack down on these underground deals because it could generate negative publicity.

"It just brings up the debate again, how expensive our plans are" outside Manitoba and Saskatchewan, he says.

However, the $48 deal may not last in Manitoba if Bell's acquisition of local carrier Manitoba Telecom Services goes through.

Some industry experts speculate the deal will lead to less competition and higher prices in the province.

If that happens, Ng points out that it may actually benefit third party dealers as long as phone plans stay cheap in Saskatchewan.

"If prices do go up in Manitoba, they'd probably get more business," says Ng.

Consumers turn to booming black market for cheap cellphone deals - Business - CBC News
I would never take a chance with these.

I know a bunch of 'fight the man' types who live and die by that mantra and they are buying a phone every year because the off market ones break down or have some annoying software incompatibility.

Phone prices are certainly too high, but getting these off market ones won't bring prices down.

Also, going on a 2 year contract provides for a good phone at a decent price and you don't feel the weight of the cost because it's paid over time in small increments.
Rogers Small Business has some great deals these days!

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