That's how they are able to sell Apple iPhones for $180 (full price $700 on a month-to-month plan) or the new BlackBerry Z10 for $140 (full price $650).
However, many critics have noted that over a three year period, subscribers end up paying more for the phone (on a $50 a month plan a subscriber ends up paying ($1,800) Canada is one of the few countries in the world where a large proportion of wireless subscribers are still on three-year plans.
In the United States, most carriers offer two year contacts. In Europe contracts can't be longer than 24 months.
Meanwhile on Thursday the Montreal-based SeaBoard Group
, a telecommunications consultance, released a report urging the CRTC either to do away with three-year contracts, or, if they are allowed, order carriers to separate the handset subsidy from the service plan and make the subsidy transferable if the owner moves to a different provider.