A new study says Canada pays the highest cellphone fees of any developed country, with Canadians paying about 33 per cent more per month than Americans do. As a result, fewer Canadians are using portable devices than other developed countries.

According to the Seaboard Group, a Canadian technology research and consulting group, just 56 per cent of Canadians have a mobile phone, compared with 75 per cent of Americans, 86 per cent of Germans.

In a report entitled "Lament for a Wireless Nation," the Seaboard Group says the average user, defined as someone using 500 minutes a month, pays a 33-per-cent premium.

The high-end business user uses 1,200 minutes of voice plus data monthly and pays a staggering 150 per cent more than a subscriber in the United States.

The group contends that the high prices are stopping more Canadians from buying cellphones and PDAs.

"Canada is dead last in the 30-country OECD measurement of wireless penetration. Oddly enough, Canada's wireless prices lead the world -- there may well be a correlation," the report says.

Canadians often pay a 911 access fee, a network service fee, as well as monthly cost of the rate plan -- plus overage charges. Many Canadian consumers buy monthly packages for $20 or $30. But when they exceed their allotted minutes, the price can skyrocket.

"Canadians aren't tech laggards, as has been suggested in recent discussions on the country's state of wireless phone competition," the report goes on to say.

"Instead, they are rational economic beings. Canadians hesitate to buy cellphones or to hit the send button on a cellphone knowing full well the cost at the end of the month will be breathtaking."

The report's authors recommend Canadian wireless carriers do away with long-distance fees, raise usage ceilings and reward customers for signing up friends.

They also suggest the government should allow and encourage outside competition in the industry.

Bob Whitelaw, the former president of the Canadian Council of Better Business Bureaus, told Canada AM Tuesday that Canadians are reticent to shop around for the best deal once they have a cellphone because they don't want to have to change their phone number.

That's about to change, with wireless number portability beginning on March 14 allowing wireless customers to keep their old number when they switch providers. But Whitelaw says that should have changed "five years ago."