I expect that part of the problem here is the low population density compared to other markets.
Simply put, Canada has about the same landmass of the continental united states (I had to look that up, but it's actually surprisingly close), but only 1/10 the number of people. The population density of the USA is listed as 32 people per km^2, Canada is 3.2/km^2. A few city-only serivces have existed: Fido, for example, but they were bought up because Canadians travel alot, and really really want good coverage on the major highways. When you are 200-300 km from anywhere, it's kinda nice to have a bar or two on your phone. That means that it is hard to draw customers to the city-only services in the long term.
Don't get me wrong: Rogers and friends are still turning an insane profit on our backs, but sometimes that is just the way it works. At least those profits are mostly staying in Canadian hands.
To build out a new cellular network takes a considerable amount of capital to provide coverage for enough people to make it worthwhile. I don't think the cell operators need collusion to keep the prices high -- since a new player either needs the money and time to build out a network, or they have to pay an existing player to offer a virtual cell network -- and you can bet that the existing players are .
The only reason we are getting new carriers finally is that the CRTC stepped in and is forcing existing players to provide that virtual network capability at a wholesale price that lets the new carriers compete. In other words, they are regulating a way to prevent the carriers from a making such a big profit and opening the field to competition. Some of that competition is being funded from non-canadian sources, which I am not sure is such a great thing: It will be years before the competition amongst carriers makes a dent in the rates we are paying, and in the meanwhile, that means sending the profits out of the country, which for Canada has never been such a good thing.
I think what it comes down to is that all the options suck, and the new options suck just as bad as the old ones, and it's only going to get worse.