Mark Goldberg


www.mhgoldberg.com





Fox Group Dispatch

Will Canada see a new new-entrant?

Could the “Consultation on a Technical, Policy and Licensing Framework for Spectrum in the 600 MHz Band” lead to a new mobile service provider entering the market? As stated in the Minister’s news release, “the Government is proposing measures to support competition and encourage investment in wireless services.”

The most significant “pro-competitive measure” being proposed for this auction is a 30 MHz set-aside for bidders other than “companies with 10% or more of national wireless subscriber market share” – which is a more polite way of saying “almost anyone other than Bell, Rogers and TELUS.” The government is proposing a further set of restrictions for companies that want to bid on the set-aside spectrum: as of the date of registering to bid, the companies must be registered with the CRTC as facilities-based-providers, and must be actively providing commercial telecommunication services to the general public in the licence area of interest.

It is notable that the language in the proposed rules use the broader term “telecommunications service” not a “wireless” or “mobile” service. As a result, there is a significant number of potential bidders or bidding partners for this spectrum. A potential bidder may be registered as facilities-based in a limited area, but offering commercial telecommunications services (such as internet services) nationally.

Today’s market conditions appear to be much more favourable compared to the environment at the time of the 2008 AWS-1 auction which stimulated the creation of a number of regional competitors. Among other factors, consider: foreign ownership restrictions have been lifted; roaming rules and rates are in place; early termination conditions in contracts are no longer meaningful; and, there is 30 MHz of spectrum being auctioned in a band with much better propagation characteristics than the AWS bands, leading to lower costs of initial network deployment.

As a result, the set-aside spectrum might be seen as an attractive opportunity for the creation of a new wave of new-entrants. What role will foreign capital play in the auction?

Regulating the internet: what happened?

Eighteen years ago, I wrote that the CRTC became “one of the world’s first regulators to clearly enunciate a “hands off” policy toward the Internet.”

At that time, the Commission issued a Public Notice enumerated by codes under each of its Broadcast and Telecom sides: Broadcasting Public Notice CRTC 1999-84 and Telecom Public Notice CRTC 99-14, with a simple title: “New Media“. The decision makes for interesting reading.

It was a different time for internet content, 5 years before Facebook, 6 years before YouTube: “The Commission considers that the majority of services now available on the Internet consist predominantly of alphanumeric text, and, therefore, do not fall within the scope of the Broadcasting Act and are thus outside the Commission’s jurisdiction.”

At the time, the CRTC was confident about Canadian content development:

In the Commission’s view, there is no apparent shortage of Canadian content on the Internet today. Rather, market forces are providing a Canadian Internet presence that is also supported by a strong demand for Canadian product.

The Commission notes that a number of initiatives and funds have been developed in both the public and private sectors to help finance and support Canadian new media product.

For these reasons, the Commission concurs with the majority of participants that there is no reason for it to impose regulatory measures to stimulate the production and development of Canadian new media content.

As far as regulation of illegal and offensive content, at the time the CRTC wrote:

The Commission notes that Internet Service Providers (ISPs) and their industry associations, in conjunction with government agencies and other organizations, have made efforts to develop codes of conduct to help combat the distribution of offensive material. It considers that more could be done for example, by establishing complaint lines and industry ombudsmen and developing international cooperation with law enforcement agencies. The Commission also notes that effective content filtering computer software is being developed. Such software will assist those who wish to control access to material that they feel is inappropriate.

And the Commission was as concerned about competitive ISPs having wholesale access to high speed facilities from the phone companies and cable companies:

The Commission considers that access by competitive providers of Internet services to the facilities they require to offer services is an important concern. In a 1998 decision (Telecom Decision CRTC 98-9), the Commission decided it would approve the rates and terms under which incumbent cable and telephone companies provide higher speed access to their telecommunications facilities to ISPs. The Commission will set out its general regulatory approach to rates and terms for such cable carrier higher speed access services in the near future.

The past 5 years have seen Canada apply an increasingly heavy regulatory hand. A search for “Regulating internet” on my blog turns up a number of posts expressing concern about government intervention.

Three years ago, already faced withe a list of areas in which the CRTC had intervened, I wrote: “Are we restricting the evolution of creative business models and innovation through regulation?”

Earlier this year, I asked “Will Canadians see greener Internet pastures in the USA?”, observing Orwellian euphemisms of “openness” and “choice” to characterize greater government control. Canada’s current approach to internet regulation contrasts diametrically with our neighbours to the south. As FCC Chair Ajit Pai told The 2017 Canadian Telecom Summit:

In short, America’s approach to broadband policy will be practical, not ideological. We’ll embrace what works, and dispense with what doesn’t. That means removing barriers to innovation and investment, instead of creating new ones. That means taking targeted action to address real problems in the marketplace, instead of imposing broad preemptive regulations. And that means respecting principles of economics, physics and law, and acting with humility as we regulate one of the most dynamic marketplaces history has ever known. This vision will unleash the massive investments that the digital world demands.

Eighteen years ago, Canada was among the first regulators to set out a light-touch approach to internet regulation. What happened?

Which path will the new Commission leadership follow?

Managing the silver tsunami

While digital health technologies hold the promise to empower us to be more and proactive in our care, a new study released today by TELUS finds that those who might benefit the most from innovative healthcare technologies are least likely to adopt them.

Among the findings of the Digital Life study:

  • Canadians in the baby boomer (age 52+) and greatest generation (age 71+) categories reported they were the most likely to access a healthcare provider (75 per cent). While 59 per cent in this demographic agreed that digital health tools would help them connect with their healthcare provider, this group ranked the least likely to use them (12 per cent);
  • Those 52+ years old in Ontario and the West are significantly more likely than those 52+ years old in Quebec to have shared their health data with their healthcare provider, used online or mobile resources to find reviews of doctors or healthcare services, and used online or mobile resources to search for specific health topics;
  • Canadians over the age of 52 were 10 per cent less likely than younger generations to agree that digital technology empowers them to take control of their health;
  • 80 per cent of healthcare providers surveyed reported using digital technology to communicate with other healthcare professionals. Six in 10 hold the belief that this integrated health team interaction improves patients’ overall wellness; and,
  • With 89 per cent of healthcare professionals surveyed agree that accessible, secure information-sharing platforms would improve patient outcomes.

The Canadian Institute for Health Information reports that two-thirds of Canadians over 65 have five or more different prescriptions, and one-quarter take 10 or more prescription drugs.

TELUS Health has announced a new product, Pharma Space, an online pharmacy service that provides reminders and automatic refills, with the objective of improved compliance with medication. Pharma Space provides patients with the flexibility to better manage these prescriptions as well as their online drug profile anytime, anywhere from a mobile phone, tablet or computer. The system allows patients access to information they need about their medications, including potential side effects. Pharma Space is offered through participating pharmacies.

We have recently dealt with aging family members having problems from drug interactions caused by prescriptions that weren’t properly coordinated between specialists. TELUS reports that 300,000 Canadians are already using Pharma Space. While that is an impressive start, it also means more than 99% of Canadians still aren’t accessing the service. That makes a significant (and necessary) growth opportunity for Pharma Care and other digital health applications.

Affordable broadband for low income households

Frequent readers of this page know that, for too long, I have been writing about the need to develop a national strategy to target bridging the biggest gap in digital adoption in Canada. Almost half of Canadian households in the lowest income quintile have no home computer and no broadband connection.

As I wrote a few weeks ago, I would like to see us immediately start addressing households with school aged children so that all kids have a chance to start the school year equipped with the right tools. In the US, FCC Commissioner Jessica Rosenworcel refers to this as closing the #HomeworkGap.

The new school year opens in a month and a half. Will service providers be ready with a new type of “back-to-school special”?

#CTS17 on demand

I have uploaded a number of sessions from The 2017 Canadian Telecom Summit to make the information more accessible to those who were not able to be with us, or to help attendees recollect what was said.

Here is a summary of the sessions now available on-line:

As you can see, there was a significant focus on innovation and developing national innovation policies. This has been an important focus for the Canadian government’s economic plan, aligning with the theme of the conference, “Competition, Investment and Innovation: Driving Canada’s Digital Future.”

Your comments on these sessions are welcome.