Delivering 5G to rural markets

In a post last fall (“Canada needs to be a global leader in 5G”), I wrote about a Policy Options article that said “Market forces alone will not deliver fast 5G internet to rural areas.”

Canadians need 5G. A recent paper describes at least 3 new areas of industrial change enabled by 5G: the Internet of Things (IoT) (enabling smart homes and smart cities); vehicle automation, healthcare and smart farms; and, augmented reality and virtual reality.

These innovations are important for rural and urban Canadians alike, and we have seen 5G services being made available in some rural markets already.

Over the past two years, a number of government policy announcements have helped create a climate that encourages investment by the private sector to extend the reach of advanced technologies beyond urban centres. “Canada’s future depends on connectivity” has been guiding regulatory determinations and telecom policy, balancing the objectives of expanding network coverage, delivering world-leading service quality, and affordable prices.

As I described last week, the cost of delivering rural broadband can be substantial. A recent government announcement awarded $163M in subsidies for less than 8000 households, including one project that cost more than a quarter million dollars per household.

What if there was another approach to encourage more private sector investment in rural broadband and 5G wireless?

Is that precisely what the government is looking at with the rumoured proposal to have Xplornet acquire the divested Freedom Mobile assets from the acquisition of Shaw by Rogers?

There are other groups that have apparently submitted bids, but it is difficult to envision how any would have a plan that could result in a sustainable business where previous incarnations of Freedom have failed. As a stand-alone business, where are the synergies to promote continued investment? As I wrote in “A Kobayashi Maru scenario”, Xplornet would be able to leverage the unused rural spectrum held by Freedom to improve the quality of broadband services it offers to its fixed wireless customers.

That would improve coverage, quality and price for hundreds of thousands of rural households, funded by private sector investment.

It is important for rural Canadians to have access to applications like smart farms, healthcare telematics, smart communities, automation.

In its review of the Rogers-Shaw transaction, will we see the government continue to maintain consistency in its policy approach to telecommunications, “balancing the competing objectives of extending the reach of networks, delivering world-leading service quality, and affordable prices”?

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