Mark Goldberg

A key to recovery? Communications leadership

An article in the weekend Toronto Star credits Canada’s strong telecommunications infrastructure with helping the country manage through the COVID-19 crisis so far. I would add that we need strong leadership to guide development of smart telecommunications policy.

In “What Canada can learn from Europe’s COVID-19 response”, Dr. Georg Serentschy and Derk Oldenburg claim: “while ineffective communication enabled the spread of the Spanish Flu—a pandemic that persisted for more than a year — connectivity is one of the greatest strengths at our disposal in the fight against COVID-19.”

Dr. Serentschy was the head of the Austrian communications regulatory authority (RTR) and, later, Chairman of the EU regulatory authority, BEREC. Mr. Oldenburg is a former Dutch diplomat who served as Deputy Ambassador to Germany and the European Union.

Looking at how various countries in Europe have managed to date, they write:

Broadband technology has proven to be an indispensable asset, serving as both a social and economic lifeline. “After weeks of lockdown in Europe, those networks have passed an unprecedented stress test,” says Oldenburg. The EU’s early COVID-19 successes hold important lessons for Canada. Germany, Austria and Denmark’s ability to slow the spread and contain the infection rates demonstrate the critical role of early action, a well-funded public health system, a population that demonstrates trust in elected government and resilient telecom networks that have sufficient headroom, says Oldenburg. In that view, Canada has many of the resources necessary to efficiently overcome the COVID-19 crisis: an early response, a functional federal state, universal public health care and a world-leading telecommunications network that’s been able to shoulder both societal networking needs and the influx of economic activity during the COVID-19 crisis.

As Canada’s economy begins to re-open, wary of a rebound and second wave, what policies will continue to build upon the strengths that have largely enabled our transition to being isolated at home?

How can we best approach the challenges of extending network reach to increase available supply of global-leading services?

What lessons are we learning to help the demand side, helping more people adopt digital connectivity?

A couple of weeks ago, we marked the 10th anniversary of the launch of a consultation to create a national digital strategy. That exercise, launched by then Industry Minister Tony Clement, turned out to be a complete waste of time and effort, as Canada’s digital policy drifted aimlessly.

We don’t need a new expert panel or Royal Commission to set out a digital strategy. As I have written before, we need to demonstrate leadership instead of managing political calculus.

What outcome do we want? What do we want our digital environment to look like in 5 years? In 10 years?

Basic, but strong leadership principles: Set clear objectives; Align activities with the achievement of those objectives; Stop doing things that are contrary to the objectives.

Understanding engineering economics

One of the most important books in my telecom library is entitled Engineering Economy, A Manager’s Guide to Economic Decision Making, by AT&T – the original, pre-divestiture, full Bell System, AT&T.

Mine is a copy of the third edition, dating back to 1977, just a couple years before I got into the industry, but likely well before many of my readers were born.

The age of the book doesn’t change the utility of the training contained within.

Fundamentally, when there are alternatives available for the deployment of capital, engineering economics provides a disciplined approach to evaluating the economic outcomes, considering revenue, operating expense, capital and other cash flows.

For any given project, there are usually a number of possible alternatives. For example, for a given area, should fibre or fixed wireless be deployed? The analysis tools allow the manager to assess the difference in cash flows, revenue and expenditures, over the live of the project analysis.

In each case, an option that must be considered is maintaining the status quo, a “do nothing” alternative.

I’m not an economist and I’m not a professional engineer. This book was designed to help managers like me understand how to assess business decisions.

Among other benefits, an appreciation of engineering economics provides a framework to recognize the difference between “threatening” to reduce a budget, and a budget reduction occurring as a logical consequence or outcome of a policy determination.

Why am I highlighting a 43-year-old, out-of-print text book? The concepts are just as important today. A basic understanding of economic analysis should be considered a prerequisite for regulatory or government policy work in the telecommunications industry.

A more evidenced based approach is warranted

After watching the Federal Government’s Parliamentary Standing Committee on Industry, Science and Technology (INDU) May 7 meeting, Greg O’Brien wrote a commentary entitled “Federal committee nothing but bluster”.

“There’s a waste of two hours,” he wrote. “Not just my own time. Everyone’s.” Later on, Greg writes “You’d think they would want to get to the point, let witnesses speak, maximize their time with a number of good questions. Nope. Maximum windbaggery is what I saw”.

I’m certain we both had higher hopes for last Thursday’s (May 14) meeting, when representatives from Rogers, TELUS, Cogeco and Xplornet were witnesses. I came away shaking my head.

While some productive discussion emerged, too much time was spent by Parliamentarians apparently building transcript materials to show off to constituents and future voters. As stated by Chair Sherry Romanado (MP – Longueuil—Charles-LeMoyne) at the beginning of the video record on “ParlVu”, the meetings are being held “for the purpose of receiving evidence concerning matters related to the government’s response to the COVID-19 pandemic.” Starting on April 23, there have been 7 such video conference meetings so far.

The meetings have evolved to become a forum for issues related to accelerating the deployment of broadband access in rural and remote parts of Canada. This has given rise to Michelle Rempel Garner’s May 7 release of the ‘not ready for prime time’ Conservative caucus “Connect Canada” plan, and NDP MP Brian Masse’s release of the “NDP Plan for High Speed Broadband Internet for all Canadians” just prior to the May 14 Committee meeting.

The opposition parties created their plans prior to hearing from witnesses, many of which are in the business of building and operating networks. That is disappointing enough. But Canadians should watch the performance of their parliamentarians in committee. How many would approve of a methodology that sees plans developed and conclusions drawn well in advance of gathering evidence?

For example, the opening remarks by Rogers for Business President Dean Prevost included this testimony that could have provided guidance for the plans [17:30:25]: “Unfortunately, where we do not have high capacity, high speed wireline networks, we are not able to provide unlimited wireless data for internet access at home at this time. Put simply, wireline networks have 50-200 times the capacity per consumer as rural wireless mobile networks. Removing datacaps would simply overwhelm the mobile wireless network, impairing service for everyone in that area, including the first responders and 9-1-1 services that rely on it.”

During last Thursday’s meeting, I was particularly disturbed by a couple exchanges between Calgary-Nose Hill MP Michelle Rempel Garner (‘MRG’) and TELUS Chief Customer Officer Tony Geheran (‘TG’).

We witnessed this exchange at 6:31 pm:

MRG: “Mr. Geheran, I think I am saying your name right. You made a comment tonight. You said ‘if you have a policy that fundamentally undermines an investment strategy, you have to change policy’ and I think I agree with that. So I’d start with saying, do you think that structurally separating the builders of network from Internet Service Providers is a way to solve the policy tension that I just described?”

TG: “No, I don’t. I haven’t seen that work anywhere globally, to sustainable effect.”

MRG: “It’s in the UK, right?”

TG: “Yeah.”

MRG: “It’s like the primary model in the UK.”

TG: “But if you look at the UK, they are wholesale moaning about the quality of their infrastructure, their lack of fibre coverage. across what is a very small geography. I know. I originated from there. And quite frankly, the Canadian networks are far superior in coverage and quality and performance through COVID has demonstrated that.”

MRG: “Well, that’s certainly not what we’re hearing in our offices from end users and that’s not the reality that we’re hearing in testimony tonight from you.”

I’m not sure the Honourable Member actually heard contradicting testimony that night. Perhaps she was confusing meetings.

So, I went off to find some independent sources to figure out what is actually going on in the UK. If the Committee members want independent corroborating evidence for Mr. Geheran’s perspective, they too can check with the independent regulators in Canada (the CRTC) and the UK (Ofcom). It didn’t take much effort to find information on the respective regulators’ websites.

Just a few weeks ago, in its April 24 Notice of Consultation reviewing its approach for rates for wholesale telecom services, the CRTC wrote “Ofcom has identified the lack of incentives to invest in new broadband networks, including full-fibre networks, as one of the key challenges facing the U.K. telecommunications industry.” Just 3 weeks ago, Canada’s regulator stated that the one of the key challenges facing the UK regulator was its lack of incentives to invest, just as Mr. Geheran had told Ms. Rempel Garner.

For verification of quality differences, there is plenty of data in the most recent annual reports from both regulators. For example, Ofcom is showing that broadband speeds in the UK increased 18% between 2017 and 2018 to reach 54.2 Mbps. According to the CRTC, average speeds in Canada reached 126.0 Mbps by the end of 2018, an 89% increase over 2017.

Or, the members of the committee could take a look at the Insights section from Ookla speed test results, which show Canada’s April 2020 wireline average at 118.11 Mbps for downloads and upload average at 51.80 Mbps. In the same period, wireline users in the UK were getting roughly half the download speed at 67.23 Mbps and about a third of the upload speed (18.28 Mbps).

When the Hon. Member from Calgary Nosehill said “that’s certainly not what we’re hearing in our offices from end users and that’s not the reality that we’re hearing in testimony,” the independent evidence supports ‘the reality’ portrayed by Mr. Geheran.

If they are hearing otherwise, the committee might want to take more time listening to different witnesses. Recall the opening of the meeting, where we hear that this inquiry was “for the purpose of receiving evidence”.

How would you interpret “receiving evidence”? Listening? Probing? Researching? Learning?

Instead, what we, the Canadian voters, have witnessed so far appeared to be parliamentary puffery.

A more evidenced-based approach is warranted.

Words matter. Accuracy matters

When I’m reading an article, I can be bothered by missing punctuation, so I am not inclined to let more blatant errors slide by, if I can help it.

I’ve pointed out mix-ups on ‘millions’ versus ‘billions’ more times than I can count – and apparently I can count better than those who confuse the amounts (it really doesn’t take an advanced degree in statistics to understand the difference). A former business reporter blocked me on Twitter years ago after I called him out for writing that capital intensity was on a declining slope, but he was using the inverse of its proper formulation.

More than once, I have challenged headlines saying that wireless subscribers have declined year over year, when the company reports lower (but still positive) net additions.

In the past couple of weeks, I have been especially troubled by three key errors that keep cropping up, and keep getting repeated as the sloppiness gets copied by others.

  • Error 1: The mischaracterization of the CRTC’s broadband policy, TRP CRTC 2016-496.

    Let us be clear: at no time did the CRTC declare that broadband is a right. Nor was it guaranteed to all Canadians. And the Commission never set 50 Mbps (down) / 10 Mbps (up) as a “basic service standard.”

    Further, please tell the Conservative Party of Canada that internet speeds are measured in bits per second, not bytes per second. The symbol used for bits is “b”; the symbol for bytes is “B”. There are 8 bits in a byte (To help remember which is which, think of big B and little b). So when the Connect Canada document says “The CRTC designated broadband as an essential service in 2015, defining broadband to be a 50 megabytes per second (MBPS) download speed and a 10 MBPS upload speed,” that sentence is wrong in at least 4 ways:

    1. The CRTC never designated broadband as an essential service;
    2. In its landmark 2016-496 policy, the CRTC defined broadband as: “Broadband is defined as an always-on connection to the Internet that provides a download speed of 1.5 Mbps and above. This connection may be delivered on fixed and mobile wireless networks using a variety of technologies”;
    3. speeds are generally measured in terms of bits (or megabits) per second, not megabytes (50 MBps would be 400 Mbps)
    4. and, the relevant decision was issued December 21, 2016, not 2015.

    In a document filled with so many errors, 4 in a single sentence is an achievement worth noting.

    Here is a simple distillation of what has been garbled by misreading and misrepresenting the Commission’s 2016 policy in what might be described as broken telephone. In 2016, the Commission replaced what used to be an obligation, writing:

    Pursuant to its legislative mandate, the Commission is establishing the following universal service objective: Canadians, in urban areas as well as in rural and remote areas, have access to voice services and broadband Internet access services, on both fixed and mobile wireless networks. To measure the successful achievement of this objective, the Commission has established several criteria, including,

    • Canadian residential and business fixed broadband Internet access service subscribers should be able to access speeds of at least 50 megabits per second (Mbps) download and 10 Mbps upload, and to subscribe to a service offering with an unlimited data allowance; and
    • the latest generally deployed mobile wireless technology should be available not only in Canadian homes and businesses, but on as many major transportation roads as possible in Canada.

    Note that there are several aspects to be observed. The objective itself is simple and does not contain any metrics, “Canadians, in urban areas as well as in rural and remote areas, have access to voice services and broadband Internet access services, on both fixed and mobile wireless networks.” The objective applies to voice and data, mobile and fixed.

    The objective is not for all Canadians to be connected to these services and technologies, but rather for all Canadians to have access to voice and broadband internet. And as indicated above, the CRTC defines broadband as “an always-on connection to the Internet that provides a download speed of 1.5 Mbps and above.” Make no mistake, the slower speed, is not sufficient to earn a check-mark for attainment of the objective. The CRTC set out how it would measure progress toward the objective, as it wrote in 2016 at paragraph 39: “The Commission will establish criteria to assess progress towards reaching the universal service objective. These criteria will be used to identify which regions do not have the appropriate level of broadband Internet access services and to determine where further infrastructure investment is needed.”

    The measurement of 50/10 is one part of the criteria used to determine progress toward attainment of the objective.

  • Error 2: How much broadband is there in rural Canada?

    I wrote a blog post about this problem a couple weeks ago. It is simply not true that only 40% of rural Canadians have high speed internet. The latest CRTC Communications Monitoring Report says that at at the end of 2018, 90.5% of rural households had access to broadband at speeds higher than 5 Mbps, 84.3% had access to speeds higher than 10 Mbps, and 72.1% had access to speeds of 25 Mbps. The 40.8% figure referred to those in rural communities who already had access to the CRTC’s long term universal service objective of 50 Mbps.

    Further, in 2018, the CRTC ruled (in the context of funding projects from its Broadband Fund) “a minimum speed eligibility criterion of 25 Mbps download and 5 Mbps upload would be meaningful and a significant first step towards meeting the universal service objective.”

    Recall that CRTC defines broadband as “an always-on connection to the Internet that provides a download speed of 1.5 Mbps and above” but its chart [Figure 9.23] in the Monitoring Report starts at 5 Mbps.

    It is also worthwhile noting that the CRTC, like Statistics Canada, defines rural as “areas [that] have populations of less than 1,000, or fewer than 400 people per square kilometre.” Roughly 20% of Canadians live in rural Canada. Other countries define rural differently. For example, the US Census Bureau defines “Rural” as encompassing “all population, housing, and territory not included within an urban area” where urban areas are populations over 2,500. England “defines areas as rural if they fall outside of settlements with more than 10,000 resident population.”

    So, when Canada talks about rural areas, we are speaking in terms of much lower population density than many other countries.

  • Error 3: Sampling errors

    It has been 40 years since I studied graduate level statistics, but it doesn’t take an advanced degree to be able to detect problems in surveys.

    There is definitely a divide that separates rural and urban broadband speeds. But as I wrote recently, there will always be such a divide and I am sorry to be the bearer of such news. As such, it was inappropriate for CIRA, an agency that promotes itself as “Canada’s Internet”, to say “we really need to make sure that rural Canadians have access to the same speeds and quality that their urban counterparts do.” No we don’t and for certain we won’t. As I wrote two weeks ago, we need to take a more grounded look at what should be done to provide all Canadians with access to really high-quality digital connectivity, which is distinctly different from trying to provide everyone in remote and rural Canada with all the options available in our cities.

    But we are talking about sampling error. CIRA recently published a flawed internet speed study, and submitted it as evidence in the CRTC’s proceeding examining barriers to deploying broadband networks in underserved areas.

    Why do I suspect there are problems with the CIRA study? CIRA reported

    • “median rural download speeds were measured at 3.78 Mbps, compared to 44.09 Mbps in urban Canada”
    • “The data is based on testing data generated between May 2019 and April 2020 from a total of 86,706 urban tests and 31,734 rural tests”
    • “Overall, the median download and upload speeds for both rural and urban Canadians combined over the 12 month period were 17.56 Mbps download and 6.69 Mbps upload.”

    We know that rural Canada has just under 20% of the population of Canada and has a lower penetration of broadband connections than urban Canada, yet the sample is made up of 27% rural. That kind of over-sampling within a small strata might be done to help reduce sampling error, but these data points are generated by users. One should ask why rural users are more likely to choose to use the CIRA measurement tool.

    Contrast the CIRA national results with what Ookla observed for Canada with its Speedtest. For March 2020, Ookla reported Canada’s average download speed was 120.98 Mbps and upload of 52.91 Mbps. The Ookla results tie in more closely to the CRTC’s Monitoring Report that says the weighted average residential download speed was 126.0 Mbps.

    Ookla reports that its Q2-Q3 2019 test results are based on nearly 4,000,000 unique devices, with more than 17,000,000 tests. In that partial period, Ookla collected more than 140 times the number of test results from Canada than CIRA did in an entire year. So when Ookla shows a national average speed that is 10 times higher than what CIRA shows, with its sample size, I know which results I am more inclined to believe.

It’s hard to take some advocates seriously when they manipulate data and spread misinformation, like the way Open Media wrote recently: “a whopping 60% of rural households – and many more low income households in cities – don’t have access to high-speed Internet.”

There are serious issues to be explored in improving access to broadband connectivity in Canada. How should we set priorities for funding? Should we maximize the number of homes getting broadband for the first time? Should we work from a basis of minimum subsidy required per household getting improved service? Do funding allocations have to be evenly sprinkled across the country? What timetable can we reasonably work toward?

Let’s start with getting the facts right and demanding accuracy from those participating in – and reporting on – the discussion.

Words matter. Accuracy matters.

I’ll be watching to make sure we get it right.

Canada’s mobile leadership

A new report [4.8 MB, pdf] released this morning by Opensignal ranks Canada’s mobile networks as fastest in the world.

Listed at the top of the key findings of “The State of Mobile Network Experience 2020: One Year into the 5G Era”, Opensignal says

Canada and South Korea are now joint top in Download Speed Experience
A year ago South Korean users were the only ones that experienced average download speeds above 50 Mbps. While Korea’s operators launched 5G in April 2019, and Canada has only just launched 5G, in early 2020 our Canadian users saw download speeds statistically tied with those of South Korea. Both countries clocked at a blisteringly fast 59 Mbps.

Among Canada’s G7 peers, the speed difference is widening. The download speed experience of France, Germany, Italy, the UK, and the US was more than 50% slower than Canada. At 15% slower, only Japan was in the same league as Canada.

Canada’s mobile speeds increased by 17 Mbps (over 40%) between the first quarter 2019 report and the first quarter 2020 report released today. It was the biggest jump of any of the 100 countries in the report. In addition, 4G availability in Canada is now measured above the 90% mark. Opensignal reported its Canadian 4G users spent (on average) 93.5% of the time connected to 4G in Q1 2020, up 4.7% from Q1 2019.

Canada’s mobile network excellence isn’t just an urban phenomenon. Recall, last September Opensignal said “If rural Canada were a country, it would rank 12th in our Download Speed Experience ranking, with our rural Canadian users on average seeing faster 4G download speeds than our users in Sweden, New Zealand, France, and 73 of the other countries we reported on.”