VOIP Regulation 2.01 Beta

The CRTC issued its Public Notice on the reconsideration of VoIP regulation this afternoon.

Interesting accelerated timetable in the PN, driven by the requirement to report back to Cabinet within 120 days (ie. around Labour Day). Comments are due on June 5 and reply comments are due June 15.

The Public Notice is especially interesting in revealing the text of the actual Order of the Governor in Council. The recitals in the Order reveal that Sending VoIP back to the CRTC was ordered in part out of a recognition of the recommendations of the TPR (no surprise), but also considering the recent Local Forbearance decision. Despite the fact that there has not yet been a Cabinet appeal, it looks like Cabinet is expecting it any day now:

Whereas the Governor in Council is currently examining Canada’’s Telecommunications policy and regulatory framework taking into consideration the recommendations of the Telecommunications Policy Review Panel and is following closely the public discussion concerning Telecom Decision CRTC 2006-15.

Cabinet is going to be busy with telecom issues. The deadline for appealing the Deferral Account decision is coming up on Monday. We expect at least one party to file by then. Local forbearance has about 6 weeks more to go on its timer, but Bell has already announced its intent to appeal.

The Order indicates that the Governor in Council is contemplating what changes to implement in the wake of the TPR panel report.

June 15 is a great day to close off the CRTC’s public process. It just happens to be the day after The Canadian Telecom Summit closes. June 13 will see the regulatory department heads from all the phone companies square off. It will be a tag team event, cablecos versus telco incumbents with MTS Allstream as the spoiler!

That session immediately precedes the keynote address by Industry Minister Maxime Bernier, who is expected to talk about the implementation plans for the TPR. He’ll be followed by keynote addresses from TELUS CEO Darren Entwistle speaking at lunch on on Tuesday and Bell CEO Michael Sabia on Wednesday.

Videotron Chief Robert Depatie speaks on Wednesday afternoon and the final word belongs to CRTC Chair Charles Dalfen, who closes the conference.

Doing well by doing good

Twenty years ago, I worked for a guy at AT&T Bell Labs who told us not burn ourselves out by working crazy R&D hours. He told us to take time out to go to the theatre, get involved with little league, various community groups, family things. In his view, it was good business. After all, he wanted employees who would still have energy in 5 years; he knew that all of our neighbours were potential AT&T customers. Doing good for employees and the community was doing good for AT&T. There was a time that the ‘telephone company’ was held in such esteem across the country. In the monopoly and early competitive days, there was always a lot of community involvement, from the employee and pensioners’ association, the Telephone Pioneers and corporate giving.

Tuesday evening, Darren Entwistle was in town as TELUS launched its Toronto Community Board. TELUS has set a goal for itself to become Canada’s premier corporate citizen. I think it is a symbol of TELUS’ commitment to be a permanent force across the country, not just in their home base: the western ILEC region. In addition to funding various community initiatives, TELUS plans to have a national community activity day – a day of volunteerism for its employees. Congratulations to those involved.

We hope that Rogers, Shaw and Bell will feel competitive pressures to match and ‘up the ante’. Such involvement by the industry will hopefully return a little lustre to our industry that has seen reputations tarnished by accounting problems, stock market losses and controversy over internet access issues.

Our communities will benefit and the goodwill will be returned many times over.

Joe Natale cited Margaret Mead in his introductory remarks: “A small group of thoughtful people could change the world. Indeed, it’s the only thing that ever has.”

At the cocktail reception at The Canadian Telecom Summit on Monday June 12, we will be featuring a silent auction to benefit the alliance of Big Brothers / Big Sisters and Boys & Girls Clubs of Canada. It’s got a high tech twist to it – bidding will done by SMS text messaging using a software application being developed just for this event.

TELUS’ launch on Tuesday evening was a good reminder for all of us. You do the right thing, because it’s the right thing to do.

VoIP Regulation 2.0

Jeff Pulver has been a major driver of VoIP promotion with a vertically integrated marketing machine and a global-scale vision. For this, it is understandable why he is sought after to participate on so many advisory boards.

However, given the reaction by some writers in the blogosphere, I think folks need a little bit better perspective on the Cabinet decision to send the CRTC’s VoIP Decision back for reconsideration.

Jon Arnold suggests that in 2004, Jeff told the CRTC to let market forces rule in order to drive ‘a highly competitive, innovative market, that in turn [would lead to] driving rapid adoption of VoIP.‘ If that is what Jeff was suggesting, it did not come across clearly, and it ironically seems to be in contrast to his current drive to have market forces set aside in order to have government regulation ‘Save the Internet’.

My reading of the pulver.com written submission to the original VoIP proceeding found that it cited two core principles:

  1. do not regulate unless necessary; and,
  2. ensure that no entity can leverage its market power to stifle choice and innovation.

Good principles. Bell would agree with these. Certainly the authors of the TPR report would agree. I think that even the CRTC agrees with those general views. The submission pulled out the big guns, stating that NAFTA obligates Parties (read that as ‘Canada’) to ensure that incumbents don’t wield their

monopoly position to engage in anti-competitive conduct… such conduct may include cross subsidization, predatory conduct and the discriminatory provision of access to public telecommunications transport networks or services.

In other words, the CRTC’s original VoIP Decision agreed with Jeff’s original filing. The incumbents were subjected to regulation in order to ensure that they didn’t use their market power to do all the things pulver.com’s submission was worried about. Which is it? Did cabinet side with Jeff or did Jeff side with the Commission? The submission was not really clear.

As Jon mentioned, Pulver’s oral testimony was not well received by the Commission:

Your written brief and your oral presentation had a rather high level of generality and to say possibly at a generic level and they don’t touch the ground of our public notice at very many points on this specific issue.

Jeff was asked if he was ‘familiar with our current sort of regulatory framework in terms of how we regulate… our broad approach to regulation of local competition?‘ Jeff’s reply?

It was suggested to me that you regulate based on other peoples’ reactions, you ask them to come into a situation and react, so you are reactive rather than proactive.

Yep. That’s Canadian regulation. Barely a step above good ol’ boy, ‘Smokey and the Bandit’ style justice. Up here in Canada, we just regulate based on which ways the howling winds are blowing, eh? Throw the combatants into an arena and see who yells the loudest. Hmmmm. And you were wondering why he might have felt a bit of a chill?

Jeff was not ‘the lone American invited to come up‘ to the CRTC’s 2004 VoIP hearings. Actually, like everyone else at those (and most) hearings, he asked the CRTC if he could speak, not the other way around. AT&T; and Vonage were also American speakers at the hearings, bringing global perspectives and similar ‘hands-off’ messages.

A suggestion for Voice 2.0 advocates wanting to have their viewpoints heard: as painful as it may be, you will need to remember that regulation needs to be backward compatible – covering all the legacy services as well as those pesky social issues.

My proposal was in one of my weekend postings. The CRTC needs an answer by Labour Day. If you had a magic wand – how would you help the CRTC craft a response to the Minister?

Revenge of the nerds

Sunday’s Toronto Star had a front page feature describing software called Psiphon, from the so-called Citizen Lab at University of Toronto. The software is designed, in theory, to help people in oppressive regimes circumvent national restrictions on free access to content by more easily offering proxy servers on the outside.

It is an interesting piece of ‘hack’-tivism. Not really news (the Globe and Mail carried a story about Psiphon in February). In some ways, I suppose that the intent of the software is a modern day equivalent of Radio Free Europe – spreading the word of democracy by opening up communications.

I’d like to look at an unintended consequences of this initiatives. Will Psiphon help spread child exploitation images? Do folks at the Citizen Lab believe that images of children should also be free of any restrictions in their transmittal on the internet or does the Citizen Lab agree with the concept that freedom to communicate can have some restrictions?

Michael Geist is quoted in the Star article saying “There are international instruments that override even sovereign governments, such as the Universal Declaration of Human Rights.” Let’s not forget there are also international instruments that restrict freedoms, such as the Convention on Rights of the Child statements on child exploitation images.

As a father of young children, perhaps the director of the Citizen Lab, Ronald Deibert will turn some attention to the issue of reasonable limits on internet freedoms.

Illegal Content on the Internet isn’t clearly defined. We’ll be examining the issue in a special session at The Canadian Telecom Summit next month.

Piling on

Other than the post office, is there another government institution that consistently attracts such public attention as the CRTC? In fact, only the Toronto Maple Leafs are subjected to more arm-chair coaching, although the Leafs are far more likely to benefit from wisdom-juice inspired commentary.

As many readers know, I have not always agreed with the CRTC’s outcomes, but it is unfair to characterize the decisions with the type of mean-spirited attacks that have become popular by some of the harshest critics. In particular, it doesn’t help the debate to be name-calling in refering to decisions as coming from “illiterates” and I think it is naive to believe that “it is impractical to regulate Internet-based services.”

Internet-based services can be regulated and should be regulated, where the public interested is best served by doing so.

It is far too easy to dismiss the fact that considerable thought and analysis goes into CRTC decisions. The Commission has operated without the kind of policy direction from the Government that is called for in the new post-TPR environment; in the meantime, the CRTC has adopted a policy of supporting choice as means to achieve the greatest consumer benefits.

The cabinet direction to the CRTC for a review of the VoIP decision is a signal that we are going to see changes – and likely a signal that many of the TPR recommendations for structural changes are coming soon. We’ll be listening to the Minister provide the direction at The Canadian Telecom Summit next month. Until then, go ahead and be critical. Complain, moan and whine.

But remember, there are at least 3 sides to every issue in front of the CRTC. It is pretty rare that the right answer is as obvious as some of the partison commentators would have you believe.

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