Regulatory consistency

Earlier this week, FCC Chair Ajit Pai spoke about the massive levels of investment required to deploy next generation 5G mobile service in his address at the Mobile World Congress:

5G could transform the wireless world. And when you add the potential of new satellite and fixed broadband technologies, as well as further innovation in 4G LTE, we stand on the cusp of exciting advances that will bring unparalleled choice and competition to consumers.

But it’s not a forgone conclusion that we will fully realize this technological potential. After all, building, maintaining, and upgrading broadband networks is expensive. And our 5G future will require a lot of infrastructure, given the “densification” of 5G networks. In my country alone, operators will have to deploy millions of small cells, and many more miles of fiber and other connections to carry all this traffic. Doing all this will command massive capital expenditures.

Chairman Pai said that such spending is best incentivized with light-touch regulation.

Today, the CRTC issued two decisions on mobile wholesale that align with this thinking. In its decision affirming the Final terms and conditions for wholesale mobile wireless roaming service tariffs, the CRTC affirmed that would not mandate wholesale services required to create an MVNO – a mobile virtual network operator – and it clarified that it would not “permit mandated wholesale roaming to be used as a means to obtain permanent access to the incumbents’ networks.” As such, the CRTC has ordered Ice Wireless to stop its MVNO, Sugar Mobile from what it calls “permanent roaming”, since that would be inconsistent with the wholesale wireless regulatory framework that was established in 2015.

In an interview with the press, I wouldn’t pick winners and losers from these CRTC decisions. Instead, I said that maintaining such regulatory consistency is an important incentive for encouraging carriers to continue to invest billions of dollars in digital infrastructure.