As the year winds down, I was checking my scorecard to see how well we did against the year’s objectives.
In early January, in my look at the year ahead, I said these items topped my telecom agenda:
- Driving universal broadband adoption
- Online harms
- Regulatory overreach
- Mandated wholesale access
- Impacts of investment on coverage and resilience
- Digital literacy
How did we do?
Driving universal broadband adoption
Universal broadband adoption is turning out to be one of those “evergreeen” items. There are two sides: supply; and, demand. Most activity focuses on the supply side, ensuring the availability of broadband wherever people are, at home or on the road. Solving the supply problem is relatively easy. It reduces to an engineering and project management problem. Given sufficient financial, human and technology resources, we know how to deliver broadband. Demand is a tougher problem. It isn’t a matter of building it and everyone will join the party. Driving universal broadband demand means understanding all of the factors that contribute to resistance to get online. Stimulating the demand side of the adoption equation requires developing an understanding of the human factors resisting getting online, factors that don’t necessarily correspond to logic. This ties to the Digital Literacy bullet on the agenda as well.
Online harms
Canada’s Online Harms Act has been introduced, but it is stalled at second reading and has not yet been sent for committee study. It is at risk of dying on the Order Paper due to the Conservative filibuster over the $400M Sustainable Development Technology Canada scandal.
Regulatory overreach
I recently wrote about regulatory overreach because of the abusive process being used by the CRTC to pressure service providers. I also expressed concerns about elements of the CRTC’s strategic plan. The Commission is unable to release decisions in a timely way to the point that it will have to relax its grip on the industry.
However, as discussed in the next section, the CRTC is hardly an “independent” regulatory body, with so much of its workload being determined by Parliamentary actions and Ministerial references. Government is just as much to blame. I find it ridiculous that a Private Member’s Bill was able to amend the Telecom Act to have a permanent reference to last week’s CRTC public notice on internet nutrition labels. From the First Reading in June 2022, through Royal Assent in late June of this year, no one had the courage to publicly state that this didn’t need legislation.
Telecommunications is a sector that requires billions of dollars in annual investment – investment that abhors regulatory uncertainty. At some point, we need greater push back from the CRTC, and more knowledgeable parliamentarians and policy advisors, or we will continue to be mired in delays driven by consultative processes.
Mandated wholesale access
A post by my colleague Ted Woodhead displays optimism about improved balance in the CRTC’s interim wholesale fibre rates decision, released October 25. We’ll continue to watch that file. How will the final rates impact investment? But shortly after that decision was released, on November 6, Cabinet sent an earlier wholesale fibre decision back to the Commission for “review”. As I asked in my post “Tangled up in red”, didn’t the CRTC’s October rates order explicitly address the issues raised by the Cabinet reconsideration directive?
A few weeks ago, the CRTC announced the launch of 3 consultations “on making it easier for Canadians to choose the best Internet and cellphone plans”. CRTC 2024-293 (Enhancing customer notification), CRTC 2024-294 (Removing barriers to switching plans), and CRTC 2024-295 (Enhancing self service mechanisms) all have deadlines for submissions of January 9, 2025 with replies due January 24. For me, the risk of customer confusion arising from self-service mechanisms creates my greatest concern.
These consultations arose from a Parliamentary direction, in this case, changes to the Telecom Act introduced as part of the Budget Implementation Act. The Telecom Act changes were just two pages out of the 686 page Act, which provides a clue as to the depth of review (or lack thereof) that was applied to the legislation.
Keep in mind, the CRTC’s Wireless Code has been around since 2013, and modified in 2017. The Internet Code has been in force for nearly 5 years. These Codes were created following extensive consultations. Will the CRTC be able to find effective ways to work around the government’s naively constructed amendments to the legislation, using a short 6-week process?
That same week, there was a fourth notice of consultation in response to political activity as the CRTC sought comments on the Cabinet instruction to reconsider the Commission’s wholesale fibre decision. For years, telecom policy reviews have called for less political interference in the workings of the CRTC. Indeed, the objectives set out in the Telecom Act call for “increased reliance on market forces for the provision of telecommunications services and to ensure that regulation, where required, is efficient and effective”. This will be a subject worth examining in greater detail, especially as we head into an election in the coming year.
Impacts of investment on coverage and resilience
Checking my scorecard, I am reminded that I wrote about how easy it can be for regulators and policy makers to lose focus, to lose sight of the prize. The CRTC had just released its “Competition in Canada’s Internet service markets” decision which opens saying “The Commission is taking action to ensure that Canadians benefit from affordable access to high-quality Internet services.” The CRTC said the right things in that regulatory policy decision:
- In setting out its regulatory framework, the Commission seeks to create opportunities for innovative competitors to differentiate themselves and bring new choices to consumers. Importantly, this is not the same as guaranteeing that one type of competitor can profitably compete without risk. In respect of wholesale HSA services, the Commission enables wholesale access at just and reasonable, cost-based rates. It is then up to competitors to find commercial strategies that deliver an attractive value proposition that responds to consumers’ needs.
As I wrote, we often lose sight of the prize. The wholesale framework is a means to an end, not an end in and of itself. It isn’t the role of the regulator to preserve the independent wholesale-based competitive ISP industry. We don’t guarantee “one type of competitor can profitably compete without risk.” This theme – and its impact on investment – is certain to continue playing a prominent role next year.
Digital literacy
Two weeks ago, I discussed the new analysis of Statistics Canada data on technology adoption. That report says “targeted solutions, including measures to improve digital literacy and skills, especially among older adults, would appear to be more logical and efficient than broader, more disruptive, industry structural changes.” Targeted measures to improve digital literacy and skills would require investment in training – an investment in people. Such investments are much harder work than building broadband access. Investing in digital literacy doesn’t create the same kind of photo op as an investment in infrastructure, but it is just as important. This item will once again be carried forward.
Looking ahead
Checking my scorecard from last year helps me prepare an agenda for 2025. What else would you like to see added to the Canadian telecom policy agenda?