How will the CRTC respond to evidence that its regulatory hypothesis is failing?
Recall, two months ago I wrote about CRTC Vice Chair Adam Scott speaking at a Scotiabank investor conference, where
We go through proceedings to crystallize issues and identify the strategically important outcomes that our decisions need to promote. And then we take the evidence on the record and use it to form a regulatory hypothesis—that by taking a certain course, we will see a certain type of outcome.
His address stated “we understand that advancing consumer interests also means supporting investment: in high quality services, resilient networks, excellent customer service, and all the other elements required of a strong telecommunications service provider.”
When the CRTC finalized its wholesale fibre to the home rates a few weeks ago, the final lines of its media release stated: “The CRTC will also closely track industry progress in investing to connect more Canadians to high-speed Internet and other communications services. In doing so, the CRTC will follow the evidence and act quickly to adjust its approach if necessary.”
What if the evidence is already showing that the current regulatory framework isn’t supporting investment? We started seeing signs that investment was beginning to decline when the CRTC released its annual monitoring report, showing an industry-wide drop of 10% between 2022 and 2024.
In the government’s Spring Economic Update [pdf, 8.2MB], the government’s headline Sovereign Wealth Fund includes “Leading Canadian companies will help build our energy, transportation and telecommunications infrastructure and future economy.”
However, Canada’s leading telecommunications companies are announcing dramatic reductions in their plans for investment in infrastructure.
A few weeks ago, we saw further evidence when Rogers cut its capital guidance by 30% for 2026, with strong statements issued by the company Chair and by its CEO at the 2026 Annual General Meeting. CEO Tony Staffieri said:
We operate in a capital-intensive sector, a sector that requires long-term investment cycles and regulatory policy that supports them.
Yet, at every turn, we face changing regulatory decisions that undermine investment – decisions that increase costs, reduce revenue, and create market uncertainty.
Decisions that reinforce an uneven playing field, and don’t reflect smart, modern regulation that ensures companies like Rogers can compete fairly and equitably.
As we look to the next few years, we have sharpened our strategy to reflect these market realities.
Executive Chair Edward Rogers said:
companies like Rogers need a modern regulatory regime that rewards investment and ensures fair and equitable competition. The opposite is happening today. The current approach is antiquated and creates an uneven playing field. It makes it hard for companies to plan, build, and invest long term.
This is a capital-intensive business with a long horizon for a return. We do not think in terms of months, or a few years, but in the next 5,10 to 20 years.
Regulatory certainty and stability matters.
Today’s telecom markets have never been more competitive, but we have also never been more regulated.
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Rules that penalize innovation and investment in Canada have never worked and will never work. Investment slows, jobs are lost, network quality and innovation suffer.
Rogers has since announced significant job cuts.
Bell’s first quarter 2026 results reflect reduced capital spending on Canadian telecom; the company’s guidance for 2026 forecasts a shift in capital spending toward investments in AI data centres, not in its core telecom infrastructure. As Bell CEO Mirko Bibic stated during the first quarter investor call, Bell will “focus capital investment on higher return opportunities.” He noted that capital expenditures have fallen from $5.1B in 2022 to less than $3B in 2026 and said that Canadian telecom investment will continue to decline given the current environment.
Whether or not it’s the kind of more kind of micro rules that are coming out, wireless that you refer to, or the bigger kind of more policy oriented fundamental rules like fiber access, put all those together, and clearly it’s having an impact on investment in the industry.
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If you just look at the capital investments over that short period of time in our industry on an annual basis, there’s literally multiple billions of dollars of annual CapEx that are no longer being invested.
Last week, 2026 investor guidance pointed to a 10% forecasted reduction in capital spending by TELUS.
Together, we have seen capital investment reduced by more than $3B annually. Yes, annually.
Prime Minister Carney recently announced an investment summit. “At a time of unprecedented trade disruption, our bold mission to unlock $1 trillion in new capital will create growth, good jobs, and long-term prosperity for Canadians.”
Commenting on the current regulatory environment, in February, Scotiabank asked, “wouldn’t it make more sense for incumbents to materially reduce capex”? A few weeks ago, when the CRTC issued its decision setting final rates for fibre-to-the-premises, various financial analysts assessed the impact of the rates when compared to the interim rates. Bank of America Global Research wrote, “More concerning is the recent steps the CRTC is taking to force changes in fees the providers can charge. The CRTC is adept at finding new areas to dictate how the providers can operate in the market.”
When he addressed the Scotia investor conference, CRTC Vice Chair Scott said “A good regulator, like a good builder, will adjust to conditions on the ground. We will need to, and are in fact required to, actively gather the evidence that will inform us as we go.”
It is worth repeating what I stated a few weeks ago: The regulatory environment doesn’t just shape competition — it shapes the network Canadians will have a decade from now.
The conditions on the ground are showing that the regulatory framework is failing to support investment, let alone incentivize investment. The CRTC typically moves at speeds that could be described as a somewhat glacial velocity (the final wholesale fibre rates decision followed a decade of CRTC processes).
The editorial in yesterday’s Globe and Mail called for “Ottawa to remove the obstacles that currently deter companies from investing in this country.”
When will the CRTC take a fresh look at how its regulatory hypothesis is impacting capital investment?