Are broadband subsidies ever finite?

A recent CBC story about PEI caught my eye: “Province issues RFP for high-speed internet in rural areas”. The province has launched a new Request for Proposals [RFP pdf, 655KB], seeking “Expansion of Broadband Internet Services across PEI”.

The vision and objective of this RFP is to enhance broadband internet services in underserved areas of the Province. The initiative is intended to address the telecommunication infrastructure gaps that still exist across PEI.

According to the RFP, approximately 31,000 civic addresses are considered to be underserved. The RFP hopes to attract proposals that will improve “access to broadband internet services at speeds up to 50 Mbps for downloads and 10 Mbps for uploads”, clearly aiming at the CRTC’s broadband service objective. It is worth noting that the CBC article incorrectly refers to the CRTC targets as being “mandated”.

How will this new PEI project be paid for?

The funding support models are still under consideration, but will likely involve some award component to build out the delivery network with sufficient capacity, reliability, and scalability to fulfil the RFP objectives… Federal Government funding support has also been explored and may become a component. The [Government of] PEI has advised that the proposed solutions may not move forward without federal funding approvals.

Ten years ago, I wrote a piece (“PEI leads horses”) about the PEI government entering into a contract to make the province the first to have broadband internet service available to 100% of its residents.

At the time, I observed:

Here is the real rub. Despite having some of the highest levels of access to broadband internet, PEI has the lowest adoption of service at only 43%. Well under half the people who could have broadband internet are finding it worth paying for.

Policy makers need to look beyond the raw numbers of people who have access to DSL or cable-based broadband. We need to be concerned about the affordability of service to lower income Canadians regardless of where they live.

PEI doesn’t have as much of a problem with broadband access as it has with broadband adoption.

Since that time, broadband service adoption has nearly doubled, reported to be 83% in 2016, according to last year’s CRTC Communications Monitoring Report, moving the province into the middle of the pack, ahead of Saskatchewan, Manitoba, Quebec and Nova Scotia.

Ten years ago, I suggested “PEI may end up being a great case study of how our current approach to broadband access is leading citizens to the fountain without helping them find it worth taking a drink.”

The latest RFP might provide inspiration for development of another study: How many times will governments be called upon to subsidize broadband access projects for the same region?

Are broadband subsidies ever finite?

Americans and Canadians both want 5G, but policy is lagging

The follow piece appeared in RCR Wireless.

Most often, we read of differences between the United States and Canada, but in one area, the people of both nations agree: neither country can get enough of mobile wireless services. Consumers devour more mobile wireless data each year, and mobile operators beg the government to release more spectrum and to streamline rollout requirements.

Moreover, the US and Canada are interdependent internet economies. The US Department of Commerce reports that trade in communications technology (ICT) services and “potentially” ICT-enabled (PICTE) services is booming. U.S. PICTE services exports to Canada totaled $27.8 billion, or 52 percent of all U.S. services exports to Canada and 7 percent of total. The United States imported $13.9 billion in PICTE services from Canada, equal to 46 percent of all services imports from Canada and 6 percent of total PICTE services imports. This digital economy is vital to tech workers on both sides of the border. With so much being at stake in both countries—billions of dollars in revenue and millions of jobs—it boggles the mind why telecom regulators are dragging their feet on spectrum.

The 5G Journey was a key theme of this year’s Canadian Telecom Summit. 5G, the next generation mobile network standard, is expected to have ultra-low latency and a download speed of 20 gigabits (GB) per second. That’s 20 times faster than the current 4G download speed of 1 GB per second. But unlike 4G, where humans mainly drove adoption, it will be IoT devices and massive machine-type communications (mMTC) like smart meters that will likely benefit most from the data-bandwidth and latency improvements that 5G communications offers. Software talking to software will drive usage of the 5G network and that will forever change what services are delivered. “With 5G we are talking about completely new business models being created. The real excitement about 5G is how people will innovate on it. The rollout of 5G will unleash a real-time economy. For the first time we can provide on-demand service based on the value of that transaction to the user,” said Alexander Brock of Rogers Communications, a Canadian cable-wireless-content conglomerate.

5G will power self-driving cars but government is taking the slow lane when it comes to releasing spectrum. There is no need to prove the value of spectrum or to prove the need to lessen its scarcity. Canada’s 2014 auction of 700 MHz brought in nearly $5.3 billion, and the 2015 sale of AWS-3 spectrum brought in $2.1 billion. Since commercial spectrum auctions began in the 1990s, the US has earned more than $100 billion on licensing the airwaves. While it is good news that the US has teed up a rulemaking for mid-band spectrum, it is a long time in coming. Canada is slowly moving toward a 3.5GHz spectrum auction planned for the year 2020.

In Canada, Rogers, Telus, Shaw and Bell are in the trial stage of 5G. In the US, Verizon and AT&T are on track to have 5G networks up and running in a handful of cities by the end of 2018. T-Mobile has promised that if it can buy Sprint, it will also be in the running. However, the US is behind China and South Korea and needs to move quickly to catch up.

In addition to spectrum, both countries struggle with optimizing the framework for rollout on the ground. Compared to Japan, South Korea, and the European Union, both the US and Canada have low population density, meaning that it costs more for service providers to roll out 5G compared to other developed countries. There is a tendency for cities to hoard wireless resources, leaving little for the vast rural areas. City leaders often demand usurious prices to access city infrastructure, such as street poles and other vertical real estate which are otherwise used for city signage and lighting. Onerous processes often delay construction of new antenna sites.

5G also levels the playing field between networks in that wireless becomes a substitute for wireline technologies. Just as fibre, coax, and cable networks deliver massive amounts of data under the ground, 5G networks delivers data through the air at similarly competitive speeds. The increasing availability of wireless technologies will pressure the prices of wireline broadband. “Competition will drive 5G in Canada. We need the government to get spectrum in the hands of carriers as soon as possible so we can go after each other,” added Brian O’Shaughnessy, SVP and CTO of Converged Networks at Shaw Communications.

Whereas 4G enabled content and service delivery largely from Silicon Valley, 5G will expand the pie to non-traditional business partnerships and new industries, incorporating new actors and businesses, and enabling new sources of jobs and revenue

With 5G, the economies of the US and Canada can become even more integrated.

Back to school specials

It is that time of year again.

Staples got in trouble a few years ago when it ran ‘back-to-school commercials with Andy Williams’ version of the Christmas season song “It’s the Most Wonderful Time of the Year” as the background music.

It isn’t just stationers who love the season; all kinds of stores appear to be running specials that target the student market. Just last night, I saw ads offering to deliver mattresses to almost any college campus community.

It is a big season for the communications sector as well. Students are getting internet packages and new mobile phone plans and there are lots of deals to be had from the carriers and independent retailers. It is a good time for everyone to shop around. Many of the deals will provide value to any family, especially those who haven’t looked at updating their communications services in a while.

Parents and students alike should take the opportunity to see what deals are available for wireless and wireline services: voice, data and TV. Most of the plans are available to anyone – you don’t have to be a student to save.

If you have young ones getting their first connections, look for tips to keep them safe online. A few years ago, I wrote 10 tips for back-to-school online safety, with a checklist from the TELUS Wise program. That is a good place to start.

Still, it is important to remember that there are still lots of families that can’t afford to get their kids online at prices that most of us consider acceptable. The national Connecting Families program, with its $10 per month broadband service for low income households with school children (announced at The 2018 Canadian Telecom Summit in June) has not yet been rolled out by all of the participating service providers. This will hopefully be fixed later this fall. Many low income families in TELUS and Rogers territories have access to programs previously announced by those companies, but unfortunately, some kids will be starting school in September unequipped to deal with a digital homework gap.

Personally, I have always hated the end of summer. As a kid, I loved summer vacation and the feeling is even stronger today when I have been able to share so much of my summertime with little visitors. Back to school means they head back home to start their own school year. Thankfully, communications technology makes it so much easier to stay in touch, with daily trans-oceanic video chats to bridge the distance.

Enjoy the last few weeks of summer. I am going to be focused on close encounters of a non-electronic kind, enjoying every minute before my visitors fly home to head back to school. For me, these last two weeks are certain to be more special than any of the savings being offered.

Participating in a responsible way

The CRTC’s rules of practice and procedure include a process for awarding costs to public interest groups in order to encourage participation in its various public proceedings. The cost awards can sometimes be quite substantial; there are examples of awards frequently in the order of tens of thousands of dollars and sometimes even higher.

According to the CRTC, “The Commission considers that costs awards are intended to encourage the participation of individuals and groups who represent subscriber interests, rather than private interests.”

Further, “when assessing costs applications, the Commission considers whether a costs applicant has participated in the proceeding in a responsible way and contributed to a better understanding of the matters considered by the Commission.”

A recent article by David C. Lowery on The Trichordist blog raises questions about whether Open Media is indeed a grass-roots consumer focused organization or representing private interests as a “Google funded astroturf group“?

In a recent article on Rabble.ca, Open Media encourages readers to use an online tool to call ISED Minister Bains with the goal that “his office will be flooded” with thousands of calls. Is this consistent with participating in a proceeding in a responsible way?

Last year, an Open Media advocacy training presentation on how to frame issues stated “Morals, values, and identity will always defeat facts, reason, logic, and self-interest”.

Is this consistent with contributing to a better understanding of issues?

Quite a week for broadband expansion

It has been a busy week for broadband expansion in rural and remote regions of Canada.

On Monday, as I wrote earlier this week, Teksavvy announced its plans to build fibre to 38,000 homes and businesses in the Municipality of Chatham-Kent in Southwestern Ontario.

Later that same day, Telesat announced the successful launch of Telstar 19 VANTAGE, a high throughput satellite (HTS) that will provide Northwestel with the HTS spot beam capacity needed to improve broadband connectivity for all 25 communities in Nunavut.

Earlier today, SaskTel annpounced that it has expanded internet service to the resort community of Waskesiu Lake.

And closing off the day, ISED and Xplornet announced a $36M project to provide up to 100Mbps wireless broadband service to 35,000 homes in 21 communities in Eastern Ontario. The planned build out is reported to include 480km of new fibre optic facilities, as backbone connections to towers that will be “using 3500 MHz spectrum to bring 5G-ready Internet technology, with download speeds of up to 100 Mbps.”

From north to south, using fibre, wireless and satellite, it has been an interesting week for investment in broadband service expansion in rural and remote communities in Canada. Delivering broadband services in Canada’s diverse geography requires a variety of technology and economic solutions. The four major projects announced this week demonstrate some of the creative ways service providers are getting more Canadians connected.

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