According to the Montreal Economic Institute (MEI), the CRTC has outlived its usefulness.

“Since Canada has successfully transitioned from monopoly to competition, there is a case to be made that the CRTC should be phased out as Canada’s telecommunications regulator.” That is one of the conclusions of the 5th annual edition of “The State of Competition in Canada’s Telecommunications Industry,” released today by MEI [pdf]. Instead of a sector specific regulator, the report says oversight of the telecommunications industry could move to a more general regulatory framework under competition law.

The report also contends that, despite what it calls “simplistic and misleading” comparisons, Canadian wireless prices are competitive.

“The average bill that Canadians pay for their wireless and internet services keeps increasing not because they have to pay more for the same services, but because they are paying more for more and better services.” The MEI report cites numerous international metrics that Canada has some of the highest quality wireless networks in the world, and comparisons of prices rarely account for service quality.

According to the report, “Wireless carriers in Canada invested on average US$78 per connection between 2010 and 2016, almost twice as much as their European counterparts, which only invested $40.”

Looking at the regulatory framework, the report observes, “The main concrete difference so far between the FCC’s and the CRTC’s approaches to net neutrality has been the steadfast opposition of the Canadian regulator to zero-rating. … In banning innovative and pro-competitive targeted pricing plans, the CRTC has not protected the integrity of the internet; rather, it has raised prices for certain consumers and lowered prices for no one.” This is a familiar refrain to my readers for whom I have made the same observation over the years.

A little over a week ago, I asked on Twitter “What if #CRTC had given market forces a chance to work?”

MEI points out the irony of the CRTC, having an agenda of increasing competition in Canada’s wireless marketplace, ended up banning an innovative pricing plan from a new entrant (Videotron). According to MEI, that ultimately hurts Canadian consumers. Similarly, the report takes aim at the CRTC’s overly prescriptive Wireless Code as having “reduced consumer choice and limited the ability of carriers to develop innovative customer offerings.”

In this instance — as in many others — Canadians would have been better off if the CRTC had relied on market forces instead of attempting to manage the competitive process.

The report points to the December 2017 wireless price war sparked by Freedom Mobile’s $50 per month 10GB plan as evidence of the market’s competitiveness. Quoting the 12-year old report of the Telecom Policy Review Panel (TPRP), MEI says “the Canadian telecommunications industry has evolved to the point where market forces can largely be relied on to achieve economic and social benefits for Canadians, and where detailed, prescriptive regulation is no longer needed in many areas.”

It has been more than 12 years since the TPRP’s report was issued and, as discussed above, the CRTC has shown few signs of restraint in its approach to telecommunications regulation. While it has abandoned its prior focus on retail regulation, it has also expanded mandatory network access schemes, created policies that dull incentives to invest, and rewarded product imitators instead of product innovators. If maintained, these policies are bound to hurt Canadian consumers in the long run.

…

Although dismantling Canada’s telecommunications regulator might meet with stiff opposition from partisans of continued heavy-handed regulation, it would be of net benefit to Canadian consumers and to Canada’s economy. The CRTC—while a necessary actor in Canada’s telecommunications landscape during the transition from monopoly to competition—has outlived its usefulness.

No doubt, the assertions made in the MEI report will feature prominently in the Regulatory Blockbuster at The 2018 Canadian Telecom Summit, taking place June 4 – 6 in Toronto. The Regulatory Blockbuster will feature leading advocates from Bell, TELUS, Rogers, Teksavvy and Ice Wireless.

Have you registered yet?

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[Update: May 8, 11:50am] The MEI report author has an opinion piece on the Financial Post website, entitled “The CRTC should celebrate its 50th birthday by giving up telecom regulations entirely” with the caption “Martin Masse: You may be wondering why exactly we still need a dedicated telecommunications regulator. We don’t”.

Can communications services providers succeed in a cloud economy?

VMware’s VP Global Market Development for its Telco Business Group, Honoré LaBourdette, will be speaking at The 2018 Canadian Telecom Summit on Tuesday morning, June 5.

Her talk plans to explore “Telco Success in the Cloud Economy.”

With the imminent arrival of 5G, with its inherently low latency, communications services providers have an opportunity to provide some innovative value-added services. These services will be build upon a foundation of next generation platforms, combining Network function virtualization (NFV) and software-defined networks (SDN), and cloud-based platforms, which could include public, private and telco clouds. These combined technologies will enable service providers to create dynamic, hybrid IT environments, allowing the service provider to move beyond just providing connectivity to becoming strategic partners for vertically based applications like digital health, connected cars, smart cities, industrial IoT and more.

Her presentation will discuss how service providers can learn how to become dominant players in this new cloud economy. Through its Virtual Cloud Network architecture, VMware enables communications services providers to have a single infrastructure for public, private and telco cloud networks with end-to-end consistency and built-in security from data center to network to edge.

Honoré LaBourdette is one of more than 50 industry leaders speaking at The 2018 Canadian Telecom Summit, June 4 – 6, in Toronto.

Have you registered yet?

It likely comes as no surprise that phone bills and TV bills are bloated by fees to cover government programs.

Your phone bill subsidizes rural and remote communications services and access to emergency services. Your TV bill not only includes subsidies for Canadian content production, but also includes mandatory monthly fees for channels most of us never watch. And even though many of us tune into the Weather Network once in a while, most people likely have no idea that the monthly fee for that channel also covers the cost of operating the National Public Alert Distribution system.

Think about that for a minute as Canadians prepare to see the first test messages show up on our phones. The cost of distributing alerts to mobile phones is being borne by people who subscribe to cable TV.

The CRTC is currently reviewing the stations that qualify for 9(1)(h) “must carry” status. The term “9(1)(h)” refers to the section of the Broadcast Act:

8. require any licensee who is authorized to carry on a distribution undertaking to carry, on such terms and conditions as the Commission deems appropriate, programming services specified by the Commission.

I was struck by the presentations from a number of these stations, such as TV5 and APTN, that their programming is providing an important public service. It is understandable why these stations should be available on every broadcast distribution system in order to ensure availability of their programming to minority groups across the country. However, the issue in my mind is how these channels are funded.

In addition to any advertising revenue the stations may sell, every subscriber to a broadcast distribution system (cable or IPTV or satellite) pays a monthly fee whether they want those stations or not. Essentially, take the forecast for the revenue shortfall, divide by the forecast for TV subscribers and the result is what each subscriber is being asked to pay.

A visit to the websites of TV5 and APTN shows that much of the broadcast programming is available for streaming access, with no requirement to verify the viewer as being a subscriber to a contributing TV system. So people who have cut the cord, or never subscribed to a TV service have free access to a service paid for by TV subscribers.

There was a time when consumers had no choices. For most Canadians there was a phone company and there was a cable company. You could choose between a wall phone or a desk phone. You could choose whether you wanted add on features, like touch tone or call waiting or call display. There was no choice of service provider. TV offered very few options, effectively just different bundles of channels.

In those days, when consumers had no choice of service provider and there were no technology options, the telephone system and the TV system were able to be used as a secondary tax collection and wealth redistribution system. Want to subsidize the cost of phone service in rural and remote areas? Just tell the phone companies to charge more in the cities. Want to ensure there are minority language TV stations operating everywhere? Put a fee on everyone’s TV bill. Want to create a fund for Canadian content production? You get the picture.

The problem is that consumers now have alternatives, and not all of those alternatives are part of “the system”. Not all content providers contribute to production funds; Netflix is just the poster child for this area of imbalance. Every quarter, we read that more households have chosen to go without BDU TV service, opting to go online for their video content. So fewer and fewer households are in the denominator, from whom funds are being recovered, thereby raising the cost per household.

As the various fees increase, services that aren’t part of the system gain further cost advantages, accelerating the incentives for consumers to escape the system, and the cycle continues.

The most bizarre cross-subsidy is associated with the National Public Alert Distribution system, where TV subscribers bear the cost of the distribution of messages over the Wireless Public Alert service, by means of mandatory fees for carriage of the Weather Network.

Not only is there a mismatch between payers and the beneficiaries, but the fees are being applied in an imbalanced way to tax users of legacy services, accelerating cost advantages for subscribers to services that are outside of the system.

Is it time to reassess funding for the competitive age?

Last month, in Telecom Notice of Consultation CRTC 2018-105, the CRTC noted, “effective access to emergency services in Canada is critical to the health and safety of Canadians, and is an important part of ensuring that Canadians have access to a world-class communication system.”

Let’s pause for a brief history of emergency services and the communications industry.

Winnipeg was the first city in North America to have a central emergency access phone number. Back in 1959, Winnipeg used 9‑9‑9 for emergency access, a dialing code created in the UK in 1937 and still used by many countries. It turned out that 9‑1‑1 was chosen for North American implementation in the mid-1960’s and most areas of Canada saw emergency access service rolled out over the next 30 years.

Emergency services have slowly evolved as mobile networks began to generate a larger proportion of emergency calls. Enhanced 9‑1‑1 enabled mobile service providers to relay location information to the emergency services Public Safety Answering Points (PSAPs). Four years ago, the CRTC announced the initial launch of text messaging for 9‑1‑1 services for hearing or speech impaired persons. At the time, I wrote: “Regrettably, I am not convinced this is a service that truly meets the needs of the community it is intended to serve.” The user interface struck me as too complicated. I closed off that post with a question: “Should people need a training course and have to invest in new mobile handsets in order to make emergency calls?”

That blog post attracted more comments than any other in 2014, with a debate about my harsh reaction.

Since then, there have been two parallel development paths for emergency services:

• Emergency alerting, where notifications are sent from the network to users; and,
• Next Generation 9‑1‑1, the evolution of how users can reach emergency services.

In 2014, the CRTC required AM and FM radio stations and over-the-air TV stations to participate in a National Public Alerting System (NPAS). Earlier this month, all wireless service providers were required to participate in the NPAS and distribute emergency alerts on their LTE networks.

Now, telecommunications service providers are modernizing 9‑1‑1.

The advanced wireless networks operating in Canada include support of IP-based voice services, such as voice over WiFi (VoWiFi) and voice over LTE (VoLTE). Currently, calls using these technologies must convert 9‑1‑1 calls to legacy public switched telephone networks, losing multimedia capabilities that might otherwise be activated during the course of a communications session.

Moreover, legacy 9‑1‑1 networks can’t communicate with internet of things (IoT) devices, such as car airbag sensors. These legacy 9‑1‑1 systems can’t receive location information from VoWifi or nomadic VoIP calls (such as Skype), using an Internet Access Point, even if the device can use GPS to determine its location, or if the address of the Internet Access Point is known with certainty.

In Canada, the CRTC has mandated the implementation of next-generation 9‑1‑1 (NG9‑1‑1) networks based on the National Emergency Number Association (NENA) i3 architecture standard. This will enable Canadians to access new, enhanced, and innovative 9‑1‑1 services with IP-based capabilities. For example (and as noted by the Commission), Canadians could stream video from an emergency incident, send photos of accident damage or a fleeing suspect, or send personal medical information, including accessibility needs, which could greatly aid emergency responders.

This means that there needs to be a capability to transfer information from the caller, not only to the first emergency call taker, but also transmit this information down the line to first responders that have been dispatched to the scene.

The Commission mandated “an Incumbent Local Exchange Carrier (ILEC) stewardship model under Commission oversight”, such that the ILECs will be responsible for the construction, operation, and maintenance of the network and services that interconnect originating operator and access networks with PSAPs. All ILECs are required to establish their NG9‑1‑1 networks and to be ready to provide NG9‑1‑1 Voice service by 30 June 2020 wherever PSAPs have been established in a particular region. The Commission also directed mobile wireless service providers to provide Real Time Text (RTT) based NG9‑1‑1 Text Messaging by 31 December 2020.

On June 5, The 2018 Canadian Telecom Summit will feature a special panel looking at “The Evolution of Emergency Communications” with experts on wireless public alerting, next generation 9‑1‑1 as well as first responder networks, including the US FirstNet.

• Will NG9‑1‑1 networks and next generation core services mandated by the Commission meet the expectations of consumers?
• Does today’s model for funneling all calls in a large region to a central first answer point still make sense in an IP world?
• Will first responder networks integrate with these central first answer points in a more meaningful way?

Be sure to register now for The 2018 Canadian Telecom Summit, taking place June 4 – 6 in Toronto. Save $250 by registering before May 1.

Register now for The 2018 Canadian Telecom Summit!

Prices increase May 1.

The most influential leaders of the Canadian & International ICT industry will gather in Toronto from June 4-6 at The 2018 Canadian Telecom Summit.

Alone, any of our keynote speakers would be well worth listening to. The Canadian Telecom Summit brings a dozen keynote addresses – and more than 40 panelists – over 3 unmatched days of presentations, discussions, sharing ideas, forming new relationships, renewing existing ones and even deal making.

Now in its 17th year, The Canadian Telecom Summit has grown to become Canada’s most important annual telecommunications & IT event, attracting hundreds of attendees from around the world each year. No other event presents a complete picture of current and expected trends & developments.

No other event matches The 2018 Canadian Telecom Summit for the depth and breadth of topics covered and issues debated.

Come see why The Canadian Telecom Summit has become THE must-attend conference. With more opportunities than ever to learn, network and do business, if you are involved with or impacted by Canadian telecommunications, broadcasting or information technology, you need to be at The 2018 Canadian Telecom Summit.

Join your colleagues, competitors and customers for 3 days of spirited discussion and networking.

Register this week for The 2018 Canadian Telecom Summit and save $250.

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