Faulty facts lead to faulty conclusions

I don’t get it.

It has never been easier to do fact checking, but I guess a lot of people just don’t bother verifying statements, especially if the point supports their previous bias.

This morning, I saw a piece entitled “Canadian, UK telecom markets share same problem” where the author wrote “On the surface of it, the British and Canadian broadband markets are nothing alike.” In the interests of accuracy, he should have stopped there.

But he went didn’t, and he wound up concluding:

The result, just as it has been in the United Kingdom, is that little has changed. Prices for both wired internet and wireless services in Canada are just as high as they were a decade ago and nobody wants to bring up the only real solution: full structural separation.

Hold on. Maybe if you say it fast enough, it sounds reasonable but stop and think about it for a minute. “Prices for both wired internet and wireless services in Canada are just as high as they were a decade ago.” Uh, no they aren’t.

For example, let’s take a look at Rogers internet service. A 100/10 Mbps service from Rogers (Rogers Ignite 100u), with unlimited data, costs $65 per month, as you can find on “comparemyrates.ca“. Just a little more than 3 years ago, one would pay $68 for Rogers Extreme Internet, a 35/3Mbps service with 120GB of usage included. So, in just 3 years, we pay less for a service that is 3 times as fast and now includes unlimited data. In 2007, there was talk about Rogers launching “Hi-speed Elite” service, an 18Mbps service with 90GB of usage for $100 per month.

So, while the author claims that prices are just as high today as they were a decade ago, we can easily see that prices have fallen, and speeds have dramatically increased.

That same article claims that “Canada doesn’t fare much better at 7.9%” of broadband connections on fibre, comparing it to the UK at 2%. In fact, the source document for the 2% figure shows the British figure at 1.7% (taken to the same number of significant digits). The OECD spreadsheet [xls] used for the Canadian figure does not list the UK, saying “No fibre data is available.” Still, it is hard to see how any reasonable person would say that 7.9 isn’t much better than 1.7. Indeed, it is 350% better!

It isn’t that hard to get the facts right. Once again, we see a case of faulty facts leading to faulty conclusions.

How government can drive innovation

Governments aren’t generally known for innovation, but government policy greatly influences – both positively and negatively – the level of innovation in an economy.

An opinion piece by Jack Mintz in the Financial Post looks for the Federal Budget, due to be introduced in 2 weeks, to bring changes to create a more friendly investment climate.

Last year’s federal budget was strewn with anti-innovation policies, bringing back the failed tax credit for labour-sponsored venture corporations and bringing in higher taxes on business and entrepreneurs. If this year’s budget brings in higher capital gains taxes and more regulatory burdens and subsidies targeted at the wrong firms, all that talk of innovation will be empty. We won’t likely see it improve.

If we want more innovation, we’ll need to make Canada friendlier to investment, particularly in the face of the rising competitiveness of the U.S. under the Trump administration.

Instead, a more business-friendly environment for investment should be our aim in face of a new U.S. competitive environment now confronting Canada.

Setting the right climate influences not only whether innovation takes place, it influences where. Our policies need to encourage investment and growth inside Canada. As Mintz concludes, “If Morneau really wants more [innovation] in Canada, he should avoid trying to pick favourite sectors to treat with subsidies and spending and instead create a better environment for businesses to invest in new ideas.”

Innovation and innovation policy will figure prominently on the agenda for The 2017 Canadian Telecom Summit, taking place June 5-7 in Toronto.

Among other issues, panels and keynote speakers will examine what are the characteristics of a policy framework that fosters the development of a more innovative economy.

The conference agenda is taking shape. The brochure is continually being updated, or refer to the conference website for the most up-to-date list of speakers.

The Canadian Telecom Summit brings together the thought leaders and key influencers of the Canadian and global ICT industry.

Have you registered yet?

Potential to innovate

Canada has a ‘proven potential’ to innovate but struggles to turn it into economic might according to professor Dan Breznitz, co-director of the Innovation Policy Lab at University of Toronto’s Munk School of Global Affairs. In this role, he tracks how today’s economy rewards countries that carve out a unique role in the global supply of ideas, goods and services.

“Canada is primed for success, as long as we embrace the right innovation policies.” According to Breznitz, Canada has science policies, research policies and industrial policies that we call ‘innovation policies,’ but these are not truly innovation policies.

So, it’s not really surprising we are failing. We are horrible and for the last 13-15 years we have become worse and worse in terms of innovation and economic growth based on innovation.

What is disturbing about this is that at the same time, we actually became better and better in terms of proven potential to innovate and invent. We are punching way above our weight in scientific research, especially useful scientific research leading to new drugs and new technology that foreign companies and foreign economies are making a lot of money on. You’ll find a lot [of that research] was Canadian.

Innovation policies, even successful ones, take a long time to really change the landscape. So, what will come out of Canada’s innovation policy consultation? “What will actually be implemented rather than just announced?”

According to Breznitz, the policies must become institutionalized, otherwise, we’ll slide right back after the next election.

Dan Breznitz will be a featured speaker at The 2017 Canadian Telecom Summit, taking place June 5-7 in Toronto. Have you registered yet?

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.

The inclusive internet

This morning, the Economist Intelligence Unit released a report on The Inclusive Internet, an index ranking 75 countries according to performance in four categories: Availability, Affordability, Relevance and Readiness.

The study was commissioned by Facebook’s Internet.org. A report accompanying the index is said to offer “guidance for policy makers on boosting internet inclusion in their countries. These include encouraging investment in fixed infrastructure, providing teacher training in digital skills, and involving men in discussions around female internet use to tackle negative cultural attitudes.”

Perhaps most surprising was that Canada ranked number one in the world for Affordability, an indicator that examines the cost of access relative to income and the level of competition in the Internet marketplace. “Price measures the cost of Internet access relative to income. Competitive environment measures the concentration of the marketplace for Internet service provision.”

Canada was tied for 8th place in the overall rankings, held back by a very low (34th place) ranking in the Readiness category, which examines the capacity to access the Internet, including skills, cultural acceptance, and supporting policy. Despite high digital literacy scores, Readiness also includes factors of “Trust and Safety” and “Policy.” Canada’s Policy score, measuring “the existence of national strategies that promote the safe and widespread use of the Internet,” was ranked 55th.

Key findings from the study include:

  • There is more to inclusion than internet availability
  • Middle-income countries outperform rich ones in some areas of inclusion
  • Local content is abundant in non-English-speaking countries. Only one native English-speaking country (the US) ranks in the top ten in local content
  • Taiwan, Spain and the UK lead the world in ensuring that women can connect to the internet. Singapore and five other developed countries—Australia, Canada, the Netherlands, Italy and Sweden follow closely behind

The full 40-page report is available [pdf, 650KB], and there is an interactive website and downloadable dataset [XLSM, 3MB].

For Canadian policy makers, there are very important lessons to be derived from this report, including the lack of local content and the embarrassing 55th place ranking for our failure to develop a meaningful national broadband strategy. The report also challenges oft-repeated statements about competitiveness and the level of concentration in Canada’s mobile and internet sectors.

We’ll examine these issues and more at The 2017 Canadian Telecom Summit, taking place June 5-7 in Toronto.

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