Honourable mention goes to a post from way back in 2006, “Knock-down versus knock-out,” which talked about challenges chasing illegal content off the internet. And there was a lot of interest in “Taking the first step” from May 25, speaking about government officials finally acknowledging the need to increase broadband adoption among low income households, although 2016 marked another year that government stood on the sidelines watching the private sector develop solutions to try to tackle the challenges of getting computers and connectivity to bridge the “#HomeworkGap”.
Thank you for following and engaging over the past year and as I wrote last week, let me extend to you the very best wishes for health, happiness and peace in the year ahead.
In an interview with the Financial Post, Commission Chair JP Blais had hinted his next big ruling — a decision on basic Internet service — will be his most disruptive yet. Earlier today, the CRTC issued Telecom Regulatory Policy CRTC 2016-496 “Modern telecommunications services – The path forward for Canada’s digital economy” [TRP 2016-496] and it is difficult to see the level of disruption.
The financial markets expressed relief with the decision, Barclays calling it ‘benign’ and Scotiabank saying ‘logic actually prevailed… the absence of retail price regulation renders this decision a “non-event” from the capital market’s perspective.’ From a consumer perspective, describing broadband as a basic service without imposing an obligation to serve creates a high likelihood that the basic service objective will not be much more than a score card bound to disappoint. The Regulatory Policy describes the former obligation as “The obligation to serve requires the incumbent local exchange carriers (ILECs) to provide telephone service to (i) existing customers, (ii) new customers requesting service where the ILECs have facilities, and (iii) new customers requesting service beyond the limits of the ILECs’ facilities.” [paragraph 3, TRP 2016-496]
Later, at paragraph 180, the obligation to serve is credited by the CRTC as having led to successful fulfillment of the voice basic service objective:
As stated earlier, there is currently near-ubiquitous access in Canada to the level of service set out in the basic service objective. As a result, the intended goal of the basic service objective has been achieved.
But, rather than impose an obligation to serve on this aggressive broadband objective, the obligation is largely being eliminated. The obligation is being replaced by financial incentive programs, an industry-funded $750M pot, starting at some undefined point in the future. This is nothing new. More than 10 years ago, the Report of the Telecom Policy Review Panel recommended “that affordable and reliable broadband services should be available in all regions of Canada by 2010.” An entire chapter of the report was dedicated to “Connectivity: Completing the Job.” Chapter 8 recalls “In 2000, the federal government set a policy goal of ensuring that broadband networks and services would be available to businesses and residents in every Canadian community.”
Recommendation 8-1
As a key part of its national ICT strategy, the federal government should
ensure that Canada remains a global leader in the deployment of broadband networks, and
immediately commence a program to ensure that affordable and reliable broadband services are available in all regions of Canada, including urban, rural and remote areas, by 2010 at the latest.
That recommendation was made more than 10 years ago. There have been hundreds of millions of dollars spent since then by successive federal and provincial programs. The CRTC got into the rural broadband subsidy business once before when it set up its Deferral Account.
A week after ISED Minister Bains announced a $500 million broadband program (“Connect to Innovate”), today’s CRTC decision sets up yet another funding program. These are taking place ten years after the report of the Telecom Policy Review Panel, 16 years after the government first set its policy goal.
The most disruptive ruling yet? Kindly excuse my cynicism. What is disruptive here?
In the hours before the policy was released, I prepared a series of Tweets on what I might consider to be disruptive regulation. They are reproduced below for your consideration over the holidays. Perhaps we’ll see more innovation in the New Year.
It is getting to that time when people reflect over the past year or make forecasts for the year ahead. Many people are preparing to take breaks, go on vacation or make the annual migration south, so it is time for my annual wrap up as well.
Over the past year, I have been just about as prolific in my writing on this blog with 102 posts in 2016, compared with 103 in 2015 and 109 in 2014, somewhat lower than the 132 posts I wrote in 2013. I continue to spend more time on Twitter [follow me: @mark_goldberg] and, now as the grandfather to two adorable little boys, I have to admit that I am doing my best to spend more time focused on other important matters.
My wish list for 2017 includes getting the federal government to demonstrate support for a program to increase the adoption of computers and broadband in low income households with school-aged children. Unfortunately, successive governments have continued to follow the same approach of distributing money toward expanding broadband supply, getting ever diminishing returns on their expenditures. In the meantime, hundreds of thousands of low income households continue to be without computers in Canada’s largest cities. Kids can’t do homework and compete if they don’t have access to a connected computer at home.
Rogers and TELUS launched programs on their own, but both would have benefited from the Federal Government assisting in identifying which households would benefit the most. It doesn’t take money, just leadership. It is my hope that government will soon recognize that broadband adoption rates are made up of a numerator (demand) and a denominator (supply); there is a lot of opportunity to be found in stimulating demand.
I look forward to writing about other carriers launching their own programs in the coming year.
While I am setting objectives for next year, I still wouldn’t mind losing 20 pounds, but I suspect my grandsons will appreciate having a soft place to rest when we take naps “watching the game” together on Sunday afternoons.
For 36 years, I have been part of the telecommunications sector, experiencing (and in some cases leading) dynamic changes that have made each day interesting. There are certain to be many more twists in the coming year. I look forward to continuing to engage with you and I hope that I will continue to provoke you to explore different perspectives on the sector in 2017.
Over the break, take a little time to check out my “innovations from telecom” series. Over the past 6 weeks (and I plan to continue again through January) each day I have been tweeting an innovation that emerged from the telecom sector that has impacted society. It is part of the run-up to The 2017 Canadian Telecom Summit (June 5-7, Toronto), which will be looking at “Competition, Investment and Innovation: Driving Canada’s Digital Future.”
What happens when successive Canadian governments and agencies fail to set out a coherent digital strategy? We end up with a Parliamentary Committee, The Standing Committee on Government Operations and Estimates, issued a report earlier today that called for the Government to “consider broadening the mandate of Canada Post to include delivering critical digital communications infrastructure to rural Canadians.” Let that sink in for a minute.
Canada Post could play a pivotal role in providing the basis for a Canadian social network – authentication service, email and block chain authority for the benefit of Canadians.
Some of the discussion talked about using the postal buildings as “a small-scale business centre with highspeed Internet and all the technological tools that rural businesses, residents and students need.” That may be reasonable to supplement community internet hubs in public libraries. But there were members of Parliament who called for the post office to actually be charged with building “critical digital communications infrastructure to rural Canadians” and the Committee agreed. The committee said the Post Office could also “facilitate the trust network needed to authenticate identities on the Internet” and this resulted in a recommendation calling for the federal government to examine, with the Minister of Innovation, Science and Economic Development Canada and the CRTC, “the possible delivery of broadband Internet and improved cellular service to rural Canada using Canada Post real estate to house servers and offer retail services to customers.” [Recommendation 43] Because in the eyes of these Parliamentarians, the only thing holding back universal broadband was a place to house servers and sales staff.
Two and a half years ago, I wrote “Canada’s digital future,” lamenting slow development of a national digital strategy and suggesting pretty basic ways to manage a national digital agenda: “Set clear objectives. Align activities with the achievement of those objectives. Stop doing things that are contrary to the objectives.”
Just before the election last year, I wrote “Voting for Canada’s digital future,” where, after reviewing all of the major party platforms, I observed that “they all disappoint from a digital perspective”.
Read the full report, the product of “consultations with Canadians. In addition to holding 5 meetings in Ottawa, the Committee held 22 public consultations in 21 different communities across Canada. The Committee also held electronic consultations, through which 5,000 Canadians and Canadian organizations shared their feedback.”
I am reminded of the line from The American President: “in the absence of genuine leadership, they’ll listen to anyone who steps up to the microphone. They want leadership. They’re so thirsty for it they’ll crawl through the desert toward a mirage, and when they discover there’s no water, they’ll drink the sand.” In the absence of clear leadership on digital issues, you can see that Parliamentarians and Canadian citizens alike are searching for solutions. For years, successive governments have failed to enunciate a coherent strategy and as a result, we have such recommendations emerge from the Standing Committee on Operations and Estimates [OGGO] covering the kinds of issues that might have been more comfortably discussed in the Standing Committee on Industry, Science and Technology [INDU].
Next week, the CRTC is scheduled to release its decision on its consultation on the Basic Service Obligation [TNC 2015-134]. We’ll see if it chooses to weigh in on rural broadband. Your comments, as always are welcome.
As many readers know, in the late Spring I was asked “to conduct an analysis of the impacts and risks that the MTS acquisition [by BCE] may have for SaskTel.” My report was released in June.
SaskTel was asked to prepare a response to my report [pdf]. Its response [pdf] was released yesterday.
