Ottawa is harming consumers of telecommunications services by encouraging artificial competition. That is the key finding of a research paper [pdf, 6.7MB] being released today by the Montreal Economic Institute that looks at “The State of Competition in Canada’s Telecommunications Industry”.

The last paragraph of the Executive Summary captures the essence of the paper:

The federal government has lost sight of the ultimate goal of promoting the development of a dynamic, efficient industry. It should set up fair rules for all that would allow fourth players to emerge if the market could support them. This would have the effect of actually encouraging sustainable competition in Canada’s telecommunications industry and consolidating the dynamism of this industry, to the great benefit of consumers across the country.

“Contrary to popular belief, with three national wireless players, and several regional ones, Canada is far from being an aberration among developed countries,” says Martin Masse, a former political advisor to Industry Minister Maxime Bernier, who co-authored the study with Paul Beaudry, who was a senior policy advisor to Minister Bernier. The authors say Europe’s wireless sector shows that high levels of government regulation and competition may bring down prices, but the European model discourages investment and innovation.

“The State of Competition in Canada’s Telecommunications Industry – 2014” is a 60-page report that provides data to counter a perception of “dismal performance” in the Canadian telecommunications sector. The authors explore the federal government’s attempts to fostering the emergence of a fourth wireless player and the results achieved in the wireline sector through mandatory network sharing policies. The authors conclude with proposals to further liberalize Canada’s foreign investment regime in the telecommunications sector (including broadcasting) and recommend relaxing restrictions in its new spectrum licence transfer rules.

Cultural nationalists are often quick to point out that eliminating foreign ownership restrictions in the broadcasting sector would lead to the elimination of Canadian content requirements. Such fears are unjustified. There is no reason why Canadian content requirements could not survive in a liberalized broadcasting market. Foreign-owned firms operate in many other sectors of Canada’s economy and must abide by the same laws and regulations as Canadian-owned firms. There is no evidence that foreign-owned firms are less likely to comply with Canadian laws and regulations than Canadian-owned firms.

The Montreal Economic Institute paper asks “how does one analyze competition in an industry like telecommunications?” This is precisely the question being explored in a special breakout session at The 2014 Canadian Telecom Summit, being presented in cooperation with the DeGroote School of Business at McMaster University on the morning of June 16. The session, “Competition in Canadian Telecom” will be moderated by Dvai Ghose of Canaccord Genuity and will feature:

• Robert Crandall [Senior Fellow, Brookings Institute]
• John Mayo [Professor, Georgetown University]
• Eli Noam [Professor, Columbia University]
• Roger Ware [Professor, Queens University]
• Len Waverman [Dean, DeGroote School of Business, McMaster University]

If you are involved in policy development or regulation, you won’t want to miss this session. The Canadian Telecom Summit takes place June 16-18 at the Toronto Congress Centre. Save $250 by registering before May 14.

Pierre Dion, the new President and CEO of Quebecor, will be the closing speaker at The 2014 Canadian Telecom Summit on Wednesday June 18. It will be his first major appearance since being named as chief of the Québec cable, media and telecom giant earlier this week.

Quebecor is a communications industry leader with subsidiaries that include: Videotron; Sun Media; TVA; Canoe Inc.; TVA Publishing; Quebecor Media Book Group; and Nurun.

For the past nine years, Mr. Dion has been the head of TVA Group within Quebecor. TVA is the largest French language network in North America, including 8 specialty services: LCN, addikTV, MOI&cie, Argent, Prise 2, CASA, YOOPA and TVA Sports.  TVA Group also has interest in Canal Évasion and Sun News. A subsidiary is the largest publisher of French-language magazines in Québec and its TVA Films subsidiary distributes films and television products in Canada’s English- and French-language markets.

Earlier in his career, Pierre was VP sales and Marketing at Videoway Multimédia, a division of Le Groupe Vidéotron ltée and previously, he had been at Vidéotron Plus.

Videotron has been one of the strongest new entrant mobile wireless players to emerge from the 2008 AWS auction. The company surprised many industry observers with the geographic reach of its spectrum purchases in the most recent 700 MHz auction, acquiring licenses in British Columbia, Alberta and Ontario as well as its home territory.

As the new leader of Quebecor, Mr. Dion will exert significant influence on the evolution of Canada’s telecommunications landscape. We look forward to his closing keynote address at The 2014 Canadian Telecom Summit.

Have you registered yet?

By the way, we have been advised that lawyers who need Continuing Professional Development (CPD) credits are able to claim time spent attending “substantive” sessions at The 2014 Canadian Telecom Summit as “Substantive Hours” toward the Law Society’s CPD requirements.

The CRTC issued a statement on losing a procedural motion at the Federal Court of Appeal in the case of the implementation timing for Wireless Code described in my posts from last summer – here and here.

It was a strange statement from the CRTC. Did losing a procedural motion merit a press release? Why would the CRTC try to appeal to the public, highlighting this ruling? As any law student, or viewer of court room drama on TV would know, a regulator or judge can’t show up at the appeal court to advocate in favour of its decision. The ruling needs to stand on its own merit.

Here is what the judge said in ruling against the CRTC:

A statutory appeal, or an application for judicial review is not an occasion for the tribunal to improve upon its reasons in light of the objections made to them by the litigants.

So the Federal Court of Appeal struck 60 paragraphs from the CRTC’s memorandum.

The case before the Court of Appeal is fundamentally about the extent of legal powers of the CRTC. The first question is whether limiting termination fees in older mobile contracts is a form of retroactive rate-making. In the past, the courts have already held that the CRTC does not have retroactive rate-making powers. Alternatively, are there other proscriptive powers that might allow the CRTC to override existing contracts?

This is the heart of the case being heard by the Federal Court of Appeal. It is an important test of the extent and limits of CRTC legal powers.

Retired General Rick Hillier will be the first day closing keynote speaker leading into cocktails on June 16, addressing delegates at The 2014 Canadian Telecom Summit.

Born in Newfoundland and Labrador, General Rick Hillier joined the Canadian Forces as soon as he could. Throughout his career, General Hillier has had the privilege and pleasure of commanding troops from the platoon to multi-national formation level within Canada, Europe, Asia and the United States. He has worked as a staff officer in several headquarters, first at the Army level in Montreal and later at the strategic level in Ottawa. General Hillier was promoted to Chief of the Defence Staff in 2005. He retired in August 2008.

General Hillier will speak about “Leadership in Difficult Times.”

And these are most definitely challenging times for leaders in the Canadian telecommunications sector.

More than 70 of the people who shape Canada’s communications sector will be speaking at The 2014 Canadian Telecom Summit, June 16-18, at the Toronto Congress Centre.

You should be there too. Why don’t you register today?

A story in the print edition of today’s Toronto Star by Graham Lanktree says that a data breach at the Office of the Privacy Commissioner of Canada may have exposed the private information of 800 current and former federal employees.

The story says that the agency lost an unencrypted hard drive during an office relocation in mid-February. The Star report says the drive had private earnings information including names, official ID numbers, salary and overtime, for current and former employees of the Office of the Privacy Commissioner and the Office of the Information Commissioner.

Although the drive was lost in mid-February, the information technology department did not notice the drive was missing until mid-March. The Toronto Star article says that it took until April 9 for the IT people to realize that missing drive had personal information. Still, 180 current employees were told about the breach last week; another 600 former employees had still not been informed.

Under proposed legislation recently introduced in the Senate [Bill S-4: The Digital Privacy Act], notification must be given “as soon as feasible after the organization determines that the breach has occurred.” Will the timeline for notification by the Privacy Commissioner help inform a definition of “as soon as feasible”?

Who polices a breach of data privacy by the office charged with policing such matters? At the bottom of the Star story, we are told that the RCMP has not been called in to investigate since there is no indication of a criminal act. An internal investigation is said to be expected to return findings on Friday. According to the story, Parliament was notified through the Ethics Committee and the speakers of the House and Senate.

Privacy, security, telemarketing rules, anti-spam, and so much more will all be discussed at The 2014 Canadian Telecom Summit, June 16-18 in Toronto. Have you registered yet?