I am going to use this post to provide references and links to stories in respect of the announced changes that are coming for Canada’s wireless sector.

• Government Press Release and Backgrounder
• Globe and Mail article by Eric Atkins
• National Post article by Christine Dobby
• Global News article by Jamie Sturgeon
• Yahoo Dashboard article by Carmi Levy
• Canadian Press article by LuAnn LaSalle
• Mobile Syrup article by Daniel Bader
• Business in Vancouver article by Nelson Bennett
• BNN-TV story and interview of Anthony Lacavera by Howard Green

It is interesting that the government waited until after the bids were submitted for Mobilicity’s assets. Would the number of bidders have changed had there been knowledge of the new framework? Indeed, are there bidders for those assets who had advance notice of such changes?

What do these changes do to the incentives for investment?

We have frequently written about the continual flux in the fundamental regulatory framework for the sector – a Calvinball approach to the market. What is the impact on the investment climate for digital infrastructure? Will the proposed legislative changes, with the government opening the Telecom Act and RadioCommunications Act, be the final word?

Doubtfully.

At what point do we look holistically at the communications sector – including both broadcast and telecom – and bring all of the legislation into the 21st century. That would mean looking at appropriate changes to the Broadcast Act, or rolling all of them together into an integrated Communications Act. As I suggested in August, perhaps it is time for a fresh look at a Telecom Policy Review.

That sounds like a discussion for The 2014 Canadian Telecom Summit, taking place June 16-18 in Toronto. I would be remiss if I didn’t invite you to register early!

As the year spins by, it is traditional to reflect on the past year and look forward to brighter days, making resolutions for the year ahead.

What a year it has been!

There has actually been progress on a resolution I made 2 years ago.

As was announced at the opening of The Canadian Telecom Summit, Rogers launched a pilot program to get affordable connected computers into low income households. As Rob Bruce said at the time:

It’s unfathomable that Canadians are living without internet access today because they simply cannot afford it. With Connected for Success we’ve taken the first step to connect youth and we urge our competitors, our partners and communities to work with us to bridge Canada’s digital divide.

There is still a long way to go. More areas of the country need to work on the demand side of the equation for broadband adoption. Kids have to have access to broadband connectivity and home computing in order to succeed in school. Let me reiterate Rob’s call for Rogers’ competitors, partners and communities across the country to work to bridge the divide.

I wrote 132 blog posts this year, down slightly from 139 in 2012. Too many of these were written during the summer, the summer of wireless discontent. There has been a lot of misinformation and name calling over the past six months; I think it is time to move forward on constructive dialog to build a more digitally enabled Canada.

There is a rabbinic tale of a man who spread tales about another. Feeling regret, he asked his rabbi how to make amends. The rabbi sent him out to store to buy a bag of seeds, telling him to go to an open field to scatter the seeds into the wind and then return a week later. The man did as he was told, and when he went back a week later, the rabbi told him “Now, go back to that field and pick up all the seeds you spread.” The man told the rabbi that he would never be able find all the seeds, let alone recover them. With that, the man understood that the damage from his words, spread far and wide, might never be fully undone.

As Joni Mitchell sang, “We can’t return, we can only look behind from where we came.” Still, as the carousel goes round and round, we can raise the level of the debate, stop the name calling, deal in issues at an appropriate level of depth and analysis, far beyond what can be captured in a 140 character tweet.

In the coming year, we need to ensure that the right policy framework is in place to encourage the private sector to make multi-billion dollar investments in digital infrastructure. We need to address issues of digital adoption and increase digital literacy among low income Canadians and small and medium sized businesses. We need serious discussion of serious issues including better analysis of potential unintended consequences.

And I still need to lose 20 pounds.

Have a safe, healthy and peaceful holiday season. I look forward to engaging with you in 2014. Together, hopefully we can exceed all our targets.

An access to information response revealed that the government has spent $9M on its ad campaign attacking Canada’s wireless industry.

The Globe and Mail and National Post have both published opinion pieces on the appropriateness of taxpayers paying for such partisan messages. I’m not even going to get into the content of the ads or try to understand how the government reconciles the contradiction between the messaging and the department’s own pricing study.

The $9M is a small fraction of more than half a billion dollars in such ads over the past 6 years.

Indeed, the $9M is reflective of policy that may be costing taxpayers much, much more.

Last night, we learned that yet another group has dropped out of the bidding for 700MHz spectrum, leaving us with just 11 remaining. Catalyst Capital, one of the main bond holders for “struggling startup carrier Mobilicity,” has withdrawn.

We could have a situation where there is un-sold spectrum when the bidding stops. Fewer bidders participating coupled with spectrum caps means the auction will generate less money for the treasury. The AWS auction generated $4.25B to pay down the national debt. Thanks to that auction, the savings on interest alone have more than covered the government’s partisan advertising bill.

Back in September, the Financial Post reported Industry Minister Moore said to Reuters:

the government was concentrating on an intensely watched auction of wireless spectrum, where it is encouraging new entrants to challenge the Big Three.

“Our policy is the auction and we’ll see what happens through the auction”

When the initial list of bidders for the auction was release in September, I wrote that inconsistency in the application of spectrum transfer and foreign investment rules have added regulatory risk that diminishes the attractiveness for investment in Canadian wireless.

A favourable investment climate doesn’t just mean that foreign money is welcome. Investors need to be confident about the rules are for taking their money out again.

Failure to approve the VimpelCom-Wind Mobile and Accelero-Allstream transactions have raised questions about how open our markets are to foreign investors. If our policy is the auction, one might have thought that government actions are consistent with optimizing the outcome of that auction.

Little kids often play chess without looking ahead, considering the secondary and tertiary implications of each move. In the spring, I wrote “Thinking 3 moves ahead“:

How will investors respond to being told that they cannot get the best deal for their money, that the company may have to be sold in a fire sale. With its accumulated tax losses, the best offer for Mobilicity will come from companies that can make use of those losses – that road leads to the doorsteps of the big three carriers. A rejection of the deal will impact more than just Mobilicity’s backers; Canada’s Industry Minister has been trying to drum up interest in market entry from investors around the world, in hopes of securing more bidders for the upcoming auction of the 700 MHz band. All of these potential global players will be watching to see whether they will face a friendly investment climate before they risk billions of dollars.

Our policy is apparently relying on the 700 MHz auction and “we’ll see what happens through the auction”. Is it time to start considering the next move?

University of Ottawa professor Michael Geist’s column in the Toronto Star this week makes for an important read. “Ottawa’s complete e-government failure” observes that just ten years ago, Canada was the top country for breadth and sophistication of electronic government services being offered. A decade later, Canada’s e-government rankings have declined, “a victim of astonishing neglect by the current Conservative government.”

Last week, the auditor general issued a scathing report on the state of e-government in Canada, noting the lost opportunities for reduced expenses and greater efficiencies as well as the complete absence of strategic vision.

The column got me thinking, once again, about lost opportunities caused by the government’s failure to release a cohesive national digital economy strategy. Three and a half years ago, shortly after the consultation was launched, I documented the consultation questions in a blog post “Succinct or superficial.” There were 24 questions organized under 5 themes plus 2 questions that might have inspired development of some kind of digital dashboard:

Improving Canada’s Digital Advantage

• Should we set targets for our made-in-Canada digital strategy? And if so, what should those targets be?
• What should the timelines be to reach these targets?

Over the summer, I wrote a piece called “Measuring success” that called for the government to take a look at measurable objectives and tracking against those objectives. I cited a Peter Drucker principle: “you can’t manage what you can’t measure.”

I would also refer back to a piece I wrote in late May that concluded “The lessons for Ottawa: Set clear objectives. Align activities with the achievement of those objectives. Stop doing things that are contrary to the objectives.”

You’re covered.

As of today, for all new or amended wireless service contracts, Canadian wireless carriers have to comply with the Wireless Code, released 6 months ago by the CRTC [original press release, Wireless Code Regulatory Policy, CRTC information page].

According to the Commission:

The Wireless Code will

1. make it easier for individual and small business customers to obtain and understand the information in their wireless service contracts;
2. establish consumer-friendly business practices for the wireless service industry where necessary; and
3. contribute to a more dynamic wireless market.

Many carriers had already started to implement parts of the code over the summer; I haven’t seen 3-year terms for smartphones since before the back-to-school sales began.

Consumers rights are set out in the original decision:

Your Rights as a Wireless Consumer

The CRTC’s Wireless Code comes into effect on 2 December 2013. The Wireless Code establishes basic rights for all wireless consumers and puts new requirements on service providers. The Wireless Code significantly limits cancellation fees and requires your service provider to unlock phones, to offer a trial period for wireless contracts, and to set default caps on data charges to help you avoid bill shock.

Do you know your rights? This checklist will help you to understand the most important things that the Code does for you. For more information, visit the CRTC’s website at www.crtc.gc.ca/eng/info_sht/t14.htm [website corrected], where you can find the Wireless Code, which explains all of your rights as a wireless consumer in greater detail.

Do you pay a bill after you use your wireless service? If so, you use postpaid services, and you have the right
□ to cancel your contract at no cost after a maximum of two years
□ to cancel your contract and return your phone at no cost, within 15 days and specific usage limits, if you are unhappy with your service
□ to have your phone unlocked after 90 days, or immediately if you paid in full for your phone
□ to have your service suspended at no cost if your phone is lost or stolen
□ to receive a Critical Information Summary, which explains your contract in under two pages
□ to receive a notification when you are roaming in a different country, telling you what the rates are for voice services, text messages, and data usage
□ to limit your data overage charges to $50 a month and your data roaming charges to $100 a month
□ to pay no extra charges for a service described as “unlimited”
□ to refuse a change to the key terms and conditions of your contract, including the services in your contract, the price for those services, and the duration of your contract
Your contract must
□ use in plain language and clearly describe the services you will receive
□ include information on when and why you may be charged extra

Do you pay before you use your wireless service? If so, you use prepaid services, and you have the right
□ to cancel your contract at no cost after a maximum of two years
□ to cancel your contract and return your phone at no cost, within 15 days and specific usage limits, if you are unhappy with your service
□ to have your phone unlocked after 90 days, or immediately if you paid in full for your phone
□ to have your service suspended at no cost if your phone is lost or stolen
□ to receive a notification when you are roaming in a different country, telling you what the rates are for voice services, text messages, and data usage
□ to a minimum seven-day grace period in order to “top up” your prepaid card account and retain your balance
Your contract must
□ use plain language
□ clearly describe the conditions that apply to your prepaid balance and how you can check your balance

The courts are reviewing a challenge from some of the carriers over a provision in the Wireless Code that would have the code apply (as of June 3, 2015), to all Canadian wireless customers. As I described when the Code was released, this provision (in paragraph 369) creates a problem that may be retroactive rate setting – a power that the CRTC does not have. The carrier concern deals with recovery of the phone subsidy in the case of early contract termination by customers who bought phones on 3-year agreements over the past year or so.

Note: Wireless customers in Saskatchewan will not have the benefits of the international data roaming and data cap provisions of the Wireless Code until June 2014, due to an inability to accelerate implementation of a replacement billing system.