Bloomberg released news yesterday that Public Safety Canada has national security concerns about the liberalization of foreign ownership restrictions for telecommunications carriers in Canada.

According to a letter to Industry Canada dated February 25 obtained by Bloomberg:

The security and intelligence community is of the view that lessening or removing restrictions from the Telecommunications Act, without implementing mitigation measures, would pose a considerable risk to public safety and national security.

Without wanting to fully debate the merits of these concerns, the timing is interesting to examine. The letter predates the announcement of the liberalization by a few weeks, meaning Industry Canada was aware of these concerns but went ahead anyway.

Why?

What made Public Safety suddenly wake up to the possibility that foreign ownership liberalization may actually occur? The issue has been on the horizon for years. There have been countless public consultations, but “mitigation measures” were not previously raised as an item for public input. Why were the Public Safety Canada concerns not set out in the 700 MHz consultation or the previous consultations that looked at opening up the market? Specifically, in the June 2010 consultation, Industry Canada asked:

Are there potential unintended effects of increased foreign direct investment in the Canadian telecommunications sector? What are the potential benefits and risks of having more global players in the market?

Wasn’t this the time for Public Safety Canada to respond? Why did the organization fail to identify the kinds of concerns that gave rise to its secret memo obtained by Bloomberg? If liberalization of foreign ownership poses a “considerable risk to public safety and national security”, why did Public Safety Canada, the organization charged with responsibility for such matters, not speak up sooner?

 Update: As the first comment indicates, the letter from Public Safety appears to have been sent during the comment phase for the 700 MHz consultation, so my comments regarding the timing of Public Safety’s comments were not appropriate.

When I visit Israel, I like to drink cafe hafuch – upside down coffee. It is a perfect variant on a cafe latte, best consumed with an extra shot of espresso and a small piece of dark chocolate while gazing out on the Mediterranean or overlooking the walls of one of the biblical era old cities.

There are different theories on the origins of the name, but “upside down” is a perfect term for the drink. To properly consume a cafe hafuch, you need to stop and sit and enjoy it.

Israelis live and work and play in a fast paced environment but they pause for coffee. Cafe hafuch is not fast food; you need to devote time to it. So cafe hafuch helps to provide a change-up to the status quo; a break in their otherwise frenetic day.

The cafe provides a venue to meet with friends and colleagues to discuss – often loudly – the political, social or personal issues of the day or contemplate their challenges at work.

That is an environment we try to replicate at The Canadian Telecom Summit. Our espresso bar, this year sponsored by Allstream, is a favoured meeting place over the 3 day event. Each year, it is always interesting to take a glance at the meetings over coffee. You can see strategy sessions among colleagues preparing for a presentation; business deals and pitches between suppliers and clients, competitors negotiating improved interconnection or taking time to understand each other’s perspective.

This is the eleventh year for our annual gathering of the leadership of stakeholders interested in Canada’s communications and information technology sector. From June 4-6, leaders from government, service providers (large and small), suppliers, financial sectors, advisory firms, and very large customers will get together for 3 days of high-octane schmoozing. Thanks to ORION, once again scholarships are available for a number of students to be able to join us.

Each morning, Michael Sone and I kick off the day at the front of the big room. But after that, you are likely to find me at espresso bar with my double-shot latte – the closest facsimile I can find to a proper cafe hafuch. Be sure to stop by.

The 2012 Canadian Telecom Summit will take place at the Toronto Congress Centre from June 4-6. Have you registered yet?

On June 4-6, The 2012 Canadian Telecom Summit once again gathers the leadership of stakeholders in Canada’s ICT community in Toronto.

With so much public attention focused on telecommunications issues, no other event is quite like The 2012 Canadian Telecom Summit in covering the industry from every angle.

The conference is structured to facilitate networking, whether you meet at our Allstream espresso bar, over cocktails sponsored by Cisco, or in a more formal setting in one of the PwC boardrooms.

ORION is providing scholarships for up to 6 students to attend the conference – there is no better opportunity to get a crash course in Canadian information and communications technologies and services! Let me know if you are interested in attending, or if you know of a student who would benefit from three days at Canada’s premiere ICT event. Six scholarships are available. Priority will be given to students enrolled in a telecom related program (technology, policy, law, etc.) at Ontario universities.

The industry continues to face interesting times for technology and policy, carriage and content.

Vertical integration figures prominently on our minds, with Bell’s acquisition of Astral, as does the changing role for CBC in the wake of substantial funding cuts for the national broadcaster. Bell Media chief Kevin Crull, Rogers Communications head Rob Bruce and CBC’s English Services EVP Kirstine Stewart will each address the conference, joining Industry Minister Christian Paradis and more than 70 other industry leaders who will speak. The full conference line-up features the leadership of virtually every major carrier and supplier of technology in Canada, together with those who set policy and regulate the industry.

This year, in addition to our always popular Regulatory Blockbuster panel, we are featuring sessions devoted to The Performance Cloud; Mobile Commerce; Social Networking; Consumers & Businesses in a Multi-Screen World; Customer Data: Opportunity or Minefield; Unified Communications; Building a Digital Canada; and, Wireless Spectrum: Paying for Air.

Now in its 11th year, The 2012 Canadian Telecom Summit attracts attendees from around the world. For 3 days, The Canadian Telecom Summit delivers thought provoking presentations from the prime movers of the industry. This is your chance to hear from and talk with them in a structured atmosphere of frank discussion and high-octane idea exchange or schmooze over coffee or cocktails in a more relaxed social setting.

Have you registered yet?

I’m in the middle of busy month from a personal perspective, so I have not devoted as much time to keeping this blog current. There are another 2 weeks to go before I can devote time fully to work, so please excuse the recent tendency of a more intermittent nature than usual. When possible, I have tweeted a comment here and there – as an aside, I wonder if most of my blog readers are Twitter followers and vice versa.

The regulatory framework surrounding vertical integration is continuing to evolve. In this increasingly converged digital world, The 2012 Canadian Telecom Summit will be looking at broadcasting issues as well, hearing from some of the most important leaders in this field: opening on June 4 with Rogers Communications chief Rob Bruce and hearing from Bell Media’s Kevin Crull and CBC’s Kirstine Stewart on June 6. Sandwiched in the middle will be discussions with CRTC Acting Chair Len Katz and our annual Regulatory Blockbuster, featuring the top advocates for Allstream, Bell, Globalive/Wind, Rogers, TELUS and PIAC.

Last Thursday, the CRTC issued a determination on negotiation parameters for a group of independent broadcast distributors (Bragg/Eastlink, the CCSA, Cogeco, MTS and TELUS) in their dealings with Bell Media. The decision provides some insights on Commission perspectives on issues such as bundling of content:

The Commission, while strongly encouraging BDUs to adopt consumer friendly packaging options, notes that programming services will need time to adapt to an increasingly consumer-focussed environment. However, the Commission considers that a programming service should not expect to be completely insulated from the effects of consumers exercising choice.

…

The Commission considers that, in return for the increased flexibility, the programming undertaking may reasonably request higher wholesale rates from a BDU in recognition of the fact that lower penetration, and thus lower volume, may result under a flexible packaging option. Consequently, it would be commercially unreasonable for a BDU to expect fixed unit pricing based on fixed penetration levels while enjoying the flexibility of delivering fluctuating penetration levels.

The CRTC prefers to have parties negotiate a commercial agreement, guided by the determinations in last week’s decision.

Just 8 weeks remain until The 2012 Canadian Telecom Summit. Have you registered yet?

Today, the CRTC launched a “Proceeding to consider whether the conditions in the Canadian wireless market have changed sufficiently to warrant Commission intervention with respect to retail wireless services“.

The public notice responds to a number of events that have led some parties (representing carriers and consumer) to have the CRTC establish an industry wide committee to develop a national wireless services consumer code.

The CRTC says that it thinks the state of competition in the consumer marketplace needs to be examined first, given that the Commission has forborne from regulating retail mobile services.

The Commission is of the view that before it can consider what form of intervention, if any, may be appropriate with respect to retail wireless services, it must first determine whether there is evidence that Commission intervention in this matter is necessary and appropriate in light of the Commission’s forbearance from regulation of the wireless industry and the Policy Direction.

In other words, the CRTC found that the market was sufficiently competition to have made its forbearance determination, so how can it intervene in developing a code, without first determining that the market is no long as competitive as it was at the time of forbearance? The Policy Direction requirement to “rely on market forces to the maximum extent feasible” would appear to be guiding the CRTC.

Recall that Industry Canada just completed a study of the state of competition in Canadian wireless services, as part of its Policy and Technical Framework for the 700 MHz band.

The CRTC consultation is structured pretty basically: one round of comments (interventions), due in 4 weeks (May 3), followed by a reply due just 11 days later (May 14).

The Commission is seeking comments on whether the conditions for forbearance have changed sufficiently to warrant Commission intervention in the development of a national retail wireless services consumer code. In their interventions, interested persons should provide evidence as to the need for Commission intervention.

Will this CRTC call for comments attract more than what they expected?

We will explore this issue and so much more at The 2012 Canadian Telecom Summit, June 4-6 in Toronto. Have you registered yet?