Statistics Canada released an interesting variant on its Internet Use Survey yesterday. Unlike its release from May which examined household use, yesterday’s numbers provide an indicator for individual usage for Canadians aged 16 and older. Both reports are for the same period.

Many of the stories I read focused on the regional differences in internet adoption – a phenomenon we have explored before for internet [such as here] and for mobile services.

There are subtle differences between the individual and household data that raised some interesting questions for me. For instance, in May we learned that 97% of households in the top income quartile had internet access, but yesterday we learned that only 94% of individuals in that quartile use the internet. On the other hand, 59% of individuals in the lowest income quartile use the internet, despite only 54% of the households having access. What is causing these discrepancies? Fewer individuals per household are on-line in upper income homes; the opposite in lower income households.

For the non-users, I like to read the excuses with a critical eye:

A majority of non-users (62%) said they did not use the Internet because they had no need or interest, did not find it useful, or did not have time. Over one-fifth (22%) mentioned a lack of skills or training, or that they found the Internet or computers too difficult to use. Limited access to a computer (12%), cost of service or equipment (9%) or age (9%) were other reasons cited for not going online.

In my view, almost all of these are euphemisms for “it’s the money.”

Yesterday’s report indicated that 88% of individuals in Halifax are online, versus 79% of Nova Scotia as a whole. Since the Halifax Census Metropolitan Area represents about 40% of the province, this means that the rest of the province has only about 73% of individuals using the internet. Why?

It is always important to look at the data and ask lots of questions. How do we increase adoption across geographies, ages, incomes, education and other demographic factors?

Can mission critical IT systems migrate to the cloud?

Information technology (IT) executives have to be reviewing their options as Research in Motion (RIM) enters its third day of service interruption. Amazon’s 3-day outage in April (and subsequent partial service loss in August) should have boards of directors asking CIOs to review their architectures.

Of course, cloud architectures can be more survivable than any single data centre, or single company networked operation. But these celebrated network failures should force an introspective process within  companies’ IT departments to ensure continuity strategies are consistent with the business objectives. All networks and systems will experience failures; anticipating and designing to survive the failure becomes a business decision.

To what extent are companies willing to lose control of the restoration process? This has to be the key frustration for corporate cloud services users today. When the CEO calls to find out the status, will the CIO be able to provide a credible answer?

Planning for The 2012 Canadian Telecom Summit is underway. We’ll explore Cloud Computing among other issues facing communications and information technology leaders today. Please get in touch to discuss how you can get involved in this year’s event – June 4-6, 2012 in Toronto.

Frequent readers know that I like to highlight unusual regulatory proceedings.

In today’s chapter, I want to look at an application to expand the use of the 8-1-1 dialing code. N11 numbers are a very limited resource: there are only 8 numbers that can be assigned. We are all familiar with 9-1-1 emergency dialing. 6-1-1 is used for reaching your phone company’s repair service; 4-1-1 is local information. Five years ago, I wrote about the CRTC’s assignment of 5-1-1 for travel information. The full list is available from the Canadian Number Administrator website, which indicates that 8-1-1 is currently assigned for “Non-urgent Health Care Telephone Triage Service.”

In my area, this service isn’t available. Only 4 provinces are currently using the 8-1-1 code and consumers have a very low awareness of its assignment. This past July, the Canadian Common Ground Alliance filed an application with the CRTC to gain access to the 811 code for Call Before You Dig services, as a matter of public safety.

The application received broad public support, including that of the Federation of Canadian Municipalities and there have been endorsements by two federal Cabinet Ministers: Public Safety Minister Vic Toews and Natural Resource Minister Joe Oliver.

Minister Toews wrote:

Public Safety Canada recognizes that the 811 number currently provides a valuable service to the public by offering around-the-clock health information and non-urgent medical advice. Broadening this service to include “Call Before You Dig” would help mitigate unnecessary risks to the public, and reduce interruptions of services provided by critical infrastructure sectors.

Minister Oliver spoke at a the September 29 meeting of the Canadian Energy Pipeline Association, saying:

I know that you are doing your part in maintaining your safety record. I know you fully understand that a good track record in safety and environmental performance helps to create a distinct competitive advantage. This is why we support your campaign to create an “811” number for Canada’s “Call Before You Dig” program.

It is unusual for Cabinet members to weigh into CRTC proceedings; in addition, another federal tribunal, the National Energy Board, voiced its support for the initiative.

The primary cause of disruption to critical infrastructure, such as telecommunications or electrical facilities and energy pipelines, is accidental excavation by homeowners or contractors. It has been 6 years since the CRTC approved the application by Alberta Health and Wellness for the assignment of 8-1-1 “for access to non-urgent health care telephone triage services” [Telecom Decision 2005-39]. Although it was the applicant for the original CRTC assignment, Alberta is not offering the service. Just a few months before the CRTC approved 8-1-1 for health services, the FCC designated 8-1-1 as “the nationwide number for contractors and others to call before conducting excavation activities.”

The provincial health agencies are less enthusiastic, despite the failure by most of them to activate their own service. Even those provinces that have no plans to activate 8-1-1 seem to want to hoard the dialing code and block any other groups from using the scarce numbering resource.

The file is now closed. The CRTC will now need to determine whether to expand the scope of 8-1-1 to include Public Safety, and bring Canada’s assignment into consistency with the US.

It has been more than 37 years since I was last in Moscow. I went to Russia in March of 1974, when Western relationships with a cold-war era Soviet Union were being thawed by hockey summits. Our grade 12 history teacher found a special way to bring life to a curriculum looking at the “History of Revolutions.”

We had a broad cultural immersion that week. I recall learning to drink vodka shots in a loud disco in our hotel in Leningrad (as St. Petersburg was then called), arguing about whether (current Canadian Senator) Frank Mahovlich was really Russian. I recall the fun we had with their mispronunciation of his name, claiming it was really Махолович [Maholovich], so we responded with our index finger raised:  Махолович один, Канада один. I still proudly display my collection of pins from trading Bazooka chewing gum with people on the streets.

There were other extra-curricular activities that are best shared at a later time.

Next Sunday, I am going back to a very different Moscow, en route to the Baikonur Cosmodrome for the launch of the world’s most advanced communications satellite. It has been a while since I have been this excited about a business trip. Xplornet is partnering to dramatically increase the amount of capacity available for rural and remote broadband service, enabling far faster speeds at a more attractive price point.

As I mentioned last week, Xplornet has a special website (4gsatellite.ca) that allows you to share in the excitement as launch day approaches. The space shot itself will be streamed to a live feed on that site.

I don’t expect to be arguing about hockey in the hotel bar, but one of the Russian phrases we learned 37 years ago will still come in handy: “водки, пожалуйста”.

Often, we speak of regulatory decisions as fair if each of the parties are equally upset.

It is tough to be a regulator in a competitive environment. Actually, I’m not sure it was loads of fun to be a regulator in the days of monopoly rate setting.

But, it has to be extra frustrating trying to understand when the expectations keep changing.

Back in July, Michael Geist accurately predicted the outcome of the CRTC’s review of over-the-top (“OTT”) video, released last week. At the time, he wrote:

The participants in this consultation fall into three main groups: those seeking competition, those who want more regulation, and those who want de-regulation.

What remains is the next step for the CRTC. It seems certain that there will be a full scale hearing, but the question is whether the Commission will cave to pressure from some groups for something immediately, or wait until the next new media hearing round in 2014.  Given the lack of actual evidence – this has been a fear-finding exercise rather than a fact-finding one – the CRTC should surely label this a watching brief and wait until 2014.

“Given the lack of actual evidence… the CRTC should surely label this a watching brief and wait…” Amazing call 3 months ahead.

In the report, the CRTC used language that paralleled the categorization of parties into 3 groups:

Many stakeholders proposed policy options to deal with the challenges associated with growing OTT content consumption; these generally fell into three large categories based on either regulatory or market solutions: a) lowered obligations for regulated entities, b) creating regulatory obligations for OTT providers and c) maintaining the status quo.

The accompanying news release said “While not containing any clear evidence…”, agreeing with the July article. The report itself even used Geist’s expression “watching brief” – a term that is rarely used by the CRTC, having appeared only 6 times in decisions, reports or policies prior to last week.

So I was a little confused by Geist’s article in Sunday’s Toronto Star. In that article, he again acknowledges the “lack of evidence”, but somehow draws a conclusion:

The consultation confirmed that consumers are gravitating toward services that offer on-demand access to video content at a price point far below that offered by conventional pay television and broadcaster services.

No such confirmation was made by the CRTC. The Commission found “that consumer adoption of OTT services is real and growing” but did not see evidence of harm to the traditional broadcast system. The word “price” appears only once in the report, and that was in the introductory reference to the Notice of Consultation. The report therefore did not draw the conclusion or even provide such a confirmation of “gravitation” to low priced on-demand access.

What the Commission said was “significant change is underway in the communications sphere” and it plans to continue to gather information, with a repeat of the fact-finding exercise next year. Fact-based decision making is what we should expect from our regulator.

The Star article says:

Indeed, rather than offering broadcasters and creator groups another chance to make the case for regulation, the CRTC should instead be closely examining the potential barriers to online video services from vertically-integrated media companies that combine broadcasting and Internet services and hold the power to undermine the nascent competition.

For example, Internet plans with expensive data caps can be used to increase the indirect costs of online video services when compared with on-demand video services from cable and satellite companies.

Yet, there was no evidence of consumer harm from internet pricing practices. Wouldn’t such evidence have been highlighted in the July blog post or this week’s Star article? It seems to me that there needs to be some clear evidence of a problem before the CRTC becomes one of the only regulators in the world to regulate retail internet business models. To the contrary, the CRTC report said “many parties stated that Canadians are the biggest online video consumers in the world.”

It seems that the CRTC got this one right by ignoring the call to sit on the sidelines until 2014.

Given the fast pace of change in this environment, the Commission intends to maintain a watching brief on OTT, and conduct financial data collection and another fact-finding exercise in May 2012 to determine if the scenarios put forth by parties with respect to potential regulatory impacts and opportunities have materialized. It expects that at that time stakeholders will be able to provide rigorously collected data, including public opinion research, internal customer surveys, historical revenues and expenses associated with OTT services, market intelligence, qualitative and quantitative evidence with respect to the state of closed captioning and described video for OTT programming and other such quantitative evidence, that will assist the Commission in better evaluating the impacts and opportunities offered by this environment. In addition, as part of its watching brief, the Commission will focus its annual consultation with the broadcasting industry primarily on the subject of OTT.

Everyone, consumers, content providers, content creators, ISPs, vertically integrated companies, independent broadcasters and all other stakeholders and observers alike, will have a chance to gather and submit evidence next summer.

The Commission was clear about its focus on its statutory mandate:

The Commission considers that currently it is best to allow the OTT market to continue evolving, better measurement tools to emerge and entities that contribute to the policy objectives of the Act to take advantage of the many opportunities in this new environment.

What exactly is wrong with that approach?

As Ricky Nelson sang, if you can’t please everyone, you’ve gotta please yourself.