How can the CRTC regulate landlords, who aren’t carriers?

The issue has come up in the past when dealing with access agreements for wireline telecommunications services and broadcast television distribution. In 1999, the CRTC decided on a clear demarcation point for inside wiring so that tenants could subscribe to competitive telecom services [Decision 99-10]. Decision 2003-45 provided additional guidelines for negotiation of building access agreements.

But the CRTC has limited powers in regulating building owners or property managers. Instead, it uses indirect regulation – such as finding that an agreement between a regulated carrier and the unregulated party (such as a landlord) contravenes the Telecom Act or Broadcast Act – as it did in 2007 with the dispute over access by Shaw to buildings developed by Concord Pacific.

So this brings us to the case of San Francisco’s Bay Area Rapid Transit (the BART). Of course, the CRTC doesn’t regulate San Francisco, but it would be helpful to discuss whether such a case would contravene Canadian telecom regulations. Here is some background. it is increasingly common for landlords to install a distributed antenna system (DAS) for improving wireless connectivity inside highrise buildings or shopping centres or subway systems, for cellular, WiFi, internal mobile radio and first responders. Some DAS (such as Optiway) are multi-frequency and have sophisticated management capabilities. It is not uncommon for the DAS to be carrier independent and be owned by the landlord or managed on the landlord’s behalf.

On July 11, (as explained here by BART) the San Francisco subway system disrupted cellular access inside their subway tunnels because it believed that mobile services within their system would otherwise be used to incite illegal activity. For various viewpoints on the legality or correctness of this, see Public Knowledge and Public CEO (Public CEO asks the question of whether access to cellular service is an absolute right).

So, to return to the Canadian context, would Toronto Transit violate any laws if it did the same thing in the same circumstances? Or what about a major shopping centre? Or an office building temporarily cutting its distributed antennae in the food court?

To add some colour to the discussion, what if the landlord got into a dispute with just one carrier and disconnected their access to the interconnection point? Or refused to interconnect with other carriers?

Are Distributed Antenna Systems a form of “telecommunications facility” and are there conditions under which a building owner would become a telecommunications common carrier under the Telecom Act?

Is Canada’s telecom policy partly to blame for RIM’s woes? That is the opinion being expressed by University of Ottawa professor Michael Geist in his article this week in the Toronto Star. As I tweeted through the weekend, I think this is a bit of a stretch. Unlike Mark Evans’ article last week, Professor Geist isn’t looking for the government to fix what ails RIM.

While RIM’s current problems can’t be solved by government policy, some of its shortcomings may be a product of Canadian policy. Indeed, RIM is the quintessential Canadian technology company, reflecting the market’s strengths and weaknesses. If the government wants to avoid a Nortel repeat, part of the solution lies in addressing the problems that plague Canadian telecom policy.

But as you work through the Star article, I think there are some fundamental logical flaws.

For years, co-founder Mike Lazaridis promoted the data efficiency of RIM’s BlackBerry, while emphasizing that wireless spectrum is a finite resource. From RIM’s perspective, efficient use of data makes its devices more attractive to wireless carriers, which incur lower costs when compared with bandwidth-hogging devices such as the Apple iPhone.

The emphasis on spectrum scarcity and the value of currying favour with telecom carriers is very much a product of the Canadian marketplace.

Spectrum scarcity is not a uniquely Canadian challenge. It is a real engineering challenge for carriers around the world and the regulators who control the availability of new frequencies. As you continue to read through the Star article, ask yourself how many GSM carriers operated in the US market, where Apple had an exclusive deal with AT&T.

That RIM has had efficient spectrum utilization as a primary design criteria speaks to the engineering mindset in RIM’s leadership. It is reminiscent of the Dudley Moore ad for Volvo in Crazy People: “Volvos are boxy but they are good.” Blackberry is boxy but it is good. Apple’s iPhone is more of a Jaguar.

RIM’s woes weren’t caused by Canada’s government, nor will they be solved by it.

The CRTC issued the 2011 edition of its report “Charting Canadian Communications Change and Regulatory Implications: Navigating Convergence II” [press release here, full report – html, pdf (3.7MB)]

The report can be viewed as a snapshot of the information that has been gathered over the past year, examining the state of network evolution and competition; content and the reflection of Canadian identity; and, consumer choices and voices.

Telecommunications and broadcasting are rapidly converging into a single world of communications that offers innovative services to consumers, delivers these services in new ways and disrupts current business models. Consumers expect to access the services or content they want at anytime, anywhere, using whichever device they choose.

The executive summary speaks about the report as a reflection of the CRTC’s ongoing research and dialogue with stakeholders, analyzing key trends and identifying challenges and opportunities within the current regulatory framework. The report focuses on the evolution of wired and wireless networks, media-consumption and a variety of consumer-related issues.

As the digital economy becomes more sophisticated, policy, legislation and regulation must adapt. Areas that can be further deregulated—or in which new approaches may be required—are critically important to address. These areas include:

• ensuring fair and non-discriminatory access to networks
• increasing spectrum resources to meet Canadian demands
• creating new regulatory approaches to support innovation, access to affordable services and the creation and promotion of high-quality Canadian content, and
• addressing consumer concerns.

In the absence of a clear statement from the government on Canada’s national digital strategy, Navigating Convergence II is an important contribution to continue the discussion on how our digital economy may develop. The CRTC has not issued any pronouncements, proceedings, rulings or policies in this report, but it collects and presents in a logical structure the diverse views and issues that might be examined within future formal consultations and multilateral discussions.

Take a look at the report – it is quite readable at about 70 pages. I’d be interested in your comments.

Mark Evans writes that “Canada Needs to Save RIM” which begs a few questions, like “what” and “how”? What help from the government does RIM need? How would the government help?

Mark writes:

Whatever tools at the federal government’s disposal should be used to make sure RIM stays vibrant as an independent company or division of another company with a strong Canadian presence.

As much as I’m not a big believer in government intervention economically, RIM is a special situation because it plays a crucial role within the Canadian economy – not only as a large employer but a company that spins off many start-ups by ex-RIM employees who want to use their expertise and wealth.

If the Canadian government, however, decides not to pro-actively help RIM, it risks having another Nortel on its hands. This is not to suggest RIM is going to seek bankruptcy protection but it may need the government’s help.

RIM is hardly a Nortel bankruptcy situation. Last quarter, the Blackberry maker had revenues of nearly $5B and net income of just shy of $700M. As Jim Balsillie said at the time of the earnings release,

RIM’s business is profitable and remains solid overall with growing market share in numerous markets around the world and a strong balance sheet with almost $3 billion in cash.

So, our government’s cash isn’t needed. The government isn’t really known for its marketing prowess to help out on that side. Should we have special tax credits for Canadians using Blackberry devices? That may run afoul of various free trade agreements.

There is no question that RIM is an important, if not integral part of Canada’s high tech landscape. But what can Ottawa do? What should Ottawa do?

We have visitors from overseas this month who are traveling around central Canada this week. Of course, they each own mobile phones from their home country but we all know how painful roaming fees can be.

So, just as I own a half dozen SIM cards for my trips, they are now the proud owners of a Canadian pre-paid SIM.

But that isn’t the point of today’s story.

They forgot to take their charger with them for this week’s side trip. As a result, we had trouble reaching them yesterday; battery life was being conserved for emergency purposes. After last night’s consultation, we determined that the phone uses the standard micro-USB so it shouldn’t be much effort to borrow a plug for a top-up.

As we discussed airport pick-up arrangements and what we do if the phone runs out of power, it made us reflect on what we did “in the olden days”. Of course we all survived, but it is a lot easier with the variety of portable communications devices that nearly all of us carry.

Which raises the question being asked by CTIA today: what is the right age for children to get their first cell phone? The various stores and carriers have launched Back-to-School specials and product introductions. My kids had phones in high school, but I think in today’s world, I would want them to have phones even earlier. I have family overseas who equipped their kids with a phone in primary school.

I’d be interested in your comments and discussion.