Next move for RIM?

Before the Canada Day holiday, the Canadian technology community gazed into an executive tennis match with alternating lobs between executives – from the anonymous “Open Letter”on Boy Genius Report and the return volley from Inside Blackberry.

There is a real problem when so-called senior executives feel compelled to appeal to our voyeuristic interest through a gutless public kvetch, rather than actually exercise their executive duties to fix the company. But what is the right long term solution for Canada’s technology leader?

A round of golf is generally a good way to lubricate the mind and stimulate non-linear thinking, perhaps since we generally follow a non-linear route to navigate each hole. This morning’s perfect weather was especially well suited to developing ideas for merger candidates for RIM. One thought was that RIM missed opportunities a few years ago when it could have merged with Motorola’s handset division; perhaps a Blackberry / Microsoft marriage would have made sense then as well?

My brother, who is not in telecommunications, but plays in the software world, chimed in with the best idea. He admonished the rest of us for thinking as telecommunications professionals – I observed that this is an occupational hazard for us telecommunications professionals. In any case, he observed that Apple’s real success is less in the technology and more in the content and how it is delivered to its users.

Who, he asked, would be the best match to bring content to Blackberry?

Amazon. They have had trouble working with Apple and they have gone so far as to develop their own device, the Kindle. Put Amazon’s content and distribution networks to work for Blackberry; get Blackberry technology to deliver Amazon content. There is a match.

Hmmm. With that, he drove his next shot to just short of the green.

Something to ponder over your steaks and beer this holiday weekend. Talk among yourselves.

Vertically challenged?

The CRTC is holding a hearing this week to examine the increased level of vertical integration in Canada’s communications industry.

In my interview with CRTC Chair Konrad von Finckenstein at this year’s Canadian Telecom Summit, I asked about whether Canada is really so much more integrated than the US. The chairman observed that the US carriers, such as Comcast, don’t have mobile networks integrated with their broadcast companies.

However, it is worth a re-examination of Comcast as a comparable of what is happening in other markets.

I first wrote about NBC Universal nearly 5 years ago, in the context of 30 Rock’s series opener – long before Comcast purchased a majority interest in the broadcast and production company from General Electric. Comcast is a $50B cable powerhouse, with more than 22M subscribing to their video distribution (nearly double Canada’s total households), 16M high-speed internet customers and 8M voice customers. With NBC Universal, the company is a major broadcaster (including Telemundo), a major producer of content and it has theme parks. Comcast also owns the Philadelphia professional basketball and hockey franchises.

The world of entertainment is changing, not just in Canada. Follow the hearings. What level of flexibility with Canada’s broadcasters and carriers have to respond to their vision of the evolving marketplace?

Moving the yardsticks

With the oral hearings approaching for the CRTC’s re-examination of wholesale high-speed internet access, alternate internet service providers have still been unable to offer matching speeds to their clients in the absence of an interim tariff until today. The CRTC issued Telecom Order 2011-377 which sets an interim rate based on a number of compromises.

The Commission recognizes the importance of providing competitors with access to higher-speed and increased POI aggregation services as soon as possible.

After all, it is two years since the CRTC began its consultation process (Telecom Notice of Consultation 2009-261).

In the interests of expedience, allowing non-facilities based competitors to begin to offer advanced internet access arrangements, the CRTC instituted interim rates that provide a 35% discount off residential rates and 15% off business rates.

There is no usage-sensitive component to the interim wholesale rates, but the CRTC was quite explicit on this point:

No inferences of any kind should be drawn from the fact that this interim tariff, given its short and transitory nature, contains no separate usage component.

In addition, the CRTC may adjust the rates retroactively, depending on the outcome of the final proceeding.

The new wholesale arrangements will be described in tariff pages to be issued by June 23 (next week). The implementation date is 30 days from today – in the middle of the oral hearings for TNC 2011-77.

CPAC coverage of The 2011 Canadian Telecom Summit

Thanks to CPAC, 8 sessions from The 2011 Canadian Telecom Summit are available for viewing. Here is a summary of the CPAC coverage:

The 2012 Canadian Telecom Summit will celebrate 20 years of Canadian telecommunications competition. It will take place from June 4-6, 2012.

Digital policy: the untold story

A reliance on market forces will continue to figure prominently in Canada’s digital policy, if the government follows the direction given to it by Conservative Party of Canada members. Michael Geist observed that the Conservatives passed a broadband policy statement at their recent Ottawa convention:

The Conservative Party recognizes the vital importance of internet connectivity to full Canadian participation in global economic, social, and cultural communities. The government should create an environment that encourages private sector investment to increase broadband infrastructure, especially in rural and remote areas of Canada.

It is worth looking at resolutions that the party did not approve. Resolution C-063 contained a number of provisions that failed to get to the plenary floor:

We believe in the need for a strong Internet link to Canada together in the 21st Century, as railroads did in the 19th Century and aviation did in the 20th. Canada must claim a leading position in an increasingly networked world.

The Conservative Party will:

  1. Support internet broadband initiatives, to bring universal access to all Canadians, especially in rural and Northern communities
  2. Support an open and accessible internet with appropriate safeguards and enforcement mechanisms against illegal activities
  3. Support network neutrality, giving each user a fair share of bandwidth to use in communicating with any other user with any protocol.
  4. We support an innovative and competitive market place while promoting private sector infrastructure investment.
  5. We support initiatives promoting telepresence and telecommuting to overcome geographical barriers.

There was also a resolution supporting the alternate ISP and telecom service providers that didn’t make it past the first gate. Resolution C-065 tried to frame continued regulated access to infrastructure by alternate providers in terms of emergency responsiveness and affordability:

The CPC affirms the importance of telecommunications to Canadians, supports the growth of telecom services, and supports a competitive environment that makes those services affordable and innovative. Regulation must continue to enforce high levels of emergency response, ensure reasonable pricing for basic phone services, and enforce competitive access to all telecommunications infrastructure that is not economically replaceable.

The convention floor chose to continue to have market forces shape Canada’s telecommunications industry development, with the government fostering an climate that encourages investment by the private sector. It is just as interesting to see what policies were not acceptable.

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