It is showtime for The 2010 Canadian Telecom Summit. We are now at the TCC. If you aren’t at the event, you can follow me on Twitter @Mark_Goldberg or follow keyword #cts10.

Watch for extensive coverage in the media – we have a record number of press pre-registered. There is a special telecom supplement scheduled for Tuesday’s Globe and Mail.

As I prepare to move out to The Toronto Congress Centre for The 2010 Canadian Telecom Summit, I thought I might share a few thoughts on some areas that could be the source of discussion in the plenary halls, the cafe, over cocktails and in corners and alcoves next week.

The CRTC’s hearings into mandated access to wholesale hispeed access services have been taking place this past week and the webcast has had some entertaining moments, not the least of which was the rebuttal testimony of “bite me.” I can’t wait to see how the expletive shows up in the transcripts. The tone certainly sets the stage for some interesting dynamics at next Tuesday morning’s Regulatory Blockbuster at The 2010 Canadian Telecom Summit.

The Financial Post announced that the 2010 edition of its Junk Science Rubber Duck award will begin in a couple weeks. I wonder if some of the broadband studies mentioned in the hearings will merit a mention in the contest.

Along those lines, let me commend to you a comment that appears on my Monday posting. The comment observes that in the Ookla Net Index Study, Latvia, Moldova, Romania and Bulgaria are all shown with top 10 rankings in broadband speeds. My reader observes:

If Moldova is not the poorest country in Europe, it comes pretty close. And Romania and Bulgaria are at the bottom of the EU.

So we can tentatively conclude two things from the study. First, the poorer you are, the better your broadband connections are likely to be. Perhaps Canada can embark on a crash program of income reduction, as part of its digital strategy.

Second, high speed broadband seems to do nothing for economic growth, at least in the short run.

We’ll be taking a more serious look at information and communication technology indicators at The 2010 Canadian Telecom Summit. I don’t expect to have time to write, but I’ll try to keep you informed. Follow me on Twitter @Mark_Goldberg and we’ll be using #cts10. Watch for extensive coverage in the media. Reporters from all the major trade and general press will be on hand and there is a special telecom supplement scheduled for Tuesday’s Globe and Mail.

The 2010 Canadian Telecom Summit, running from June 7-9, is our 9th annual gathering of the leadership of the communications industry, gathering in Toronto for 3 days of what we like to call “high-octane” inter-exchange of ideas.

The conference opens on Monday morning with an address by Industry Minister Tony Clement.

Tomorrow, we start to move into the Toronto Congress Centre and begin the transformation of their halls into the focal point for the communications and information technology industries. Once a year, it helps to get out from behind the computer screens and meet people in non-virtual reality.

I hope to see you there.

Have you registered yet?

I took a fresh look at the Statistics Canada Internet Use Survey results and it seems to support my oft expressed view that we need to consider a way to support internet use based on affordability.

Statistics Canada is reporting that the urban / rural divide describes a difference of 83% use of the Internet in communities of 10,000 or larger, versus 73% use in smaller communities. The national average is 80%.

On the other hand, 94% of people from households in the top quartile of annual income (those over $85,000) use the internet versus just 56% of those from household in the lowest quartile (less than $30,000). The income-based digital divide includes users from rural and urban communities and represents even more consumers that need to be brought on-line.

Since the opening remarks of The 2008 Canadian Telecom Summit, I have been suggesting a needs-based direct user subsidy as a better approach to expand broadband adoption.

We propose that the government establish a sustainable program that helps lower income Canadians to pay what it costs to provide service, regardless of means. Our tax system is already structured to be able to offer such subsidies and there are even mechanisms to differentiate based on geography.

This kind of approach would use the AWS auction windfall to stimulate economic investment in broadband infrastructure by regional and niche service providers. It represents a way for the government to re-invest money generated from the telecommunications industry, back into the industry to help bridge the digital divide and render broadband affordability a non-issue.

I have long felt that it is patronizing (although clearly politically expedient) to target subsidies based solely on geography. Just because the cost is higher in some regions doesn’t mean that all residents need or deserve public subsidy for their communications services.

Should  the government anoint a defacto “official supplier” in high cost serving areas, with taxpayer grants to the winning service provider that effectively prevent competition from ever bringing benefits to these areas?

We need to find a way to bring internet into the homes of the Canadians who need help the most, regardless of their geographic location.

Harvard’s Berkman Centre was commissioned last year by the FCC to produce a report on international broadband deployment and usage. Its report was widely reported as being damning to the broadband industry structure in Canada and criticisms of the report were ridiculed based on the interests of funders of contradicting studies.

We pointed out numerous times that the report re-hashed flawed OECD studies [for example: here, here, here, here, here].

It turns out that Harvard’s researchers got it wrong when looking at one of the fundamental inputs that led them to conclude that American and Canadian regulatory frameworks need to be overhauled to support for European-styled open access, rather than the facilities-based platform competition enjoyed in North America. 

Yesterday, Bell Canada was asked by the CRTC to place on the public record a letter it sent to the Berkman study author, Yochai Benkler. The Berkman study had been made part of the record of a CRTC proceeding looking at mandating wholesale access to high speed services.

Two of the central themes of the Berkman study have come under question during the CRTC proceeding. First is the assertion that Canadian speeds and prices are too high. The CRTC commissioned its own study that appears to contradict this point.

But a more fundamental assertion of the Berkman study used erroneous pricing data to support its conclusion that Canada’s entire regulatory framework was flawed. Berkman said:

During the first generation transition and to this day, Canada has had some of the highest regulated rates for unbundling anywhere in the OECD.

And later, Berkman said:

Indeed, Canada has the highest monthly charge for access to an unbundled local loop of any OECD country.

Bell Canada has been trying to replicate the data that led Berkman to its conclusions. And according to the letter sent to the author and filed by Bell, Berkman didn’t look at the underlying data properly.

Bell Canada’s territory is divided up into seven (7) rate bands, specifically Bands A through G. Although Rate Band D is the middle rate band it represents only two percent (2%) of Bell Canada’s ULL, and is mostly associated with small towns and rural areas. Ninety percent (90%) of Bell Canada’s ULLs fall into Rate Bands A and B, the two least expensive rate bands for ULL.

So the Harvard study appears to have used Band D as a proxy for the average Canadian unbundled loop price, not knowing that it was actually completely unrepresentative of the Canadian marketplace.

As can be seen from the tables above, Bell Canada’s weighted average monthly ULL rate is among the least expensive in the OECD data set, with only five countries having lower ULL rates.

This critique seems to echo problems identified by NTT last fall which said that Berkman misrepresented the Japanese situation, a problem that could have been cleared up with a simple phone call.

As NCTA said in its criticism of the Berkman study, the authors abused their academic standing:

The Berkman Report, in short, is an advocacy piece, not the work of dispassionate scholarship that the Commission requested.

As I indicated yesterday, Len Waverman, Dean of University of Calgary’s Haskayne School of Business and author of the Nokia Siemens Networks Connectivity Scorecard will be speaking at The 2010 Canadian Telecom Summit next week. On June 8, we will host a number of sessions helping to develop strategies for Canada’s digital economic future.