With the Olympics acting as a bit of a distraction, it took me some time to get around to reading the CRTC report, “Navigating Convergence: Charting Canadian Communications Change and Regulatory Implications.” Many of the news accounts of  the report were typically superficial, effective for looking for sensational headlines and forcing the CRTC Chair to issue a statement to respond.

One of the stories focused on so-called “skyrocketing” prices supposedly highlighted in the report. If you check out Figure 7 in the report, you will see that the prices don’t really seem to be “skyrocketing.” The overall CPI rose 13.3% from 2002 to 2008. Telecom services rose 5.7%, less than half the rate of inflation. Prices rising 5.7% over 6 years: help me understand the adjective, please. That’s a fizzled out kind of skyrocket, isn’t it?

Now, eyeballing Figure 7, you will notice that prices have been pretty flat, with an uptick in the final year. The statistician in me asks, what happened in that year? Well, followers of the CPI would know that in 2007, Statistics Canada updated the CPI, changing the base year to 2002 and it also updated the basket of goods to match consumer purchase patterns in 2005.

So the first point is that there is a discontinuity that needs to be examined and understood. Secondly, the CPI report from Statistics Canada is measuring a basket of services that does not necessarily align with current purchases. The current basket is 5 years old. An objective of the CPI is to match the goods and services that the average household buys, and adjust in order to understand like for like price changes. But certain goods and services are very different today from what was available 5 years ago.

Think about the challenge in comparing prices on computers – the purchase price may stay at $1000, but that buys a lot more of a machine today than it did in 2002. Today’s households buy a very different mix of telephone services than what they bought 6 years ago. That changing mix means prices for legacy services may have changed for all the right reasons as tastes and trends transition.

Cable and satellite rose 30% since 2002; double the CPI. Of course, let’s also be sure to take a look at what has happened to TV over that period. More channels, more digital, affordable big screen TVs (meaning more set top boxes per household), more HD, pay-per-view, on-demand, etc.

In other words, people are buying more TV services, perhaps because they want to and because they think it is worth the price, especially compared to other entertainment choices in a tough economy.

It is easy to look at numbers; it is a lot tougher to understand them, draw conclusions and develop policy based on the data.

Early bird prices expire at the end of February for The 2010 Canadian Telecom Summit. Sessions at the event will explore all of the issues affecting Canadian Telecommunications. Register today for The Canadian Telecom Summit.

For a few years now, I have been calling for Canada to develop a national digital strategy. Others have independently echoed the call and many other countries have moved faster toward examination of the broad range of issues to be considered as economies evolve to prosper in a digital era.

The CRTC’s recent report “Navigating Convergence” has a section on National Digital Strategy. The report observes:

A world-leading broadband network infrastructure is not an end in itself. The “pipes” are only useful inasmuch they are used to deliver services, applications and content to Canadians.

The 2010 Canadian Telecom Summit will have special sessions on Tuesday, June 8 that look at International Perspectives on ICT Strategies, followed by a session looking at Building Digital Canada. Early Bird rates for The Canadian Telecom Summit are available until the end of February.

Have you registered yet?

A story in Monday’s New York Times talked about the emergence of a new technology for mobile digital TV, in desperate need of a catchier name: ATSC-M/H (Advanced Television Systems Committee for Mobile and Handheld).

Beginning in April, eight television stations in Washington, D.C., will broadcast a signal for a new class of devices that can show programming, even in a car at high speed. In all, 30 stations in Atlanta, Chicago, Los Angeles, Seattle and Washington have installed the necessary equipment, at a cost of $75,000 to $150,000.

Apparently, Our Communications Research Centre spoke about ATSC-M/H in its submission more than a year ago to the CRTC’s New Media proceeding. A couple of months ago, CRC announced its own trial of the technology (thanks to Bram Abramson for the tweet with the links).

The CRC’s submission to the Commission concluded with a statement:

CRC has been collaborating with the broadcasting industry to develop and evaluate various broadcasting technologies. CRC will continue to look into the future and work on new broadcasting technologies such as the ATSC-M/H and multimedia broadcasting, as well as more advanced video technologies like 3D TV, super-high definition and immersive TV.

Thirty TV stations in a number of major US cities are in live market trials, while Canada is in a government test lab. While the CRC is working in cooperation with Canada’s broadcast industry, de-risking the investment in research, is there an unintended consequence of delaying the availability of new technologies for Canadians?

Announcements and news stories coming out of the Mobile World Congress in Barcelona are indicating that a vibrant, competitive marketplace for consumers will continue. A tweet from Michael Hennessy pointed me to an interesting article in The Guardian, speaking about Europe’s fall from its leadership in the mobile world. Late in the day, he tweeted a pointer to an announcement that the major Canadian wireless carriers have agreed to provide the lead commercial trial for the GSMA’s OneAPI initiative.

In more news from Barcelona, some of the world’s largest mobile service providers, including all of the major US carriers, have created The Wholesale Applications Community, targetting Apple’s apps store. Twenty-four service providers, with access to 3 billion customers, have signed on, as well as manufacturers Samsung, LG and Sony Ericsson. Wind Mobile appears to be the only Canadian carrier to have signed on at this time.

In a Barcelona media event hosted by CEO Steve Ballmer, Microsoft announced Windows Phone 7, delivering a more desktop-like experience for Windows applications. The browser is based on Internet Explorer, so mobile web-surfing might be more comparable to what users are after. Mobile Outlook has many of the functions of its desktop equivalent and it operates on locally cached data to run faster. All Windows Phone 7 devices are automatically Zune enabled and include XBox Live. It puts the PC strengths into the mobile device.

Microsoft has already established hardware partnerships with Qualcomm, LG, Samsung, Sony Ericsson, Toshiba, HTC, HP, Dell and Garmin Asus. Special service provider relationships were announced with AT&T and Orange for distinctive applications development. No Canadian service providers were announced in the list of initial partners: AT&T, Deutsche Telekom AG, Orange, SFR, Sprint, Telecom Italia, Telefónica, Telstra, T-Mobile USA, Verizon Wireless and Vodafone. But, Windows Phone 7 enabled handsets aren’t scheduled to hit stores until the Christmas 2010 shopping season, so we can expect Canadian partners to sign on before then.

Harry Patz, Microsoft’s North America VP for the Communications Sector will be speaking at The 2010 Canadian Telecom Summit on June 7.  Microsoft will be hosting an Innovation Showcase at the event. Early bird rates expire at the end of February. Have you registered yet?

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Did Bell Canada’s deferral account application force the Commission to look at restoring some of its regulatory powers under sections 24 and 27(2) of the Telecom Act?

In Telecom Notice of Consultation 2010-43, the CRTC said that it wanted comments on whether it was appropriate to restore some regulatory authority over mobile data:

The Commission notes that there is a link between issues regarding high-speed Internet service and mobile wireless data services, as well as the associated service providers. Accordingly, as part of the proceeding initiated by this notice, the Commission will review the appropriateness of the mobile wireless data services forbearance framework.

The CRTC asked for comments fairly broadly: “Should the Commission change the scope of forbearance with respect to mobile wireless data services, and if so, to what extent?”

Recall that Bell asked for authorization to use deferral account funding to provide broadband services that it has traditionally provisioned using DSL technologies. While all of the carriers enjoy forbearance from economic regulation, in Telecom Order 99-592, the CRTC retained S. 24 and S. 27(2). Section 24 regulatory authority was retained explicitly to continue to regulate confidentiality. When the CRTC granted forbearance to mobile services in Decision 96-14, it included release of Sections 24 and 27(2) for any non-voice mobile services.

In 1996, we had not yet seen the first Blackberry. Non-voice mobile services were hardly-used text messages and one-way pagers. Times have changed.

Now let’s go back to Bell’s deferral account application. If Bell uses its mobile data service capabilities to provide residential broadband, then consumers would be receiving a completely unregulated substitute (mobile data) as a substitute for a partly regulated service (DSL). That would raise questions about regulatory asymmetry; the principle that rules should be technology agnostic. If DSL is subject to Sections 24 and 27(2), why wouldn’t its proposed substitute also have these sections apply?

If the CRTC approves Bell’s deferral account plans for HSPA to deliver residential broadband, then it seems that the Commission would first need to reimpose certain regulatory authority over mobile service. The CRTC needs a consultation process before taking such a step. Which brings us to the current process.

But that raises another question. Has approval of Bell’s deferral account plan hit a delay? How can HSPA for deferral account projects be approved until after the 2010-43 process is complete (with a decision sometime in 2011)?

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