Why do more ISPs in the UK and other parts of Europe use local loop unbundling than we see in Canada?
Ofcom, the UK regulatory authority, is proposing increases in prices for BT Openreach services, with loops rising to £85 per year – roughly C$150 – from £81.69 today. It represents an increase of about C$0.50 per month.
Interestingly, most loops in Ontario are less than this, running C$145 in rate band B and as low as C$78 in band A (which covers the city core).
Ofcom issued a 250 page consultation document [pdf, 933 KB] describing its proposal. In the document, Ofcom says that a third of all BT local exchanges have unbundled loops available, covering more than 80% of the population. The document says that 60% of the UK has access to 4 or more competitors.
It again raises the question in my mind as to why more Canadian ISPs aren’t taking control of their own service provision using local loops.
There are around 100 submissions currently listed on the CRTC’s New Media consultation website. The usual suspects came to the proceeding looking for internet service providers to become new sources of funding for Canadian cultural production.
Most interventions warned the CRTC to stay away from regulating the internet. Some were pretty basic, like Ron Turner’s eloquent contribution to the discussion:
You are talking bout poking yur nose into regulating internet in Canada—keep your nose out of it– none of your business– we got way too much government regulation already– why dont you go after the virus and spammer guys and for thaT you dont haver to regulate nothin for that—- MAKE YOURSELVES USEFUL NOT USELESS
And then there is John Renny’s submission:
I am disgusted and appalled to think that the CRTC are thinking or even thinking about regulating the Internet; you’ll keep your damn hands off of our Internet; I’m going after each and every one of your jobs; …
Who the hell do you think you are? …
Into this debate, a number of other parties waded with far less passion. Such as Google looking to keep the internet ‘awesome’:
Canadian content is flourishing on the Internet. The Commission should resist the temptation to try to fix what is not broken. Without regulation the Canadian broadcasting policy objectives have been, and will continue to be, implemented on the Internet. The New Media Exemption is the best regulatory approach to keeping the Internet awesome.
Barrett Xplore’s submission is strictly legal, indicating that the CRTC has no legal authority to impose such fees. Barrett suspects that some continue to believe that there are very few facilities based ISPs, a fact belied by the Deferral Account proceeding.
Most facilities based ISPs are explicitly exempted from provisions in the Broadcast Act:
For greater certainty, this Act does not apply to any telecommunications common carrier, as defined in the Telecommunications Act, when acting solely in that capacity.
Rogers has appended a legal opinion from Faskens which confirms that the CRTC has no legal authority to impose fees on the ISP sector.
Since the major ILECs and cablecos are also Broadcast Distribution Undertakings, perhaps this is what leads some to believe that the Commission has authority and administrative wherewithal to tax ISPs for subsidies. It will be interesting to see legal argument on the other side.
As CAIP notes in its submission:
The true issue at hand is that no amount of funding will compel audiences to watch content that is not compelling. … Canadians are simply finding the content they desire using online resources rather than traditional distribution methods.
There are many other issues being reviewed by the CRTC in this proceeding, as we wrote in October. Many of the parties noted constraints set out in the Public Notice that limited their ability to discuss accessibility and net neutrality. At least one party has noted the potential for overlap with the internet network management proceeding and has recommended merging the oral hearings.
Sometime today, you will be receiving our first email blast announcing The 2009 Canadian Telecom Summit. For the past 3 months, Michael Sone and I have been working on development of the program for The 2009 Canadian Telecom Summit, which will take place June 15-17 at The Toronto Congress Centre.
You can now visit the conference website to take a look on-line or download our preliminary brochure [pdf, 193KB].
You will see that we are working on some interesting new sessions dealing with many of the issues that have been raised on these pages. Over the next few months, I’ll take a closer look at some of the themes for discussion at the event.
Registrations have already started to come in – we can issue receipts right away to help meet your year end requirements. Be sure to hold the dates and we hope you will join us in June.
If you want to propose a speaker, just contact us. If you aren’t yet on our email list, please sign-up at this location.
Ofcom, the UK regulator, has published a voluntary code of practice for ISPs in describing broadband speeds. ISPs that agree to adhere to the code are listed on the Ofcom website.
The agency has also produced a consumer guide [pdf, 252 KB] describing the highlights, including an explanation that ISP fair usage policies can result in restrictions on speeds and capacities.
Ofcom acknowledges network management by ISPs, but requires disclosure as part of its code:
39. Where ISPs apply traffic management and shaping policies, they should publish on their website, in a clear and easily accessible form, information on the restrictions applied. This should include the types of applications, services and protocols that are affected and specific information on peak traffic periods.
No prohibition on ISPs acting on the basis of applications, services and protocols: ISPs that sign up to the Ofcom code are required to disclose how they act on the data stream.
Most Canadian ISPs would qualify under these very loose guidelines. For example, I decided to visit the fair use pages of a few of the ISPs listed by Ofcom.
AOL’s disclosure allows them a lot of freedom in responding to network management concerns:
If a Member’s usage exceeds what AOL Broadband deems fair and reasonable for a residential broadband service, speed-limiting restrictions may be applied during peak hours (typically evenings) in the first instance. We’ll also be in contact with Members whose usage is deemed excessive with advice and recommendations of how to reduce usage.
If usage continues to be very high, we may reluctantly give a Member notice that their account will be terminated.
O2’s Fair Use Policy has maintained its own discretion in determining what usage is considered excessive:
There is no limit on the monthly network usage. However if we feel that your activities are so excessive that other customers are detrimentally affected, we may give you a written warning (by email or otherwise). In extreme circumstances, if the levels of activity do not immediately decrease after the warning, we may terminate or suspend your Services.
Will the new entrant wireless carriers need to pass two levels of Canadian ownership scrutiny?
Recall that when Bell Canada had its review of its proposed restructuring, there were two different reviews: one by the CRTC in a public forum; and one by Industry Canada.
The current focus is on Industry Canada’s review of ownership structures for the new licensees. After all, our federal treasury has already cashed more than a billion dollars in cheques from companies that have never operated before in Canada in any form. They aren’t cable operators or phone companies.
So Industry Canada has to approve of their ownership structure before issuing licenses.
But there is still the question of the CRTC. In order to operate telecommunications facilities (which includes mobile wireless transmission), the CRTC has to approve the registration of the operator as a carrier. The CRTC’s processes are different from those used by Industry Canada and the Commission could theoretically subject the operators to a different standard.
Is it possible that an operator will be Canadian enough to hold an Industry Canada license, but not have enough maple syrup and Timbits in their veins to pass CRTC scrutiny?
