Providing telecommunications in the Far North is a significant challenge. The population density is 0.03 people per square kilometre (0.02 in Nunavut), less than two orders of magnitude lower than the population of Canada as whole. Canada is already among the world’s least densely populated countries.

Adding to the engineering challenges are the vast distances to be covered, a harsh climate, and challenging geography. With less than 120,000 people, the Far North represents just 0.3% of Canada’s population across nearly 40% of Canada’s land mass. Indeed, on its own, the Far North would rank as the world’s seventh largest country (smaller than Australia but larger than India).

Upgrading telecommunications in the Far North isn’t easy, but it could deliver significant positive changes for Territorial residents. Telecommunications services can be a vehicle to digitally shrink distances.

As I mentioned in April, the CRTC has been studying the state of telecommunications in the Far North. The Commission conducted a week long public hearing in Whitehorse in April to canvass views. Final comments on the proceeding were supposed to be submitted last Friday (June 9). However, on May 24, the CRTC suspended the proceeding, saying:

The Commission is committed to consulting a diversity of voices and perspectives on the issues raised in this proceeding. The Commission intends to take additional steps in this regard, while recognizing the importance of a timely decision.

Last week, TELUS filed an interesting proposal in the form of a procedural request. In its letter, TELUS made two recommendations to enhance the process:

• addition of a reply phase; and,
• the appointment of an inquiry officer “to engage directly with interested parties in Nunavut.”

The suggestion of including a reply phase is not that unusual. Given the nature of the proceeding, it likely should have been part of the CRTC’s original public notice. As TELUS noted, “Reply is commonly part of a major proceeding as it allows parties to challenge the veracity of any conclusions made in final submissions and to correct the record regarding any mischaracterizations of information already submitted.”

The appointment of an Inquiry Officer is a less frequently used power of the CRTC. Under the Telecom Act,

70 (1) The Commission may appoint any person to inquire into and report to the Commission on any matter
      (a) pending before the Commission or within the Commission’s jurisdiction under this Act or any special Act; or
      (b) on which the Commission is required to report under section 14.

In 2014, the CRTC appointed Commissioner Candace Molnar to be an Inquiry Officer to explore the Canadian marketplace for satellite services used on a wholesale basis. In 2012, Commissioner Tim Denton was appointed to be an Inquiry Officer to examine issues related to 9-1-1 evolution. Before that, we have to look back 40 years to see that the CRTC appointed a senior staff member to be an Inquiry Officer to examine Phase III costing.

TELUS notes in its letter that the CRTC has considerable discretion in who could be appointed.

In appointing an inquiry officer, the Commission is not limited to Commissioners and staff member, but may designate any person it deems to be suitably qualified. To address the particular issues in Nunavut, the inquiry officer could, for example, be from the Far North or very familiar with the circumstances, cultures and languages of Nunavut. Such an individual could engage with the people of Nunavut with a granularity and cultural sensitivity not possible in a regulatory hearing, but consistent with the Commission’s intentions toward Indigenous engagement as espoused in the Notice. Without the structure associated with a full hearing, an inquiry officer could converse directly with individuals in their homes or communities and the report could be completed comparatively quickly.

The purpose of the CRTC consultation is stated as “want[ing] to hear from you on what actions it should take to improve telecommunications services in communities in the Far North.” While the Commission sought comments using a “new online engagement platform”, without reliable internet access, how would most residents of Nunavut access it?

The people of Nunavut are the among most remote and the most dependent on satellite-based communications. For most residents, internet-based communications is slower and more expensive than similar services delivered to the majority of Canadians. Although the CRTC held its public hearing in the North, travel from Nunavut to Whitehorse is impractical for most. Participating via internet would not have been an option; isn’t that precisely why this consultation is being undertaken? Notably, the Government of Nunavut did not participate in the proceeding.

The CRTC itself noted that it “is committed to consulting a diversity of voices and perspectives on the issues raised in this proceeding”. The idea proposed by TELUS, to appoint an Inquiry Officer to collect evidence, would appear to be a solution to bridge the information gap, sensitive to the cultural diversity and geographical challenges that may have inhibited participation by Canada’s most remote citizens.

Until the state of telecommunications in the Far North is improved, it is imprudent to rely on conventional procedures to canvass local perspectives. Solving the challenges of upgrading telecommunications in the Far North will require unconventional engineering and regulatory approaches.

So isn’t this an appropriate occasion to use one of the more unconventional powers of the CRTC – appointing an Inquiry Officer?

Is it time for government telecom policy makers to say, “Mission accomplished”?

At a recent investor day hosted by TD Securities, Bell CEO Mirko Bibic said:

You talk about the competitive landscape or dynamics or intensity, I think it is to be fully expected. When you have four well capitalized companies who are integrated across wireless and wireline and, in several cases, broadcasting or media, it’s not surprising to me that there’s competitive behaviour we’re seeing across the board. Ultimately, it’s what you ought to want. As a consumer living in the country, it’s totally expected.

It should form part of a different type of dialog that we should be having. To the extent anyone thought there was an issue with competitiveness, haven’t we kind of solved it? You’re seeing the benefits of having four well capitalized companies operating across wireless and wireline, which by the way, you don’t see anywhere else in the world. Very few countries have four wireless players. And frankly, no countries have the ubiquity of fibre deployment that we have, with four players who own their wireline and their wireless assets.

In “Thoughtful policy”, I cited a recent Financial Post article by economists Dr. Jeffrey Church and Dr. Christian Dippon. The article notes how so many observers of Canada’s telecom markets “mistakenly attribute all price differences to differences in competition.” In reality, a number of factors that can have significant impacts on costs vary between countries. “In other words, prices will differ even if “competition” is the same.”

Using multiple regression analysis, it is possible to develop a model to account for variables such as “the quality of network service, availability of family plans, consumer preferences, income, availability and terms of handset provision, alternatives to wireless services, costs of provision, and the institutional / regulatory / legal environment”. Using such an analysis, it is possible to compare market prices to the statistically predicted price, to produce what Dr. Dippon calls a “value ratio” (as shown in the figure).

Measuring price without consideration of variances in quality produces meaningless results. “Value” seems to be a much more relevant metric.

Policy makers need to look at factors beyond price as a measure of competitiveness. The marketplace is working. As I told the Canadian Press a couple weeks ago, price reductions we are seeing in the mobile market are “well beyond any of the expectations that were set by Ottawa”.

So, are authorities in Ottawa preparing to declare “mission accomplished”? That would be unlikely. However, with the recent substantive changes in the structure of the sector, it might be appropriate to ask if regulators should stand aside and let marketplace dynamics work.

A recent Globe and Mail survey of Canada’s top chief executive officiers found that more than 60% of CEOs “believe Canada is on the wrong track when it comes to being a place for business to invest”. That should be a source of concern for policy makers.

Canada’s four facilities-based national competitors are spending billions of dollars extending and upgrading their wireless and wireline networks. That work is not complete. Policies need to support and encourage these continued levels of investment. And that usually calls for a lighter touch.

Canada’s future depends on connectivity.

Are there broader benefits arising from broadband connectivity?

We know about the power of broadband investments in driving toward an innovation-based economy. A new report [full report pdf, 686 KB] from the Montreal Economic Institute examines decreases in energy consumption and emissions facilitated by broadband networks. It notes the potential for 5G networks to achieve further environmental sustainability. This is a benefit of 5G about which I recently wrote.

MEI’s report observes “A 10-percentage-point increase in mobile broadband penetration is associated with a 7% reduction of CO2 emissions per capita”. New 5G networks are more energy efficient than previous generations. An Accenture report [pdf, 3.8MB] notes “that for a general 5G cell site, energy used in data transmission will be 8-15% of what it currently is for a similar 4G cell site and milimeter wave technology can further reduce energy consumption to 1-2% of a 4G macro site.”

According to MEI,

The 5G network architecture will facilitate the expansion of the Internet of Things (IoT)—the “fourth industrial revolution”—in which nearly everything will be connected to the internet. Thanks to billions of sensors, intelligent management, and real-time data analytics, sophisticated learning and optimized processes can have very real impacts on energy efficiency and consumption, and therefore on GHG emissions.

In my post late last week looking at the future of the future of work, I noted that at the end of last year nearly one in ten Canadian workers had a hybrid work arrangement. Ten percent of Canadians are working part-time from their offices, and part of the time from home or remotely. A further 16% were working exclusively from home. So, a quarter of Canadians rely on broadband connectivity to perform their jobs. MEI notes that broadband enabled remote work contributes to reductions in commuter traffic and office use, reducing energy consumption and emissions. The report cites a study estimating that a 10% reduction in traffic congestion would result in “the city of Montreal slashing 130,000 tonnes of CO₂ emissions, equivalent to removing 29,000 cars off the road.”

Broadband decreases the demand for transportation, improves industrial processes, and changes the way public services are accessed and delivered.

With these environmental considerations, clearly there are broader benefits associated with accelerated broadband deployment. MEI says “Given these benefits of the digital economy, facilitated by broadband internet and wireless mobility, it would be advisable for governments to reexamine the burdensome regulatory framework and public policies that stifle investment and innovation in this area.”

Remote working was supposed to be part of the future of work.

As the pandemic forced many offices to transition to working from home, we asked if networks could handle the shift in online traffic. Many offices were completely closed during the first year or so following the declaration of a pandemic. It turned out that the networks performed pretty well. The future of work had arrived.

And, a lot of people got used to the idea of working from home. Hours of commuting time were eliminated, as well as savings in travel costs and parking. Some people (and some jobs) adapted well to working from home. Some people vacated expensive downtown housing and escaped to lower cost suburban and rural locations.

Others didn’t (or couldn’t) adapt as well.

Despite remote work collaboration tools, many companies found drops in productivity when staff weren’t able to meet face-to-face for problem solving. A recent article in the Globe and Mail examined “The remote work revolution that never took off”. Remote working, a prediction by those planning the future of work, is characterized as a privilege or benefit, not a right.

Employment lawyer Howard Levitt writes:

As a result of pandemic safety precautions, forced closures and stay-at-home orders, employees were permitted or required to work from their homes. Employers can order their employees back to work when those conditions end.

What if they do not? At some point, and we are getting there, employees who are working remotely will be able to take the position that remote work has become a term of their employment and that their employer can no longer order them back to work.

Can an employer force employees to return to the office? In most cases, yes. But, market conditions can play a role in that answer. For some types of work, especially professions with limited qualified candidates, employees are in a better position to dictate the terms of employment.

Some employees relocated. If remote work is an option, why not avoid the cost of living in urban areas? Still, employers can reasonably have policies to expect employees to remain in the same province, to avoid unintentionally being subjected to laws of a different jurisdiction.

In January 2022, roughly a quarter (24%) of Canadians worked exclusively from home. By December 2022, that fell to one in six (16%). “In that period, the proportion of workers with hybrid arrangements rose from 3.6 per cent to 9.6 per cent” according to Statistics Canada data collected by the Globe and Mail. “A hybrid model can be useful for time management… On office days, a worker can attend meetings, presentations and lunches, while on home days they can do work that requires deeper concentration.”

More work is required to address corporate culture in a remote work environment. How do employees develop company loyalty if they don’t regularly come into a company facility?

The CEO of Royal Bank recently said that the slow pace of employees returning to offices is impacting productivity and innovation. “I think all CEOs in every sector I talk to are struggling with the balance of attracting, retaining, developing talent, promoting talent, building culture, creating productivity, it’s tough. It’s really tough. We don’t have the final model yet.”

In the meantime, the future of the “Future of Work” is leaning toward a hybrid model. Last weekend, in the Toronto Star, David Olive wrote,

Fixating on where employees work is missing the point. The point is the long-simmering worker dissatisfaction unleashed at the end of the pandemic.
…
In ideal offices, respectful managers extend to employees the kind of autonomy they had while working from home.
…
What has been lost so far in the workplace transition is a focus on the basic questions: “Do you value your job? And does your employer value you?”

What does work look like in your company? Toward what direction are you heading?

Maybe I am the naive one for expecting delegates at national political convention to produce thoughtful policy resolutions.

Shame on me.

At the recent Liberal Party convention, there were 24 policy proposals that earned majority delegate support as an “official party policy”.

One of these, ranked tenth in priority, was entitled “Combatting Disinformation in Canada”. The policy requests “the Government explore options to hold on-line information services accountable for the veracity of material published on their platforms and to limit publication only to material whose sources can be traced.” Because it directly impacts press freedoms, the media had a field day with this one. A Globe and Mail editorial called it “nothing short of dreadful and dangerous”.

The resolution passed without debate. No one stood up to challenge it. And while the Prime Minister told journalists that the government “had no intention of acting on the party’s policy”, let’s remember that this same government is pushing through a suite of legislation to control internet content, generally treating committee review of the bills with hostility.

As the Globe editorial wrote, “the resolution reflects how the Liberal base, at least, thinks that control should be increased”.

This wasn’t the only resolution that should have attracted greater review. Number 17 caught my eye, entitled “Fairer Access to Telecommunications Infrastructure”. The leadoff recital begins “Whereas a 2017 OECD report found…”. And, that may be all you need to know about that first recital.

Should we actually care what a six year old OECD report reported? A 2017 OECD report, any 2017 OECD report, is based on data from 2016 or earlier. It is 2023. If there are no newer reports that support your resolution – the first recital of your resolution – that may be an important indicator. Contradictions in that policy resolution might bring comic relief to your day. For example, the policy calls for nationalization of telecom infrastructure in part of the resolution, while seeking more international carriers in the second part. What a welcome to doing business in Canada!

I am not just picking on the Liberal Party. Three years ago, I noted that more thoughful policy would be helpful for all of the political parties. At the time, the Conservatives had produced a telecom policy paper that read more like a rough draft of a first year college term paper, a hodgepodge of random thoughts.

Our parliamentary committees seem broken. Is there a sufficient depth of understanding of issues to help produce more thoughtful policy?

Last week, University of Calgary economist Dr. Jeffrey Church and NERA’s Managing Director Dr. Christian Dippon penned a detailed critique of the “junk science” approach to analysis of international price comparisons, published in the Financial Post. The article is a deeper analysis, but it is worth investing time and brain-power to read.

Notably, the authors write that “The quality of network service, availability of family plans, consumer preferences, income, availability and terms of handset provision, alternatives to wireless services, costs of provision, and the institutional / regulatory / legal environment all differ across countries.” These factors are all missing from more simplistic analysis of price comparisons, leading to a flawed conclusion that higher prices in Canada are to be blamed on market competitiveness. “The FCC assessment [pdf, 2.8MB] of effective competition in wireless services contrasted starkly with the emphasis on flawed international price comparisons by the CRTC and the Competition Bureau.”

Junk science market analysis contributes to the flawed resolution passed by the Liberal party at its convention. Such policies, based on overly simplistic price analysis, can lead to increased costs for Canadian carriers, ultimately raising prices for consumers and potentially harming the business case for investment in network upgrades.

What is the best way to facilitate development of more thoughtful policy?