Addressing the dark side of the web is a concern for many of us.

At the Canadian Information Productivity Awards in Toronto last week, Paul Gillespie spoke about the work he is doing with KINSA, the Kid’s Internet Safety Alliance, and CETS, the Child Exploitation Tracking System. He received the only standing ovation of the evening. He spoke to the information technology industry about his work trying to track down child exploitation and predators. It was something people could understand. It wasn’t self-serving. His brief speech set out clear social benefits of his work. He spoke, in part, of the need for legislative reform to enable his work to proceed.

The Telecom Policy Review includes a recommendation that addresses some of these reforms, part of which is contained in the recommendation discussed in yesterday’s posting. More needs to be done, with cooperation of the industry and others.

To explore solutions, the topic of illegal content on the internet requires reasoned discussion and debate. Paul Gillespie has agreed to return to speak at The 2007 Canadian Telecom Summit next June.

This week, Michael Geist wrote in the Toronto Star that he is concerned that selective deregulation of the phone companies and the failure to implement the complete bundle of recommendations of the Telecom Policy Review (TPR) panel could lead to the development of a two-tiered internet in Canada.

His belief that adoption of the TPR report will bring salvation from the scourge of a two-tiered internet is not founded in fact. He writes about being concerned about ISPs traffic shaping of applications like movie and music downloading applications.

The Star article selectively quotes the TPR as including a net neutrality provision that calls for legislative changes to:

confirm the right of Canadian consumers to access publicly available Internet applications and content of their choice by means of all public telecommunications networks providing access to the Internet.

But the citation in the Star neglected to complete that passage. TPR Recommendation 6-5 continues with

This amendment should

(a) authorize the CRTC to administer and enforce these consumer access rights,
(b) take into account any reasonable technical constraints and efficiency considerations related to providing such access, and
(c) be subject to legal constraints on such access, such as those established in criminal, copyright and broadcasting laws.

Those omitted sentences would appear to permit the traffic sculpting of ‘legitimate peer-to-peer’ applications that offended the author. Part (b) seems to be designed to take into account the technical realities of the internet as a shared network resource.

Another complaint raised in the Star was in respect of Shaw’s quality of service enhancements for over-the-top VoIP service. On September 21, in Decision 2006-61, the CRTC ruled that certain enhancements that the cable companies used in providing their own services may indeed discriminate, but the Commission ruled this was not ‘undue discrimination.’

The TPR actually seems to lean towards letting the ISPs make reasonable decisions, but with clarity of information provided to customers. As we wrote last March when the report was first released:

Given the complexity of this area, the rapid evolution of technologies and the market dynamics, the Panel believes the regulator here should have more discretion than in other areas of regulation. However, the Panel also believes this discretion should be exercised with a view to encouraging reliance on market forces and customer choice as much as possible. For example, there may be situations in which a customer wants an ISP to block access to particular applications or content. In addition, some customers may be willing to accept a reduced degree of access in exchange for a lower price. Such consumer choices should be respected.

In the Panel’s view, the purpose of a customer access rule should be consumer protection, and there should be a strong emphasis on ensuring that customers have the information required to make informed choices. In this way, the rule would promote the efficient operation of market forces.

It merits repeating our view that the TPR provides a Solomonic balance of interests.

By the way, Professor Geist has agreed to join our panel examining illegal content on the internet at The 2007 Canadian Telecom Summit in June. We look forward to a lively discussion.

The CRTC has issued a Public Notice (PN 2006-14) to examine the regulatory framework for wholesale services and definition of essential service.

This proceeding will be significant and it includes live hearings scheduled to be held in Gatineau in October 2007. Yes, a year from now. Following the hearings, there will be further exchange of arguments and reply, meaning that the file won’t close until January 2008. A decision will be rendered within 180 days.

The timing should be perfect for The 2008 Canadian Telecom Summit.

This is a major regulatory proceeding. Among the more more significant issues in looking at relaxing regulation of retail services is whether there is still a need to regulate wholesale services. If so, what are the essential wholesale services that should be regulated, as contrasted with those that are provided according to what the market will bear.

As the CRTC notes in the Public Notice:

The Commission notes that to date it has not conducted a comprehensive framework proceeding with respect to wholesale services and that, as noted above, its current regulatory regime for wholesale services evolved on an incremental basis. … The Commission, therefore, considers there is a need to conduct a comprehensive proceeding to review the regulatory framework for wholesale services, including, in particular, a review of the definition of essential service and the associated pricing principles.

…

The Commission notes … that the complexity of the interrelationships between several of the wholesale services means that to deal with them in isolation could create unforeseen problems.

The Commission’s conclusion … is that any limitation of scope in the interests of time would ultimately create a longer overall timeline as it would be necessary to conduct several significant lengthy related proceedings in sequence.

[PN 2006-14, p.15-21]