Later this week we’ll be marking the 30th anniversary of the CRTC’s landmark decision enabling competition in Canada’s telecommunications market.

Telecom Decision CRTC 92-12: Competition In The Provision Of Public Long Distance Voice Telephone Services And Related Resale And Sharing Issues, was released June 12, 1992. The regulatory process began with an application filed by Unitel in May of 1990. Regional public hearings took place across the country, and the main hearing, with sworn testimony and cross examination by all parties took place over 11 weeks, from April 15 to July 5, 1991.

Competition had been rejected by the CRTC previously. The benefits of a competitive marketplace for telecommunication had to be proved to be in the public interest. Competition didn’t arrive in Canadian telecom by government fiat; we had to demonstrate the benefits.

At the time, competitive telecom was relatively new in a very limited number of countries. I was recruited to return to Canada after spending a half dozen years in the US, following the 1984 break-up of AT&T. My job was to define the interconnection architecture and build the network capital investment plans to transform Canada’s telegram company into a competitive digital communications company. In the first couple weeks, I rewrote the company’s interconnect plan, so new entrants would interconnect as peers, not customers.

Presenting the new plan at a board meeting a few weeks later, I met Ted Rogers and CP’s Bill Stinson for the first time and the new interconnection plan was put through the wringer. My boss motioned for me to sit down, but the lawyers I had been working were sitting in the back of the room and they wanted me to keep going. Later, I was told that I was being tested. As we packed up, Ted came over and told me it was a really good presentation and he looked forward to hearing more the next month. My boss said. “If that was a good presentation, what do you consider to be a bad one?” As he walked back into the boardroom, Ted answered “Why, you know what a bad presentation looks like!”

Over the course of the next 18 months, we assembled volumes of evidence, and answered thousands of interrogatories. My personal briefing book was a 4 inch binder with 33 tabs. [As an aside, I ran across it recently and would be happy to donate it to a resource library, if anyone is interested.] We carried 2 shelves of back-up binders into the hearing room. And that was just for the network panel.

For the oral hearing phase, I was part of the opening panel, on the witness stand for the first week testifying about the interconnection architecture. The strategy was to put the network panel up first, based on a thought that it would be boring and chase the story off the news so that we could get down to the serious policy issues over the following 10 weeks. Personally, I thought we were more exciting than the economists!

It was a different era. Sworn testimony – I was affirmed. Full cross examination, without the ability to consult with our lawyers once on the stand. The Minto Suites was home to many of the out-of-town teams. Long days at the hearing on the Quebec side of the river would transition to long evenings, usually starting off with the sauteed mushrooms and refreshments at the hotel’s street level bar/restaurant.

Someday, I really should pull together more stories from those days.

A memorable moment from the hearing came when I finished testifying. I was chatting with our corporate head of law and the legal chief at Bell came over and complimented our panel. I was shocked. A couple days earlier, he was doing his best to trip us up and here he was telling our lawyer what a good job we had done. During the following week, SaskTel’s outside counsel, the late Willie Grieve, caught up with me at our hotel and asked if I could help him understand how our proposal worked. We were developing a model of “co-opetition”.

Those personal interactions indelibly reshaped my understanding of the regulatory process. Inside the hearing room, we could (and we would) vigorously advocate our positions, while still maintaining courteous, professional and even friendly relationships with the other team. It is like the way opposing teams line up to shake hands at the end of a hockey playoff series, demonstrating respect for their industry colleagues.

Those professional relationships were important as we moved into implementation. Every so often, an issue needed an escalation to avoid (or mitigate) a service affecting incident. It helped to have a relationship with my counterpart on “the opposing team.” Sometimes, it is helpful to resolve issues without resorting to the regulator.

Scratch that. It is almost always preferable to resolve issues without resorting to a regulatory filing. I think there is a lesson in there for many of today’s industry participants.

I wrote a nostalgic post 5 years ago that you may find to be worth a fresh look.

Last week, I contacted the members of my small but high energy team of bright young engineers who had all been recruited from Nortel and Bell Labs to join what was then called CNCP. All of them were under 30, reporting to me when I still had a full head of dark hair at the age of 32. It was a memorable time together, working ridiculously long hours, creating bonds that keep us connected 30 years later. I am proud of what we accomplished and the leadership roles in the global telecom sector that each member of our team assumed after we moved on from Unitel.

There were notable industry leaders who had emerged from among the CRTC staff involved in that proceeding. But that is another story for another time.

As I have mentioned before, I will sometimes be driving on a highway here in Canada, video-chatting with my daughter who is on a high-speed commuter train halfway around the world, without either of us having to think about the cost. I don’t ever take that for granted. The miracle of connectedness is possible thanks to more than a century of investment and innovation by some people with whom I am honoured to have worked.

Ubiquitous affordable communications haven’t always been the norm.

During the regional CRTC hearings in 1991, we divided up the various provincial and territorial capitals in order to have a company representative sit with our lawyer, to listen as members of the public delivered comments to a mini-panel of Commissioners. I attended the Vancouver and Whitehorse hearings on the company’s behalf. As an aside, let me note that the weather in Vancouver in February is a little milder than Whitehorse, but I am not sure have seen any place prettier than the Yukon in Winter. There wasn’t a lot of air connectivity to Whitehorse so we ended up spending a few days there for a half-day hearing. After settling into my hotel room, I remember walking into the lobby where our lawyer was chatting with a CRTC Commissioner before we all set out for adventure during the few hours of daylight. I opened the conversation saying “did you see the long distance phone rates listed in the front pages of the Whitehorse phone book?” Surprisingly, neither of them knew that it cost around $3 per minute to call Toronto. In 1991, that would have taken an hour’s work at minimum wage to pay for a two minute call.

We changed that for most Canadians.

Thirty years ago this coming Sunday, Canada created the regulatory framework that enables today’s competitive environment for communications connectivity.

I’ll be thinking of my colleagues and friends among those who were involved, from all sides of the proceeding, applicants, respondents, intervenors and the Commission. I invite you to add your reflections in the comments section.

Congratulations on the past 30 years. As Ted Rogers would say, “the best is yet to come.”

A post on the Canadian Wireless Telecommunications Association blog reminded me to take a look at the latest quarterly update to the CRTC’s Communications Market Report.

The joint CRTC – Statistics data is showing that Canadian consumers are continuing to get more value from their internet and mobile services.

CRTC and Statistics Canada data shows an additional 500,000 households connected to high-speed internet in 2021 for a total of 12.1M, representing an increase of 4.2% over 2020’s subscriber total of 11.6M.

At year-end 2020, 3.3M (28%) of subscriptions were for speeds of 300Mbps or more; such connections increased to 3.9M (32%) over the course of 2021. Downloaded data traffic nearly doubled between year end 2019 and 2021, increasing from an average of 228.4GB in fourth quarter 2019 to 404.8GB by year end 2021.

On the wireless side, the latest report shows dramatic price reductions across-the-board, while average usage climbed 40% to 5.3 GB in 2021 over 2020 (3.8 GB).

The Canadian Wireless Telecommunications Association blog summarized the CRTC pricing data in this graphic:

As prices went down, CRTC and Statistics Canada report that average usage increased:

CRTC data shows that there were 1.2M more mobile subscriptions at the end of 2021 (33.4M) than there were in the first quarter of 2021 (32.2M).

As prices continue to rise in the rest of the economy, Canadians are paying less, while getting more for their communications services.

The public interest for telecommunications is multi-dimensional. Although some lobbyists seem to focus solely on lower prices, government policy needs to balance other factors, like investment in increased coverage, new technology and services, and quality.

Last Thursday, when Minister François-Philippe Champagne announced a new policy direction, there were 3 “associated links” in the press release:

• Order Issuing a Direction to the CRTC on a Renewed Approach to Telecommunications Policy
• Backgrounder: Summary of the Government of Canada’s new proposed policy direction to the CRTC
• Backgrounder: Renewing Canada’s approach to Telecommunications Policy: Context for Action

Much of the focus of media coverage was on the proposed Policy Direction as well as the disposition of the wholesale rates appeal:

We recognize the important balance that must be achieved between the need to invest in our networks and the need to promote continued competition and affordability. The wholesale rates decision made by the CRTC in 2021 is an attempt to correct errors made in 2019, and it makes permanent the rates that have been in force since 2016. The decision provides stability, and the government has determined that it will not alter this decision.

My initial impressions were captured in a blog post, “A new direction for Canadian telecom”.

I noticed that many of the news articles cited language that appeared in the Policy Direction Backgrounder, as opposed to the more moderate language found in the actual draft Order.

There seemed to be less attention on the Context Backgrounder, and as has become usual, that is where I like to focus.

I have talked about a theme of balance that I think continues from Minister Navdeep Bains era 5 years ago, balancing Quality, Coverage And Affordable Prices. A few weeks ago, I observed, “In its rejection of an appeal on the CRTC’s Review of Wireless Services, just last month Cabinet said: “the Governor in Council considers that the Commission’s decision appropriately balances investment incentives to build and upgrade networks, and sustainable competition and the availability of affordable mobile wireless prices for consumers”.”

Nearly two years ago, Minister Bains said Canada’s Future Depends on Connectivity. Generally, last week’s telecom policy announcement promises a framework that continues to balance consumer interests, including the incentives for service providers to make investments that deliver quality services, available to all Canadians.

Policy consistency is important. The context backgrounder leads with details of how these policies have delivered benefits for Canadian consumers:

Canada has benefited from very high investment levels over time, with the private sector investing $11.4 billion in 2020. Canada has consistently been above the Organisation for Economic Co-operation and Development (OECD) average. For example, in Canada the share of telecommunications revenues invested in capital expenditures over time was 30-50% above the OECD average. This has led to high quality telecommunications networks. For example, according to Ookla’s March 2022 Global SpeedTest, Canada ranked 16th out of 142 countries for median mobile speeds, ahead of all members of the G7, and 17th out of 182 countries for median fixed broadband speeds ahead of all members of the G7, except the USA and Japan.

When it comes to the household availability of full fibre networks, in 2020 the household coverage in Canada (49%) was ahead of the US (42%), Australia (16%), UK (18%), Germany (11%), and Italy (34%) and the EU average of 43%. Similarly, when factoring in cable networks, coverage of the faster speeds of 100 Mbps and 1 Gbps are available to 87% and 76% of homes compared to 76% and 51% in European Union countries. Data from OpenSignal shows strong speeds for new Fifth generation (5G) services with Canada ranking 4th in 2021, strong historical coverage of 4G services, and for more specialized application metrics Canadian operators were not among global leaders but above the sample average. Fibre and new 5G services continue to roll out and ongoing investments will ensure Canadians benefit from these and future technologies as they are introduced and deployed.

The subsequent paragraphs, talking about rural service gaps, demonstrate an understanding and appreciation of the challenging aspects of business cases to build in parts of Canada.

The background document provides a market overview and helps to understand the context in which policies are being formed, “promoting more competition, universal access and a more consumer-oriented telecommunications sector in Canada.”

Minister Champagne said “We recognize the important balance that must be achieved between the need to invest in our networks and the need to promote continued competition and affordability.”

This reference to balance, coupled with the Policy Direction’s requirement for predictability, provide important messages of policy consistency.

Have we seen the end of Calvinball in Canadian telecom regulation?

Last week, Telesat announced the successful completion of a demonstration in Brazil of Low Earth Orbit (LEO) backhaul for a 5G network. The performance results achieved were said to be close to fibre connectivity. Telesat conducted the world’s first 5G backhaul demonstration 3 years ago, with round trip latency of 18-40 milliseconds, and supporting video chatting, web browsing and simultaneous streaming of up to 8K video.

In Canada, and in many areas around the world, 5G technology is being used in a fixed wireless application to provide residential broadband. Wireless is a cost effective way to connect homes and businesses in low density areas, especially where considerations of Canadian geography and climate increase the challenges associated with placing wireline facilities.

Today, Starlink terminals require a very high initial payment and monthly service fees are about double the prices paid by urban subscribers for similar terrestrial services. Earlier this month, the Government of Canada announced that it would be providing a $900 per household subsidy for residents in a number of Manitoba communities to help offset the upfront costs associated with subscribing to Starlink.

One of the biggest challenges for building terrestrial rural broadband networks has been the umbilical connection. In the case of wireless, network operators have to provide backhaul from the tower to the network. The Telesat announcement, using LEO for 5G backhaul, adds another technology solution for consideration to solve that problem.

Customer premises equipment for 5G typically is easier to install and has a much lower cost than what is required for LEO. With the LEO connectivity centralized at the 5G base station, the cost of the LEO terminal is effectively shared by all of the subscribers on a tower, which should significantly improve the economics for a LEO-based broadband service. Typically, fixed wireless is priced lower than direct-to-home LEO services.

When will we see LEO supported 5G for fixed wireless in rural Canada? Will this enable a more cost-effective choice for customers of rural broadband service providers?

A study from UK’s BroadbandChoices ranks Canada number 9 of 164 countries for quality, availability & cost of internet, up 7 positions from last year.

But you wouldn’t necessarily know that from reading Canadian telecom newsletters. It isn’t easy to conduct such studies and maybe it is just as tough to sort through the headlines to report on what is going on. Unfortunately, MobileSyrup took another recent broadband report and torqued the conclusions. MobileSyrup writes “Canada takes 103rd place in study examining worldwide broadband cost”. The headline doesn’t properly reflect the actual study, which didn’t compare worldwide broadband costs, it compared lifetime broadband costs around the world.

I don’t think it takes an advanced degree in statistics to be able to sort through the numbers, but since I do happen to have those credentials, let me provide a different perspective on the same source documents. Comparing lifetime broadband costs would mean that a country with high monthly broadband prices but short life expectancy would rank “better” than a country with lower prices but longer life expectancy. But that isn’t how this study was done. Instead, all MoneySupermarket did was take monthly broadband prices from a different study – the Internet Accessibility Index – and multiply it out by the worldwide average life expectancy of 72.6 years.

There were no adjustments for household size – fixed internet is shared by everyone in the household; no adjustment for age at which people start their own household – if the life expectancy is 72 years, a person doesn’t start paying for their own fixed broadband until they move out. And, as I mentioned, no adjustment for variations in life expectancy.

So in reality, the study is simply looking at monthly broadband prices and multiplying by a constant, 871.2 (12 months times 72.6 years), in order to grab some clicks. The table also looks at average median income and looks at monthly broadband costs as a percentage of income.

Bhutan ranked first in these rankings of raw broadband prices, but the report also shows that its US$10 monthly broadband price represented more than 4% of average income. Canada raked 109 in this report, but broadband is reported to be just 2.24% of income. The residents of which country are better off?

I will note that I am not able to reconcile the incomes used in the MoneySupermarket report. As a result, it isn’t clear that the study is using household income versus individual income.

But let’s go back to the original study upon which I based my headline: Canada ranks 9th out of 164 countries for quality, availability & cost according to the 2022 Internet Accessibility Index. That is an improvement from a 16th place in 2021.

That should have been celebrated.

By the way, Bhutan – ranked lowest in lifetime broadband cost – ranked 115th in the Accessibility Index, with download speeds rated at just 3.3 Mbps.

I have had problems with MobileSyrup reporting on international pricing studies in the past. In this instance, the Internet Accessibility Index was referenced as the source for prices by the authors of the lifetime cost study. Wouldn’t that have been reasonable context for MobileSyrup readers?

International comparisons are very difficult to get right, but we should question why it seems only those studies portraying Canada in a negative way are considered newsworthy.

Maybe headlines shining a positive light on Canadian telecom would be seen as click-bait? (Not this article, of course.)