Circumstances shift over time, and telecommunications technology, policy and regulations are no different.

A recent set of CRTC filings provides an opportunity to take another look at the processes for changing the regulatory landscape.

A year ago, in “Channels of appeal”, I described the three normal ways to appeal a CRTC decision: to Cabinet (the Governor in Council); to the Federal Court of Appeal; or, back to the CRTC itself.

These processes have prescribed timetables set out in the Telecom Act or the CRTC’s Rules of Practice and Procedure.

But what do you do if you believe an older decision is past its “best before” date and the channels of appeal have long since expired?

That question has come up in the context of a TELUS filing, “Application requesting that SILECs be classified as Originating Network Providers for NG9-1-1” [zip, 820KB]. I’m not going to look at the substance of the application or its merits. For the purpose of today’s post, it is sufficient to know that this is a new application, dated April 21, 2022, asking the Commission to modify determinations made five years ago, in 2017.

The Independent Telecommunications Providers Association (ITPA) filed an entertaining reply that seems to suggest that there is no process available to challenge older CRTC rulings.

In its reply [download pdf, 170 KB], ITPA asserts that when TELUS argues in its application that the Commission “erred”, then its application became an appeal subject to the channels of appeal and the timetables set out in the legislation. ITPA says “waiting almost five years after the decision or order because one dislikes the effects of the decision or order is not among the choices.”

Regardless of how TELUS chooses to qualify its application, it does not make it a “new application”. Calling an apple an orange does not make the apple an orange.

I thought it would be obvious that there must be ways to change regulations after the 90 day statutory appeal process expires. Technology changes, circumstances change, the rest of the world evolves. It is inconceivable that the rules of procedure would not contemplate such a need.

And indeed, they do. In Telecom Information Bulletin CRTC 2011-214: Revised guidelines for review and vary applications, the CRTC describes the processes. Interestingly, that guideline reference is cited in the ITPA reply where the Association argues that TELUS is almost 5 years too late to file a review and vary application.

The point is, TELUS did not file a review and vary application. TELUS must have read the second half of the Information Bulletin where the Commission described “Criteria for distinguishing review and vary applications from new applications.”

In the past, some applications have been framed as new applications when they should have been framed as review and vary applications, and vice versa. The delineation of general guidelines for distinguishing among the various applications should assist applicants in determining whether to proceed by way of a new application or a review and vary application and avoid unnecessary delays.
…
The Commission has identified five factors that, although not exhaustive, will assist in assessing whether an application raises an issue relating to the original or the continuing correctness of the decision in question and accordingly, whether it should be treated as a review and vary application or a new application. These factors are the following:

• whether the application raises an error of law, jurisdiction, or fact;
• the extent to which the issues raised in the application were central to the original decision;
• the extent to which the facts or circumstances relied upon in the application were relied upon in the original decision;
• the length of time since the original decision; and
• whether the resulting decision would supersede the original decision in a prospective manner as opposed to curing an error on a retrospective basis.

We can’t have a situation where any application seeking a change is deemed to be a “review and vary”, but then the filing is thrown out for being too late. The CRTC’s guidelines accommodate such circumstances by indicating that a new application should be used.

The regulatory landscape needs to be able to evolve and the rules of procedure accommodate these shifting sands.

I think we are going to find that the CRTC will agree that TELUS properly formulated its filing as a new application.

Class dismissed.

In Canada’s competition review system, Canadians’ interests are represented by two separate, but equally important groups: the Competition Bureau, who investigate; and, the Competition Tribunal, a quasi-judicial body led by Federal Court judges who adjudicate cases brought forward under the Competition Act.

Forgive me for inserting the “Law & Order” sound effect here.

As the review of the Rogers – Shaw merger moves to this next phase, it is important to recognize that there is a clear separation between the Competition Bureau and the Competition Tribunal. My weekend post provided a high level description of the Tribunal.

The two bodies are completely separate and have not always agreed on competition policy or interpretations.

There have been a number of significant applications brought forward by the Competition Bureau that were rejected by the Competition Tribunal or the Courts.

In “Courts slam competition chief in two harsh legal putdowns”, Terence Corcoran describes what he calls “a harsh rebuke” delivered by the Competition Tribunal to the Competition Bureau this past Canada Day (2021).

Just over two years ago, the Competition Tribunal ruled against the Commissioner’s application against Vancouver Airport and ordered the Commissioner to pay $1.3M in legal costs, as described in a note from Oslers.

In a case looking at the Toronto Real Estate Board, the Competition Tribunal dismissed an application filed by the Commissioner alleging abuse of dominance.

Rogers only competes with Shaw in the mobile business, and the companies say their proposal will spin off that business.

Based on statements by Rogers and Shaw that the companies are “proposing the full divesture of Shaw’s wireless business, Freedom Mobile”, it is difficult to envision how the transaction “prevents or lessens, or is likely to prevent or lessen, competition substantially” as prescribed in the Act.

Some academics have over simplistically alluded to disappointment in the outcome from the Xplore Mobile remedy arising from Bell’s acquisition of Manitoba Tel.

There should be no parallels drawn between then and now. At the time of the Bell-MTS transaction in 2017, Xplornet had different ownership, had no prior experience in the mobile business and it did not acquire a complete national network and business operation. As I describe in “A Kobayashi Maru scenario”, the situation is very different if Xplornet acquires Freedom Mobile. Xplornet has fixed wireless services in need of additional spectrum in rural markets; Freedom Mobile owns spectrum in vast swaths of rural markets where it has not deployed (and likely will not deploy) its mobile network.

Indeed, a transaction with Xplornet could greatly strengthen the level of competitive intensity in the Manitoba market, (a market in which Freedom Mobile does not operate), by boosting Xplornet’s overall mobile operations, while enabling Rogers to leverage the Shaw wireline assets in the province to compete better against Bell. Such a remedy provides the Competition Bureau with an opportunity to gain a win on the earlier Bell-MTS transaction.

Acquiring the wireline business from Shaw enables Rogers to be a stronger competitor in Western Canada, positioned to deploy 5G network investment more efficiently to compete with the incumbent wireline phone companies: TELUS in BC and Alberta; Sasktel in Saskatchewan; and, Bell in Manitoba.

When the merger was first announced, Brad Shaw testified before the Parliamentary Industry Committee and said that the status quo was not an option, the level of investment required for wireless was beyond the ability of Shaw to undertake:

Canada’s future success depends on a forward-looking approach to connectivity. We need to bridge the digital divide to connect underserved rural and indigenous communities in the west, but we also need to build out a new 5G platform. This is an investment challenge of unprecedented scale. We cannot look backwards, as we might have worked in the past. As we look forward, it is clear that Shaw cannot build what Canada needs on our own. By joining forces with Rogers, I am confident that we can create something extraordinary for Canada.

“It is clear that Shaw cannot build what Canada needs on our own.”

As such, rejecting the merger transaction will predictably result in a weakened fourth competitor in Western Canada, unable or unwilling to make the necessary investments. Rogers would continue to operate at a disadvantage in the west, lacking the depth of infrastructure it sought from the transaction. How was this factored into Competition Bureau modeling of the status quo?

As BMO Capital indicated in an investment note last night, “We believe an outright rejection of this deal would not satisfy the government’s position of a four-player market (i.e., Shaw will not keep funding wireless, that’s why they sold).”

With a full divestiture of Freedom Mobile being proposed, the only segment of Shaw’s business in which it competed with Rogers, it will be fascinating to see the basis of the Competition Bureau’s objection to the merger.

Late Friday evening (or very early Saturday morning), Rogers and Shaw issued a joint press release in response to having received notification that the Commissioner of Competition intended to file applications to the Competition Tribunal opposing the companies’ proposed merger.

A number of people may not understand what this means, so I will try to sort out the players.

The Competition Tribunal is “a specialized tribunal that combines expertise in economics and business with expertise in law”. Members of the tribunal are appointed by the Cabinet, but are independent of any government department”.

The Governor in Council appoints judicial members from the Federal Court on the recommendation of the Minister of Justice. Lay members are appointed by the Governor in Council on the recommendation of the Minister of Innovation, Science and Economic Development. They provide expertise based on their individual backgrounds in economics, business, finance, accounting or marketing. Lay members are appointed on a part-time basis.

The members are appointed for fixed terms of up to seven years and may be reappointed. One of the judicial members is appointed Chairperson of the Tribunal by the Governor in Council.

There are 5 judicial members of the panel, but interestingly, the Tribunal’s website indicates that terms expired last week (April 29) for 2 of the members, including the Chair, The Honourable Mr. Justice Denis Gascon.

Procedurally, the Tribunal hears applications for orders under Part VIII of the Competition Act (Matters reviewable by the Tribunal) in panels of three to five members. A judicial member presides at the hearing and there is at least one lay member on the panel.

There is a formal protocol defining the separation between the Commissioner of Competition and the Tribunal. Notably, the Tribunal is defined as “strictly an adjudicative body that operates independently and at arm’s length from the Government of Canada, its departments and the Commissioner.”

So, the Commissioner of Competition carries out competition related investigations independently with the support of Competition Bureau staff, but that body is independent of the Tribunal. “At all times, the Parties will strive to ensure that any interactions will not create potential or future conflicts of interest, or undermine the public perception of the Parties’ independence and impartiality.”

If it is helpful, think of the separation of roles between the police and the judicial court system. Under this metaphor, the Competition Bureau is the police force, the Commissioner is the Chief of Police, and the Competition Tribunal is the Court. The position of “Commissioner of Competition” used to be known as the Director of Investigation and Research, which was more descriptive of the role played in cases such as this merger.

I’ll have more on this in the coming weeks.

Last week, MediaSmarts released “From Access to Engagement: Building a Digital Media Literacy Strategy for Canada” [pdf, 2.9MB].

The report is an output from a symposium held in February. MediaSmarts has been advocating for digital literacy for more than 15 years, since its earlier incarnation as the Media Awareness Network, and you will see references to digital literacy on this blog dating back almost as long.

A national strategy will provide experts, advocates and service providers in the digital media literacy field with a unified but flexible approach for preventing and responding to online harms through education and critical skills development. At the same time, people living in Canada will be empowered to use, understand, create and engage with digital technology and digital media, which is at the heart of active digital citizenship and innovation.

Unfortunately, Canada doesn’t have an accurate baseline to measure our digital media literacy skills, unlike some of our closest trading partners, such as the United States, the United Kingdom, or Australia. As I recently noted, digital literacy appears to be a significant inhibitor in increasing adoption of internet connectivity among vulnerable populations eligible for affordable broadband and devices. The report notes “that when it comes to digital participation, access to technology and training is crucial for historically marginalized people in Canada, including Indigenous communities, people living in poverty, newcomers and people with disabilities.”

A recent article in Policy Options by the report’s authors observed “Access alone cannot close the digital divide.”

Digital literacy is more than technological know-how. It includes various ethical, social and reflective practices essential to developing online resilience and ethical digital citizenship. We must then embed these practices in our work, learning and daily life. Approaches to digital literacy that overemphasize access, hard technological skills and risk-avoidance constrain rather than bolster user agency. The risk is that while most people do not need coaxing to use digital technology, many users become deeply immersed in online life without the necessary digital literacy skills and supports.

Let’s take a look at that last sentence. I would agree that “most people do not need coaxing to use digital technology”, but we also need to consider the challenge of digital literacy training for those who do need coaxing. While the number of folks who don’t use internet is closing, last week’s release from Statistics Canada [Full Report: pdf, 820KB] shows there is still over-representation of some groups that are getting left behind. Statistics Canada data identifies age and education among the most significant factors impacting internet skills.

We are making progress. Statistics Canada reports “Fewer Canadians are on the ‘have not’ side of the digital divide”.

From 2018 to 2020, the shares of Canadians identified as either Non-users or Basic users of the internet and digital technologies declined by almost 5 percentage points, from 23.8% to 18.9%. This represented a shift of almost 1.4 million Canadians from the ‘have-not’ to the ‘have’ side of the digital divide.

Leaders of the various low-income broadband programs (Connecting Families, Connected for Success, Internet for Good) may be able to provide valuable input to help inform the development of Canada’s national digital literacy strategy on factors influencing non-adoption of internet connectivity. As I wrote last year, “we have learned that getting people online isn’t just a matter of price.”

Of those who do not currently use the internet, a significant portion attribute their lack of online activity to issues of digital literacy and concern for cybersecurity.

Access alone cannot close the digital divide.

Canada needs to place greater emphasis on development of digital literacy among users and non-users alike.

In a post last fall (“Canada needs to be a global leader in 5G”), I wrote about a Policy Options article that said “Market forces alone will not deliver fast 5G internet to rural areas.”

Canadians need 5G. A recent paper describes at least 3 new areas of industrial change enabled by 5G: the Internet of Things (IoT) (enabling smart homes and smart cities); vehicle automation, healthcare and smart farms; and, augmented reality and virtual reality.

These innovations are important for rural and urban Canadians alike, and we have seen 5G services being made available in some rural markets already.

Over the past two years, a number of government policy announcements have helped create a climate that encourages investment by the private sector to extend the reach of advanced technologies beyond urban centres. “Canada’s future depends on connectivity” has been guiding regulatory determinations and telecom policy, balancing the objectives of expanding network coverage, delivering world-leading service quality, and affordable prices.

As I described last week, the cost of delivering rural broadband can be substantial. A recent government announcement awarded $163M in subsidies for less than 8000 households, including one project that cost more than a quarter million dollars per household.

What if there was another approach to encourage more private sector investment in rural broadband and 5G wireless?

Is that precisely what the government is looking at with the rumoured proposal to have Xplornet acquire the divested Freedom Mobile assets from the acquisition of Shaw by Rogers?

There are other groups that have apparently submitted bids, but it is difficult to envision how any would have a plan that could result in a sustainable business where previous incarnations of Freedom have failed. As a stand-alone business, where are the synergies to promote continued investment? As I wrote in “A Kobayashi Maru scenario”, Xplornet would be able to leverage the unused rural spectrum held by Freedom to improve the quality of broadband services it offers to its fixed wireless customers.

That would improve coverage, quality and price for hundreds of thousands of rural households, funded by private sector investment.

It is important for rural Canadians to have access to applications like smart farms, healthcare telematics, smart communities, automation.

In its review of the Rogers-Shaw transaction, will we see the government continue to maintain consistency in its policy approach to telecommunications, “balancing the competing objectives of extending the reach of networks, delivering world-leading service quality, and affordable prices”?