Earlier this week, Statistics Canada launched a new portal for data about Canada’s telecommunications sector, with a wealth of insights that should contribute to a far better understanding of the state of the industry by regulators and policy makers.

The portal currently highlights a few interesting datapoints, such as:

• Consumer prices for cellular services decreased by just under 15% in December 2020 compared to December 2019
• Capital investment by the wired and wireless telecom sector was just under $10B in 2018
• In 2018, over half of Canadians used their smartphones for e-banking, 44% for online shopping, and a third for streaming
• In 2019, 105,000 people worked in telecommunications, earning an average of about $66,000 for a total payroll of just under $7B

It is great to see Canada’s official government statistical agency invest additional resources into helping us improve our understanding of the underpinnings of the digital economy. Frequent readers will recognize that I have frequently written about the need for more data (such as here, here, here, here, and here).

In the past, I have asked “How is Canada supposed to be engaged in evidence-based policy making when there is so little information being gathered about who is online, how Canadians are using the internet and perhaps most importantly, who isn’t online yet and why not?”

What else would you want to see?

Better data leads to better quality decision making by regulators and policy makers. Statistics Canada new telecommunications portal is a welcome contribution to inform a fact-based discussion of issues.

“The programs need to be put in place now, not tomorrow. Now.”

That was the broadband affordability message from Bob Murphy, Chair of the Weston Chapter of ACORN Canada, in a deputation to Toronto’s Executive Committee last Wednesday evening.

ACORN members represent those people for whom the term “affordability” is serious. Bob Murphy delivered a heartfelt message. “When I talk about affordability, we bounce that word around at all committees… When I am speaking here about affordability, I’m talking about affordability for low income…Internet is more important now because of COVID… I have to spend money for internet before I spend money for food. This is not just an issue with me; it’s an issue with many Ontario Disability recipients. We have too many low income circumstances that have to prioritize internet before food. Internet before food. Can anybody here, sitting on this long day, imagine yourselves having to decide ‘Shall I pay for Internet or shall I have food and nutrition.'”

That speaker’s deputation resonated with me. How could it not? There is an immediate need. “These programs need to be put in place now, not tomorrow. Now.” But, despite the City calling its project “Affordable Internet Connectivity for All – ConnectTO”, a city owned fibre program fails to serve the level of urgency that was clearly stated.

No matter how much broadband prices fall, there will always be an affordability issue for many vulnerable Canadians. Canadians who have to choose between paying for internet or paying for food.

That is what affordability means.

Unfortunately, in recent weeks, we have seen the term “affordable broadband” hijacked and applied to alternate agendas, such as those ISPs seeking to bypass wholesale broadband access with taxpayers footing the bill for capital investment.

Now, I have no doubt that people want to pay less for their telecommunications services. I want to pay less for my telecommunications services, just as I want to pay less for my kosher meat, my dairy products, my property taxes. I want to pay less for everything. There are some things that I simply can’t afford. There are cuts of meat that I don’t buy unless they are on sale. I drive an 11 year old Hyundai.

But I don’t have to choose between paying for my internet and putting a nutritious meal on the table. I eat mac and cheese when I want to, not because I have to. The overwhelming majority of Canadians can afford their broadband service. I think it is important to differentiate between those who gripe about their monthly bills (it is part of our national birthright) and those who can’t afford a device, let alone the service to connect it online.

At the City of Toronto Executive Committee meeting, Bianca Wylie spoke about what she called applying a product management approach, and what I call systems engineering, defining requirements. She recounted an experience in an earlier job: “I used to be part of a company that built software. And one day when we were working on the software I asked if something was possible. My colleague told me to reorganize my question. They told me to say what I wanted, rather than asking what was possible. This is called requirement writing. Define the things you want then build them.”

Nearly 12 years ago, I wrote “A systems engineering approach to broadband”, saying “Most people define problems in terms of solutions. Many people say that they need nails when what they really need is to hold two pieces of wood together. The difference between defining problems in terms of requirements versus preordaining a solution.”

There are some well intentioned folks who likely believe they are helping with development of an affordable broadband solution, by endorsing a municipal fibre network, but that solution misses a key product requirement. The ACORN members at the meeting were pretty clear. They demanded, not requested, $10 per month broadband, immediately. “These programs need to be put in place now, not tomorrow, now when we have our families that rely on the internet every day.”

ACORN representatives told Toronto that the organization has been working on affordable broadband since 2016. As followers of this blog are aware, many of us have been working on this issue since 2008. Indeed, in partnership with Toronto Community Housing, Rogers launched Connected for Success in 2013, years before ACORN started thinking about the issue. Connected for Success offers residents of Toronto Community Housing 25/5 broadband service with no overage charges for just $10. And it’s been available for some time and is available now. Not tomorrow, but now.

In the years that carriers like Rogers (with Connected for Success) and TELUS (with Internet for Good) have been offering broadband to disadvantaged households, we have learned a lot about the challenges of driving broadband adoption in disadvantaged communities. People don’t just need an affordable connection. They need devices. They need digital literacy training. They need to learn about online safety. They need to build trust. These are issues that need the involvement of social service agencies.

As I wrote a little over a week ago, there were serious flaws in the study used to support Toronto establishing a city owned fibre network. Toronto is no broadband backwater. It is one of the most connected cities in the world. It is simply not true that 40% of Torontonians do not have broadband service that meets the CRTC objective.

Toronto doesn’t need a city-owned fibre network. The city will not be adding any connectivity to any place that doesn’t already have gigabit service available.

Not one.

As currently proposed, ConnectTO is bound to be a billion dollar broadband boondoggle.

But most importantly, the ConnectTO plan fails to meet the most fundamental requirement: the need to provide service now.

Not tomorrow. Now.

There is an interesting webinar on Strategic Autonomy coming up this Wednesday morning, January 27, 2021, from 10:00am – 11:30am (Eastern time), hosted by the International Telecommunications Society.

The year 2020 will be known as the year the Covid pandemic changed our lives and livelihoods. Up to date, more than 60 million people have been infected and 1,4 million people have died. We can expect a wave of bankruptcies, unemployment and a big pile of additional public debt that will have to be shouldered by next generations. And we have seen tremendous disruption of supply chains, further escalation of the conflict between the US and China (and further focus of these rivals on each-other), spectacular growth of the digital economy and a huge push towards a digitalized society.

Strategic autonomy looks at having a sufficient choice of suppliers to avoid dependence on any single company or national supply chain. In addition, the subject examines issues of information and network security and the reliability of suppliers and issues associated with political landscapes.

Are national industrial policies equipped to appropriately assess resilience in supply, cyber security and issues of independence.

This webinar has a Euro-centric focus but appears to raise issues of relevance to those of us in Canada and the United States.

“A year after the pandemic hit, this webinar looks at the background and the fundamental questions involved in the building of the next phase in the digital communication infrastructure that is key to the recovery of the European economy.”

Opening remarks: Professor Erik Bohlin (Chalmers University and member of the ITS Board of Directors)
Moderator: Dr. Georg Serentschy (Serentschy Advisory Services GmbH and ITS Corporate Board Member)

Confirmed speakers:

• Thibaut Kleiner, Director Policy Strategy & Outreach, European Commission
• Dr. Paul Timmers, visiting research fellow at Oxford University and former European Commission director. Paul is one of the leading academic experts in the field of strategic autonomy
• Derk Oldenburg, Foreign and EU Digital Policy Expert
• Carmen Gonsalves, Head of international Cyber Policy, Ministry of Foreign Affairs, The Netherlands
• Jonathan Sage, Government and Regulatory Affairs Executive, IBM.

The complete program description is available here [pdf] and registration for the event is free.

I look forward to seeing you online.

If I was asked to put together a list of places in Canada that needed government support for broadband infrastructure, I don’t think the City of Toronto would crack the top 1000 places. I might examine some of the suburbs in the Greater Toronto Area, to make sure those rural areas had upgraded access, but the city proper? Not a chance.

Next week, Toronto’s Executive Committee is considering an item entitled “Affordable Internet Connectivity for All – ConnectTO”. The City’s Technology Services group “is seeking City Council’s support to lead “ConnectTO”, a collaborative program that aims to centralize stewardship of municipal resources and assets to deliver the City’s goals on equity and connectivity, including creation of a City of Toronto broadband network.” A City of Toronto fibre-enabled broadband network is envisioned.

Of course, I am one hundred percent behind initiatives promoting universal affordable internet connectivity. I have been beating that drum for 13 years now, on these pages and in public discussions.

Where I tend to have problems with otherwise well intentioned proposals is in two areas: confusing access to broadband with adoption of broadband services, and confusing affordability with average prices. The 9-part report does both, and in doing so, steers City Council toward a solution for a non-existent technology problem when the focus should be on social services.

The report going to Toronto’s Executive Committee has a number of flaws. In the Report for Action by the City’s Chief Technology Officer, Technology Services Division, the Background reads:

Well-developed broadband infrastructure is essential for residents to participate in the digital economy, learn online, and to access government services. The CRTC has set minimum service levels of at least 50 megabits per second (Mbps) download speed and 10 Mbps upload speed and access to unlimited data for high-speed broadband. However, research from late 2020 indicates that 39% of Torontonians surveyed did not have internet speeds that met the CRTC minimum service level. The same research indicates a majority of the 62 countries in one study offer 100 Mbps as the most frequent internet speed. More recently, there are concerns that 50 Mbps download speed and 10 Mbps upload speed is not sufficient for the more data intensive ways which Canadians are now using the internet, such as online learning, electronic business transactions, etc., especially with multiple simultaneous devices being used in the same household.

I could devote this entire blog post to explain the flaws in this one paragraph.

Many may think, “Who cares? This is just a Background paragraph. Move on.” I think that these flaws form a basis for erroneous thought that tends to permeate through the report and its 8 associated appendices. Some of the materials are wholly irrelevant, as if to provide filler, or add heft to the filed materials. But the recommendations in the report seem to flow from the erroneous background, and that makes me somewhat distrustful of the rest of the materials.

Let’s take a look at some of the problems in this paragraph. I won’t quibble with the first sentence, although it leaves out what most of us use our broadband for: entertainment (music, streaming videos, social media, etc.). But since this is a serious matter before the City executives, I guess the CTO wanted to stick to the introduction lifted verbatim from the CRTC. Unfortunately, that didn’t continue into the second sentence. The CRTC continued with “That is why we set new targets for Internet speeds. We want all Canadian homes and businesses to have access to broadband Internet speeds of at least 50 Mbps for downloads and 10 Mbps for uploads.”

There is a subtle, but important difference there. The CRTC didn’t set a minimum service level. It set a target for all Canadians to be able to access those service characteristics, leaving it up to Canadians to choose whether or not they want to subscribe to that speed. The error in the second sentence is why the very next sentence is so completely misleading and flawed: “However, research from late 2020 indicates that 39% of Torontonians surveyed did not have internet speeds that met the CRTC minimum service level.”

On first read, one might think that Toronto is a broadband backwater, with nearly 40% of of the city unable to access to the CRTC’s broadband speed objectives. That simply isn’t true. Virtually every household in Toronto has access to gigabit speeds (and faster), from at least 2 competing service providers, Bell and Rogers. Many residents have access to alternative fibre-based services from companies like Beanfield Metroconnect.

An appended report from Ryerson, the research source for the data in the above highlighted paragraph, is disappointing in what I see as a lack of scientific and analytic rigour. Much of the report is based on survey data, with 80% of the 2500 responses coming from an online survey. No wonder the study found 98% of the respondents had internet access! The first 80% needed internet access just to answer the survey. The other 2% must have come from the telephone survey respondents.

The Ryerson report, Mapping Toronto’s Digital Divide, contains a number of other data mismatches that can be detected by looking carefully. I’ll highlight a couple instances, such as this paragraph:

A majority of the 62 countries in one study offer 100 Mbps as the most frequent internet speed. Such speeds allow for simultaneous and noninterruptive web browsing on multiple devices, including streaming services in 4K high resolution. While many countries around the world do not offer speeds lower than 100 Mbps, Canada continues to remain among the few internationally to continue to provide internet speeds less than 9 Mbps, alongside notably the US and UK.

Without looking to the footnotes, one might think that the statement in the second sentence refers to the same collection of 62 countries as discussed in the first sentence. But that would be wrong. In fact, the second sentence is based on ISED’s 7 country pricing comparison. The sentence is inaccurate.

Ryerson looked at data speeds as well and the report presents results in an embarrassing and extremely misleading fashion.

The global average download speed for broadband internet as of November 2020 according to one source was 91 Mbps; while the Canadian Internet Registration Authority found the average Ontario download speed was 52 Mbps from April 2019 to March 2020.

There are multiple obvious flaws in this data. The timeframe used for the global datapoint was November, 2020, while the Ontario data is from a year earlier. In addition, the global datapoint came from Ookla’s Speedtest, while the Ontario data is from the deeply flawed CIRA speed test. There was no reason for this. Ookla’s Speedtest has Canadian specific data (156 Mbps), broken down by province (Ontario was 153 Mbps) and indeed, Toronto specific data (171 Mbps). Why wouldn’t the authors match the data source and timeframe?

It comes across as authors torquing the presentation of data to fit some kind of an agenda. Ryerson should retract the report and redo it with greater academic rigour.

Toronto does not have a problem with the availability of broadband, and there is absolutely no reason for the city to contemplate construction of fibre facilities. A number of the appendices are dedicated to maps and analysis of how to build fibre to libraries that clearly have available existing commercial services. If Toronto wants to assist with private sector digital infrastructure investment, it can facilitate access to ducts, rights of way, municipal electric poles or other support structures for fibre, and make available vertical real estate for radio antennas.

I have often written that people frequently confuse broadband adoption with broadband access. It is somewhat easier to contemplate ways to fix gaps in broadband access; it’s just an engineering problem. In urban markets, the economics have permitted multiple competing companies to build gigabit broadband infrastructure to virtually every corner of the city.

It’s a lot tougher to drive adoption. Most telecom companies separate the engineering and operations groups from the marketing and sales groups for a really good reason: these are different disciplines. One side builds and operates the network; marketing and sales develop the services that drive adoption, using the network.

While the Report for Action for the Executive Committee has lengthy discussions about broadband pricing and international comparisons, targeted subsidy programs, such as the nearly 7 year old Connected for Success program from Rogers and TELUS’ Internet for Good get only a passing mention in the Ryerson appendix, not the main document. Considering the history of Connected for Success, launched originally with Toronto Community Housing before being taken across the Rogers network, it might have deserved more significant consideration by the proponents.

Toronto, and indeed every city, has a broadband adoption challenge among certain disadvantaged sectors. As the ConnectTO agenda item Summary indicates, “access to high-speed internet is necessary for residents to equitably participate in day to day life.”

But, my concern is that this proposal veered off course with its line: “Technology Services is seeking City Council’s support to lead ‘ConnectTO'”. In November 2017, in a memo to the Economic Development Committee, Toronto’s CIO and GM of Economic Development and Culture wrote, “In Toronto nearly 100% of households have ‘access’ but this refers only to the necessary infrastructure being in place. In practice, access depends on affordability.” It is disheartening that so little progress has been made in more than three years.

This isn’t a technology issue. It requires marketing and product development. The lead should be with the agencies invested in delivering community services to disadvantaged members of the community.

Last week’s Cabinet shuffle brought a new Minister of Innovation, Science and Industry into the telecommunications policy arena, The Honourable François-Philippe Champagne. As indicated in his biography, he brings a wealth of experience at large international companies in Europe, particularly in the fields of energy, engineering, and innovation. These are great credentials for the Minister of Innovation, Science and Industry.

For telecom policy, Minister Champagne’s predecessor, Navdeep Bains, had focused on the tension between quality, coverage and price, seeking to balance the requirements for investment to support providing world-leading communications services, while ensuring affordability for all Canadians, including those in rural and remote areas. Last August, former Minister Bains succinctly summarized the policy as “Canada’s future depends on connectivity”.

Canada’s future depends on connectivity. Our government recognizes that access to affordable, high-quality high-speed Internet is a necessity for all Canadians, no matter where they live.

The COVID-19 pandemic has only reinforced the importance of connectivity. The investments our government is making in high-quality networks, particularly in rural and remote communities, are key to ensuring equitable digital access for all Canadians. Equitable access also means that it is available at fair prices that Canadians can afford.

The message from Minister Bains last summer expressed the perspective of Cabinet: “On the basis of its review, the Governor in Council considers that the rates do not, in all instances, appropriately balance the policy objectives of the wholesale services framework and is concerned that these rates may undermine investment in high-quality networks, particularly in rural and remote areas.”

The critical importance of maintaining a balance of competing policy objectives figured prominently. Quality, coverage, and price.

In a blog post in late August (“Acting in the public interest”), I wrote about the tension between these policy objectives. I noted that Minister Bains was careful in defining “Price” as “offering service at an affordable level.” As such, it is clear that an affordable price is not necessarily the same as having the lowest price. “Acting in the public interest involves balancing priorities to achieve an optimal outcome. It isn’t all about price.”

There can be a high cost associated with low prices. Israel serves as an example of what happens to quality when there is a singular focus on reducing prices, as Canadians have been warned: “Prices did fall, but so did the quality of the networks. The massive reductions to revenues caused major reductions in capital expenditures, network roll-out and expansion, market capitalizations of the participants and even the number of employees.”

The past year has highlighted the importance of investment in world-leading technologies and extending the geographic reach of Canada’s mobile and wireline broadband networks. A policy framework that encourages network investment is the best way to accelerate expansion of quality infrastructure into unserved territory. The vast majority of investment in networks – rural and urban, wireless and wireline – comes from the private sector, not government. While governments support and supplement network investment by carriers, large and small, governments do not (and generally should not) supplant private sector investment.

To the extent affordability is a concern, perhaps targeted support programs can be developed to supplement Connecting Families, without increasing the level of regulatory intervention in the market, consistent with the objectives of Canada’s telecom policy.

Will the CRTC’s review of mobile services and its determination on the application to review wholesale internet rates create a shift in the balance between quality, coverage and price? These proceedings are foundational, with the potential to cause significant shifts and disruptions in the marketplace and the investment climate.

The mandate letter for Minister Champagne appears to provide for continuity in Canada’s digital policy priorities. The letter incorporates Minister Bains’ mandate letter by reference (“In addition to the priorities set out in my mandate letters of 2019…”), and is entitled “Supplementary Mandate Letter.”

It is interesting that the matter of rural broadband appears in both letters. In the December 2019 letter, broadband is referenced as:

Work with the Minister of Infrastructure and Communities, the Minister for Women and Gender Equality and Rural Economic Development and the Minister of Canadian Heritage to deliver high-speed internet to 100 per cent of Canadian homes and businesses by 2030.

Thirteen months later, in a COVID environment, the new letter says:

Recognizing that all Canadians need the tools to fully participate in and benefit from the digital economy, support the Minister for Women and Gender Equality and Rural Economic Development on the continued implementation of the Universal Broadband Fund to ensure that all Canadians, no matter where they live, have access to high-speed internet. Your work should include considerations around the effective use and deployment of innovative technologies, such as low-earth-orbit (LEO) satellites, to connect all Canadians.

I found the removal of the 2030 deadline in the supplemental letter as interesting, and perhaps noteworthy. Similarly, the specificity of LEO technologies and “considerations around the effective use and deployment of innovative technologies” merit further consideration. Is it a signal to favour policies to drive investment in facilities?

How should we interpret silence in the supplemental letter regarding other areas of the Minister’s mandate? Is it a signal that the government is satisfied with progress made to date in areas such as reductions in mobile pricing?

How will the government encourage deployment of digital infrastructure, in urban and rural markets, while preserving the balance (and tension) between quality, coverage and price?