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With the Shaw – Rogers merger announcement, and Parliament debating a bill that threatens to bring a lot of internet content under CRTC regulation, it seems everyone has been forming an opinion on regulatory reform. Unfortunately, there is a lot of misinformation being spread, and opinion pieces being written using deeply flawed reports. Garbage in; garbage out.

I have written much on two sets of reports that seem to keep being cited, despite egregious errors that should be obvious with even a cursory examination. As I wrote last November, studies from Rewheel Research have been thoroughly discredited, with 24 leading academics and telecom economists and lawyers from around the world referring to their reports as a “careless mish-mash of data points from which no reliable conclusions can be drawn.”

I wrote about some obvious problems with the methodology for a UK-based mobile study from cable.co.uk in a piece last summer, “Look at the data”. As I wrote at that time, “It’s very easy to look at a chart on social media, nod one’s head, and retweet or reply without bothering to look beyond the headline. It is tougher to apply a critical eye, look at the data, and determine policy based on deeper analysis.” Sadly, not enough people take the time to look beyond the eye-catching headlines before regurgitating them.

A more recent report from cable.co.uk suffers from the same methodological problems as I documented about the mobile report. One glaring data point jumped out at me. If you are to believe cable.co.uk, the average monthly cost of broadband in Canada is US$76.14, up from US$34.86 last year – an increase of US$41.28. Does anyone believe prices more than doubled last year? Anyone?

That is why I say, “Look at the data”.

A week ago, Toronto Star columnist David Olive appears to have relied on the flawed cable.co.uk data and rankings as the basis for his article “The time is right for Ottawa to fix Canada’s disgraceful telecom system”. By failing to detect the fairly obvious errors in the report, there is no support for Olive’s conclusions.

CWTA president Robert Ghiz had this response published in Saturday’s Star:

Canada’s telecoms among world’s best in overall value
Questionable studies report misleading findings on price of country’s wireless services

Canadian telecom providers offer some of the best and most affordable telecom services in the world.

The Economist’s Intelligence Unit’s Inclusive internet Index ranks Canada third out of 100 countries in internet affordability. Similarly, global accounting firm PwC recently ranked Canada first in the G7 for affordable wireless services.

Unfortunately, these studies are too often ignored. Instead, more attention has been given to one-dimensional and misleading studies that paint an inaccurate picture of telecom prices and affordability in Canada. These include Cable.co.uk’s fixed broadband price study and price comparison reports by Finnish consultancy, Rewheel.

The Cable.co.uk study looks at the median of surveyed broadband plans to develop its country rankings. Using this median price, it claims that broadband fees in Canada are 27 per cent higher than the U.S. But the actual dataset used by Cable.co.uk tells a different story.

Of the Canadian and U.S. broadband plans measured by Cable.co.uk, the cheapest was offered in Canada. By focusing on the median plan, irrespective of which plans consumers choose, Cable.co.uk gives the false impression that Canadians pay more for broadband service.

The questionable quality of the Cable.co.uk methodology is made crystal clear when its 2020 report is compared to its findings in 2019.

For 2020, Cable.co.uk concluded that the average fixed broadband monthly cost in Canada was $76.14 (U.S.) while the average monthly cost in 2019 was $34.86.

Clearly, prices for fixed broadband internet in Canada did not more than double in one year. In fact, in its most recent pricing study, the government of Canada observed that “over the last five years, Canadian broadband prices have trended downwards” and were lower than the U.S.

Meanwhile, Rewheel has been widely criticized for its flawed approach to mobile wireless price comparisons. Last year, 24 leading telecom academics, policy experts and economists released a highly critical review of Rewheel’s methodology, including the recommendation that Rewheel’s reports should come with the same kind of warning labels that social media platforms apply to suspicious information. Similarly, the International Center of Law and Economics published an article cautioning that a Rewheel study examined by the article’s authors amounted to little more than a “careless mishmash of data points from which no reliable conclusions can be drawn.”

In addition to the Economist and PwC reports, other studies have found that Canada’s telecom industry offers superior value. For example, a U.S. industry association-commissioned study found that Canadian wireless subscribers receive more value for their dollar — or “more bang for their buck” — than customers in all other G7 countries plus Australia.

While the studies cited above do not generate the same eye-catching headlines as those which misrepresent telecom prices in Canada, they offer a more meaningful consideration of affordability and value.

Also under-reported is the fact that the three federal government agencies charged with carefully monitoring the telecommunications industry have all concluded that wireless prices in Canada are dropping quickly. According to the CRTC, the average price of wireless plans declined by 37 per cent between 2016 and 2019.

Statistics Canada’s Cellular Service Price Index has declined 23 per cent since January 2019, in contrast to its all-item Consumer Price Index, which shows the cost of all goods and services increased. Finally ISED’s quarterly price monitoring has found that most wireless plans surveyed have decreased between 10 and 18 per cent compared to benchmark prices collected in early 2020.

Even as prices decline and usage soars, Canada’s telecom network operators continue to invest billions each year in expanding Canada’s digital infrastructure to underserved communities and ensuring that Canada maintains its global leadership in quality of service by deploying next-generation technologies such as 5G. Largely due to these investments, Canada’s telecom industry contributes more than $74 billion in GDP and supports more than 630,000 jobs across Canada.

As the COVID pandemic has highlighted, Canada’s economic well-being, safety and quality of life depend on high-quality digital infrastructure. Making world-class telecommunications services available to all Canadians at affordable prices remains the focus of our members.

Flawed data leads to flawed conclusions.

Canada’s telecom policy needs to be based on high-quality reports and studies.

Surfshark, a provider of online privacy and security solutions, has produced a study examining the quality of a digital wellbeing in 85 countries representing 81% of the global population.

The Surfshark Digital Quality of Life Index is based on five “fundamental pillars”: Internet affordability; Internet quality; Electronic infrastructure; Electronic security; and, Electronic government.

Canada (.78 index) ranked 3rd out of the 85 countries examined, behind Denmark (.79) and Sweden (.79), with its overall ranking brought down by only ‘moderate’ data protection laws.

Canada’s broadband affordability ranked first in the world, with the index looking at how much time on average needed to be worked to afford the lowest price plans.

Overall internet affordability, which included mobile broadband, placed Canada in second place, behind Israel. Surfshark’s ranking is consistent with the Inclusive Internet Index ranking by the Economist’s Intelligence Unit, placing Canada’s internet affordability in third place of 100 countries examined, based on cost relative to income and competitive environment.

And recall that a report by PwC released a little over a year ago showed “Canadian mobile services top G7 affordability ranking”.

So why do we keep hearing these deeply flawed statements like, “everybody knows Canada has some of the most expensive internet access prices in the world?”

While such statements may create eye-catching headlines, it is not a proper reflection of reality.

With so many important Canadian telecom policy issues under consideration, it is critical that discussions are based on the evidence. The Surfshark index, like the Economist’s Inclusive Internet Index and PwC’s study, all demonstrate that on average, Canadian telecom services are affordable.

As I said at the time of the PwC study last year, “there are indeed some Canadians unable to find an affordable device or service plan that they may need to participate in today’s economy.”

That needs to start with developing a greater understanding of those individuals and households on the wrong side of the digital divide and focus programs to target those inequities.

But it is long past the time to leave behind the flawed populist narrative on overall affordability of Canadian telecom services.

Ofcom, the telecom regulator in the UK, issued an important policy statement last week promoting investment and competition in fibre networks.

In its story about the policy statement, Computer Weekly said that infrastructure in the UK’s was recognized to be in “urgent need of an upgrade, especially as demand for data continues to accelerate, an issue made even more pressing by the need for mass remote working.”

Computer Weekly reported “To address these needs will require significant private investment in full-fibre broadband, said Ofcom, which noted that network competition had helped full-fibre coverage increase at its fastest ever rate over the past year – and that momentum had continued throughout the pandemic.”

when it comes to ultra-high-speed fibre services, Ofcom confirmed these would continue to be free from pricing regulation. The rationale for this decision is that people can choose the entry-level service as an alternative. Moreover, Ofcom added that Openreach could also “charge a bit more” for regulated products delivered over full-fibre instead of copper, because it regards full-fibre as consistently faster and much more reliable.

This echoes the policy set forward in Canada last summer, when Industry Minister Navdeep Bains pronounced “Canada’s future depends on connectivity”.

Ofcom wrote:

Our approach to supporting investment in gigabit-capable networks is focused on encouraging competition between different networks where viable, which will provide high quality services, choice and affordable broadband for consumers throughout the UK. We recognise that it will require significant investment from private companies to upgrade the UK’s networks, so they are fit for the future. Our decisions incentivise that investment – giving regulatory certainty and allowing companies to make a fair return whilst ensuring consumers continue to have access to affordable broadband as new networks are rolled out.

As I think back to an exchange between the Conservative Industry critic and a TELUS executive at Canada’s parliamentary industry committee last year, we can now see a clear statement from the UK regulator favouring competitive private sector investment in infrastructure, and creating regulatory incentives for facilities-based competition.

Favouring facilities-based competition has been Canada’s telecom policy approach for nearly 30 years. And other regulators are seeing the light.

This morning, Rogers announced significant expansions in eligibility and available speeds for its Connected for Success broadband program, that aims to bridge the digital divide for up to 750,000 lower income households.

Recall that Rogers was the first Internet provider to offer a program targeting disadvantaged households, announcing Connected for Success in the opening keynote address at The 2013 Canadian Telecom Summit. Initially, Connected for Success was aimed at residents of community housing systems across the Rogers footprint until the Federal Government established a qualification system as part of its support for Connecting Families five years later at The 2018 Canadian Telecom Summit.

Today’s enhancement significantly expands eligibility for Rogers Connected for Success to help bridge the digital divide for even more Canadians in Rogers service areas in Ontario, New Brunswick and Newfoundland. In addition Rogers is now offering more speed options to help support evolving connectivity needs beyond the 25 Mbps speeds provided in the basic Connected for Success package, with new packages exceeding governmental targets for broadband access.

Eligible customers can apply through the Connected for Success website and they must provide verification they receive government financial assistance under one of the qualifying programs:

• Rent-Geared-to-Income housing assistance
• Maximum Child Care Benefit
• Ontario Works,
• Ontario Disability Support Program (ODSP),
• New Brunswick Social Assistance Program,
• New Brunswick Disability Support Program,
• income and disability benefits through Newfoundland’s Income Support,
• and for seniors receiving the Guaranteed Income Supplement (GIS).

With today’s enhancements to the program, Rogers will now offer a 75 Mbps option for $25 per month, and a 150 Mbps option for just $35 per month, in addition to its basic 25 Mbps service for $10 per month. All three speed options include unlimited data. Rogers plans to offer a 50Mbps option in the Spring for $15 per month.

A Rogers customer experience specialist will contact every qualified customer to do a needs assessment, helping determine which speed service meets their household’s needs best. The program provides free installation and modem rental, unlimited data and no credit checks. According to Rogers, “This personalized experience will ensure the unique needs of every customer are met, including online schooling, accessing online social supports and job searches, attending virtual medical appointments, and combatting social isolation by staying connected to loved ones virtually.”

The Rogers media release quotes Daniele Zanotti, President & CEO, United Way Greater Toronto, “We know that COVID-19 is having a disproportionate impact on vulnerable populations and those living in poverty in Canada – with a growing digital divide in who can access much needed supports. For an isolated senior trying to book their vaccine, a mom reaching out for crisis counselling or a furloughed worker trying to re-enter the workforce, digital access is no longer a luxury – it’s a necessity.”

The Honourable François-Philippe Champagne, Minister of Innovation, Science and Industry said

The COVID-19 pandemic has highlighted how much we all rely on digital connections now. It has reinforced the importance of access to affordable high-speed Internet as, now more than ever, Canadians are working, learning and communicating with friends and family from home. It is a priority for our Government to ensure that all Canadians get connected, and we are counting on our partners in the private sector to help us achieve that goal. I congratulate Rogers on expanding its Connected for Success program, now helping even more Canadians with their connectivity needs, and further bridging the digital divide.

Today’s service enhancements to Connected for Success provide a clear path forward for affordable broadband. It meets the primary criteria set out by deputants during Toronto’s ConnectTO presentations – delivering affordable broadband now. Not tomorrow. Now.

I recently wrote that some have hijacked the term “affordability” to match their own agenda. With expanded eligibility and expanded low-priced options, Rogers Connected for Success is delivering affordable broadband to even more households today.

Rogers first launched Connected for Success in 2013, becoming the first service provider to offer a broadband solution to low income families. With today’s enhancement to the program, offering faster speeds to a broader range of eligible households, Rogers is continuing to demonstrate its commitment to developing more inclusive broadband solutions for those facing economic challenges.

It isn’t easy being a regulator.

Just look at the way people talk about the CRTC, Canada’s radio, television and telecommunications regulator. Complaining about the CRTC is part of our national birthright. Regardless of whether an issue actually falls under its purview, Canadians rush to blame the CRTC. Next to the post office, there may not be another government institution that engenders such opprobrium in our hearts and minds. I have observed before that “most Canadians feel they have a right, if not a duty, to criticize” the CRTC.

Some complaints legitimately fall firmly within the CRTC’s jurisdiction; some complaints are shared responsibilities with other branches of government; but, many other complaints (like Canadians being upset that off-shore streaming services block access to certain shows) simply aren’t issues that can be resolved by the CRTC. That doesn’t keep people from blaming the Commission.

Recently, some social media have taken aim at the regulator for moving at “sloth speed”, claiming “The speed at which the CRTC is operating is failing both the Canadian Telecommunications industry and Canadians as a whole.” An OpEd in the Toronto Star prods the CRTC to accelerate its wholesale internet pricing decision, claiming “The fact that Toronto is even considering building its own network to ensure affordable pricing for an essential utility is a shameful indictment of the regulatory delay in putting these options in place at the federal level.” In a bizarre approach to government relations, a wholesale-based internet service provider launched a campaign to flood the CRTC with emails, months after the close of a proceeding. It is unclear to me how this could have accomplished anything but add a further delay to the regulatory process.

One might say that such forms of complaining may succeed at inciting, without providing any clear insights to advance the regulatory processes or policy framework.

On the point of wholesale services, let’s be very clear. Even if the CRTC upholds its wholesale rates at the August 2019 level, these will not result in the $10 per month price plans being sought for low income households. As I have written before, “in recent weeks, we have seen the term ‘affordable broadband’ hijacked and applied to alternate agendas”. Such is the case with these recent, very public attacks on the regulator and the policy makers on both sides of the river in the National Capital Region.

This past weekend, I spotted a relevant 11-part Twitter stream related to the challenges of utilities regulation. Although it was written largely in response to power regulators in the wake of widespread blackouts in the south central United States, many of the comments resonated with me.

Professor Gus Hurwitz is the The Menard Director of the Nebraska Governance and Technology Center and the Co-Director of the Space, Cyber, and Telecommunications Law Program at the University of Nebraska. I encourage you to follow him on Twitter. Here is the essence of his 11-part weekend rant:

I spent much of last week watching recordings of meetings of local utilities regulators from around the country. They were terrible. Simply terrible. This isn’t a criticism of the regulators, however.

They are under-resourced, frequently staffed by well-intended but non-expert individuals — sometimes staffed by ideological nut jobs (from the left or right) hell-bent on using the regulator to impose their own policies.

There is frequent illegality. Either citizens demanding they do illegal things, investigation of malfeasance of prior commissions, or commissioner fighting over how to do things that the law says they cannot. But again, this isn’t a criticism of the regulators. They perform an important function, and are often trying to thread impossible needles.

This is especially true when they are trying to navigate changing technologies being used in new ways by a changing society with different needs, using static laws developed for older, generally simpler, technologies, the anticipated multi-decade CapEx and cost recovery.

And “federalize regulation” isn’t all that great a solution, either. Putting aside the legal issues, the local regulators often are responding to legitimately localized concerns. And federal regulators often face similar resource and expertise constraints!

I keep saying this: I’m not blaming the regulators. So who am I blaming?

Well, I’m blaming you, and me, and everyone who takes for granted their work or expects both regulators and industry to magically deliver perfect, low cost, zero risk, reliable results, while consistently voting to under-fund the regulators, passing punitive laws that harm industry, and electing lying politicians based on their promises to cut red tape and hold industry accountable. And while refusing to actually get involved with the process ourselves.

All the great stuff that makes our modern lives so wonderful … it takes public and private collaboration and a society that’s both willing to fund it and understanding of its limitations.

Today, we have overt public and private antagonism and a society that expects everything to work perfectly at no cost. Given that, expect things to get worse before they get better; expect things to get worse unless those who are able to help are willing to get involved.

It’s easy to complain about the performance of a regulator, or indeed about many regulated industry participants. And it is certainly within our rights to complain. I suspect that prospective staff members at the CRTC are warned (or should be warned) that if they have a thin skin, they may want to look at another line of work. I’ve attracted my fair share (or more than my fair share) of critiques for the crime of providing an alternate point of view.

While it is easy to complain, it is a lot tougher to get involved and help make things better. It takes much deeper thought to improve regulatory processes, maintaining balance to improve outcomes for consumers (especially vulnerable consumers).

Regulating competitive markets isn’t easy in the best of times. During COVID-19 induced lockdowns, it must be much more complicated for staff to collaborate on complex economic calculations and determinations and prepare carefully nuanced decisions.

The Telecom Act explicitly acknowledges that the regulator won’t always get it right when issuing an Order or Decision. That is why a number of channels of appeal exist, channels that have been used by major carriers and smaller service providers alike. Filing an appeal isn’t an abuse of process. Indeed, it is precisely a proper use of the processes established in the Act, as part of the checks and balances that exist for the regulator and the Courts.

Let the regulator do its job. When it issues its determination, if you don’t like it, file an appeal.