Search Results for: incentives

A flood of documents arrived in my email late yesterday, with parties filing their comments in response to the seventh amendment to Telecom Notice of Consultation 2009-261.

The filings should be available on the CRTC website in the next couple days.

In the meantime, here are some highlights.

From TELUS [para. 12]:

While new investment is completely in line with macro-economic policy, unbundling is not. In fact unbundling actually increases the risk of investing in facilities that are required to compete with the market leader in broadband and broadcast distribution. Unbundling is an absurd proposition at best if the goal is to promote competition.

From Bell [para. 19]:

In the end, the trade-off faced by the Commission can be summarized as follows: is it better to mandate access to NGNs and depress investment, in the hope of spurring some hybrid or resale competition in those limited well-served areas where each of cable, ILEC and wireless providers will have built high-speed broadband networks, at the expense of competition in “lost” areas, or is it better to not impose regulatory measures and let ILECs invest as much as market forces allow, in order to provide as many Canadians and communities as possible with the benefits of competition from at least three competing facilities-based networks?

From Rogers and the major cable carriers [para. ES14]

The international evidence points to some risk that wholesale access requirements would have a negative impact on incentives for investment by facilities-based broadband service providers. A review of the literature provides no strong evidence that the benefits would be sufficient to outweigh this risk.

From MTS Allstream [para. E3]:

Based on the U.S. experience, withdrawal of regulated wholesale services is more likely to discourage investment than to stimulate it. In contrast to the existing situation in the U.S., in Europe it is recognized that replication of existing infrastructures is neither practical nor desirable, even in densely populated areas, and that unbundling networks and providing wholesale access is a proven enabler of both competition and investment.

Surprisingly, the Canadian Association of Internet Providers had no comments. Their two page submission consisted of a restatement of the subjects upon which CRTC was seeking comments and a statement that the Competitors “look forward to reviewing the submissions of interested parties.” Considering the association’s declaration of importance of this issue, it is somewhat surprising that there was no substance to its filing, no evidence filed to address the question that seemed to be crying out for input from CAIP et al.

At paragraph 11.B.b, the notice asked for evidence to support or counter:

whether, in the absence of the speed-matching requirement and the mandated provision of the high-speed access services under consideration, there would be competition sufficient to protect the interests of users;

This point seems crucial for the various appeals that were mounted by CAIP over the past year. It seems bizarre that the Competitors wouldn’t put forward evidence to address this point. They need to do more than just look forward to reviewing other submissions. CAIP and the Competitors should have put forward a strong case and prepare to defend it.

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Update [February 9, 7:15 am]
Teksavvy filed a complete set of comments, with supplementary expert evidence, including a literature review that could result in the CRTC being the first quasi-judicial body to pronounce upon the Harvard Berkman study that was released last October [see our many posts such as here, here and here, describing critiques of that piece]. Most importantly, there is a paragraph in Teksavvy’s submission that begs the question of why its evidence wasn’t filed by the CAIP coalition.

TSI notes that the competitive sector is not in good health. Evidence of this is demonstrable through the reduction that has occurred in recent years in the number of competitors participating in the regulatory process and the reduced vigour of the participation of those who are left. The result has been that TSI has had to expend considerable resources in order to ensure that competition does not die, and with it, TSI itself. This is a big burden for one competitor to bear, and it is not a burden that can be sustained indefinitely.

Welcome back and Happy New Year!

The new year may also bring a new session of Parliament.

Through the holidays, we learned of plans to prorogue parliament, which will lead to the death of 4 technology related bills, as Michael Geist reported, including Bill C-27, the so-called Electronic Commerce Protection Act (ECPA).

As I wrote last May, the bill is flawed in that it goes far beyond protection from spam to prevent forms of commercial contact in digital form that are perfectly legal in paper form. McCarthy’s had also warned about restrictions being too broad.

Typically, we see internet communications as being more open than traditional media – we are less likely to impose restrictions on digital content than print or other forms. As it is written, the bill would be better titled the Electronic Commerce Restrictions Act; it discourages many efficiencies that should be available to businesses of all sizes in reaching out to new customers.

Hopefully, the reintroduction of the bill will enable Industry Canada to encourage confidence in e-commerce without choking off incentives for Canadian business to adopt innovative business models.

The CRTC has issued another update to Telecom Notice of Consultation 2009-261, which has been titled “Proceeding to consider the appropriateness of mandating certain wholesale high-speed access services.”

Today’s update, number 7, expands the scope and sets out a new schedule in order to incorporate the directions from Cabinet issued a week ago [Bell/TELUS Order and MTS Allstream Order].

The Order in Council states that the Governor in Council considers that the continued development and availability of broadband Internet infrastructure and services is important for Canadians and the Canadian economy. It notes that it is critical that the regulatory regime provide a cohesive, forward-looking framework that provides the proper incentives for continued investment in broadband infrastructure, encourages competition and innovation, and leads to consumer choice.

So, TNC-2009-261-7 reopens the paper proceeding and delays the oral hearings that had been scheduled to open in early January.

Specifically, the CRTC is seeking comments by February 8 asking:

1. the application of the existing essential service framework on a forward-looking basis such that it provides appropriate incentives for continued investment in broadband infrastructure, encourages competition and innovation, and leads to consumer choice; and
2. in the context of the discussion provided in response to A, above,
   1. whether the speed-matching requirement, mandating the provision of the high-speed access services under consideration, or mandating access to any new types of Internet access infrastructure does, or would, unduly diminish incentives to invest in new network infrastructure in general and, in particular, in markets of different sizes;
   2. whether, in the absence of the speed-matching requirement and the mandated provision of the high-speed access services under consideration, there would be competition sufficient to protect the interests of users;
   3. whether the respective wholesale obligations imposed on ILECs and on incumbent cable carriers are equitable or represent a competitive disadvantage; and
   4. whether the impact of these wholesale requirements unduly impairs the ability of incumbent telephone companies to offer new converged services, such as IPTV.

The hearings will now take place May 31-June 4, finishing up in time for everyone to attend The 2010 Canadian Telecom Summit, which opens on June 7. We are open through the holidays if you are looking to register early with your remaining 2009 budget.

There was considerable press and editorial coverage of Industry Minister Clement’s decision to intervene in the Globalive ownership issue. No need to rehash that ground here. I spoke to a couple reporters from Canadian Press talking about consumer and policy issues.

There was a common thread in the decisions; the government continues to support a model of facilities-based service providers being the means to deliver sustainable competition in world of converged communications.

The three decisions from Friday support a theme of fostering an environment favouring private sector investment in advanced telecommunications infrastructure.

In its decision to send speed-matching back to the CRTC, the Government said that it wants the Commission to consider the impact of its Decision on incentives for investment.

Will Industry Canada keep this in mind when it is developing its auction policy for the next major swath of mobile wireless bandwidth?

IC Schedule – Globalive http://d1.scribdassets.com/ScribdViewer.swf?document_id=23985717&access_key=key-11xt7pmkzsdnfisrdx5g&page=1&version=1&viewMode=list

MTS Allstream Order in Council
http://d1.scribdassets.com/ScribdViewer.swf?document_id=24015524&access_key=key-1tmo7fmofjsb2dddk1fq&page=1&version=1&viewMode=list

Bell / TELUS Order in Council http://d1.scribdassets.com/ScribdViewer.swf?document_id=24015688&access_key=key-bbo0ezlgp1h11zd8gap&page=1&version=1&viewMode=list

As part of its support for the development of a National Digital Strategy, TELUS has released a paper, called “Leaping Forward – Wireless Broadband and a National Digital Strategy.”

According to the paper, now that Canada has built an ubiquitous broadband infrastructure, the question of how to leverage these networks and development of a broadband economy be part of a larger digital industrial strategy:

That industrial strategy for Canada would include:

• incentives for continued investment
• policies that promote consumer access and choice; and
• ensuring that application providers, software developers and content creators across the value chain can reach markets.

Telus expands with its own Top 10 list of principles to guide the discussion and debate in developing the national digital strategy:

1. Canada needs to trust the market to build our broadband future
2. Government can find smart ways to support a digital media strategy without large expenditures funded by taxpayer dollars
3. Spectrum auctions should be fair and open to ensure to ensure that the $2 billion dollar overpayments in the last AWS auction are not repeated again
4. Canada and the world are our markets; we cannot be inward looking
5. Digital content is not limited to narratives/stories but is also software and applications that enable the creation, distribution and sharing of content online
6. Governments are ill equipped to shape new media or to sustain markets that don’t exist, but government can stimulate investment and innovation
7. Canadians must have the opportunities to access, communicate, interact, create and transact over open broadband networks
8. Copyright is not an absolute; it must be balanced against fair use
9. Intellectual property is the currency of an information economy just as much as access to broadband is a prerequisite to participation
10. The consumer and public are already shaping markets and we need to follow their direction to succeed

Each of these points are fleshed out in greater detail in the paper – see below.

Many of these themes have been discussed by Telus before, such as in the context of its Petition to the Governor in Council from last March. A ruling on a series of cabinet appeals is expected later this week.

Leaping Forward-Wireless Broadband and a National Digital Strategy FINAL http://d1.scribdassets.com/ScribdViewer.swf?document_id=23376655&access_key=key-eo0fzs9dtqop8q5cy4i&page=1&version=1&viewMode=list