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As I indicated yesterday, there are a number of touch points for government review in a transaction like buying a phone company.

Regardless of who acquires BCE – even if it is a private equity firm – there will need to be an application to the CRTC for approval of the transaction, under the Telecom Act, Broadcast Act and Bell Canada Act.

It appears that the time pressures for the CRTC could be considerable. Under the Bell Canada Act:

Unconditional approval shall be deemed to be given under subsection 11(2) thirty days after written notification of a proposed transaction to the Commission, without prejudice to the exercise of the Commission’s powers under the Telecommunications Act.

That seems to mean that the CRTC has only 30 days under the Bell Canada Act, but perhaps more time under the Telecom Act. [Lawyers, can you help us here?] As we saw in the CRTC’s review of the CTV/CHUM transaction, the CRTC can be very responsive, but even that determination still took 6 months from the date of the original application in order to allow oral hearings.

The CRTC would be guided in its review the transaction by assessing the consistency with the objectives of the Telecom Act:

1. to facilitate the orderly development throughout Canada of a telecommunications system that serves to safeguard, enrich and strengthen the social and economic fabric of Canada and its regions;
2. to render reliable and affordable telecommunications services of high quality accessible to Canadians in both urban and rural areas in all regions of Canada;
3. to enhance the efficiency and competitiveness, at the national and international levels, of Canadian telecommunications;
4. to promote the ownership and control of Canadian carriers by Canadians;
5. to promote the use of Canadian transmission facilities for telecommunications within Canada and between Canada and points outside Canada;
6. to foster increased reliance on market forces for the provision of telecommunications services and to ensure that regulation, where required, is efficient and effective;
7. to stimulate research and development in Canada in the field of telecommunications and to encourage innovation in the provision of telecommunications services;
8. to respond to the economic and social requirements of users of telecommunications services; and
9. to contribute to the protection of the privacy of persons.

The Broadcast Act will also come into play because of broadcast licenses held by Bell.

On top of these CRTC review points, there is also the Competition Bureau that will need to assess whether a substantial lessening of competition is expected to result, substantial being the operative word.

With TELUS saying that it is no longer pursuing its bid, it may plan to pick up assets expected to be divested after a private equity acquisition. Depending on the pieces, the entire review process may start all over again!

It is fitting that Michael Geist’s column is published in The Toronto Star, which has a reputation as being the official news agency of Her Majesty’s Loyal Opposition. Yesterday’s column reflected the leftist bias that inspires many academics so thoroughly. It is a wonder that university graduates can become functional in the capitalist environment that greets them in the real world.

There are just too many critiques of Michael’s piece to address while keeping this posting manageable. I’ll touch on just a few.

Although he tries to find inspiration in the report of the TPR to support his populist campaign against a ‘two-tiered internet’, Michael continues to quote the text out of context – in exactly the same manner that he did last November. In the interest of space, I’ll advise you to simply look there. The TPR explicitly permits ISPs to “take into account any reasonable technical constraints and efficiency considerations related to providing such access,” no matter how much Professor Geist tries to ignore the plain text. If you repeat a half truth does it become whole?

He suggests that the FCC imposed net neutrality conditions on AT&T – when the reality was that these were AT&T;’s voluntary commitments in order to sway the minority Democrat commissioners. The FCC itself has consumer protection principles that are comparable in effect to what is set out in the TPR and are have been generally upheld by CRTC practice.

The article complains on one hand about “steady price increases” from DSL and cable providers, but on the other hand, net neutrality advocates don’t want these ISPs to develop alternate revenue sources in order to keep prices for internet access affordable. Indeed, most comments on his site argue that the carriers should just charge more to people who want faster downloads. Well, I’m confused. Which is it? Charge more or avoid price increases? Should the carriers lose money when they invest in your infrastructure?

The article charges that the Minister is “burying attempts to establish a national broadband infrastructure,” ignoring the fact that there are already numerous national broadband backbones owned, maintained and continually upgraded by a number of carriers operating in a competitive environment. The last thing we need is a government initiative competing against or replacing private sector corporations. It seems that we are seeing a call to nationalize the internet backbone – returning to central planning and control by government.

Life would be simpler that way – one benevolent crown corporation carrier with all of our best interests always in the forefront of their planning. Sorry to say that the era of PTTs has largely become a distant memory. I seem to recall that we found that those government monopoly phone companies ended up restraining innovation and charging way too much for lousy service.

Of course, the PTTs had decent wages and great pensions for employees. Those were the good ol’ days.

Creating a vision for telecom policy reform was part of the theme of a posting a couple weeks ago.

How does Industry Canada get the average donut-eating-public interested in the report of the Telecom Policy Review panel in order to move the issue higher on the public agenda?

I mentioned two weeks ago that the report is a great recipe book, but many people may have trouble seeing what the end result looks like. I think that we have to show people a vision of tomorrow. The picture of some gourmet delight on the cover of the recipe book.

Let’s take a look at parts of the executive summary of the report for to find a place to start.

The new objectives [of the Telecom Act] should focus on three broad goals:

• promoting affordable access to advanced telecommunications services in all regions of Canada, including urban, rural and remote areas

• enhancing the efficiency of Canadian telecommunications markets and the productivity of the Canadian economy

• enhancing the social well-being of Canadians and the inclusiveness of Canadian society by meeting the needs of the disabled, enhancing public safety and security, protecting personal privacy and limiting public nuisance through telecommunications networks.