Wednesday, October 27, 2010

Canada - Hearings on the rural Internet held by the regulator

[globe and mail] The future of the Internet in Canada is being shaped in Timmins, Ontario.

On Tuesday, the Canadian Radio-Television and Telecommunications Commission began a hearing into whether to make broadband Internet a “basic service” like dial-up Internet in rural and remote areas, where the cost of delivering high-speed Internet is too high for profit-conscious companies.

You can listen to the ongoing discussion here: (starts at 9 am, for the next few days, and then again starting on Nov 1.)

“The burning question now becomes whether the Commission has a role to play in the provision of broadband Internet services where it is currently not available,” said Konrad Von Finckenstein, the CRTC's chairman.

The issue is of huge consequence: Although urban Canadians can enjoy relatively competitive broadband service, those in rural and remote communities have little if any choice at all. Services being provided are already subsidized by fees collected from telecom companies, which goes to offsetting the cost of subsidizing service delivery. And service is generally much slower, and much less reliable.

But the issue is also highly complicated: The free market (which companies love) has already resulted in the expansion of broadband services to more than 90 per cent of the population. My guess is many of the largest companies – like Bell, Telus and Rogers – will argue that their advanced wireless networks are good enough, are expanding, and that any households not reached by that will be able to take advantage of improving satellite technology (new satellites are being launched in the next few years that will greatly improve the quality and capacity of existing satellites, which are generally pretty feeble, and expensive).

The real problems revolve around how to reach the remote communities beyond Canadian companies' existing footprint, while also recognizing that mandating certain “broadband” Internet speeds is difficult, since technology is rapidly changing – making any speed definition a moving target. Traditional broadband is defined as 1.5 megabits per second download speed, but that is far below what Canadians in cities already enjoy, and may be far slower than what companies eventually provide.

Essentially, telecom companies usually hate additional regulation. And this hearing represents a significant source of new, potentially very onerous obligations on these companies. Bell Aliant's vice-president of regulatory and legal affairs, Denis Henry, was up first at the CRTC hearing. He argued against more regulation and said - unsurprisingly - that increased regulation would harm the industry. “The commission does not need to regulate broadband, such a notion seems to ignore Canada’s track record in expanding broadband without regulation,” Mr. Henry said.

Mr. Henry said the government should focus on digital literacy, since many more people have access to broadband Internet than actually sign up for the service and use it. “Adoption lags availability by a wide mark,” he added. Mr. Von Finckenstein, pushing back, read off a long list of countries that have mandated broadband targets.

Some countries have set targets for 100 per cent availability (at speeds beyond what's being discussed in Timmins, though in smaller countries), essentially defining it as a human right, as well as something a country needs.

“They all recognize that this is something that a modern economy needs,” Mr. Von Finckenstein said.

CRTC holds hearing on fate of rural broadband

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