Canada - Regulator said to lack legal authority to force ISP to expand rural coverage

[globe and mail] The Canadian Radio-television and Telecommunications Commission has no legal authority to force Internet service providers to expand high-speed broadband to rural areas, says a business professor.

Ian Lee says CRTC hearings, held in October to decide whether companies should be required to extend broadband Internet to all rural parts of the country, are outside the commission's jurisdiction.

“They have encroached into new territory that they never were in before, that they didn't have the authority to encroach upon before,” Mr. Lee, a professor at Carleton University's Sprott School of Business, said in an interview.

It's the latest salvo in a continuing controversy over whether the CRTC has the authority from Parliament to make telecommunications companies such as Bell Canada treat broadband the same as other services, like telephone or dial-up Internet.

Those in favour of making broadband a basic required service say CRTC regulation is the only way thousands of rural Canadians without high-speed Internet will ever see service in their homes.

“You have to do it that way because otherwise you'll just have this hodgepodge of programs that don't really work and that are also subject to a lot of political manipulation,” said John Lawford of the Ottawa-based Public Interest Advocacy Centre, a group of lawyers who argue on behalf of consumers.

One Internet service provider, MTS Allstream, told the CRTC during the hearings in October that covering 100 per cent of the country would cost $700-million a year for 10 years.

The federal government, struggling with a $56-billion deficit, may be reluctant to commit the public money necessary to fund rural broadband.

Lee's comments echo arguments Internet service provider Bell Canada made at the October hearings.

Bell officials said the CRTC cannot make the Internet a basic service because it would force the company to expand its broadband network outside its current service territory. Vice-president Denis Henry said the independent public commission, which operates at arm's length from Parliament, can only regulate the company within the area it currently serves.

CRTC officials argued during the hearings that declaring high-speed Internet a basic service falls within their mandate to regulate existing services.

Other advocates for basic service say leaving expansion of the Internet to market forces will also mean a continued lack of service for rural residents.

“It will be a godforsaken long time before Bell is providing access to rural eastern Ontario or northern Ontario, remote locations,” said technology lawyer David Fewer, the director of the Canadian Internet Policy and Public Interest Clinic at the University of Ottawa.

“It's not going to happen without some interest that goes beyond market forces.”

Launching a court case against the CRTC is one way to overturn a decision. Mark Goldberg, a telecommunications consultant, says a court could decide the commission has no legal basis for ruling in the area.

The CRTC will make a decision on the matter by May.

Jacqueline Michelis, a spokesperson for Bell Canada, says the company will wait until then before commenting on possible legal action.

While high-speed Internet is readily available to urban residents of Canada, many of those living in outlying areas of the country are still forced to make do with dial-up, generally less reliable and slower.

A report released by Statistics Canada earlier this year found that 92 per cent of people in Canada had access to high-speed Internet in 2009.

Internet regulation outside CRTC jurisdiction: expert