OTTAWA – There is broad consensus among the smaller Internet providers, consumers groups and local governments that high speed Internet is a critical part of Canadian society and the economy. They are now telling the CRTC that it should take the steps necessary to include broadband as part of the basic service objective and find ways to ensure its rollout is funded by the industry and government.
As the Canadian Network Operators Consortium (CNOC) noted in its July 14 submission to the CRTC’s review of basic telecommunications services, broadband has a “prominent influence” on Canada’s economic, social and cultural identity.
“Broadband Internet must therefore be considered a basic telecommunications service that is integrated in the basic service objective and government subsidies should be made available to allow deployments in high-cost serving areas. These changes are necessary to ensure that all Canadians can access and participate meaningfully in a digital economy enabled by a world-class communications system,” writes the group.
For Dr. Catherine Middleton, Canada Research Chair at the Ted Rogers School of Management at Ryerson University, it’s more than just designating broadband as a basic service, it’s that all telecommunications services have become applications on high speed networks.
“From this perspective, the only type of service that should be defined as a basic telecommunications service is a high quality broadband network. With appropriate measures in place to ensure all providers have access to deliver services over networks, all telecommunications services that were delivered on a mix of technologies in the past (voice using copper phone lines, television using coaxial cable) can be delivered over a broadband network,” she writes.
The one outlier among the submissions read by Cartt.ca is the Canadian Association of Wireless Internet Service Providers (CanWISP). It believes that while broadband is essential for participating in modern day economic and cultural life, the private sector is up to the challenge already and therefore the CRTC doesn’t need to step in.
All parties agree that access to broadband critical for those living in underserved rural and remote communities, but so is affordability. While many Canadians living in villages and towns aren’t able to access the minimum 5 Mbps speed set by the Commission in 2010, low-income households lack the financial means to subscribe to high speed Internet services in the first place (and that applies to the poor in big cities, too).
According to Statistics Canada data contained in the Affordable Access Coalition (ACC) submission, 82.5% of all households in Canada have access to the Internet at home but only 50.3% of household in the lowest decile do. (ACC is a group that includes the Consumers Association of Canada and the Public Internet Advocacy Centre, among others.)
The CRTC’s contention in 2010 that market forces and targeted government funding would bridge the access gap hasn’t come to fruition, adds the ACC. It notes that where other governments have taken action to increase minimum broadband speeds Canada is lagging.
“In the AAC’s view, bold action is necessary to ensure that all Canadian households have access to broadband Internet service at a speed that allows them to participate in the digital economy, and so that low-income Canadians can afford access to basic telecommunications service of a high quality,” it writes.
So what should the minimum broadband speed be?
“The Commission should update the basic service objective to include broadband at an internationally-comparable and evolving speed target.” – Affordable Access Coalition
ACC says it should be 25 Mbps by 2020. The Federation of Canadian Municipalities notes in its submission that the European Union has adopted a “fast Internet” speed of 30 Mbps. The U.S. has also upped its benchmark for “advanced” broadband to 25 Mbps. Therefore, it concludes that “the Commission should update the basic service objective to include broadband at an internationally-comparable and evolving speed target.”
(It’s worth noting that last month, rural internet provider Xplornet committed to getting to 25 Mbps across its footprint by 2017 and urged the industry to offer 100 Mbps across their networks by 2020.)
Despite the agreement that broadband is already an essential service, there was some division among parties as to how this would be funded. Some parties argue it would be logical to use the existing, but a slightly modified, National Contribution Fund (NCF) mechanism.
The ACC says there should be two new elements added to the NCF. First, a broadband deployment funding mechanism with money from retail Internet and paging service revenues as well as a return to historic NCF levels during the 2001 to 2014 period would be implemented. An affordability funding mechanism would be added to go towards connecting and subsidizing low-income households.
According to the organization, base level funding would amount to 0.74% of telecommunications services revenue, while an ambitious plan would increase the NCF to 1.42% of telecom service revenue. This would be approximately the same size as the U.S. Universal Service Fund over the 2001 to 2014 period, it says.
Alberta’s Axia NetMedia on the other hand suggested something completely different. In essence the company is arguing that the government of Canada should empower the CRTC to allow for the creation of a national New Broadband Infrastructure that could be jointly owned by provincial, municipal governments and parties not already involved in the Internet access business. Existing broadband providers would be prohibited from owning any of this new infrastructure.
“This policy framework is proven in France and Singapore, which have created competition and compelling end user value using these principles. It is the normal policy framework for any basic shared infrastructure (water, power, utilities, roads, airports…),” the company writes in its submission.
Cartt.ca will have more on the views of the large telecommunications providers in the coming days.
