Why would service providers hold themselves to CRTC targets when the CRTC itself won't?
The regulator has halved its minimum speed requirement for its broadband internet fund
Canadians pay some of the highest internet prices in the world for middle-of-the-road service. We talk about this endlessly. The question is: who's going to be the one to step in and do something about it?
There's no clear answer yet, but it's pretty safe to say it won't be the Canadian Radio-television Telecommunications Commission (CRTC), which recently revealed the details of a new fund for broadband expansion that is limited in scope, and will do little to help Canadians.
In 2016, the Commission deemed broadband internet access a basic service and set aside $750 million for infrastructure investment to provide service where market forces have failed, particularly in rural areas and the north. The "Broadband Fund," in other words, was designed to address the digital divide by incentivizing projects in poorly served areas.
It all sounded good. But at the end of September, the CRTC finally announced the details of what that funding will look like, and the plan fell way short of what was promised.
Half the speed requirements
Two years ago, the CRTC set speed targets of 50 megabits per second (Mbps) download and 10 Mbps upload. But now, the Commission says it will only require half of that: 25 down and 5 up. The difference between these two speeds is more than how quickly a user can download a document or the quality of a video stream a video; it's the difference between having an internet connection that can allow six, 12, or more devices able to operate online at the same time in a multi-person or multi-family home.
The data shows that as each household adds additional internet-connected devices, inhabitants are more likely to report slow connection issues, such as buffering or loading errors. This issue is amplified in lower-income and some Indigenous communities, where access to high-bandwidth connections is limited or cost-prohibitive, and multiple families may share a single dwelling. Without a high-bandwidth connection, the ability to be connected continues to be more luxury than basic service.
The CRTC says it lowered the requirements to encourage applicants for projects in remote areas. But this is a tough pill to swallow since there is little in the decision that actually guarantees approved slower projects will eventually be upgraded to meet the real 50/10 targets. Although "scalability" is one criteria for assessing projects, the CRTC has not outlined what, if any, follow-up will take place to ensure these upgrades actually happen, or when. Major broadband upgrades don't come around for communities very often, so it's essential that our standards are future-proofed to make sure these investments last.
Furthermore, the decision is vague about another key factor in high-quality internet access: latency. Where bandwidth (for example 50 Mbps) measures how much data can move at once, latency measures how fast that data can get across the network and back, and it is key to real-time services like video conferencing. Without clear latency requirements for Broadband Fund eligibility, it is much less likely to achieve its goal of high-quality broadband across the country. The end result encourages a "trust us" approach from network operators who aren't exactly famous for over-delivering on their services.
All of this raises the question: why would any service provider hold themselves to the CRTC's basic services objectives, when even the regulator itself won't? By lowering the standards for its own funding, the CRTC effectively lowered it for everyone else and further entrenched our country's digital divide.
Let me be clear: investment in faster internet for rural areas is critical for everyone in Canada. Our whole economy loses out when so many people are left in the slow lane, or without internet altogether. Imagine getting a job, going back to school, staying in touch with friends and family, or trying to access crucial government services without a high-quality internet connection.
Until we saw the final decision, this funding was our best chance in decades to bring all Canadians up to speed. Sadly, it fell drastically short of expectations.
And this isn't just about wired internet into the home – the CRTC's lack of ambition for ensuring high quality affordable communications extends to our cell phone market as well. Four times now – in 2015, 2016, 2017, and most recently in March of 2018 – the CRTC has said no to allowing innovative new cell phone providers called Mobile Virtual Network Operators (MVNOs) to set up shop in Canada. MVNOs are cell phone providers that pay a fair price for access to rent unused capacity on incumbents' existing cell phone network, instead of starting from scratch and building yet another redundant and massively expensive national network.
MVNOs offer competitive prices for cell phone service and a variety of plans, and are common in the U.S. and Europe. But because the CRTC apparently still hasn't recognized the need to set fair rates for these providers, incumbents are currently holding MVNOs out of the market with outrageous rates that make it impossible for these companies to just break even.
After four separate rejections of calls to support these providers – clearly recognizing a desperate need from the public and smaller telecom companies wanting to sell affordable wireless services – the Commission's only response has been to look into whether it should legally require Big Telecom to provide a low-cost data-only plan; a Band-Aid solution that will do little address the fundamental problems of a lack of competition in the market. Without more choice, most internet users will continue to pay more money for less data than our global counterparts.
The CRTC clearly isn't going change course. But the federal government can push back. Innovation Minister Navdeep Bains has sent CRTC decisions back for review in the past, including the 2017 MVNO decision. In the interest of bridging the digital divide, he should consider doing so again here.