Federal Budget-Broadband delay in budget disappoints, but hope remains for eventual rollout

The federal government’s decision to postpone the rollout of high-speed Internet across the country was a disappointment for many observers. But they do hold out hope that the delay will give the industry more time to convince a skeptical public the project is worthwhile. "We will work with Canadian industry, provinces, communities, and the public on private-sector solutions to further broadband Internet coverage in Canada, particularly for rural and remote areas," Finance minister Paul Martin told the House of Commons during his budget address Dec. 10. "More planning is required to properly achieve our commitment, particularly given the rapidly changing technology and, as a consequence, we will shift our target to the end of 2005." The issue was studied in depth by the National Broadband Task Force (NL, June 18/01). One of the members of that panel wants to take the next year to educate consumers, especially in rural and remote areas, about the benefits of broadband. "In the next 12 months we’re going to work diligently to try and raise the prospect and the benefits of broadband in rural communities," Vic Allen, CEO/vice-chair of Upper Canada Networks, tells Network Letter. "Perhaps we’ll get the number of write-ins to our elected officials that trigger them to pay more attention to this most strategic initiative." Allen was in Ottawa last week attending a broadband conference. Several of the panelists told Network Letter they were surprised at the vehemence of the opposition to the project from editorialists and columnists in the national media. Spending figures that were attributed to the federal government are in fact a total of public and private dollars, with government outlay being at the national, provincial and local level. It was speculated at the time of the task force report’s release that some of the broadband load would be handled by existing grids such as CANARIE Inc.’s CA*net 3 and proposed CA*net 4, the SchoolNet network, and the Community Access Program. Martin granted CANARIE $110 million for the rollout of CA*net 4 and extended the lives and funding for the other two initiatives (see story in this issue). They are being continued at an annual cost of $40 million and an additional $105 million is being allocated to expand the two programs, which pleases the chair of the task force. "There are two or three propositions in the budget that I think are comforting," David Johnston suggests to Network Letter. "One is SchoolNet and Community Access Programs have had significant extension for three further years and they can provide, I think, part of the base for going forward. And CA*net 4 has been fully funded and that will provide very big pipe links into some of the smaller colleges and universities. And then the sleeper that may be very helpful indeed is the $2-billion infrastructure foundation. Normally infrastructure is interpreted as roads, bridges and sewers but in the last infrastructure program it included information technology. So I think what we’ve seen there is kind of a half step forward as opposed to the full step we’d all hoped for." Although generally disappointed by the delay, Brian Beaton, coordinator of K-Net Services in Sioux Lookout ON and a member of the task force, likes the prospect of using federal funds for non-traditional services. He came to Ottawa to attend the Broadband Canada conference and was encouraged by what he heard from a bureaucrat and a politician. "I started talking about the possibilities of water and sewer, transportation and all those other basic infrastructures that a lot of municipalities are very concerned about," he tells Network Letter. "I asked ‘can telecom be included?’ Michael Binder indicated yes at session. And again Joe Jordan also indicated yes. That gives me a lot of hope." He laments the slowdown in the rollout announced by the finance minister. "It also puts off the opportunity that much further where I’d rather have it today," he says. "I need broadband connectivity. I don’t need narrow pipes coming out of urban centres that’ll take care of me. I want to see rural opportunities develop." Beaton suggests the usual investment strategy will need to be inverted in order to be successful. Instead of beginning in large metropolitan areas and expanding to other areas, developers should move from remote regions to the bigger centres. "I think the traditional business models don’t work in this case," he asserts. "I think the network needs to be looking at the edges first in order to be able to build the foundation that’s required for a sustainable broadband network." Some task force members offer the hope that changes in technology will improve the outlook for a broadband initiative by 2005. "While our broadband task force reported last May, even in that eight or nine months, the delivery mechanisms have changed and I think improved," Johnston notes. "We may find this can be done more cheaply, we may find it can be done with a greater dependence upon wireless and satellite than heretofore we thought possible." While the broadband project received little political or monetary support on Dec. 10, speculation is rife its time will soon be at hand. Sources inside and outside of the federal government are suggesting Martin may issue an updated budget early next year.

Federal Budget-Broadband delay in budget disappoints, but hope remains for eventual rollout

News | December 18, 2001

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