Consumers trump lobbyists in development of telecom regulation: consultant

TORONTO—Political intervention in the development of regulatory policy is here to stay, as grassroots consumer movements reduce lobbyists' ability to sway politicians and regulators, Playbook Communications consultant Erik Waddell said. “The Harper government, and really the Conservative party, is at heart a populist movement,” Waddell said Wednesday during a panel discussion at the Canadian ISP Summit in Toronto. “In the telecommunications and IT world, this populist sentiment has translated primarily into a pro-consumer, pro-competition agenda that more and more has led to direct market intervention.” The federal government has played an increasingly active and high-profile role in the regulation of telecommunications services over the past five years, and has butted heads publicly with telecommunications providers and the CRTC in the process. In 2008, the government rejected pleas of established wireless carriers when it decided to set aside certain blocks of wireless airwaves for new entrant players as part of an Industry Canada spectrum auction. In 2011, then-industry minister Tony Clement issued a statement on Twitter saying the federal government would overturn a new CRTC Internet wholesale policy unless the commission conducted a review. Waddell has served in a number of government roles and was an adviser to Clement when he was industry minister and later president of the treasury board. Most recently, the government engaged in a public relations war with incumbent wireless carriers this summer over Industry Canada's rules for the upcoming 700 MHz spectrum auction, through which the incumbents will be limited to acquiring a single block of the best airwaves while other players will be allowed to acquire up to two of the four prime blocks in each market of the country. Waddell said the government intervened in each case to accomplish policy goals that are based on a populist ideology. The appeal to populism, he added, “inoculates” the government from lobbying by big telecom companies. “Legislators and regulators are more easily swayed by organized grassroots efforts of local constituents than by corporate lobbyists,” Waddell said during the panel discussion, which focused on regulatory issues. “And, likewise, regulatory policy that promises to garner popular support among constituents is more likely to be favoured than an opposing policy that would solely benefit corporate interests but not be well-received or understood by Conservative supporters.” Waddell said the government's telecom policies have been designed in piecemeal “and largely in reaction to current events.” He said the government would benefit from a holistic review of its telecom policies, though not until the political environment “cools down” following the summer campaigns by the government and the incumbent wireless carriers. “The political is going to remain part of the regulatory process. Ministerial discretion and power will—and should—remain part of the equation,” Waddell added. “A technocratic regime with no ability to make exceptions or respond to the electorate is in no one's best interest.” Michael Geist, the Canada research chair of Internet and e-commerce law at the University of Ottawa, said during the panel discussion that there has been a “gradual shift” toward populist telecom policies in Ottawa over the past five years. He pointed to the CRTC's 2011 usage-based billing wholesale Internet decision as the “catalyst” for further populist decisions after widespread public anger over the commission's decision resulted in the government receiving more than 500,000 consumer complaints. “The number of people speaking out on an issue was a wake-up call to some that this was an issue people care about and I think we've seen the ramifications from that,” Geist said. The CRTC said in July that it will launch a new review of its wholesale Internet rules next year. Chris Tacit, a lawyer with Tacit Law who represents the Canadian Network Operators Consortium (CNOC), noted that the review will focus, in part, on consumer issues and will ask “healthy questions” about how consumers can best benefit from its wholesale Internet policy. Tacit said the commission has made it clear that “virtually nothing is off the table,” including potential new regulations that could require incumbent Internet providers to offer wholesale access to their new fibre-to-the-home networks, so that smaller providers can offer their own retail services over the incumbents' fibre infrastructure. Jonathan Daniels, BCE Inc.'s vice-president of regulatory law, said on the panel that Bell's fibre-to-the-home network is unlike its older networks because the company does not install the “fibre drop” connection—which runs from a utility pole into a subscriber's home—until after that subscriber orders a fibre-based Internet service. Rolling out that connection, he added, is the most expensive part of a fibre-to-the-home network deployment, which could complicate any CRTC decision requiring the company to offer wholesale access to its fibre-to-the-home infrastructure. “We don't actually build the fibre to the individual customer premise until that customer orders service,” he said. “We're not going to do that and go and send a technician to do the most expensive part until we actually know we have that customer.” Daniels said the government and regulators should only intervene in regulatory policy when market forces fail to produce competitive conditions. He said unnecessary regulations can distort a market and lead to poor telecom policies and market operations. As part of the discussions, Geist said current Industry Minister James Moore is “engaged” in telecommunications issues and wants to “clear the deck” of files that were in front of the industry department when he took over the portfolio from former industry minister Christian Paradis this summer. Among those, he said, are the draft regulations of proposed “notice-and-notice” requirements outlined in the government's copyright reforms last year—which would require ISPs to inform subscribers if they have been found to have violated online copyright laws—and the final regulations relating to anti-spam legislation passed in 2010. “I would expect that some time in the next few weeks we will see the final regulations and this will take effect some time next year,” he said of the anti-spam regulations. —With reporting by Nicholas Kyonka at nkyonka@thewirereport.ca and editing by Derek Abma at dabma@thewirereport.ca. CORRECTION: An earlier version of the story gave an incorrect year for when anti-spam legislation was passed.

Consumers trump lobbyists in development of telecom regulation: consultant

News | November 13, 2013

Unlock all the Canadian telecom, broadcasting and digital media news you need.

FREE TRIAL

SUBSCRIBE

Inside The Wire Report

Information

Hill Times Publishing

Get in Touch With Us

Consumers trump lobbyists in development of telecom regulation: consultant

News | November 13, 2013

Unlock all the Canadian telecom, broadcasting and digital media news you need.

FREE TRIAL

SUBSCRIBE

Related Stories

Competitors unhappy, incumbents closed-lipped about CRTC’s interim wholesale rates

Google granted exemption from requirements of Online News Act

CRTC sets interim rates for wholesale FTTP access

CRTC licenses Uvagut for mandatory carriage, Inuit TV as discretionary

Reuse & Permissions

Inside The Wire Report

Information

Hill Times Publishing

Get in Touch With Us