CRTC hears divided opinions about internet service in North

Local governments and advocacy groups are urging the CRTC to take action to address the issue of insufficient telecom service in Northern Canada, while big telecom companies are asking the regulator to take a hands-off approach. The CRTC heard from various intervenors in its ongoing consultation on the state of telecommunications in the North, and in particular the service offered by BCE Inc. subsidiary Northwestel. Last week it released a public opinion research survey that showed northern residents want the CRTC to allow enhanced competition to break up the “monopolistic” landscape of internet services in the area, which is dominated by Northwestel. The government of Northwest Territories said in its intervention that if the CRTC wants to see northern residents have access to internet service that is comparable to that available further south, it must take action. That includes regulating internet service rates in satellite-dependent areas, “ongoing portable subsidies to lower the rates for both residential and business Internet services,” and reviewing “the terms and conditions of wholesale access by competing service providers.” Currently, “residents of the NWT must pay considerably more to receive considerably less,” with residential internet rates that can be as much as 133 per cent more expensive in the North than in the South, the NWT government said. “We strongly urge the CRTC to immediately introduce a new subsidy, funded from its Central Fund, to address this problem in both the residential and business markets,” it said. The Federation of Canadian Municipalities’ Northern and Remote Forum said the impact of the COVID-19 pandemic has made the inequalities between the North and Southern Canada even more apparent. “With an estimated 14% of northern households with no home internet, and many others with slow, expensive, and unreliable access,the transition to remote learning and work during COVID-19 has laid bare the unequal access of Northern residents to essential services in Canada,” the Northern and Remote Forum said. In addition, quality of service is a concern, the FCM said, noting that consultations with municipal leaders have shown “network outages remain a persistent concern and have a significant impact on the well being of residents.” It asked the CRTC to take into account the “deleterious and unpredictable effects of data overage fees on households that require multiple, competing uses (education, health, business and other usage) on capacity constrained legacy copper/wireless networks.” The Public Interest Advocacy Centre (PIAC) also said action should be taken to address service outages, noting the CRTC’s recent report found they are a problem for many northern residents, and that “nearly half of Northern residents reported that network outages majorly or moderately impacted their well-being.” PIAC added that some northern intervenors to the CRTC consultation have detailed their experiences with outages that last “many days, sometimes weeks.” It said that the interventions the CRTC has received from northern residents indicate that telecom affordability, especially home internet, is a problem. “Many residents feel that they are overpaying for services and not even getting what they want, with many concerns regarding data overages noted. For some residents who cannot afford to pay for these services, it seems that they are either making compromises on other necessities or letting go of their internet packages,” PIAC said. In contrast, Telus Corp. told the CRTC that the higher internet rates in the North can’t be taken as a sign there is an affordability problem, because northern and southern Canada aren’t comparable. Prices for other goods and services are also higher in the North, while per capita income is also higher, it argued. “This means that simple price comparisons for telecom services between northern Canada and the rest of Canada do not, by themselves, reflect an affordability concern. Some low-income Canadians, including northern residents, may experience challenges paying for telecommunications services, just as they have difficulty obtaining other goods and services,” Telus said. “However, if northern residents face challenges obtaining telecommunications services, this is indicative of broader structural issues associated with poverty and affordability in the North, rather than a sectoral issue in the telecommunications industry.” Rogers Communications Inc. argued there is no need for a telecom service subsidy in the North. It said the ongoing Broadband Fund from the CRTC, which provides $750 million in funding for extending broadband services, “represents the most appropriate mechanism for supporting the Commission’s objective to ensure the affordability of Internet services in the North,” and it’s not necessary to put in place a subsidy for internet or landline phone service. Nunavut-based telecom provider SSi Micro Inc. asked the CRTC to make changes to wholesale rules that affect Northwestel. It said Northwestel is the “largest, and perhaps the only” Canadian incumbent telco “that also owns monopoly cable television facilities in its ILEC serving territory to be exempt from the requirement to offer third-party internet access (TPIA) on a wholesale basis to its cable and fibre-to-the-premises (FTTP) facilities.” SSi currently has a Part 1 application in front of the CRTC asking it to mandate that access. SSi said the way the current regulatory framework for Northwestel is designed allows Northwestel “to use the Commission as a shield against its actual and potential competitors.” “The Commission’s regulatory framework should not be making competition against Northwestel harder,” SSi said. Northwestel itself also filed an intervention, telling the CRTC it should not subsidize competitors or impose any new wholesale requirements. “Specifically, we strongly urge the Commission to reject any regime that would subsidize uneconomic competitive entry, as this would divert needed funds from broadband deployment and potentially undermine and jeopardize already approved plans to expand service for Northerners,” it said. Northwestel argued that any attempt to rush through TPIA service “particularly in light of the current proceeding that is specifically geared to a fulsome exploration of our total framework, would have significant negative impacts on Northwestel's continuing ability to expand connectivity in the North.” It said that the broadband funding bids it filed with the CRTC include economic models with a positive business case, but if those models are adjusted to include the impact of TPIA, “we find that providing TPIA at SSi's proposed 35% discount off of our retail rates triggers a significantly negative in communities approved for broadband funding.” Introducing TPIA would change the “actual business case for our approved broadband subsidy projects and could very likely result in us choosing not to invest despite the existence of Commission subsidy,” it argued. — Reporting by Anja Karadeglija at akarad@thewirereport.ca and editing by Michael Lee-Murphy at mleemurphy@thewirereport.ca

CRTC hears divided opinions about internet service in North

News | January 27, 2021

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CRTC hears divided opinions about internet service in North

News | January 27, 2021

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