Telecom in northern Canada

August 01, 2013

The Conference Board of Canada has published a major paper on Canada’s telecom sector.

The report looks at satellite dependency, affordability, “connectivity scenarios”, case studies and covers off some lessons learned from various jurisdictions and experiences. It make recommendations for public policy.

A few interesting points from the report:

• Satellite-backhauled connectivity is the only option for 36 per cent of communities in the Northern connectivity profile (Nunavut for example is 100% satellite).
• In mid-2013, the Canadian Radio-Television and Telecommunications Commission (CRTC) target of 5,000 Kbps down/1,000 Kbps up continues to elude most Northern communities.

The reports recommendations:

• Increased capital investment: Increased capital investment into connectivity is clearly required in Canada’s North. The report suggests ‘targeted funding’ and perhaps public ownership may be required to sustain innovation.
• Reducing IT capacity constraints: There are scarce IT professionals in Canada’s North to manage next-generation Internet services and develop applications.
• Access to functioning and capable devices: In addition to critical connectivity infrastructure, northerners need capable devices.
• Improvements to network diversity and redundancy: The design of Northern network backbones can have a negative impact on service reliability.
• Increased efforts to improve affordability: Most Northern families have earnings below the national average while the cost of living is much higher in the North than in the South. If Canadian social policy is serious about developing a Northern knowledge-based economy, it should investigate the relevance of a northern subsidy for residential broadband service.
• Increased Northern and Aboriginal content development, relevant delivery channels, and appropriate support for digital literacy: Having affordable and reliable broadband ICTs is a necessary but not a sufficient condition for Northerners and Northern organizations to use them.

Commentary

The Conference Board report is well researched, well written and thoughtful. The focus of the report on bandwidth and connectivity is sensible. The recommendations make sense, as far as they go, with one exception noted below.

We can all agree that capital investment in telecom infrastructure is needed in the north. The nub of the problem is how to garner this investment. The private sector requires a return and government funding is very limited. Governments have invested millions in very wasteful ways, yet the Conference Board suggests public ownership as being a panacea. Northwestel, for example, has invested several hundred million dollars in capital over the past 25 years in northern telecom infrastructure, would territorial governments be willing to take-over this investing ? Or do they now have enough on their plates delivering health-care, roads and schools ?

The regulator, the CRTC, adheres to antiquated rules that focus on telephone network access. The focus more rightly should be on delivering maximum bandwidth for minimal cost to consumers. But everyone should realize that bits and bytes are not free, and if investor-owned entities like Northwestel are expected to invest millions in far-flung communities they need to earn a fair return.

Sources

• a)"Mapping the Long-Term Options for Canada’s North :Telecommunications and Broadband Connectivity" Conference Board of Canada. July, 2013. see http://www.conferenceboard.ca/