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Let’s talk about solutions - for Canada’s broken telecom market

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I have a lot of respect and admiration for independent telecom analyst and tech writer Peter Nowak. Peter regularly calls bull on Big Telecom’s misleading talking points, and backs it up with hard data and solid analysis. I consider his blog a public service and I read it regularly myself.

That’s why I took a keen interest when he critiqued one of OpenMedia.ca’s key recommendations on how to fix our broken cellphone market. We all know we pay some of the highest prices in the industrialized world, so this is a subject close to many Canadians’ hearts as well of course.

I don’t get a chance to write that much anymore - OpenMedia.ca work is overwhelming to say the least - but I’d like to take this opportunity to jot down some of my thoughts on this matter, especially in light of this morning’s announcement by the government of positive new measures to help Canadians access independent options.

Peter basically asserts that government action to stop the Big Three cell phone providers from blocking Canadians from accessing new, more affordable indie providers (or what policy folks call MVNOs or wholesale access) is wrong headed.

Basically one of the things we at OpenMedia.ca have been calling for is for wireless companies like Ting to be able to reach Canadians just like indie ISPs like DistributelAcanacStart orTeksavvy, just to name a few, do for wired Internet. At the moment Canadians are blocked by the Big Three from using Ting, which I think is wrong.

We’ve had our Time for An Upgrade report out since March, and it looks like the government is starting to listen. This morning’s announcement indicates that decision-makers are finally getting serious about real solutions to our broken cell phone market. I have to say it was really frustrating to see many fall for the false choice of the Big Three vs. Verizon during the summer. Many fell for the Big Three’s misleading narrative PR spin, so it’s encouraging that we’re having a reasonable discussion again.

I don’t think it’s true that new indie providers would only offer inferior, mostly voice, service as Peter suggests. Ben Klass makes a good case for how such policies could really shake up cell phone service for Canadians. Elliot Noss from Ting also suggests that wholesale wireless options would offer much more than lower end options to Canadians, with his own company as an example. I think at the very least it’s worth trying - it could only help.

Learned Hopelessness? 
I do agree with Peter that if the government and CRTC are not committed to enable real choice through new indie (MVNO or otherwise) providers then we’re sunk. That said, this morning’s news gives reason to believe that the CRTC and government are finally committed to moving forwardin a decisive manner.

I understand why Peter might not agree - most Canadians have been frustrated over and over that the government won’t just step up to the plate and fix this problem. But I think there’s some learned hopelessness at play that isn’t helpful.

As I said, I understand the sentiment - I’m still a young-ish man but I’m starting to feel a bit like an old war horse after about six years in the trenches on telecom issues. I also have to say that it’s not the first time I’ve been told something can’t be done, but seen Canadians persevere.

I was told that we couldn’t win Net Neutrality (Internet openness) rules - we did. I was told we couldn’t stop an Internet pay meter from being imposed on all Canadians - we did. I was told we certainly couldn’t stop the government’s C-30 online spying train from leaving the station - we did. I was told we couldn’t get cell phone customer protection rules put in place - we did (albeit imperfect).

In short, it’s safer to be cynical and be surprised when things work out - but I think there’s plenty of evidence that when there’s sustained effort by Canadians we can win these things. It will take time, lots of time, and it will be imperfect - but it can happen.

In terms of stopping Big Telecom from blocking Canadians from accessing indie providers (what the wonkier among us call wholesale or MVNO access) -- I think there are signs that it’s very doable.

Peter noted that indie wired ISPs have this type of access and it hasn’t solved the problem. That’s true, but A) it’s way better than not having innovative providers such as Acanac, Distributel, Start.ca, and Teksavvy challenging Big Telecom; B) there are CRTC hearings on the horizon that point to improvements in this system; and C) Our work here isn’t done yet.

Personally I prefer open networks (“structural separation” in policy talk) as a common sense solution. That’s how we open the market to indie providers for real. I think that if Industry Minister James Moore really wants to act decisively rather than trying to make tweaks at the margins, that’s exactly what he should and will do.

I realize that Moore and the CRTC might not have the stomach to act so decisively. Enabling enforced cost-based access for indie providers with an active citizen-oriented CRTC seems like a solid first step that moves us towards open networks. It’s a pragmatic start.

That would help fix the market, and, judging by their track record, Big Telecom will inevitably try to discriminate against smaller providers, which is when we get to move to fully open networks. This is how it happened in the U.K. I would argue that the appetite for open networks is already there for wired, but the government may not be ready yet.

Let’s also consider what Ben Klass notes about how better access for indie providers “would bolster both the currently struggling fourth facilities-based carrier (Wind) and enable MVNOs to set up shop, experiment with new business models, and exert pricing pressure on the incumbents. We’re not talking about a zero-sum game between a fourth carrier (roaming) and MVNOs (wholesale), the two are complements”.

If Peter wants to advocate for full structural separation/open networks, I’m all for that - in fact that’s what we do. But I would hope that his argument against more incremental change to enable Canadians to use indie services would be focused on it not going far enough, rather than the arguments that Elliot Noss did a good job poking holes in here.

If you think these access issues are inconsequential, Ben Klass explains just how hard Big Telecom (Bell in particular) is fighting tooth and nail against positive change. As Ben says “They can’t be happy about having to face a potentially serious threat to their ability to keep collecting sky-high economic rent.”

I’d say if the government isn’t ready to be decisive and coherent by opening the networks, then let’s start with stopping the Big Three from blocking Canadians from accessing indie services.

After all, there really aren’t any other useful options that are more likely to come into force. Some suggest giving Big Telecom more access to capital is a good idea - but that will of course just give them more power to dominate the market. The other option is public ownership like Saskatchewan has successfully done -- James Moore has already explicitly ruled this out so I don’t think we’re going to see anything like that under this government.

That said if the government opens up to this public option that Peter has thankfully been raising as part of the conversation -- I hope the public entity would then share its digital infrastructure (spectrum) with a variety of independent and community-based providers.

Let’s also please not forget that four players - which is all you get with other approaches on their own - is really not good enough to ensure better service and prices. So let’s stop the Big Three from blocking our access to indie providers as a first step to fully opening the networks.

 

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