Thursday, January 14, 2016

Why Mayor John Tory is against competition for access to affordable fast broadband

Political and corporate insiders
Cities across the country have long emphasized the importance to the local economy of creating innovation hubs.

There are different roads toward that goal, however, as shown by competing submissions from the mayors of Toronto and Calgary in a high-stakes battle over the future of broadband Internet services.

Toronto’s Mayor John Tory (joined by Ottawa Mayor Jim Watson) sided with large telecom companies, while Calgary’s Mayor Naheed Nenshi emphasized the importance of open networks and more robust competition.

The submissions stem from a crucial ruling issued by Canada’s telecom regulator in July. Hoping to foster a more competitive market and having used various “open access” policy measures to give independent Internet providers a chance to compete in the Internet services market, the Canadian Radio-television and Telecommunications Commission (CRTC) decided to extend those rules to fast fibre connection services.

The upshot of the ruling was that companies such as Bell would be required to share their infrastructure with other carriers on a wholesale basis. The companies would enjoy a profit on those wholesale connections, but the increased competition would facilitate better services, pricing and consumer choice.

Indeed, the policy approach is similar to the one used for slower DSL broadband connections that has been instrumental in creating a small but active independent ISP community that serves hundreds of thousands of Canadians.

Months later, Bell filed a cabinet appeal over the decision, asking the new Liberal government to overrule the CRTC. Industry Canada recently posted the comments from interested stakeholders and in the process revealed a fascinating split on the issue.

On one side, Bell garnered support from large business groups and technology companies such as Cisco and Blackberry. Those companies have strong business relationships and were unsurprisingly willing to support Bell’s position. On the other side, consumer groups, independent Internet providers, some cable providers and the Canadian Federation of Independent Business lined up in support of the CRTC decision, emphasizing the benefits of a more competitive market.

While the corporate divide was to be expected (most corporate submissions supporting Bell used similar language and some even copied Bell executives), the more interesting difference arose from submissions from several large Canadian cities.

Toronto and Ottawa both submitted brief letters expressing support for Bell’s position. The two-page letters both cite planned Bell investments in the cities and express fear that the CRTC ruling might delay company plans.

Tory, a former Rogers executive, says that Bell deserves to be treated fairly, but does not explain how the implementation of a policy designed to create more competition for his constituents represents unfair treatment.  (more...)


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