Universal Broadband Fund
In its 2016 budget2019 Budget, the Government of Canada committed $500 million over five years to “extend and enhance broadband service in rural and remote communities.”188 Further details on program parameters will be announced in the coming months.
The federal government’s 2016 budget also provides $255 million over two years, starting in 2016–17, to the First Nations Infrastructure Fund. It will be used to support investments in a range of complementary infrastructure projects, including broadband connectivity, “in order to help communities as they develop and grow."189
CRTC Review of Basic Telecommunications Services (Telecom Notice of Consultation (CRTC 2015-134)
In April 2016, the Canadian Radio-television and Telecommunications Commission (CRTC) concluded the hearing portion of their “Review of basic telecommunications services.” Academics, public interest groups, individuals, municipalities, and telecom companies appeared before the commission to comment on the feasibility of including high speed internet as a “basic telecommunications service,” or whether broadband internet is a basic service, akin to landline telephone services, to which all Canadians require access.
The hearing centred around three major questions: Is broadband an essential service? What essential activities are Canadians taking part in online, and what service level is required to support those? And how do we pay for it? The CRTC is expected to release a decision in the coming year.
CRTC Review of wholesale wireline services and associated policies (Telecom Regulatory Policy CRTC 2015-326)
federal government committed to the creation of a national connectivity strategy, in conjunction with additional funding for broadband projects in Canada. As well as topping up a number of existing broadband funding initiatives, including the Connect to Innovate program and the CRTC’s Broadband Fund, the High-Speed Access for All: Canada’s Connectivity Strategy also created the Universal Broadband Fund, with an initial investment of $1.75 billion over six years158. In subsequent federal budgets, investments in the Universal Broadband Fund were increased to $2.75 billion. The strategy also set the goal of achieving 98% access to 50 Mbps download / 10 Mbps upload in Canada by 2026, and 100% by 2030.
Eligibility for the Universal Broadband Fund is determined using the National Broadband Internet Service Availability Map159. Any project existing within a 250 m road segment that does not have access to 50/10 Mbps internet is deemed eligible for UBF funding — provided the project delivers a minimum 50/10 Mbps connection speed and provides open access to Points of Presence. As of June 2021, Alberta has received $5,303,762 in funding for broadband projects from the Universal Broadband Fund, serving a total of 12,259 households160.
CRTC Broadband Fund
In Telecom Regulatory Policy CRTC 2016-496, the CRTC first expressed its intention to create a funding mechanism to support broadband infrastructure projects in Canada161. Through a number of subsequent public proceedings, the CRTC established parameters around its Broadband Fund — an investment of $750 million over five years in broadband infrastructure projects throughout Canada.
Money for the fund is not drawn from general tax revenue, but is redirected from funds previously collected from incumbent projects by the CRTC to subsidize telephone services in remote and rural areas. Eligible projects include Transport, Access or Mobile Wireless initiatives existing in an area deemed “underserved” by ISED’s National Broadband Internet Service Availability Map, which uses a hexagon system. Underserved, in this context, means any 25 km2 hexagon that does not have access to 50/10 Mbps for any household.
The first call for applications to the CRTC Broadband Fund was announced in June 2019 for eligible projects in Canada’s North, with eligibility opened up to all areas of Canada in March 2020. As of June 2021, no projects in Alberta have received funding through the CRTC Broadband Fund162.
CRTC Wholesale Rates Regulations
From 2015-2021, the CRTC initiated a number of impactful proceedings with respect to wholesale rate regulation in Canada. Historically, the CRTC has applied an “essentiality test” to infrastructure owned by facilities-based carriers. Where telecommunications firms own “bottleneck facilities” that are not easily or practically duplicable by competitors, but are otherwise required as an input to provide telecommunications services, the CRTC mandates that wholesale providers be given access to these networks in order to deliver internet services, thereby fostering competition in the telecommunications market163.
Whereas large CRTC decision 2015-326 mandates that large incumbent carriers provide disaggregated wholesale access to their fibre networks for access and transport facilities. Large DSL and cable providers have been required to share their copper and coaxial cable networks through wholesale and Third Party ISP Access (TPIA) arrangements since the 1990s. Incumbents will now be , incumbents have been required to do the same with fibre optic access networks . Bell Canada appealed the decision with the federal cabinet,190 but the petition was rejected by the Minister responsible for Innovation, Science, and Economic Development.191
The decision will be implemented provincially beginning with Ontario and Quebec. As per paragraph 152 of the decision, when a competitor requests disaggregated wholesale high speed access from the incumbent in Alberta, the new rule can be triggered here.
First, since the demand for wholesale HSA services is currently focused within certain geographic markets, disaggregated wholesale HSA services should be implemented in phases, starting with Ontario and Quebec. Other phases targeting the implementation of disaggregated HSA services in other geographic markets will be identified at a later stage. Implementation of the disaggregated wholesale HSA service in the designated geographic markets will be triggered by competitor requests for the service at specific central office and head-end locations. Incumbent carriers are to consult with their wholesale HSA service customers to identify the specific central office and head-end locations where a disaggregated wholesale HSA service will be in demand.192
CRTC Examination of differential pricing practices related to Internet data plans (CRTC 2016-192)
In May 2016, the CRTC initiated a “proceeding to examine the policy issues surrounding the use of differential pricing practices by Canadian internet service providers related to the provision of internet data plans.”193 The proceeding stemmed from applications by several parties concerning Videotron’s practice of offering an unlimited music service to its mobile wireless customers. In this example, the music service is a zero-rated service, which means that the music service does not count toward a plan’s data-cap, whereas any other traffic does apply. So far, interventions by interested parties have addressed net neutrality and differential pricing practices in the form of zero-rating, sponsored data pricing mechanisms, and data caps.
Differential pricing by internet service providers is a growing global practice, and regulators in other jurisdictions have examined or are currently examining this issue. It is the aim of the CRTC to generate “a clear and transparent regulatory policy regarding differential pricing practices for internet data plans”194 as a result of this proceeding. The hearing will take place in October 2016.
Industry Canada & Tower Siting
In 2008, during the Advanced Wireless Services (AWS) auction, Industry Canada mandated antenna tower and site sharing.195 Tower and site sharing will become increasingly important as the provision of wireless access networks grows, particularly in rural Alberta.
In 2013, the Canadian Wireless Telecommunications Association and the Federation of Canadian Municipalities launched a joint Antenna System Siting Protocol Template — a tool for municipalities to use to develop antenna siting protocols or improve existing ones. Industry Canada also offers advice for local governments in creating processes in its Guide to Assist Land-use Authorities in Developing Antenna Siting Protocols.
or “fibre-to-the-home” networks since 2015164.
Between 2016-2019, the CRTC undertook an extensive proceeding to investigate the reasonableness of its costing framework with respect to wholesale rates. The proceeding was spurred by filings by wholesale providers claiming the existing pricing framework allowed incumbent carriers to unjustly overcharge them for network access, thereby significantly increasing the fees they had to charge their customers.
The CRTC accepted this reasoning in 2019 and significantly lowered wholesale access rates (by as much as 89% in some cases) and mandated incumbent carriers to repay wholesale providers all overcharged rates retroactive to 2016165. In response, incumbent carriers Bell and Rogers filed an appeal with the CRTC, in conjunction with initiating court proceedings to appeal the rate-setting decision166.
Following a stay order of its 2019 decision while it investigated Bell’s appeal, in May 2021, the CRTC reversed its previous determination on overcharged wholesale rates and significantly raised rates on wholesalers. Met with widespread derision by wholesale providers and broadband advocates, the decision led to immediate price increases and suspensions of services by a number of wholesale providers.
At the time of writing, wholesale provider Teksavvy had petitioned the federal Minister of Innovation, Science and Industry to have the CRTC’s May 2021 rate increase overturned167.
CRTC Regulatory Policy 2016-496: Universal Service Objective
On December 14, 2016, the CRTC released CRTC Regulatory Policy 2016-496 establishing the Universal Service Objective, which set an internet connection of at least 50 mbps download speed and 10 mbps upload speed, with unlimited data allowance, as a target for both residences and businesses across Canada168. In addition, the decision set fixed and mobile wireless broadband internet and fixed mobile wireless voice services as “basic telecommunications services.” The regulatory policy has been significant in formalizing the CRTC’s shift in focus towards high-speed internet access.
In addition, the Universal Service Objective of “50/10” has served as the eligibility basis for all significant broadband infrastructure funding initiatives since 2016, including the Universal Broadband Fund and the CRTC’s Broadband Fund, and for the federal government’s long term innovation agenda more broadly.
References
158Government of Canada. High-Speed Access for All: Canada's Connectivity Strategy. Accessed 15 June 2021.
159ISED. National Broadband Internet Service Availability Map. Accessed 15 June 2021.
160Government of Canada. Selected Universal Broadband Fund Projects. Accessed 16 June 2021.
161CRTC. Telecom Regulatory Policy CRTC 2016-496. Accessed 15 June 2021.
162CRTC. Broadband Fund Projects Selected for Funding. Accessed 15 June 2021.
163CRTC. Telecom Decision CRTC 2008-17. 03 March 2008.
164CRTC. Telecom Regulatory Policy CRTC 2015-326. 22 July 2015.
165CRTC. Telecom Order CRTC 2019-288. 15 August 2019.
166The Canadian Press. Bell petitions Trudeau government to overrule CRTC on wholesale network rates. 13 November 2019.
167TekSavvy. TekSavvy Petitions Federal Cabinet to Overrule CRTC’s Arbitrary Rate Decision. 28 May 2021.
168CRTC. Telecom Regulatory Policy CRTC 2016-496. 21 December
References
188. Government of Canada. Budget 2016 - Chapter 2 - Growth for the Middle Class, 22 March 2016. Accessed 27 June 2016.
189. Government of Canada. Budget 2016 - Chapter 3 - A Better Future for Indigenous Peoples, 22 March 2016. Accessed 27 June, 2016.
190. CBC. Bell appeals CRTC ruling forcing company to sell fibre internet access to small ISPs, 7 December 2015. Accessed 27 July 2016.
191. CBC. Cheaper internet may be coming after cabinet rejects Bell appeal, 11 May 2016. Accessed 27July 2016.
192. CRTC. Telecom Regulatory Policy 2015-326, para. 152, 22 July 2015. Accessed 27 July 2016.
193. CRTC. Telecom Notice of Consultation CRTC 2016-192, 18 May 2016. Accessed 8 July 2016.
194. CRTC. Telecom Notice of Consultation CRTC 2016-192, 18 May 2016. Accessed 8 July 2016.
195. Industry Canada. CPC-2-0-17 — Conditions of Licence for Mandatory Roaming and Antenna Tower and Site Sharing and to Prohibit Exclusive Site Arrangements. Accessed 17 May, 2016.