Policy shift needed to improve broadband access for rural, remote residents: Senators Patterson and Black
Tags
Many will read this op-ed using a wireless device. Most Canadians don’t realize how much of a luxury that is.
While it is laudable that the government has repeatedly committed to improving broadband access for rural and remote communities, many federal policies continue to frustrate this goal. For this reason, we have repeatedly raised the issue of equal and affordable access to high-speed broadband in the Senate Chamber.
One major barrier is the government’s disinclination to support overbuild. In urban environments, overbuild happens naturally, as a consequence of competition. In northern and rural jurisdictions with no service or unreliable connectivity, “overbuild” is actually redundancy. Redundancy ensures service continuity should anything go wrong with the primary provider. Users, for instance, should not be without internet access in Nunavut because it is raining in Saskatchewan. And — as anyone from these regions knows — anything that can go wrong, will go wrong.
The $2.75-billion Universal Broadband Fund is meant to fund initiatives in line with Canada’s Connectivity Strategy, released in 2019. However, Innovation, Science and Economic Development Canada warns: “Any elements or areas of a project that propose to overbuild existing services will be removed from the final project, in the event it is selected, and in any event, projects proposing to overbuild existing services to any degree will generally be assessed less favourably relative to competing proposals that do not.”
Another hurdle for rural, remote and northern communities is the lack of available spectrum, which can be used to deliver internet to these jurisdictions. The recent spectrum auction is illustrative: while Canada’s big three (Rogers, Bell and Telus) picked up the majority of available licences, a total of 757 licences went to other providers across the country, many at a heavily subsidized rate.
These licences are sold at a discounted rate to notionally encourage competition. However, there is nothing preventing a company from sitting on the licence and not using it to provide service to communities. Instead, these companies can sell their subsidized licences for huge profits. In 2013, Shaw made $160 million flipping unused spectrum it bought at a heavily subsidized rate. In 2017, Videotron sold its spectrum after it sat idle for several years for a total profit of $243 million.
Why does all this matter? Because Canadians suffer when companies sit on spectrum licences instead of actively building infrastructure and ensuring these licences are used to improve coverage areas and quality of service.
That is why Senator Dennis Patterson introduced Bill S-242, An Act to Amend the Radiocommunication Act, which he lovingly calls the “Use It or Lose It” bill. The bill reflects, in part, a government commitment in Innovation Minister François-Philippe Champagne’s mandate letter to implement a “use it or lose it” approach to accelerate broadband delivery.
The concept is simple: either ensure that a minimum of 50% of the population covered by the licence is being serviced or have the licence revoked and put back up for auction.
Report after report lists Canada as one of the most expensive countries in terms of internet service costs and one of the worst countries for internet service availability in rural, remote and northern communities when compared to other member countries of the Organisation for Economic Co-operation and Development. These conditions are embarrassing and are having deleterious impacts on the quality of life of northern and rural citizens.
In an increasingly digitized world, where the pandemic has forced hybrid and remote scenarios for work and education, we need fast and reliable internet now. Scrapping the overbuild policy for underserved regions and passing the “Use It or Lose It” bill is a good start to achieving that goal.
Senators Dennis Patterson and Rob Black represent Nunavut and Ontario in the Senate, respectively.
A version of this article appeared in the April 6, 2022 edition of The Hill Times.
Note to readers: The Honourable Dennis Glen Patterson retired from the Senate of Canada in December 2023. Learn more about his work in Parliament.
Many will read this op-ed using a wireless device. Most Canadians don’t realize how much of a luxury that is.
While it is laudable that the government has repeatedly committed to improving broadband access for rural and remote communities, many federal policies continue to frustrate this goal. For this reason, we have repeatedly raised the issue of equal and affordable access to high-speed broadband in the Senate Chamber.
One major barrier is the government’s disinclination to support overbuild. In urban environments, overbuild happens naturally, as a consequence of competition. In northern and rural jurisdictions with no service or unreliable connectivity, “overbuild” is actually redundancy. Redundancy ensures service continuity should anything go wrong with the primary provider. Users, for instance, should not be without internet access in Nunavut because it is raining in Saskatchewan. And — as anyone from these regions knows — anything that can go wrong, will go wrong.
The $2.75-billion Universal Broadband Fund is meant to fund initiatives in line with Canada’s Connectivity Strategy, released in 2019. However, Innovation, Science and Economic Development Canada warns: “Any elements or areas of a project that propose to overbuild existing services will be removed from the final project, in the event it is selected, and in any event, projects proposing to overbuild existing services to any degree will generally be assessed less favourably relative to competing proposals that do not.”
Another hurdle for rural, remote and northern communities is the lack of available spectrum, which can be used to deliver internet to these jurisdictions. The recent spectrum auction is illustrative: while Canada’s big three (Rogers, Bell and Telus) picked up the majority of available licences, a total of 757 licences went to other providers across the country, many at a heavily subsidized rate.
These licences are sold at a discounted rate to notionally encourage competition. However, there is nothing preventing a company from sitting on the licence and not using it to provide service to communities. Instead, these companies can sell their subsidized licences for huge profits. In 2013, Shaw made $160 million flipping unused spectrum it bought at a heavily subsidized rate. In 2017, Videotron sold its spectrum after it sat idle for several years for a total profit of $243 million.
Why does all this matter? Because Canadians suffer when companies sit on spectrum licences instead of actively building infrastructure and ensuring these licences are used to improve coverage areas and quality of service.
That is why Senator Dennis Patterson introduced Bill S-242, An Act to Amend the Radiocommunication Act, which he lovingly calls the “Use It or Lose It” bill. The bill reflects, in part, a government commitment in Innovation Minister François-Philippe Champagne’s mandate letter to implement a “use it or lose it” approach to accelerate broadband delivery.
The concept is simple: either ensure that a minimum of 50% of the population covered by the licence is being serviced or have the licence revoked and put back up for auction.
Report after report lists Canada as one of the most expensive countries in terms of internet service costs and one of the worst countries for internet service availability in rural, remote and northern communities when compared to other member countries of the Organisation for Economic Co-operation and Development. These conditions are embarrassing and are having deleterious impacts on the quality of life of northern and rural citizens.
In an increasingly digitized world, where the pandemic has forced hybrid and remote scenarios for work and education, we need fast and reliable internet now. Scrapping the overbuild policy for underserved regions and passing the “Use It or Lose It” bill is a good start to achieving that goal.
Senators Dennis Patterson and Rob Black represent Nunavut and Ontario in the Senate, respectively.
A version of this article appeared in the April 6, 2022 edition of The Hill Times.
Note to readers: The Honourable Dennis Glen Patterson retired from the Senate of Canada in December 2023. Learn more about his work in Parliament.