Telecom Policy - News

  • – 2021-04-21 –

    In yet another of a long string of missed opportunities and short-sighted half measures, the CRTC has announced its regulatory solution for Canada's chronic cell phone market debacle. In adopting a regime that replicates, rather than overcomes, the most problematic features of Canada’s mobile landscape, the Commission’s regulatory solution offers slim hopes for Canada’s cell phone market.

    As anyone with a phone plan is aware, world-high mobile prices have plagued Canadians for years. Yet Canada’s dominant national providers (TELUS, Bell and Rogers) have persistently denied this reality through lobbying efforts, regulatory filings, and even active misdirection. It is therefore encouraging that the CRTC’s recent decision finally and definitively confirms the nature and scope of Canada’s pricing woes.

    The decision also correctly identifies several endemic problems in mobile competition that have caused this state of affairs: market entry is difficult, as upfront costs are high, spectrum is inherently limited, and dominant providers enjoy a substantial head start. As a result of these conditions, several stuttering attempts over the years to instill price discipline from new competitors have failed to make any meaningful headway into the national providers’ dominant market presence and globally high revenues. In response, the Commission adopts a two-tiered regime. First, in an attempt to provide more competition, it obligates dominant providers to let competitors operate 'virtually', without the need to build their own networks (the MVNO mandate). Second, to provide some relief for Canadians who simply cannot afford mobile data connectivity, dominant providers will be obligated to offer lower cost plans.

    Each component promises, in theory, to address long-standing problems in Canada's cell phone landscape, but both fall short in the implementation. The MVNO regime is crafted narrowly, and is only available to a small number of existing comptitors. The low-cost plans imposed by the CRTC will help some customers in some regions, but mostly replicate plans already offered by some regional competitors, and do so on outdated 3G technology.

    Cross-posted & paired with a post by Erin Knight at OpenMedia.ca. Image Source: Georg Arthur Pfleuger, @knurpselknie, "Facetime between mother and son", Unsplash, June 20, 2020

  • – 2020-12-09 –

    Last week, CIPPIC testified before the House INDU committee, outlining steps that could be taken to move Canada toward universal adoption of fast and reliable Internet. Substantial provincial and federal resources are being leveraged to connect households across Canada. Yet full and universal Internet adoption is an ambitious goal, one that will require a coordinated national effort and strategic mobilization of cross-cutting resources.

    Nor can affordability be overlooked — too many Canadians are priced out of connectivity, even as access to the Internet becomes an increasingly essential pre-requisite to participation in modern life.

    In a landmark 2016 decision, the CRTC adopted 50/10 unlimited connectivity as a long term objective for universal home Internet in Canada. As of 2019, however, only 45.6% of rural households have access to broadband Internet (which the CRTC defines as a reliable 50 mbps download and 10 mbps upload connection & unlimited data), and of these close to 60% of these are dependent on less reliable wireless technologies. Particularly troubling, only 35% of first nations reservations have access to broadband.

    Given Canada's constitutional and regulatory makeup, no single body can fully control connectivity efforts. However, entrusting either the CRTC or ISED to develop a comprehensive national strategy and adopt a loose but formal coordination role could drive a more integrated approach that substantially increases the efficiency of current funding allocation.

    UPDATE: INDU's report in tihs study was issued June 22, 2021: "Affordability and Accessibility of Telecommunications Services in Canada: Encouraging Competition to (Finally) Bridge the Digital Divide", June 2021.

    Image source: transCam, "Internet", October 6, 2005, Flickr, CC-BY-NC-ND 2.0

  • – 2020-07-17 –

    CIPPIC and OpenMedia filed comments calling on the CRTC to adopt robust regulatory measures necessary to reverse Canada's broken mobile ecosystem. Canadian mobile service providers such as Bell and TELUS extract some of the highest revenues in the world, and the correspondingly high retail costs have prevented Canadians from realizing the full potential of mobile connectivity.

    As our submissions to this proceeding painstakingly document, Canada's mobile retail costs are prohibitively high by global comparative standards. Canadians pay more per GB of mobile data than almost any other OECD or EU country. The amount of revenues Canadian mobile providers extracts from each customer is also world leading, and this impacts heavily on Canadians, who do not make full use of their mobile devices or are priced out of mobile connectivity altogether. On that front, Canada has fewer mobile subscribers on a per capita basis than the vast majority of OECD countries, and Canadians use barely one half the amount of mobile data as the average OECD country. Canada continues to fall further behind in terms of both adoption and data usage.

    These trends have been indicative of the Canadian mobile market for years, and a robust regulatory response is required. In our final comments to this proceeding, we call upon the CRTC to mandate a wholesale regime that would allow Virtual Network Operators (MVNOs) to provide mobile connectivity over incumbent service providers networks. This will allow for an infusion of competition, while ensuring that incumbent providers are well compensated for the use of their networks. CIPPIC and OpenMedia also called on the Commission to mandate affordable mobile plans with at least 4 GB of monthly data.

    Image Source: Falcon Photography, "The New Golden Xperia Z5", Flickr, March 15, 2016, CC-BY 2.0

  • – 2019-12-10 –

    CIPPIC and vLex deploy expert knowledge and artificial intelligence to improve the ability of Canadian citizens to make a difference.

    CIPPIC and international legal technology firm vLex are partnering in a Law Foundation of Ontario funded project to seek to reduce the barriers to effective public participation in communications policy-making by developing a free and fully public communications law and policy research platform.

    This initiative aims to increase access and contextual understanding of regulatory, policy and legal submissions and documentation, allowing Canadian citizens to become more informed and more influential in a policy-making process that is often dominated by multi-billion dollar telecom and broadcasting giants.

    Built on vLex’s AI-powered technology, Iceberg, CIPPIC and vLex will train and deliver the tools that analyze the thousands of documents, comprising millions of pages, generated across hundreds of regulatory, legislative, judicial and policy proceedings. All with the goal of arming the public with the capability to participate effectively and at a level previously available only to the largest commercial entities.

  • – 2018-12-06 –

    CIPPIC appeared before the Supreme Court of Canada on Thursday, December 6, on day 3 of the joint hearing on the standard of review in judicial review of administrative decisions.  uOttawa law alumni James Plotkin and Alyssa Tomkins represented CIPPIC in this hearing, and Mr. Plotkin gave oral argument.  CIPPIC's intervention focused on whether the rule of law requires courts to apply a correctness or reasonableness standard to jurisdictional questions.

  • – 2018-10-02 –

    The CRTC rejected a proposal for a mechanism that could be used to block websites accused of copyright infringement, in a definitive victory for digital innovation and free expression in Canada. As we pointed out in our joint intervention with OpenMedia, the proposal was deeply flawed for its lack of effective procedural safeguards, which could have led to the censorship of websites and online services that were not engaged in copyright infringement. The proposal also disturbed a carefully calibrated series of trade-offs that sits at the heart of Canada's balanced copyright regime and conflicted with long-standing principles of net neutrality by compelling ISPs to interfere with customer access to content. On the other hand, claims advanced in justification of the website blocking proposal dramatically overstated the harm caused by online copyright infringement. While such infringement does continue to occur, its detrimental impact does not rise to such levels as to justify the adoption of an extraordinary remedy of this sort, with its many attendant unintended impacts.

    As CIPPIC/OpenMedia and many other public interest interveners urged, the CRTC denied the claim on the basis that it lacked legal authority to interfere with copyright policy by ordering extreme website blocking remedies. However, as both the government undertakes comprehensive reviews of Canada's telecommunications, broadcasting and copyright regimes, those who have most strenuously advanced this form of expedited website blocking mechanism are sure to continue to do so in these other fora.

    Image Credit: CIPPIC, CC-BY 4.0, 2018

  • – 2015-05-20 –

    The Federal Court of Appeal issued its ruling in Bell Canada v. Amtelecom, 2015 FCA 126, which challenged the implementation of the CRTC's wireless consumer protection code. The Code was put in place by the CRTC out of recognition that Canadian customers of mobile services were not adequately protected by the existing regime. It sought to improve the state of affairs by granting customers comprehensive rights, overseen by the CCTS, including an important provision that limited service providers from locking Canadians out of the wireless market for three years at a time and thereby hindering competition. The protections in the Code were to apply to all customers two years from the day the Code was issued, including to those customers who were still locked in to pre-existing three year contracts. However, a number of providers appealed the decision, arguing that the CRTC lacked the power to protect customers until their existing contractual terms expired. Specifically, these Appellants argued that by restricting the length of wireless contracts to two years and limiting the penalties a wireless provider could impose onto customers for switching providers early, the CRTC impermissibly interfered with vested rights retrospectively by preventing them from recovering the cost of subsidized mobile devices.

    In its arguments to the Federal Court of Appeal CIPPIC, representing OpenMedia, argued that the Code was actually future-facing (not retrospective) and that, regardless, the CRTC had the regulatory authority to interfere with past vested rights. The switching costs imposed on customers for moving to another provider early -- out of frustration with the service or because better deals emerged in the market -- were in reality penalties imposed on customers for future actions. This is borne out by the record of the proceeding, where a number of service providers testified that these penalties were a means of minimizing churn (preventing customers from moving to a competitor) not a means of recouping mobile device costs. Many of these penalties exceeded the value of any device, which is the reason the CRTC regulated the amount of early termination fees, forcing providers to tie these to device subsidies. More importantly, the CRTC is entrusted with overseeing a comprehensive regulatory regime that requires the balancing of complex policy objectives in a highly specialized environment. It would be impossible if not impractical for the CRTC to carry out its task without the ability to interfere with vested rights. In a carefully thought out decision, the Federal Court of Appeal found that the Wireless Code did in fact interfere with vested rights retrospectively, but that the CRTC was empowered to do so as long as it acted reasonably which, in this instance, it did. As a result, all Canadians, including those who are currently stuck in three year contracts, will be able to benefit from the Code's protections as of June 3, 2015. This includes the ability to leave a service contract without penalty 24 months from the day the contract began. For more information, see our resource pages on the Wireless Code and on our intervention in Bell v. Amtelecom.

  • – 2015-05-18 –

    CIPPIC has joined over 65 civil society organizations from around the world in an open letter to Mark Zuckerberg regarding its Internet.org initiative. Internet.org is Facebook's portal for mobile Internet access in developing countries. The portal is essentially a mobile app through which individuals can access other Internet sites, after first passing through Facebook's servers. The portal is zero rated, meaning that Facebook has entered into deals with wireless providers around the world that exclude Internet.org usage from data charges. While Facebook presents this as an altruistic initiative designed to get the next 3 billion Internet users connected, many have questioned whether it is truly altruistic or simply an attempt to place Facebook at the centre of the future Internet, establishing it as gatekeeper to downstream content and innovation. Meanwhile, the initiative detracts from other charitable efforts designed to provide true connectivity capacity in developing countries and, as domestic telcos are forced to shoulder the costs of the initiative, it is not clear what benefit Facebook provides to developing countries at all.

    Regardless of its motivation, Facebook's Internet.org leaves much to be desired. Where it is active, individuals already think of Facebook as 'the Internet'. However, the Internet provided by Facebook is a highly curated environment, which only allows sites pre-approved by Facebook that operate on Facebook's terms. In this sense, it threatens the expressive and innovative force of the Internet, which has always relied on the capacity to innovate and express without permission. It is, indeed, this 'innovation without permission' model that allowed Facebook itself to supplant MySpace as the world's leading social networking site - Facebook's ability to reach its audience was not dependent on MySpace's (or anyone else's) permission. Additionally, all Internet.org traffic passes through Facebook's servers, raising concerns it will in time feed into Facebook's broader profiling activities while acting as a one-stop hub for state censorship initiatives. Internet.org simply comes with too many strings attached.

  • – 2015-05-05 –

    The CRTC released its long anticipated vision for the future of wholesale wireless today. The decision is noteworthy for its recognition of the market concentration inherent in Canada's mobile markets. Historically, mobile services were forborne, meaning that the Commission held back several of its most potent regulatory tools. The mobile industry is highly concentrated and susceptible to risk of coordinated activities. As CIPPIC (on behalf of OpenMedia) demonstrated in its submission to the proceeding, this has led to high prices, some of the lowest mobile adoption rates in the developed world and minimal service innovation. Even in their own advertisements, some incumbents are hard pressed to differentiate themselves from their competitors on price and quality! The Commission recognized this, and reapplied its full regulatory powers to mobile wireless.

    However, the CRTC adopted a disappointingly minimalist approach in doing so. It mandated cost-based roaming, a move that will improve the ability of existing new entrants into the mobile market such as WIND to compete more effectively. Historically, these new entrants were prevented from offering their customers compelling services because the moment a customer stepped outside the entrant's service area, they faced extreme roaming rates. The CRTC decision improves on this state of affairs, allowing new entrants to compete far more effectively as they take the time to build out their national networks. The CRTC did not, however, adopt other important measures such as mandating wholesale access in general and MVNO access in particular. Mandating wholesale access is necessary to facilitate a truly competitive landscape that is not bound by finite spectrum availability, and stimulates investment in radio access network equipment. Mandating MVNO access is necessary to facilitate market innovations such as international roaming and to expand highly underdeveloped Canadian niche markets such as pre-paid. While taking some important steps towards fixing Canada's mobile market, it is disappointing that the CRTC did not go further in spite of its recognition that the market is concentrated and in need of more competition.

  • – 2014-11-12 –

    CIPPIC appeared before the Federal Court of Appeal today, on behalf of OpenMedia.ca, arguing for the timely application of a Wireless Consumer Protection Code developed by the CRTC and imposed on providers of mobile services. The appeal, lodged by a number of mobile service providers, seeks to delay the application of the Wireless Code for existing service contracts until the term of those contracts expires (the standard term for wireless service contracts is three years). The argument is that the CRTC does not have the legislative authority to impose the protections in the Wireless Code onto pre-existing consumer contracts because this constitutes an interference with vested rights. CIPPIC argued that, first of all, there is no interference with vested rights as the Wireless Code primarily focuses on mitigating future penalties (by, for example, limiting the penalties a service provider can impose on a customer for leaving a service term early). Moreover, given the important and central objective of preventing 3 year customer lock-out to the proper functioning of the comprehensive regulatory regime entrusted to the CRTC, the regulator has the legislative power to interfere with vested rights if it is reasonable to do so.

    For more information, see our resource page for Bell et al. v. Amtelecom et al.: https://cippic.ca/telecom/Bell_v_Amtelecom_Wireless_Code_Appeal