Towards a new Canadian broadband future?

There have been renewed concerns about Canada’s lagging productivity and weak investment climate, especially around broadband infrastructure, which provides a foundation for a thriving digital economy. Turning adversity into opportunity, now is the time to develop new visions for enhancing prosperity and growth against the backdrop of telecom infrastructures. Long-standing gaps with the United States in both labour productivity, and information and communications technology investments have been identified by the Organisation for Economic Co-operation and Development, and more recently, productivity concerns have been raised in the construction sector and high tech in Canada. One of our technology sectors—telecoms—is facing increasing problems with growth, profitability, and falling stock prices. Research over the last 20 years has established that broadband plays a significant role in enhancing productivity and economic growth. Moreover, the importance of an inclusive digital infrastructure for all to benefit from the opportunities has been recognized since the start of commercial internet in the 1990s. However, an investment paradox has emerged since then, both for wireline and wireless networks. While relying on the telecom infrastructure, the so-called Big Tech companies have developed strong platforms and applications that wield substantial market power and capture significant value, and even-newer players have started to dominate artificial intelligence. Erik Bohlin holds the Ivey Chair in Telecommunication Economics, Policy, and Regulation at Ivey Business School at Western University. Photograph courtesy of Erik Bohlin This paradox is not being reversed by 5G. The build-out of 5G has been most extensive in markets where telecom is rapidly expanding, such as China and India. Countries—such as Canada—which had expansion in 4G are relatively slower in 5G, reflecting typical investment cycles. Moreover, the traditional broadcasting industry is meeting the same challenges where—increasingly—the old broadcasting style of programmed and pervasive TV is being replaced by on-demand and online streaming where new players produce content that captures the audience. Some broadcasters around the world have been able to transit towards online platforms, but others are remaining in the old style, and losing out. In this context, the recent Canadian Radio-television Telecommunications Commission decision directing the major telephone companies to provide wholesale access to fibre networks may prove pivotal for investment incentives. For 25 years, the European Union has followed a primary emphasis on mandated access in telecoms, and has lower rates. However, the recent debate initiated by the European Commission to push Big Tech to compensate the telecom carriers for investment shortage suggests that all is not well in Europe. A telecom investment shortage of more than 150-billion euros has been identified in recent well-publicized EU reports. The crises in productivity, inclusion, growth, and complex regulations present themselves as an opportunity. What we need is an increased dialogue about Canada’s objectives and about the impact of long-term infrastructure development on citizens’ welfare because telecom even has potential benefits on climate change and resilience. There is a need for government funding, as well as collaboration between government and industry. New modes of infrastructure finance and public-private partnerships need to be developed. We also need an increased dialogue between industry and government about the fundamental objectives for developing a strong, viable Canada, and the enabling role that telecom infrastructure may play in achieving that vision—a vision that will need to face the reality that the fundamental competition now is not primarily between the telecom carriers, but with other value systems. Ivey Business School is taking some small steps toward that end by hosting a series of workshops where government and industry are invited to reflect on the pressing situation for the telecom infrastructure for Canada. The workshops have centred on broadband policy and new frameworks for resilience, with a recent one centred on satellites. Erik Bohlin is an expert in telecommunications policy, an inter-disciplinary topic concerned with the impact of digitalization in the economy and society. Bohlin holds the Ivey Chair in Telecommunication Economics, Policy, and Regulation at Ivey Business School at Western University. The Hill Times

Towards a new Canadian broadband future?

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Towards a new Canadian broadband future?

We will need to face the reality that the fundamental competition now is not primarily between the telecom carriers, but with other value systems.

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