Tuesday June 1, 2021 | NATIONAL [Updated June 1 & June 3, 2021]
by Mary P Brooke, Editor | Island Social Trends
Consumer retail internet service fees in Canada are among the highest in the world.
Not reducing the price-point of wholesale Internet rates will have a direct impact on Canadian consumers as it leaves open the possibility of retail Internet prices to skyrocket.
That’s what NDP Telecommunications critic Brian Masse (Windsor West) led with in a news conference this morning from Ottawa. He points out that the recent Canadian Radio-Television & Telecommunications Commission (CRTC) decision to decline regulation of whole Internet rates (from big telecom providers to smaller Internet Service Providers) goes against the idea of protecting consumers.
On May 27, after a lengthy review, the CRTC announced that it has reversed its 2019 ruling, saying it found significant errors that cast doubt on the correctness of the decision. Instead, the commission said it will maintain the interim rates that have been in place since 2016, with some adjustments.
That decision is a win for big incumbents with fibre optic networks (and doing further upgrades in 5G). It’s a victory for Canada’s large internet and phone companies that Canada’s telecommunications regulator has reversed a 2019 decision to drop wholesale internet rates.
“There’s something not right here”:
“There’s something not right here, going against 20 years of work and there’s something not right about trying to go back against a decision that is made in the courts,“ said Masse today in a news teleconference from Ottawa.
“What we’re proposing is a solution for the short term and potentially the long term,” he said, noting that containment of retail internet prices has been part of the NDP platform in previous campaigns and is again in the campaign platform for the upcoming federal election.
There is also some question as to whether the CRTC is out of date with modern times and technologies (it’s an institution that was created to regulate TV and radio).
Public monies support telecoms:
“There is a robust injection from the public,” Brian Masse told Island Social Trends in a telephone interview after today’s press conference. In the past, utilities would be required to present a rate structure proposal for any increases. Such was the case for phone services about 20 years ago. There has been “decades of abuse on consumers”, says Masse, with regard to internet fees and prices.
When the big telecoms undertake mergers and buy out smaller companies they are indirectly receiving public monies because the smaller ISPs were able to secure some parts of the bandwidth spectrum at government-subsidized rates.
Prices will go up:
As a result of this CRTC reversal, it’s almost certain that internet prices will go up right away and that there will be fewer of the smaller competitors which have relied upon some relief from the higher 2016 rates.
With fewer smaller players in the market, bigger companies will simply likely increase their rates just because they can.
Essential service:
In Canada, Internet service has been deemed an essential service. Certainly almost everyone relies on it for communications, business, news and entertainment, the education system, and family life connectivity.
Internet is a modern-day ‘utility’, nearly as basic now as electricity, water and housing. Reliable Internet connectivity helps keep individuals, businesses and communities whole in basic ways including the important capacity to do remote financial transactions (24/7, outside of old-fashioned banking hours), take part in retail commerce (such as online shopping during a pandemic), and maintain education systems (notably during a pandemic).
And if one looks through a ‘COVID’ lens — at the sectors of society that have been negatively impacted by the economic challenges of the pandemic — that is “mostly women, minorities and vulnerable communities”, says Masse. He suggests this is incongruous with the societal lens that the Liberal government says they are using to help Canadians with economic recovery through and beyond the pandemic.
Short term solution:
In the short term: “What we can do is reverse the (CRTC) decision, put back to 2019 rates and make ISPs budget the money, then move toward price regulation in the retail market to ensure stability for everybody as we sort this out.”
This regulation would “settle down the market for Canadians”, said Masse, referring to some of the ‘games’ played by telecom providers as to levels of service and data packages. This would help people “pay some of their (other) bills” as well.
The NDP telecommunications critic adds: “We still have a merger taking place (a so-called takeover),” referring to the current bid for Rogers to buy-out Shaw (which offers Freedom Mobile). That would leave just three major players in the Canadian telecom market: Rogers, Bell and TELUS.
Some major players are offering discount pricing on data packages or even giving away a TV or tablet as a way to attract new customers. Today Masse noted the interplay among the biggest players which usually serve to confuse if not manipulate the consumer.
“These are not good things when people depend upon this product too much,” he concluded in defense of consumers and average Canadians who are struggling to pay bills. Masse said that decision-makers in Ottawa are essentially out of touch with the struggles of families who are trying to keep up with the cost of Internet upon which they rely as small businesses, families with children doing remote learning at home, and for social connection especially during the ongoing pandemic.
Mechanism for change:
The pressure to get government to make this change is rather simply a matter of the Minister sending a paper to the CRTC (asking the CRTC to reinstate the 2019 wholesale regulatory rateZ). The NDP will “put pressure on government to do this”, Masse told Island Social Trends today.
The cabinet “could do that today”, says Masse, adding that public pressure will force them to do this, with a federal election looming ahead in 2021.
