ARCHIVED - Transcript, Hearing April 11, 2016
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Location: Gatineau, Quebec
Date: April 11, 2016
© Copyright Reserved
Attendees and Location
140 Promenade du Portage
- Chairman: Jean-Pierre Blais
- Members: Candice Molnar, Peter Menzies, Linda Vennard, Christopher MacDonald
- Legal Counsel: Emilia de Somma, Amy Hamley
- Secretary: Jade Roy
- Hearing Managers:
John Macri, Christine Bailey, Sarah O’Brian
--- Upon commencing on Monday, April 11, 2016 at 9:00a.m.
1 LE PRÉSIDENT: À l’ordre, s’il vous plaît.
2 Bonjour à tous et à toutes. Je vous souhaite la bienvenue à cette audience publique.
3 Avant de commencer, je tiens à reconnaître que nous sommes réunis aujourd’hui sur le territoire traditionnel des Premières Nations. Je remercie le peuple Algonquin et rends hommage à leurs aînés.
4 Au cours de cette audience, le CRTC examinera les services de télécommunication de base dont les Canadiens ont besoin pour participer de manière significative à l’économie numérique.
5 The CRTC examined basic telecommunications services for the first time in 1999, and then in 2011. There is a need to review them again, given these services’ rapid, pervasive and unrelenting evolution.
6 Five years after the last review, we are now living in a digital age in which online services and wireless communications are an ever-growing importance in the lives of Canadians. They allow Canadians to keep in touch with one another, of course, but they also provide access to a wide range of online services, including health, educational, banking and government services.
7 Given the development in this area in recent years, our objective for the hearing is to identify what has changed in terms of telecommunications services. This will enable us to determine whether the new reality warrants the CRTC’s intervention and, if so, what form this intervention should take. For example, the current regulations will be examined to see if they are still appropriate, whether they need to be modified or if new ones need to be created.
8 Le CRTC n’est cependant pas le seul joueur dans le paysage des télécommunications canadiennes. En ce qui a trait aux services mobiles, par exemple, Innovation, Sciences et Développement économique Canada -- anciennement Industrie Canada -- est, entre autres, responsable de l’allocation du spectre des fréquences ainsi que des exigences de couverture entourant la mise en place des réseaux sans fil.
9 Le récent budget du gouvernement fédéral a annoncé des investissements afin d’améliorer la disponibilité des services internet à large bande au pays. Ces sommes viennent s’ajouter au financement accordé par le passé.
10 S’y ajoutent encore les ressources financières que les gouvernements provinciaux, les municipalités et les conseils de bande consacrent à la large bande d’un océan à l’autre, sans compter les investissements réalisés par le secteur privé afin d’améliorer et accroître la portée des réseaux.
11 The CRTC must therefore take these players, and many others, into consideration when it reviews basic telecommunications services. Our role is clear and framed legislatively, and our jurisdiction is defined by the Telecommunications Act. It is only by taking into account the stated policy objectives, our own jurisdiction and the evidence submitted to us that we can ultimately make an informed decision.
12 It was from this perspective and by taking into account the diverse range of players that the CRTC established the original objective for basic service, for example, or for the service improvement plans for telephone service providers.
13 It was also through this same lens that the CRTC approved the use by major telecommunications service providers of deferral accounts to extend their broadband internet services to a greater number of rural and remote communities. Between 2010 and 2015, this initiative extended broadband access to more than 280 additional rural and remote communities.
14 À la fin de 2014, 96 pour cent des Canadiens avaient accédé à une connexion internet permettant une vitesse de téléchargement de 5 mégabits par seconde. C’est bien, certes, mais c’est donc dire qu’à l’inverse, 4 pour cent n’y avaient pas accès, ce qui représente des centaines de milliers de foyers et d’entreprises.
15 Au cours de la présente instance, le CRTC ciblera les principaux enjeux auxquels sont confrontés les Canadiens quant aux services de télécommunications de base. Nous étudierons également le rôle que peut et doit jouer le Conseil afin d’assurer que ces services soient disponibles et abordables pour tous les Canadiens.
16 De toute évidence, l’avenir de ces services est un sujet qui soulève de multiples questions, voire les passions. Plus de 27 000 commentaires ont été reçus lors de la consultation et plus de 30 000 Canadiens ont répondu à un questionnaire à ce sujet. La présente audience en est d’ailleurs une autre preuve probante. Forte de ses trois semaines de comparution, il s’agit d’une des plus exhaustives des 20 dernières années et une de celles ayant suscité le plus d’intérêt, tant de la part de l’industrie que du public en général.
17 The CRTC must make informed decisions, based on solid evidence, while taking into account the real and reasonable needs of the population; the real and reasonable needs of the population.
18 It must also consider the anticipated outcomes and the market’s ability to adapt, given the available resources.
19 As it is crucial not to confuse “wants” with “needs”, the CRTC is asking parties to make a fact-based and objective approach to these discussions. As an administrative tribunal, the CRTC’s role is to give parties and panel members an opportunity to test and challenge points of view in an open and transparent proceeding.
20 Some parties have said that broadband is a fundamental human right. Addressing such a statement goes well beyond our legislative mandate.
21 The CRTC does plan, however, to use this hearing to determine what level of telecommunications services could be deemed to be basic services, basic services that Canadians should be reasonably expected and able to receive.
22 The CRTC therefore issues the following challenge to the parties:
23 Demonstrate to us, using evidence, that the public interest and the specific situation in each region justifies action by the CRTC; explain to us why market forces are currently insufficient to respond to the public’s needs; needs not wants.
24 Comme vous le savez, le CRTC se fonde sur des preuves et des dossiers publics exhaustifs afin de prendre des décisions éclairées dans l’intérêt de tous les Canadiens. Sans une participation active des Canadiens, le processus du CRTC ne serait ni représentatif, ni efficace. Ainsi, j’aimerais dire un grand merci à tous ceux et celles qui, jusqu’ici, ont pris le temps de participer au présent processus et je profite de l’occasion pour à nouveau demander aux Canadiens de nous faire part de leurs commentaires.
25 Nous invitons les Canadiens à partager, sur notre forum de discussion en ligne, leur opinion à propos de tout sujet traité dans le cadre de l’audience.
26 Le forum est accessible au www.crtc.gc.ca depuis ce matin et le sera jusqu’au 28 avril, soit la dernière journée de l’audience.
27 Many people are following our activities closely on social media. This is the ideal opportunity to be heard and express your opinions, so that they are among the points of view that will be included in the public record.
28 I would also like to point out that comments posted on Twitter or through a blog will not form part of the public record. So if you have views, we’ve provided you a forum to use.
29 Finally I would like to make a few introductions. The Panel consists of the following Peter -- people: Peter Menzies, Vice-Chairman of telecommunications, Candice Molnar, Regional Commissioner for Manitoba and Saskatchewan; Linda Vennard, Regional Commissioner for Alberta and the North-West Territories; Christopher MacDonald, Regional Commissioner for the Atlantic and Nunavut and myself, Jean-Pierre Blais, Chairman of the CRTC and I will be chairing this hearing.
30 The Commission’s team assisting us includes John Macri, Christine Bailey and Sarah O’Brien, hearing Co-Managers; Emilia de Somma and Amy Hamley, legal counsel and Jade Roy, hearing Secretary.
31 I will now ask the hearing Secretary to explain the procedure we will be following.
32 Madame la secrétaire?
33 LA SECRÉTAIRE: Merci. Bon matin et -- bienvenue à tous. Before we start, I would like to go over a few housekeeping matters to ensure the proper conduct of the hearing.
34 When you are in the hearing room, we would ask that you please turn off your smart phones as they are an unwelcomed distraction and they cause interference on the internal communication systems used by our translators.
35 We would appreciate your cooperation in this regard throughout the hearing.
36 Nous désirons rappeler aux participants d’allouer un délai raisonnable pour la traduction lors de leur présentation à vive-voix, tout en respectant le temps alloué pour leurs présentations.
37 Veuillez noter que les documents seront disponibles sur Twitter, sur le compte du Conseil à @crtcaudiences, au pluriel, en utilisant le mot click#crtc.
38 Just a reminder that pursuant to section 41 of the rules of practice and procedures, you must not submit evidence at the hearing unless it supports statements already on the public record.
39 If you wish to introduce new evidence and an exception to this rule you must ask permission of the Panel of the hearing before you do so.
40 Please note that if parties undertake to file information with the Commission in response to questioning by the Panel, these undertakings will be confirmed on the record through the transcript of the hearing.
41 If necessary, parties may speak with Commission legal counsel at a break following their presentation to confirm their undertakings.
42 For the record, please note that we are putting on the record Exhibit 1 entitled “bandwidth requirements for popular internet applications”, which Panel members may be referring to during their questioning. Copies are available in the examination room and they will be soon also available on the web.
43 And now we will begin with a presentation by Government of Yukon. Please introduce yourself and your colleagues and you have 15 minutes.
44 MR. PRATT: Thank you, Madam Secretary. Good morning, Mr. Chairman, Commissioners. My name is Jim Pratt. I’m a consultant to the Yukon Government.
45 With me from the Government of Yukon Economic Development is Steve Sorkin, who is the Director of technology and telecommunications policy.
46 And before I begin I would like to, on behalf of ourselves and any of our northern colleagues who may be in the room, to let you know that we certainly appreciate the white northern welcome that has been provided for us here.
47 Mr. Chairman, Members of the Commission, we are very pleased to have the opportunity to address you on matters of what we believe are of critical importance to current and future Yukoners, and to many others in Canada.
48 This proceeding represents a crucial opportunity to further the goals of Canadian telecom policy and specifically to establish a program that will enable all Canadians-in every corner of the country-to fully participate in the digital economy.
49 The Government of Yukon has been actively engaged in telecom policy matters, including many appearances before the Commission, for more than 15 years.
50 Looking back on some of our submissions, it is remarkable how many of our policy priorities remain relevant and indeed useful for this present proceeding.
51 Of the original principles, the following statements effectively frame our position here.
52 First, meeting the need for access should be considered the top priority, one that is too important to leave to market forces.
53 There should be no sacrifice in the quality and capabilities of telecom services available to isolated Yukoners and in fact there should be special consideration given where it is reasonable and practical to do so.
54 Access to telecommunications alone is not sufficient to meet the needs of Yukon customers if the price that must be paid is out of proportion to the means of those who require the service.
55 And lastly, where necessary to achieve the policy objectives and where market forces are not able to achieve the benefits of those policies for all Yukoners, then subsidies are an appropriate solution.
56 Yukon’s position is that the solutions in this proceeding should enable all Canadians, in both urban and rural areas, in all regions of Canada, to have access to fast, affordable and reliable broadband service.
57 The record shows clearly the overwhelming importance of broadband access to all Canadians-at home, at work and everywhere in between.
58 The EKOS report contains specific insights on the needs and priorities of rural Canadians.
59 Concerns expressed about broadband included the higher costs, including overage charges, which is a particular concern in our region, lost opportunities due to slower speeds or service interruptions and frustration with the inability to keep pace with the access available to urban Canadians.
60 It is also important to note, that those living in isolated communities identify an even greater need for internet access, something particularly applicable to many northern communities.
61 Keeping in mind the goals of fast, affordable and reliable, we would like to focus on three important issues: the broadband standard, the broadband subsidy and the transport subsidy.
62 I will briefly outline two other topics we see as pivotal: ideas for implementation of the subsidy program and how all of these issues all might be affected by the specific circumstances of the Yukon environment.
63 Anything else we would propose to address in our written submission.
64 Fast: the Broadband standard. One of the core issues in this case is the definition of basic service.
65 Particularly whether basic should include broadband at a specified rate and if so what that rate should be.
66 Consideration of this question is closely linked to the obligation to serve, which has in effect been the chief policy tool that has been employed to use -- to achieve universal connectivity.
67 Yukon has taken the position that basic must include broadband and we believe that there is some merit in utilizing a regulatory construct, because it has proved so effective in extending access in high cost areas in -- throughout history.
68 As described in our intervention, basic service has been a moving target, reflecting changes in technological capabilities and the expectations of customers over time.
69 It is our view today that the establishment of a broadband standard for Canadians is actually more important than whether that standard is considered as part of basic services.
70 If measures are adopted that provide subsidy support for broadband service and for transport connectivity in high cost areas, while at the same time enabling the prospective operation of market forces, it is possible to alleviate the responsibility on a single provider of an obligation to serve.
71 We have proposed a broadband standard of 25Mbps download and 3 Mbps upload and hopefully, Mr. Chairman, that will be the last time any of us needs to repeat all those -- all those words and we all know what we are talking about when we -- when we use the numbers -- with an aspirational target of 130 for these reasons.
72 The present defined standard of 5 and 1 is simply inadequate for the current level of everyday usage and it is certain to leave Canadians lagging behind.
73 Incremental improvement in the standard will not address the gaps that exist today in -- the broadband access needed by Northerners and will certainly not keep pace with future requirements.
74 Without a stretch goal to inspire what we might term a quantum change, the basic standard will become the de facto ceiling for rural and remote communities.
75 But whether the standard is incorporated in a BSO or not, Yukon believes that the case for the Commission to establish the standard is unequivocal.
76 The need is clear and the data compelling. With the benefit of the record here, the Commission can and should lead the development of broadband capability for all regions.
77 Turning to the theme of “affordable” and the broadband subsidy. Access to a service is not enough if the service is not affordable.
78 Yukon has consistently maintained that the principle of affordability must address the provision of comparable service at comparable prices throughout the country. This same principle is incorporated in many Commission decisions.
79 In our view, “comparable” prices do not require postage stamp pricing policies, but at the same time rural and remote Canadian’s should not pay more for services of lower quality or capability than those available elsewhere.
80 The results of the opinion survey are very much consistent with this. All Canadians should pay similar prices for similar services and some northern residents, recognizing the additional importance to them of access to broadband expressed the view that their service might even be slightly more expensive.
81 Affordability must include consideration of the total amount that a subscriber pays. In usage-based billing the actual cost, the actual user cost can be dramatically different than what the stated tariff rate might be. Many users, some in remote communities, stop using the service when the usage cap is reached. The EKOS report shows a sizable number of Canadians, more rural than urban residents actually limit their internet use for such reasons, which we believe does not and should not meet the standard of affordability, as to do so would result in what is effectively just part-time internet service for those customers.
82 Yukon's preferred approach to the broadband subsidy involves a CRTC-supervised process where transparent proposals for subsidized services can be considered on a community basis, with stakeholder input, defined progress and performance measures and be open to possible competition.
83 It is absolutely clear that rural and remote users, and especially those in the North, will not have access to the fast, affordable and reliable broadband service without subsidy support. In this regard, Yukon welcomes the announced federal budget support for rural and remote broadband. In our view, this represents a clear opportunity for the Commission to set standards and devise a mechanism for achieving universal basic broadband.
84 Reliable and the transport subsidy:
85 From the perspective of broadband users, reliability means that the service works and is available when they need it. Factors affecting reliability problems for Northern users can include service quality, capacity and up-time performance.
86 Unreliable broadband connections have impacts beyond mere inconvenience. A recent fibre outage that impacted services throughout the North adversely affecting businesses in transacting online orders, maintaining service-level agreements with customers, and processing retail transactions, just to name a few.
87 Adequate investment in the physical and electronic infrastructure which connects communities is an important prerequisite for providing reliable broadband. In TRP 2011-771 the Commission's concerns about the impact of under-investment on service quality and reliability led to the requirement for Northwestel to submit a modernization plan.
88 Based on the evidence considered in TRP 2013-711, the Commission determined that the lack of investment in transport facilities would remain a barrier to improve service in Northern communities, even after completion of the proposed modernization plan. That decision also found the need to "establish a mechanism to fund infrastructure investment in transport facilities in Northwestel's operating territory" leading to the consideration of a transport subsidy in this proceeding.
89 There are two significant problems to be addressed here. One is the lack of access in many communities to comparable service at comparable prices. The other is the negative impact of the lack of transport capacity on the development of competition in Northwestel's territory.
90 The subsidy mechanism that we propose would consider transport project proposals on a transparent basis with CRTC oversight and be open to stakeholder input and possible competitive supply.
91 Including the input of stakeholders such as local governments helps to identify project opportunities and priorities and could enable other funding support. A review of Northwestel's most recent progress report on its modernization plan indicates that third party input and funding support is already being utilized in many cases, so there is reason to believe that this approach is workable.
92 With respect to the issue of the impact on competition, it will be necessary that prospective competitors have access to these facilities at affordable cost, and indeed that their capacity needs are factored in to the project design. While the incumbent is likely to be the only entity with the capability to design and construct the subsidized transport facilities, this process as we have proposed would also contemplate another party proposing or bidding on a project.
93 Some brief comments on implementation. A considerable part of the record here addresses the possible subsidy mechanisms and the plans for implementation, certainly more than enough for the Commission and staff to develop workable solutions. Instead of repeating our proposals in detail we would like just highlight some of the factors we believe are important to consider in evaluating that mass of information.
94 Number one, targeted: A mechanism that includes a focus on communities will allow for customized solutions that are effective for the specific needs of those communities. The existing National Contribution Fund provides a general revenue transfer to offset incumbent costs but it does not enable targeted support for specific infrastructure needs nor has it yet been adapted to allow for alternative service providers.
95 Consultative: Incorporating a process which engages service providers, governments and user needs will optimize the solutions and provide the opportunity for stakeholders to participate in implementing and supporting the solutions.
96 Transparent: By ensuring that the projects proposed for subsidy funding are transparent and subject to review, there will be a greater recognition of the responsibility attached to public funding support and will also keep open the prospect of competition.
97 And, lastly, incentive-based: We suggest that adoption of measures that encourage performance, improved efficiency and customer satisfaction will reinforce the obligation to provide service, and to some extent address the factors that would otherwise have been the outcome of competitive supply
98 Commenting briefly on the impact of the -- of these issues on the Yukon Environment, in the intervention we identified several barriers to full participation of Yukon homes and businesses in the digital economy:
99 - First, high-speed services are not universally available;
100 - Overall, speeds are lower and prices higher than in southern communities;
101 - High usage charges represent a significant burden to customers;
102 - The absence of competition restricts choice, limits innovation and does not provide price discipline;
103 - Concentration of facilities ownership within Northwestel and its affiliates presents a significant structural barrier to competition.
104 The measures in our proposal establishing a broadband standard and implementing subsidy programs for service and transport infrastructure -- for broadband service and transport infrastructure can address the barriers of access and pricing for rural communities. High usage charges reflect the absence of competitive alternatives in Yukon, and their continued absence means that choice, innovation and price discipline will not be available in our market.
105 As the Commission is well aware, the industry structure in Yukon presents unique challenges for the development of telecommunications policy objectives. Facilities-based competition has long been a hallmark of CRTC policies across the country, and has in time proved successful in generating a robustly competitive broadband market, where telecom and cable facilities are owned by competing entities.
106 Unfortunately, this pathway is not available in Yukon where telecom, cable and even wireless facilities are controlled by Northwestel and its parent, Bell Canada.
107 This barrier to competition was implicitly recognized, we believe, in the Commission's decision to re-regulate retail internet service in Yukon, and it is our view that continuing CRTC oversight will be required of the investment, service levels, and prices in the Yukon broadband market to ensure that the interests of businesses and residents are best served.
108 To wrap up, the issues in this proceeding are momentous for Northerners, and those Canadians who lag behind in their ability to fully exploit the benefits of the digital economy. The record is copious, demonstrating the high level of interest from all corners of the country as well as the Commission's thoughtful and thorough approach to consultation, for which you should be commended. Yukon submits that all of these efforts can be focused on the following -- can be resolved into a focus on the following:
109 One, universal broadband access throughout Canada is vital to the full economic participation of Canadians, to their ability to thrive in a global digital society and to further strengthen the fabric of the country, locally, regionally and nationally.
110 All Canadians should have access to comparable broadband services at comparable prices. Universal broadband access will not be achieved without subsidy support and active participation by governments, and agencies in places where it is clear that market forces will not accomplish the objectives. Where there are economic or structural barriers to the attainment of broadband objectives it will be necessary for government to intervene.
111 The subsidy mechanism for broadband support should be community-based, targeted to needs identified with community input, and transparent. Where feasible to enable the prospect of future competition, measures should be adopted to ensure that subsidy support does not deter incentives for entry or improved efficiency.
112 To enable the provision of broadband service in rural and remote communities in the North, a program of subsidy support is necessary to extend transport facilities.
113 Finally, with respect to the role of the Commission, it is our view that without CRTC leadership it will simply not be possible for all Canadians to have access to the broadband capabilities needed for full participation in either Canadian society or the worldwide digital economy. By defining the standards, establishing mechanisms and overseeing the implementation of initiatives to achieve broadband connectivity, the Commission will provide the means and the guidance to achieve this critical telecom policy objective.
114 We very much appreciate this opportunity to address you. We wish you well in the deliberations and look forward to your decision. We're happy to answer any questions that you might have.
115 THE CHAIRPERSON: Thank you very much for that presentation and for starting us off in this hearing. So I will -- I have a few questions for you and we'll see if my colleagues have some others for you as well. Let's start off.
116 In your position you are advocating for target speeds greater than 5 and 1, only 25 and 3. Why that speed? Why is that the standard and how did you come to it?
117 MR. PRATT: One obvious reference point, Mr. Chairman, would be the recent -- the FCC standard that the Commission has established there of 25 and 3. It is -- that's one angle.
118 Another would be the relative balance between where we were; what we know customers are pushing up against now and where we think it should be. As we mentioned, it's important to have not just the bare basic minimum but to have a standard that we feel will be useful for the foreseeable future and with a combination of those considerations. That would be essentially how we came up with that.
119 I think in the previous submission we had even suggested, and it would be in this submission that the stretch of 100 is probably where we would all like to be but unrealistic to move there that quickly.
120 THE CHAIRPERSON: I don't know if you have a copy of Exhibit 1. Maybe the Secretary could give you a copy of that so that you understand where I am going with my questions.
121 But when talking about speed targets, wouldn’t it have been reasonable, and you know I take it that you were informed in part by what the FCC did, but wouldn’t it have been reasonable to look at the likely number of concurrent users, let's say in a household, the likely services or applications that they would be using and using the sort of information that you see on this chart about how much speed you need to look at files or stream radio or audio and the other applications here, including VoIP? And you look at the number of users likely concurrently in a household, the types of applications, even using your expression of the foreseeable future of how many -- what would be the likely new applications -- look at what those services and applications require in terms of speed and extrapolate from that what a basic speed ought to be.
122 MR. PRATT: Well, a reasonable, logical approach if we were actually looking at providing broadband service ourselves, and those would be the considerations, I expect that the service providers would look at themselves.
123 I think the one observation that we would make from a user and policy perspective is that it seems every time an expectation is established for, this would be the right number based on the number of uses that consumers or providers find some new application, and the expectations that we all have today even as well-informed as we can be will not be as accurate as what actually happens several years down the road.
124 And as we mentioned, I do have a concern about the risk of a standard becoming a ceiling for users in the North that if there is -- in those situations where there is -- a subsidy is required and there's only a single provider, there is no impetus for that single provider to adapt beyond that standard that is established. So that would be another consideration I think that went into our calculation.
125 THE CHAIRPERSON: But you didn't take it from that perspective?
126 MR. PRATT: It wasn't scientific, Mr. Chairman; that's correct.
127 THE CHAIRPERSON: With respect to -- and I take your point about future needs. I remember a few years back when the British government built the ring road around London and created capacity, and it was supposed to last decades and within just a few years traffic jams reoccurred because the availability of it meant people were on it. And I guess that's what you are saying part with respect to, if there is more there will be more and the expectation becomes greater.
128 So what guidance would you provide to us when we look at what the basic needs are to make a reasonable assumption with respect to future needs in that scenario?
129 MR. PRATT: Well, we thought 25/3 would be a reasonable target for the ---
130 THE CHAIRPERSON: So in 25/3, what part would you suggest of that 25 and that 3 is for future growth as opposed to current needs?
131 MR. PRATT: Surplus to current needs. It will depend on the user. It will depend on the -- the rates of growth will be different in different places.
132 And, quite frankly, we would like to see faster growth in the North and if this kind of building this kind of access facilitates that, Northerners are better off and, I believe, all Canadians are better off.
133 THE CHAIRPERSON: Right. Back in 2015 in a related proceeding, you advocated 15/1. Now, it's 25/3. Could you help me understand that, that slight -- well, I don't ---
134 MR. PRATT: That was ---
135 THE CHAIRPERSON: --- want to qualify it, but there has been a change.
136 MR. PRATT: Yeah, right. There certainly has been a change. That was two years ago or the decision was two years ago. I believe that that's -- unless I have got my decisions confused, that was -- we were looking at 2010 data and 2010 needs in that proceeding. At that point our best feel for what our users would benefit most from was 15/1. Looking at this proceeding and, again, reiterating that we were looking not just to catch-up but to get to a place where we felt there was some level of -- level for growth or provisions for growth, 25/3 was our conclusion.
137 THE CHAIRPERSON: Would it be fair to say because you just used the expression "your best feel", I think that there wasn't a scientific or analysis of that?
138 MR. PRATT: Absolutely, Mr. Chairman. It was not. It was based on the information reference points that we looked at from sources in Canada and elsewhere and what we felt would be appropriate for our environment given the circumstances today and what we foresee.
139 THE CHAIRPERSON: I notice that both in your 25/3 proposal and your aspirational 100/30 proposal that the upload speeds have increased. Can you explain to me why you think that's required?
140 MR. PRATT: The increase in upwards as well as upload and download?
141 THE CHAIRPERSON: I am focusing on the upload speeds because, you know, historically we have gone at one up. You have done it -- you have proposed one up at one point as well and now here you are proposing in terms of a standard of three up and an aspirational goal of 30 up. So I am trying to figure out what has changed.
142 MR. PRATT: Right. Okay, so for the download point to the increasing frequency of data/video higher bandwidth usage that is ubiquitous. I was in the Louvre last summer and couldn’t get close to the Mona Lisa for the people taking selfies in front of the picture and, you know, shooting them all over the world to their friends. Those kinds of things seem to be exploding.
143 So it deals with just the simple amount of data that is being consumed.
144 THE CHAIRPERSON: Just taking selfies with the Mona Lisa in a foreign capital, in a museum, is part of basic services -- are you?
145 MR. PRATT: Not part of basic services but when we’re talking about the usage that is becoming common when those aspects, that high consumption of band width has become part of everyday life, not just for those social opportunities but economically, culturally and, in our case, for the delivery of services.
146 THE CHAIRPERSON: Right.
147 MR. PRATT: And to -- but if you’d like, on the upload, as more people are generating more content on their own, there is a higher, much higher requirement for the upload than there has been in the past.
148 THE CHAIRPERSON: Right, but you didn’t go through -- you’ve mentioned social applications that obviously are quite common but did you go through the potential -- other uses that require upload speeds to establish both your aspirational and -- the standard you’re proposing in terms of maybe videoconferencing or business applications? You didn’t do that; did you?
149 MR. PRATT: Not specifically or numerically, no.
150 THE CHAIRPERSON: In your written submission, you stated that “some technology options are not feasible in some parts of the country” and that parts of the North and I guess remote regions, as you know, are served by satellite technology.
151 Do you think that satellite delivered services are still likely to be in use in what you call the “foreseeable future” as the technology mechanism to serve people in parts of Yukon or other remote communities in the country?
152 MR. PRATT: There is just one satellite-served community in Yukon. So our familiarity, direct familiarity with that is less.
153 But certainly knowing what we do know about the topography and the circumstances in other parts of the country, the Eastern Arctic specifically, it would seem a long ways off to imagine terrestrial connexions between those communities.
154 So it would be reasonable to expect that satellites will continue to be an important aspect of the transport network.
155 THE CHAIRPERSON: Knowing what we know about current availability of satellite capacity and likely developments, do you think it’s feasible to be thinking of a 25/3 speed standard, acknowledging that there will be communities that will continue to be satellite served?
156 MR. PRATT: I’m sure you’ll hear others more expert on that subject than we are, but I believe there are combinations, hybrid combinations that can provide speeds in -- if not exactly there, certainly getting there. And I guess based on the assessment or extrapolation from technology development in the past, I believe there’s reason to anticipate advancements in satellite delivery as well that could be effective there.
157 THE CHAIRPERSON: It’s hard to do regulatory policy on hopes and expectations. The problem I’m having trying to get your help with is if, indeed, your position is that 25/3 is the right standard, what do we do in areas that because of the nature of the technology, that is in a sense not feasible?
158 MR. PRATT: Certainly, the Commission is charged with the duty of regulating on a nation-wide basis. The Commission has been very effective in adapting to specific needs in specific regions, the North and the Yukon specifically.
159 I would suggest that it’s reasonable and practical for the Commission to establish a standard based on an excellent record and based on the expertise that is applied to assessing that record. And then where there are circumstances that more time may be needed to get to a certain standard or an adaptation may be required because of the technology.
160 None of that means that the standard is wrong nor that the standard is inappropriate, nor that it shouldn’t still be the target.
161 And what we were suggesting in our submission is that -- that is in our belief an appropriate role for the Commission to lead that development.
162 THE CHAIRPERSON: I notice in your oral presentation today you used the expression “comparable broadband services” in a couple of places at least, and I take it that’s in juxtaposition to “identical”?
163 MR. PRATT: I think that’s fair, Mr. Chair. We have talked about that in many previous submissions in terms of the regular basic service in the North; that we acknowledge it is -- the postage stamp option is not necessarily the most -- that there’s more balancing that needs to be done.
164 THE CHAIRPERSON: Right. And would satellite-delivered communities be an area where we have to think about comparable as opposed to identical?
165 MR. PRATT: Well, there’s a -- comparable could comprehend a number of things: standards could be one; prices could be another; timing could be another.
166 Our view, as Yukoners and Northerners, is that, to the fullest possible extent, that everyone should have access to the same services within reason at the same prices, again, within reason.
167 THE CHAIRPERSON: Right.
168 Okay, let me now turn to the question of affordability, which you’ve also raised in your submissions.
169 Now, you’ve supported an affordability subsidy to support access to broadband services by low income households. Others have advocated for a maximum retail price for broadband. Do you have views on that?
170 MR. PRATT: I do think there is merit in a maximum retail price. I think that’s one of the tools that the Commission might consider deploying.
171 What we struggled with in putting together the proposal is the balance or the transition from the -- the transition from the traditional approach to the basic service obligation to something that might comprehend more use of market forces.
172 So that instead of the default being a single provider, if the default for basic, if you will, is the option for multiple providers, the mechanisms that we suggested -- and I skipped over them in the oral presentation -- would use the tools of transparency and competitiveness to say, now, if there is a proposal by one or another provider to offer this subsidized service, let’s define what the subsidy is and let’s perhaps say that there is a maximum retail price that the Commission believes is just and reasonable.
173 Then the option would exist that if there is -- if more than one provider could make that offer, it’s -- the obligation, the service obligation is satisfied. It is satisfied in fact by setting the standard and putting the subsidy mechanisms in effect because one provider or another provider will provide the service.
174 THE CHAIRMAN: Right and it’s not to dismiss your proposal. We read it, heard it again this morning and I think we understand it.
175 I’m actually trying to dig around whether you have view on an alternate approach, which is sort of a package for basic broadband services at a price and we wanted to see your views on it.
176 For instance, because you said it could have merit, but sometimes these things fall apart on the details. What would it look like if we were go down -- hypothetically down that road?
177 And I realize it’s not your proposed option; it’s an alternate option on the record, in terms of speed, price and probably based on what you said today, monthly data capacity -- or minimum data capacity?
178 MR. PRATT: I want to be as helpful as I can so I’m not -- I’m not sure where you’d like me to start.
179 It’s -- would that be a subsidized -- a subsidy to a single provider? Is that -- is that the model or ---?
180 THE CHAIRMAN: That -- before we decide how it gets financed, I guess one has to define what you’re trying to achieve as an outcome and I’ve heard a lot about speed, but I haven’t heard a lot so far this morning on price and data caps.
181 And in fact data caps, I mean they all live -- they all speak to each other those three baskets, don’t they?
182 MR. PRATT: M’hm.
183 THE CHAIRMAN: Your speed will have an influence on data caps, which then will have an impact on price, and so speed is an interesting and important matter, but it’s not the sole issue.
184 So if we’re looking at the question of affordability I was wondering if the Government of Yukon has a perspective on both price and the monthly data cap capacity?
185 MR. PRATT: Well I’d have to just go back to the comparability of prices and as we mentioned, looking at the whole -- the total cost onto subscribers.
186 If their -- if their usage is curtailed, as many Northerners have had to do because of the impact of the data caps, it’s probably not comparable service even if the -- if the prices are comparable, so that would have to be taken into account as well.
187 THE CHAIRPERSON: But you have no specifics to help us figure that one out?
188 MR. PRATT: Oh, in terms of what the data cap should be or ---?
189 My ideal world would have a competitive offering and, you know, since that’s off the table, because we’re here talking about exactly that lacuna, we need to then substitute what would be reasonable by looking at the parallels or comparables elsewhere.
190 THE CHAIRPERSON: Right.
191 And I appreciate you may not have got answers for us today, but you know when I ask questions at the beginning it sort of gives a signal to others to maybe get prepared for questions I’ll be asking to others.
192 So let’s forge on then dealing with some other issues related to this notion of what is an entry level package and a potential subsidy or other mechanism you might want to put in place for affordability concerns.
193 I take it you would be of the view -- or tell me, that it would have to be technologically neutral?
194 MR. PRATT: In principal that’s correct, but once again if we had our preference -- and I suggest that your preference and mine would be the same, we’d let the market decide those things and not need to make prescriptions.
195 So to the extent that technology options are not -- need to be addressed from a policy perspective, my recommendation would be that insofar as possible we be technology neutral.
196 But in the case of satellite versus fibre that simply just isn’t feasible everywhere and that’s where some reasonable accommodation would need to be made keeping in mind the objectives, the service -- the standards, the service objectives, and as we have suggested, keeping open the possibility of competition.
197 THE CHAIRPERSON: Your views onto who should be -- on whom the obligation should bear to offer that basic -- that basic entry-level package?
198 There’s a bit of an issue as to who in fact could arguably be described as the incumbent in this sector.
199 MR. PRATT: Well and that was -- we were maybe stumbling towards in the explanation of one -- of the concept of -- evolving concept of a basic service obligation.
200 I think that if the Commission were to set the standard and we have the funding mechanisms in place, and some analog of the mechanism that we have proposed was in place, that it wouldn’t matter. That it wouldn’t matter on whom the obligation was placed, because the standard is there.
201 The need from the policy perspective and vetted by the information and rules that might be imposed, once that -- once that’s defined then there would either be one or another provider who would take advantage of that opportunity.
202 Then, you know, one needs to examine the possibility what if nobody were to accept that opportunity to provide service.
203 In which case I think we used the term in one of our submissions “impose an obligation to connect”, so that -- and that may be the dominant provider or the incumbent or -- it doesn’t -- from my perspective, it doesn’t need to be pre-determined on whom that obligation would fall.
204 THE CHAIRMAN: Okay, well let me continue on the affordability issue then, but maybe specifically from the perspective of the fact that you -- you are here as a territorial government and there -- there’s other governments that will appear, so the question of affordability of services I take it is something that provincial and territorial governments struggle with?
205 I take it there are social assistance programs in Yukon?
206 MR. PRATT: Yes, certainly there is.
207 THE CHAIRPERSON: So in establishing the level of support for those social assistance programs, how much does Yukon Government allocate for the cost of communication services?
208 MR. PRATT: I’m sorry, Mr. Chair, we’d have to speak to somebody and get the information for you.
209 THE CHAIRPERSON: Right, so could you undertake to get back to us?
210 MR. PRATT: Absolutely we will.
212 THE CHAIRPERSON: As you notice the date for that is May 5th?
213 MR. PRATT: Yes, sir.
214 THE CHAIRPERSON: In that -- and you may have to follow up with your colleagues and the Government on this.
215 How does this compare the calculation of other basic expenses such as shelter, food, clothing, heating, commuting, in deciding what social assistance -- the level of social assistance programming required?
216 MR. PRATT: Right, I expect there is a table that includes all of those things.
217 THE CHAIRPERSON: And perhaps you could therefore in the undertaking add the criterias(sic) that you use to calculate those?
218 MR. PRATT: Yes
219 THE CHAIRPERSON: Okay. I appreciate it.
220 Now we’ve talked a lot about and we’ve heard a lot about the needs of residential users and I was wanting to get your perspective on the needs of small and medium businesses.
221 I mean we know that small business represents nation-wide and perhaps as a particularity in Yukon, but let me know if it’s the case, but it’s estimated about 30 percent of GDP is associated with small business and about 9 percent is associated with medium sized businesses.
222 So have you considered beyond the needs of residents what are the business needs in Yukon?
223 MR. PRATT: Certainly, Mr. Chairman, the size and configuration of the Yukon market does not, you know, map the Canadian average.
224 And small businesses in particular are often very small, the individual proprietor-type businesses operating a fishing lodge or a hotel somewhere. We have typically viewed those types of small businesses as simply another category with very, very similar needs to residences. So when we have in the past said similar kind of treatment should be applied to small businesses as well as the residences, for the major businesses, national businesses that might operate in Yukon, they’re often better versed at addressing their own needs and negotiating their requirements with either the incumbent provider or an alternate provider.
225 THE CHAIRPERSON: Well, I’ve heard it said, though, that access to broadband in terms of economic development could be a counterweight to a phenomenon we often see of people leaving remote non-urban areas to move to more urban areas so that they can continue to do business. And that obviously is not necessarily very good for regional economic development.
226 So I was wondering from your perspective, whether it’s from tourism to other business or sectors that you in Yukon are trying to support from an economic development perspective, if you’ve assessed the business needs from that perspective in terms of speed, data caps, usage, quality of service from, you know, lost packets to jitter, all those sorts of things?
227 Certainly the qualitative surveys EKOS did seemed to suggest that there were people in remote areas that were having difficulty because of some of these issues in remaining competitive and developing economically, while still staying in the regions.
228 MR. PRATT: And that’s absolutely the case in Yukon. The difficulty with reliability that I mentioned in the opening remarks is an object case. With the utter reliance of those businesses on continued connectivity, it really is crucial for them to have the reliable service and access to service that negates the distance and remoteness.
229 I have to say, though, in response to the first part of your question that we did not specifically identify what business requirements would be as to, you know, jitter and all that.
230 But probably overlooked in my response to your question on the 25-3, what the impact on small business would be? And I think the proposal we have made of 25-3 is also keeping in mind the critical impact of that service on those businesses.
231 THE CHAIRPERSON: Okay.
232 In your July 2015 submission you stated that there were barriers to full Yukon participation in the digital economy and I think you raised that again this morning. I want to have your views, though, to what extent have those barriers been eliminated in whole or in part through, for instance, the rollout of the NorthwestTel’s modernization plan?
233 MR. PRATT: Not yet would be the quick summary. And I think the key factor we mentioned again this morning is the structural component. The opportunity for competitive entry is significantly affected by the lack of opportunity for facilities-based competition. And that cascades in a number of ways, that without the threat of a cable provider coming in to offer internet service, there’s less incentive to change the usage caps. It’s kind of a fact of economic life that if there isn’t an alternative, there’s no reason to change.
234 THE CHAIRPERSON: In terms of elimination of barriers, what impact do you assess the announcement of the Dempster Highway fibre build on avoiding some of those barriers?
235 MR. PRATT: That’s an important link in the creation of some fibre rings that would enhance the reliability. It is, I believe, still a proposal; it’s not shovel-ready or anything like that yet. And it also would address only part of the issue. In terms of the network configuration, I’m sure you recall from some of the previous NorthwestTel proceedings that traffic tends to all funnel back down into Alberta from across the north, which is why an outage there affects Nunavut as well as Yukon.
236 THE CHAIRPERSON: Right. Well, has the Government of Yukon given consideration to other specific projects that would be required to continue to remove those barriers you’ve identified?
237 MR. PRATT: I think the government’s track record and anticipated future track record would be that wherever a project comes up that makes sense, we’d look at it. Resources are not infinite and I think there’s a need to make sure that other requirements are addressed as well. But in terms of planning, it’s not really our role to plan the network. We can have some wishes and hopes, but that’s not part of our mandate.
238 So unless Steve, you have any other specific things, I don’t think there’s anything on the horizon we could point to right now.
239 THE CHAIRPERSON: Right. Okay, so you’re in a sort of -- I don’t want to -- reaction sounds judgemental, but you wait for proposals to appear and decide whether or not they make sense. When that is done, could you help me -- because then it’s your past practice -- to what extent have you put priority on connectivity versus bandwidth versus redundancy in terms of relative importance?
240 MR. PRATT: Certainly in terms of the business community in Yukon in particular, the ICT sector, what we’ve been hearing from there is that reliability is one of the most important aspects in terms of the development of the ICT sector in the Yukon. Even if the occurrence of outages isn’t very frequent, the possibility of a business being down for 8, 12 hours at a time inhibits certainly businesses, in particular customers who have -- or businesses who have clients in other territories that they need to service in terms of SLAs and those types of things.
241 So certainly right now in terms of projects, we’re looking to develop the Dempster project. And in terms of increasing reliability of the telecommunications system in Yukon is our number one priority.
242 THE CHAIRPERSON: I take it that if the analysis is being done, reading between the line, on a case-by-case basis, there is no existing program or support currently in place?
243 MR. PRATT: I think case-by-case would be really accurate.
244 I wanted to just add, though, I recall in the past Yukon has invested also in enhancing the backbone for mobile access to help deliver government services. So that’s another key aspect for us, being able to provide the same level of service to communities that are remote.
245 THE CHAIRPERSON: Right. And I take it there’s no plans for a future government program of support mechanism that case-by-case is likely to be the foreseeable approach as well?
246 MR. PRATT: I don’t believe there’s anything that either one of us could speak to on that, sir.
247 THE CHAIRPERSON: But you are here on behalf of the Government of Yukon?
248 MR. PRATT: That is correct.
249 THE CHAIRPERSON: In your submissions you talk about this obligation to connect, which is a different lens through which one could look at some issues that we have to grapple with, particularly as it relates to, I guess, backbone facilities and transport facilities. Are you aware of service providers other than NorthwestTel, who could be interested in moving in and serving remote Yukon communities?
250 MR. PRATT: I know, Mr. Chairman, that there are other providers, and we could probably hear from several who have capability of doing that. From the government's perspective, we haven't -- there's no specific opportunity that we could identify today.
251 THE CHAIRPERSON: Okay. Again, in terms of transport issues, someone suggested that maybe we could have a model whereby one provides support to build broadband transport networks, let's say to a particular point of presence in a given community, and then the access connectivity within that community to market forces. Has that model ever been tried, to your knowledge, in Yukon?
252 MR. PRATT: Not Yukon. That is, I believe, the SuperNet model, so there is a ---
253 THE CHAIRPERSON: Which you would know a little bit about then, from your past experience?
254 MR. PRATT: From, yeah, way back when, yeah. And I think that can be effective. I think there are -- there still remain challenges, especially if the community is very small in generating enough interest for entry by other providers.
255 THE CHAIRPERSON: So what are the elements for that model to be successful?
256 MR. PRATT: Obviously, as you mentioned, the subsidized connectivity at a significant capacity that's going to be attractive to entrance in the small communities. And when we think about the Yukon or northern context, I believe there also needs to be some incentive, policy incentive, by way of a broadband subsidy that would make -- that would create a market opportunity.
257 And I just jump on from there that again, the way I would envision that working is that if their economic growth occurs, population increases, more opportunities are seen by competitive providers, then à la the forbearance model, it's possible to either, as we suggested in this submission and previously to maybe sunset some of the subsidy provisions or provide some incentives à la price caps ---
258 THE CHAIRPERSON: Right.
259 MR. PRATT: --- where you ratchet down the subsidy.
260 But there will still be two essential different types of communities, those that where no one could imagine competition ever occurring, in which case the subsidy provision is indefinite; and those that might be transitional, in which case the kinds of things we have proposed here would come into play.
261 And that's why we have suggested that if one provider comes up with a proposal that it be transparent, that then everyone can look at it, and if there is another business opportunity, that could be made available.
262 THE CHAIRPERSON: Thereby creating a marketplace of subsidies?
263 MR. PRATT: Well, it might start that way, Mr. Chairman, and they -- ideally, the subsidy would not -- and that's, I think, why it's important that it be transparent and why it not be restricted to just a single provider, because then the option is still open for competitive entry to happen in the future, as markets change, as technology changes, and as others view the business opportunities.
264 I really think it's important that those provisions be kept in mind. That's the balance that we were trying to strike between the concept of market forces and the obligation of the Commission.
265 THE CHAIRPERSON: How important would the size of the community and the level of economic activity -- how important would those be to determine whether this would be something that was temporal or perpetual?
266 MR. PRATT: Absolutely critical. It could be a small community but maybe there's a big economic engine there.
267 And again, I hate to keep -- you know, sound like the broken record going back to what my submission -- our submission was, but the -- that's why it's also important to look at these on a community by community basis, that those opportunities could be unique, especially in the north.
268 THE CHAIRPERSON: So you don’t, at this point, have anything objective in terms of how much economic activity or the minimal size of the community, in terms of the number of residents that would -- that make the difference, a bit of the Rubicon between something that's temporary and ongoing?
269 MR. PRATT: No, unfortunately, no metric that I could offer, other than to say, "We'll know it when we see it."
270 We'll know those communities that are clearly -- will continue to need help and the gray area in between is -- I'd be -- be interesting to try and figure out what that might be.
271 THE CHAIRPERSON: Okay. Let me now turn to directory information.
272 In your view, how important is this service to residents and businesses in Yukon?
273 MR. PRATT: I'm sorry, directory information?
274 THE CHAIRPERSON: Yes.
275 MR. PRATT: Much less important than it used to be. I don't know have any statistics on what the usage is.
276 THE CHAIRPERSON: So how do residents and businesses currently access numbers, for instance, for government services right now?
277 MR. PRATT: I think we'd have to undertake to answer that and perhaps look at the distinction between what the most remote communities and the more wired or more accessible communities.
279 THE CHAIRPERSON: So are you telling me -- okay, I'm happy to see the undertaking for May 5th, but would it be likely that there's a different perspective, based on your assessment, as to whether in a given community, people would reasonably have access to a level of connectivity that allows them to look up the number versus a community that just doesn’t have the level of connectivity to do so? Is that -- and that there would be a different -- I'm talking about government numbers here, different respective about how those are made available.
280 MR. PRATT: I don’t know that for sure, but I suspect that that would be precisely the case.
281 THE CHAIRPERSON: Okay. Let me turn now to the issue of digital literacy. It's not really at the core of the CRTC's regulatory responsibilities, but it does -- it is raised by a number of parties in this proceeding, and maybe it's an opportunity to take a snapshot of the issue, especially since one could argue that provincial and territorial governments, who are responsible for education, might have a particular interest in this area.
282 So has the Government of Yukon assessed the level and extent of digital literacy in the territory?
283 MR. PRATT: We don’t know. I'm sorry, Mr. Chairman.
284 THE CHAIRPERSON: So could you undertake to verify if that's the case or not?
285 MR. PRATT: Yes.
286 THE CHAIRPERSON: And provide details, if there is such a study?
287 MR. PRATT: Certainly.
289 THE CHAIRPERSON: Are you aware of any best practices with respect to digital literacy of -- seen from the Government of Yukon's perspective as well?
290 MR. PRATT: I could tell you something, but we'd be better to ---
291 THE CHAIRPERSON: Okay.
292 MR. PRATT: --- undertake.
293 THE CHAIRPERSON: So you can add that to your undertaking.
295 And in the same perspective, are there digital literacy programs offered in schools for kids, I guess, and for adult education or ongoing education, say community centres, that might provide places to build on people's digital literacy?
296 MR. PRATT: We will add that to the undertaking.
298 MR. SOROCHAN: One program that Yukon Education has in place is that all high school students in the communities are given laptops, and that's a basic part of their -- they take online classes and they're -- regardless of what kind of connectivity they have at home, in the classroom they have access to technology and to internet access, so that's an ---
299 THE CHAIRPERSON: Right, and I take it -- maybe you could confirm that in your answer to your undertaking, that it's not (inaudible) laptop, but they are given educational training, support, to actually develop their knowledge on how to interact with it?
300 MR. SOROCHAN: Absolutely, yeah. The laptop is the tool but we can expand on that.
301 THE CHAIRPERSON: Okay. Let me turn to monitoring, because it's one thing to make a policy, but it's also a good policy practice to make sure that you can do -- monitor it on an ongoing basis after a decision is made.
302 In fact, you’ve advocated, I believe, for more monitoring of internet -- a quality of broadband internet services.
303 So in your view, what precise data should the CRTC collect?
304 MR. PRATT: There is a number of different options, some of which the Commission has already engaged in, the national survey approach. I think that on a -- I guess our view in the proposal was that by setting the standards there would then be a requirement to monitor those standards and if we are looking at a community-based program or a community-based subsidy it should be measured at that community level.
305 I wanted to suggest a customer satisfaction kind of approach, but thinking back to the EKOS report and the observation that many customers didn't really know what their speed was there may be two cuts at it. One would be the technical and that would presumably have to be obtained from the service provider what is your -- what are the speeds that are delivered? Maybe there could be an independent test done periodically.
306 And the other would be the customer satisfaction measure of whether they are happy with the service that's being provided, given the uses that they expect to make which is obviously more subjective.
307 THE CHAIRPERSON: Implicit in my question, and maybe I should have asked you, you are of the view that it is the role for the CRTC as opposed to another body to get involved in this?
308 MR. PRATT: I would suggest that it is an excellent role for the Commission and whether that required additional resources would certainly be appropriate.
309 THE CHAIRPERSON: And you mentioned again residential users. That may be an obvious point but is there a role to monitor issues related to wholesale issues and transport issues as well?
310 MR. PRATT: Presumably, if there are wholesale customers they have a strong interest in making sure that their level of quality and access is available. If there is not then I think there is more of a role for the Commission to look at what is being provided, the prices and perhaps show cause why there aren't more competitors.
311 THE CHAIRPERSON: You mentioned one of the -- I think we noticed ourselves in doing the surveys, and it's a factor of newer technologies that people don't always appreciate some of the technical aspects of it because it is relatively new. I guess that's not unique. We all understand what a litre of gas is but we would be hard-pressed to actually say how far it would bring us because there is other factors and things change. Oddly enough, a two by four that my father might have used to build is not the same size of a two by four I would use to build. For some strange reason it's not even two by four.
312 MR. PRATT: The same thing happens with airline seats in my experience.
313 THE CHAIRPERSON: Indeed. So to what extent can monitoring be effective without a deeper understanding of some of these technical aspects?
314 MR. PRATT: Okay. The subjective assessment deals with part of that. Is the two by four -- is it still as strong or as effective as it was before? It may not matter if the dimensions are slightly shrunk, looking at the purpose for which it is intended to be used.
315 And the other, to the extent that there is a safety, security or other technical issue, it would require technical expertise in order to do that monitoring.
316 THE CHAIRPERSON: In terms of things we ought to monitor, do you have any views about things such as latency, jitter, packet loss or other quality service indicators? Is that something we should monitor or should we be taking a reading based on complaints as opposed to proactively measuring it?
317 MR. PRATT: It will depend on who we are looking at protecting. The major customers, I would suggest, have the opportunity to examine those issues for themselves and make their own determinations about what is important.
318 For the individual residential small business, perhaps, user I think the subjective approach would likely -- customer satisfaction be sufficient.
319 Whether there is somewhere in the middle that users could be disadvantaged if their expectations of service were not met as to the degree of latency or jitter, then I can't right now conceive of who that might be, who would need that kind of protection.
320 THE CHAIRPERSON: Okay. My last question before I turn to my colleagues, in your written -- your oral presentation that you talked about right on page 1 about special consideration should be given to reasonable and practical -- where it is reasonable and practical to do so, can you help me understand exactly what you mean by that? Or was that constructive ambiguity?
321 MR. PRATT: I wish I thought of that. I would have adopted that term. I think what we are driving at there is that with the modesty that I believe is prevalent in our region there is not what's comparable. We want what's the best that we can get, but we don't want to be too strident in asking for it.
322 But we also would like it to be remembered that those people at the furthest edges, if you will, may have even more needs than average. What we are looking at here is maybe arguing on their behalf that we should give them special consideration.
323 THE CHAIRPERSON: Thank you.
324 Commissioner Menzies.
325 COMMISSIONER MENZIES: Thanks. Two or three short questions, hopefully.
326 How much would it cost ---
327 MR. PRATT: Which ---
328 COMMISSIONER MENZIES: --- for the Yukon to be served in the way that you wish it to be served?
329 MR. PRATT: I honestly don't know where to start, Commissioner Menzies, you know whether we break it down to --
330 COMMISSIONER MENZIES: Bigger than a breadbox, smaller than a house, you know, I mean a billion dollars, a hundred million dollars; do you have a rough estimate?
331 MR. PRATT: No.
332 COMMISSIONER MENZIES: Okay. How do you propose it be paid for?
333 MR. PRATT: I think what we have suggested in our proposal is that the NCF is a workable feasible model when we look at the broadband subsidy, extending -- if we were to extend the definition of basic or reframe the definition of basic that that would be an appropriate model. How the math would work out and whether there would need to be other sources of funds added, I don't know.
334 COMMISSIONER MENZIES: Okay.
335 MR. PRATT: I'm sorry. Let me just add, with respect to the transport subsidy I think that an infrastructure funding by the Federal Government would be an appropriate source to deal with the transport subsidy; the difference being that the transport subsidy, I expect, is more like a one-time or you get -- once you get there you have got most of it whereas the broadband subsidy may, subject to whatever competitive options come up later be more ongoing -- the operational.
336 COMMISSIONER MENZIES: In speaking of funding, the Yukon government introduced its budget the other day and in reporting on that it indicated there was $30 million in federal infrastructure spending. But I didn’t see -- and you’ve already addressed the manner in which the Yukon Government funds projects on an application-or-as-needed basis.
337 But I want to give you the opportunity to address something that, you know, critics of your proposal could bring up and it’s better for you to be able to address it now than later.
338 The Government indicates that it’s now the -- with Alberta’s demise likely to become the only jurisdiction in Canada that has no net debt, there was $47 million rolled over from the previous fiscal year into this year’s budget, which indicates a very modest surplus but a balanced budget anyway.
339 So a reasonable person might ask why should people in parts of the country that do have net debt and may be challenged, which is everybody except you, who may be facing their own challenges, why is it fair for people without any net debt and some cash surplus to ask to be subsidized by those who do have net debt?
340 MR. PRATT: I think the starting point is the national telecommunications policy. This is a national issue. It benefits -- while it might benefit Northerners, it benefits similarly all Canadians in the same way that basic service does. Those considerations were not part of the calculus for the high-cost serving area subsidy. This, in our view, is the same kind of situation only perhaps more important because of the importance of broadband.
341 COMMISSIONER MENZIES: Thank you. Those are my questions.
342 THE CHAIRPERSON: Thank you. I believe, just checking signals, that those are our questions. Thank you very much.
343 We will take a 15-minute break until 10:45.
344 Donc, nous sommes en pause jusqu’à 10h45. Merci.
--- Upon recessing at 10:31 a.m.
--- Upon resuming at 10:45 a.m.
345 LE PRÉSIDENT: À l’ordre, s’il vous plaît.
346 Madame la secrétaire?
347 THE SECRETARY: Thank you.
348 We will now hear the presentation of Kativik Regional Government. Please introduce yourself and your colleague and you have 10 minutes.
349 MR. DUMOULIN: Thank you. Good morning, Mr. Chairman, members of the Commission, on behalf of the people of Nunavik, I would like to thank you for giving us this opportunity to have our voices heard.
350 My name is Jean-François Dumoulin. I’m here to represent the Kativik Regional Government, and I’m here today with Jean-François Bouchard, who is the Assistant Director of Administration and the head of the Tamaani internet section, which is responsible for providing broadband services directly to residents, businesses and organizations in Nunavik. Jean-François is here to answer any questions you might have that are of an operational nature.
351 The KRG is a supra-municipal body responsible for delivering public services in Nunavik, which encompasses all of the province of Quebec, north of the 55th parallel.
352 Nunavik is a vast area, roughly half a million square kilometers, with a population of 12,000 of which 90 percent are Inuit.
353 KRG exists as a result of the James Bay Northern Quebec Agreement, a treaty between the Inuit of Nunavik and the government of Quebec and the government of Canada, which among other considerations grants the Inuit of Nunavik certain rights for self-determination and equal access to services available to all Canadians.
354 Telecommunications in the far North is a vital link to the world. For us, it is the difference between being remote and being isolated. But like all infrastructure in the Arctic, it remains fragile, extremely costly and difficult to operate.
355 Broadband internet is essential to Nunavik. Over 15 years ago, our leaders saw the potential of the internet to bridge vast distances but due to the small market potential of the region and the high costs, it soon became apparent that if we wanted internet, we would have to build a network ourselves and find some way to fund it.
356 And so Nunavik has benefitted greatly throughout the last 12 years from targeted initiatives that have funded network infrastructure. Programs such as the National Satellite Initiative, Broadband Canada and Connecting Canadians have allowed us to build a network and provide broadband service.
357 The service is slow and expensive compared to southern broadband, but nevertheless, it is a lifeline for Nunavik.
358 Targeted initiatives, however, address only capital costs, the majority of which go into satellite capacity for transport network, with the remainder for evergreening the last mile network. These initiatives are vital, but they do not address operating costs.
359 And moreover, because of the lack of a long-term national policy on Broadband development, these initiatives have become short-term and unpredictable. Case in point, for two years between 2012 and 2014, we had no indication that there would be any additional targeted initiatives, leading us to fear that we would actually have to shut down our broadband service.
360 And typically, when the initiatives are announced, we are left with a very short amount of time to design, build and implement. This forces us to make compromises to meet short deadlines, which often wind up costing more and reducing quality of the service.
361 However, we believe that these targeted initiatives will need to continue, at least for Nunavik, until a fibre optic transport network can be built.
362 The main stakeholders are the KRG itself, the government of Quebec and the government of Canada, who should continue to work towards building a fibre optic transport network that would be a long-term solution that would solve the problem of very high transport network once and for all.
363 We support the principle that broadband is an essential service for which recurring funding is available in high cost areas. While the market in Nunavik has thus far supported operating costs for broadband, the high costs and complicated logistics in remote communities force us to sell our services at very high prices.
364 And so without a program of recurring financial assistance, the cost to Northern consumers will probably continue to increase. Our Northern consumers already tend to be low income and are already considered under considerable financial strain from numerous areas, none the least of which is the high cost of food.
365 And once targeted initiatives cease, should we get to that point, recurring funding will become essential for evergreening the last mile network.
366 In defining targets for essential broadband service, it will be important to consider cost and data cap, not just speed. And I am going to go off script here to mention that we deliberately did not put targets, numerical targets for speeds for data cap for cost, because in Nunavik things typically tend to work the other way around. The budget comes out and then we figure out what the data caps and the speeds will be, based on the amount of money we have available to make that work.
367 For Nunavik at this point, it would make no sense, however, to impose an obligation to serve broadband on the ILEC, because the ILEC has no broadband infrastructure.
368 And this brings me to discuss wireline telephone service. Wireline telephone service is also essential in Nunavik.
369 The EKOS report, the less talked broadband report, notes that wireline service continues to be used very heavily in the Territories, and it does as well in Nunavik. And this is because our communities are difficult to access, and we must rely on air travel rather than roads.
370 So an outage that could be repaired with a truck roll lasting several hours in a rural community, for us, this can easily become a complicated exercise in logistics lasting several days.
371 And so having two distinct options for communications, broadband or telephone, greatly increases the security of our communities.
372 However, the wireline telephone infrastructure owned and operated by the ILEC appears to be aging and in need of modernisation. There have been at least two recent events, in 2012 and in 2014, where some communities could not rely on the wireline telephone for long periods of time, and these were severe enough to garner media attention.
373 In addition, Nunacell, which offered cellular service in several communities up until 2015, has disclosed to us that they had a great deal of difficulty with the interconnection between their service and the wireline service due to the age of the wireline telephone equipment.
374 I’d like to make a side note here that that is not why. However, Nunacell is no longer operating.
375 We are aware of the proceedings with regards to modernization of NorthwestTel’s infrastructure and wonder why such a modernization review has not been done for other remote communities in Canada.
376 I also want to go off script here and say that the KRG is open to working with Bell on improvements for a wireline service as long as the collaboration of that nature would not lead to a dangerous single point of failure on both the broadband and telephone networks.
377 And lastly, I’d like to address the issues of accountability and self-determination.
378 By owning and controlling their own telecommunications infrastructure, the people of Nunavik are able to make decisions that consider their own goals and priorities. As an example, we have established a mechanism with Nunavik organizations whereby we are informed in advance of any planned activities in small communities. This allows us to reconfigure capacity on our network in order to ensure that a large meeting planned in a small community will not have a negative impact on the broadband infrastructure.
379 Contrast this with the events that occurred in September 2015 in Nunatsiavutm, or our neighbours in Labrador, where the non-Aboriginally owned broadband provider decided unilaterally to reduce broadband speeds to all consumers.
380 By having ownership and control, we are able to make decisions that are for the public good rather than for commercial interest. And we feel the Commission should put a priority on supporting locally-owned internet service providers, especially in Aboriginal areas.
381 Obligation to serve should include certain obligation with regards to accountability. Specific recommendations have been proposed in our written response to the Commission’s questions but in general terms the operator should be required to be transparent regarding their network capacity including reporting on call failures related to congestion or technical issues.
382 The operator should also be required to notify local authorities in advance of any planned service impacting event or provide an escalation procedure for service-impacting incidents.
383 So to conclude, we believe that broadband is an essential service. However, wireline telephone also continues to be essential. Modernization and accountability aside, basic service obligation for a wireline telephone has served Nunavik relatively well.
384 However, we believe that broadband and wireline telephone service should be considered as distinct services and not rolled into a single service obligation. In Nunavik, the ILEC is best positioned to continue providing wireline telephone service and the KRG is best positioned to continue offering broadband services. And this really is just a question of who owns the infrastructure.
385 Recurring funding will be needed to provide broadband services at a reasonable cost, especially for low-income households. And lastly, we believe that targeted initiatives will continue to be necessary to remove the cost of network transport from the equation until such time as low-cost transport bandwidth through a fibre optic backbone can be obtained.
386 Thank you. We’ll be happy to answer questions you might have.
387 THE CHAIRPERSON: Thank you both for being here. Commissioner Molnar will start us off.
388 COMMISSIONER MOLNAR: Good morning.
389 I want to begin just by getting a good sense of the services that are currently available in your territory. You mentioned that you’re in a position where you take what funding is available and back-configure to develop your service plans and pricing. So where are you today? What is the basic service, and I’m speaking internet service now, that are available to your citizens?
390 MR. DUMOULIN: So currently we are operating a satellite-based transport network. We provide broadband services that are 1.5 megabits download and 384 kilobits upload. This is under the Broadband Canada program. We are in the middle of implementing a new program, an upgrade, under Connecting Canadians.
391 And this new program that we are currently developing has three principal components. One is a major upgrade of the satellite transport network for five years where we will increase our number of transponders from the current 4 transponders to 12 transponders. This will allow us to reach targets of three megabits to meet the Connecting Canadians targets and potentially as high as four megabits.
392 The other two components are based on last-mile technology. The current last-mile technology being used is wireless infrastructure that is 12 years old and end of life and it all has to be replaced this year. And so we are putting a HSPA+ solution in all communities in order to do broadband. This plan is not, I would say, fully-baked at this point; we’re still working through some details. And we have recently decided that we will likely have to add LTE in order to meet the residential broadband targets to do this.
393 In addition, in the communities of over 1,000 population, so that’s four communities -- specifically Kuujjuaq, Inukjuak, (Inaudible), and Salluit -- we are deploying an FTTH network in order to ensure that the wireless networks that are going to be put in there don’t get overloaded.
394 The technology decisions that we are making on the last-mile network are not only in view of this current transport network that we’re building, but in view of a future development which we would hope would involve undersea fibre that would allow us to greatly exceed our current targets of three and four megabits.
395 So we are basically trying to future-proof our last mile for as long as we can.
396 COMMISSIONER MOLNAR: So that I understand well, let’s talk about the last mile first. Your FTTH and LTE network, those are being put in place with funding available to you from who?
397 MR. DUMOULIN: The funding was made available through, in part, Industry Canada, Connecting Canadians, in part through Plan Nord and in part through KRG economic development programs. We’re also from -- the operational revenue of the internet service is also contributing a small amount.
398 So the breakdown specifically is 15 million from Industry Canada, 11.5 million from Plan Nord, 7.5 million from economic development at KRG, and 4 million from the internet service budget.
399 COMMISSIONER MULNAR: For your last mile?
400 MR. DUMOULIN: No, that includes everything.
401 COMMISSIONER MOLNAR: That’s everything?
402 MR. DUMOULIN: Yeah.
403 COMMISSIONER MOLNAR: Including transport?
404 MR. DUMOULIN: I don’t have the breakdown specifically of how much funding is for last mile and so forth. It’s rolled into one program.
405 COMMISSIONER MOLNAR: Fair enough. So you are upgrading to three megabit? Those are the plans you provide, the service you provide to your end customers?
406 MR. DUMOULIN: Yeah, those are future plans that are expected to go online in October of this year.
407 COMMISSIONER MOLNAR: So what kind of data caps would be associated with those plans?
408 MR. DUMOULIN: The basic plan of three megabits will have a 45 gigabyte data cap. And then we have a variety of plans that are lower cost, lower speed and higher cost, higher speed. So these plans are available. If you want I could make those available to you.
409 COMMISSIONER MOLNAR: M’hm. You have already developed and communicated your future price plans?
410 MR. DUMOULIN: They have not been communicated publicly. They have been communicated internally and with Industry Canada and Plan Nord.
411 COMMISSIONER MOLNAR: Okay. And you’d be prepared to file those with us?
412 MR. DUMOULIN: Yes.
413 COMMISSIONER MOLNAR: But not communicate? I don’t want you to be in a situation here where I’m asking you to communicate to your customers via a CRTC proceeding.
414 MR. DUMOULIN: Thank you.
415 COMMISSIONER MOLNAR: But I am interested in how you establish pricing. So you’ve established price plans that will provide three megs down? What’s your upload?
416 MR. DUMOULIN: The upload is going to be 512k.
417 COMMISSIONER MOLNAR: And you established the price of that how?
418 MR. DUMOULIN: The price basically is -- because we receive subsidies for the transport network, the price is predicated entirely on the operating cost. So a large part of the capital costs are subsidized and then we look at the number of customers that we have and we have to essentially break even. So we operate our service at a non-profit and we have to try to break even and keep a small amount of money to put into a cash reserve for this sort of project. Often the target-initiative programs have matching funds requirements. So we need to put money aside for that.
419 COMMISSIONER MOLNAR: And is this the operating costs of the last mile?
420 MR. DUMOULIN: This is the operating cost of everything of the network. So we’re talking about, you know, once the transport network is operational, it still needs to be managed or maintained, the satellite earth stations, the teleport the internet gateway. So that’s one thing, and then the actual work of maintaining the network in the communities which involves a lot of travel with technicians and so on and so forth.
421 So all of these costs put together, we try to come up with, based on the number of customers that we have, a break-even business plan.
422 CHAIRPERSON MOLNAR: And again, to ensure that I understand, that we understand, at this point with the current funding under the last program that has -- or some promised funding that’s been announced recently by the federal government, you have three megabits guaranteed for five years from a transport perspective?
423 MR. DUMOULIN: Yes. However, the cost of that to the end-user will be $80 a month. So it’s significantly higher than what you would pay down south.
424 CHAIRPERSON MOLNAR: Eighty dollars ($80) you said?
425 MR. DUMOULIN: Yes.
426 CHAIRPERSON MOLNAR: Is that the price you hadn’t communicated to your customers?
427 MR. DUMOULIN: Yes.
428 CHAIRPERSON MOLNAR: Okay.
429 MR. DUMOULIN: They know that we’re not -- that’s the current price of our service and we’ve committed to not raising the price.
430 CHAIRPERSON MOLNAR: Oh, I see. Okay. So if we’re looking in this proceeding at what are -- I mean, there’s many things being discussed in this proceeding. I’m sure you know that well if we just heard the party before you speaking of aspirational targets of 100 meg. You folks are sitting using three meg -- or one and a half at this point, hopeful for three.
431 If we were to focus first on what is the basic needs of consumers instead of an aspirational target, how do you see the service that you maybe not deliver today but at three megs meeting the basic needs of the citizens in your area?
432 MR. DUMOULIN: Our position is that going to three megs will allow us to survive the next five years so that we can iterate significantly more once we have fibre transport built up north.
433 So if the question directly is, is it adequate to meet the needs? No, not likely. I mean we know even just from -- you know, from looking at Exhibit 1 that three megs is going to be barely suitable for most applications.
434 And we have to keep in mind that in Nunavik we’re in a situation of overcrowding so we have many homes where there are -- are designed for four, five, six people where they have 50 percent more people than they’re built to handle. So typically you’ll have one account and you’ll have 8, 10, 12 people working off of it.
435 So, you know, it will allow very basic connectivity. We don’t expect -- and we have set the expectation with our customer base that, you know, we will alleviate some of the congestion that is currently occurring but it’s not going to be transformative.
436 CHAIRPERSON MOLNAR: And I read that in your submission as well and it is, I think, an important point to note that when we define the needs of a household, households don’t have the same characteristics everywhere in Canada. So your households are larger?
437 MR. DUMOULIN: The current rate of overcrowding in Nunavik is approximately 50 percent, which mean half of people are living in homes where there’s more people -- there are more -- typically, in order not to be considered overcrowded, it’s one room per inhabitant. So 50 percent of people live in conditions where there are more inhabitants than there are rooms in the house.
438 CHAIRPERSON MOLNAR: M’hm.
439 MR. DUMOULIN: And of course this leads to all sorts of -- a variety of problems, whether they’re health-related problems, educational problems, so on and so forth. And telecommunications is no exception so you wind up getting overcrowding, if you will, on the access link into the house -- you know, the broadband link.
440 CHAIRPERSON MOLNAR: M’hm. I understand that your -- I’m going to call them consumers because you’re here as an ISP so -- that your consumers face a lot of congestion. Would their primary issue be speed, their cap? What would you say are the primary issues that would be affecting their ability to meet their basic internet needs?
441 MR. DUMOULIN: I mean, as it was mentioned before, a lot of consumers don’t have the technical knowledge to be able to tell you whether it’s speed or not; they just want it to work. And they want it to work for the whole month, not get a warning after two or three weeks saying, “Hey, you’re at 90 percent and it’s going to start slowing down unless you -- you know, unless add more capacity.” And unfortunately, you know, we have to do that because there’s a limit to how much capacity we do have.
442 So when -- I think if -- our preference is if we can get a three megabits to work uncongested, it’s probably more interesting for consumers to have a higher cap than it is to have more speed, to be able to use it, to use it well, and to use it for the whole month rather than have it for half the month and then run into capacity issues.
443 CHAIRPERSON MOLNAR: M’hm.
444 MR. DUMOULIN: That’s our feeling just from anecdotal evidence that we’ve gathered.
445 CHAIRPERSON MOLNAR: M’hm. So that would be your kind of design approach going forward is to increase the capacity so that there’s a greater amount of usage available to your customers at a lower speed versus raise the speed and keep the cap where it is?
446 MR. DUMOULIN: Yes. Specifically, in the context of the Canadian program, there was a limited budget for the Northern component. And, you know, based on the analysis that we did, we felt that if we tried to do five megabits with that budget that it would not work well and it would probably -- the oversubscription would be such that there would be some heavy congestion on the network. So we favoured a lower cap with a higher -- sorry, a lower speed ---
447 CHAIRPERSON MOLNAR: A lower speed, higher cap, yeah.
448 MR. DUMOULIN: --- with a higher data cap, which is why we’re -- the data cap that we’re planning to offer is 50 percent higher than what was in the Connecting Canadians target.
449 CHAIRPERSON MOLNAR: Okay. Speaking of your sort of long-term solution being fibre, are you in conversations with anybody about achieving that fibre transport today?
450 MR. DUMOULIN: So there have been discussion between KRG and the Province of Quebec since 2013. We did a significant number of studies -- a pre-feasibility study, a socio-economic analysis -- and this work eventually led to the announcement that was put into the Plan Nord last April. So the Plan Nord announcement states an intention -- however, it’s not funded -- to move towards a fibre-optic network in Northern Quebec.
451 I’m here to speak for KRG; I’m not going to speak for the Province of Quebec so I can’t make any commitments for them. However, the interaction has been very collaborative and we’re very hopeful that we’ll be able to move forward on this project.
452 In this year’s budget the Province of Quebec allocated some money for a final feasibility study to build a fibre network across Nunavut. And the hope of that study is to come up with a final price and really look at detailed -- in detail the geography and the bathymetry of the region to figure out exactly where such a network would go, how it would be built and how much it would cost. So our hope is that the study will be concluded some time in the next 12 months.
453 CHAIRPERSON MOLNAR: So at this point is there a sense of the cost of that?
454 MR. DUMOULIN: The pre-feasibility study that we did in 2013 had estimated a cost of $158 million. If we ramp for inflation on today’s prices, that’s 163, I believe. However, indications that I’m getting from the submarine cable industry is that prices have been steadily decreasing for the last five years, which is why it’s going to be important for us to do that feasibility study to get an updated price.
455 And we also have another variable, which is the fluctuation of the value of the Canadian dollar so that adds an unknown quantity to whether our $163 million estimate is still good or not.
456 CHAIRPERSON MOLNAR: M’hm.
457 MR. DUMOULIN: One of the issues with submarine cable is the variability at fibre landing. So what I’m told is you can make the best estimates you want on a desktop study but when you get there a landing can cost anywhere between $2 and $20 million. So that study is going to be absolutely vital for us to nail down the cost.
458 CHAIRPERSON MOLNAR: Okay. Again, making sure I’m understanding sort of the situation you folks face, you’ve pretty much -- are in the process, through your plans of LTE and fiber to the home, of future-proofing your distribution networks and you’ve got a process in place. You’re working with the government in trying to secure fiber transport.
459 With fiber transport achieved do you feel the needs of your communities will be well met?
460 MR. DUMOULIN: I think the needs in terms of capacity and speed will be well met. The one remaining variable is the high operating cost.
461 So -- and this is something that we don’t have a really good handle on because we haven’t operated a fiber network; to date we’ve operated a satellite network.
462 But the reality of having to fly people around Nunavik rather than send them out in trucks to do things like install drops, and fix the networks, and repairs, and so on and so forth, means that the operating costs remain very high.
463 So our worry -- and it’s not our biggest worry of course, our biggest worry is getting this network built, but our worry is how do we then look at getting this $80 a month price down to something that looks more like what is being paid say in -- maybe in urban centres or maybe in sort of near rural centres.
464 Where, you know, like the EKOS reports mention, that some Northerners are willing to pay a little bit more, but should they be paying double?
465 Is what we’re charging fair? Are we going be a -- are we going to have to increase the rates because we need to do more work to maintain this network or not?
466 And so that’s a concern for us going forward is if we -- if we get where -- if we get to where we would like to be, which is with a high speed transport network, we -- we’re concerned that we get our -- put ourselves into a situation where it costs too much to operate and then we’ve sort of, you know, we’ve painted ourselves into a corner.
467 So I think, you know, do we need immediate action I don’t think so, but certainly it’s a concern going forward with this.
468 Not just sort of like be put aside and checked off as problem solved and not looked at.
469 COMMISSIONER MOLNAR: So coming here today -- and I certainly understand why you folks are before us today, but what would you see to be the priorities for the Commission as it regards helping you to achieve the requirements of your community?
470 MR. DUMOULIN: Well I think it’s very hard for us to set a standard if there’s no national standard and we want to be able to tell our people you’re in an equitable situation with what’s going on in the rest of the country.
471 So I think for this, you know, for the Commission to be able to set goals to set monitoring rules. Targets not only in terms of speed data cap and so forth, but in terms of reliability and in terms of quality of service is important for us, because then that gives us sort of a target to say okay well look that’s going on in the rest of the country so this is our goal.
472 And we need to meet that to make sure that it’s equitable with what’s going on, as long as that goal obviously meets the needs and I would assume it would.
473 COMMISSIONER MOLNAR: Okay very good.
474 And so as it regards setting those standards -- you know again the Government of the Yukon who is here before you set out sort of two different targets as it related to broadband 25.3 and I think 130.
475 Would you see that -- what would be valuable to you would be a standard as to what people require today as a minimum to be able to fully participate in the digital economy and society or what would you see to be the standard that should be established?
476 MR. DUMOULIN: Well I mean the standard is going to be a moving target, I think.
477 So I think more important than saying what is it people need today is saying -- is to put ourselves into a position where the infrastructure that’s being built today is going to be able to evolve towards those needs.
478 So it may be for example appropriate today to say I don’t know I’m going to pull a number here, I’m not saying this is the standard, but say the number is 8 megabits well are the mechanisms in place to make sure that in five years down the road that can be increased to 12 megabits?
479 Or are you going to be back to the starting point where you now need to start building infrastructure again and again?
480 Which is sort of the situation that we’re in with the satellite transport network, where every time -- every time the target is increased and -- and thus far the target has been set by industry Canada, we have to sort of, you know, take everything apart and put it back together again, knowing that in five years time we’re going to be back to where we started, which is, you know, it’s wasteful and inefficient and costly.
481 So I think the whole question of national policy and where we’re going has to extend beyond what digital 150 did and look at 2017.
482 It has to go beyond that and say how do we -- you know, where -- how do we get there from here on say, you know, a 15-20 year horizon.
483 And so that -- I think we’re -- you know, we’re hoping that there’s going to be, I guess, clearer direction so that we know what path to follow.
484 COMMISSIONER MOLNAR: Okay, fair enough. I think it makes sense that there be different standards for a build, so that you’re building to meet future requirements.
485 Clearly if you’re making any kind of capital investments you want to make sure that they are future proofed, so standards for future investment.
486 But the other thing you spoke of was having some kind of standards upon which the people in your community and you as an ISP, can assess what is reasonable as it regards service delivery, and price, and quality, and so on, which I would think would be a more current -- it’s kind of the scan of today. What is -- you know, what is required today; is that true?
487 So we should -- there’s perhaps two standards? What is the build standard and what is -- what is it that consumers should be or could be expecting today?
488 MR. DUMOULIN: The -- I want -- I guess I want to draw an analogy maybe a little bit to the wireline telephone thing.
489 It’s -- you know if something is put in place and then maybe it’s left on coast, it may be working well today, tomorrow, next year, but then there has to be some sort of mechanism to make sure it continues to work well down the road.
490 So what is that mechanism today? What are we looking at? So in the case of say telephones it would be like well how many -- how many lines out do you have in a community? What’s the ratio of households per line out? How often do the -- does that system get to the point where you cannot make a call out? Who is monitoring that? What happens when you reach those thresholds? Who is responsible for fixing it?
491 And the same sorts of things, I think, have to be done for broadband. You know, where’s your -- where’s your backbone? Is it running at 50 percent, 80 percent, 90 percent? What happens when it runs at 90 percent and people start to complain?
492 Who is -- you know, who is going to keep track of that? Is it up to the ISPs to keep track of that? Is it up to some sort of complaints board to keep up with that?
493 And I think –- but I think if you’re going to set a target, there has to be a structure behind it with mechanisms where you know that your targets are being respected.
494 And I don’t know how that would look like, but I think it’s something to keep in mind. That -- and there’s going to be some reporting requirements, because there may even be some technical reporting requirements involved in that, so that you’re not necessarily just, you know, relying on the word of the service provider. You have to look at, you know, other factors.
495 COMMISSIONER MOLNAR: Right. Good. Let me try this again.
496 So we would agree that we want a standard for future bills and that will help you in defending or -- or creating your business plans as to future investments such as this -- well I guess if you get fiber transport and you’ve already future-proofed your distribution you maybe don’t really require us to set a standard for future bills?
497 MR. DUMOULIN: Well I think it’s -- to be honest I think it’s pretty clear that once you get a fiber transport into a community, assuming that fiber transport is affordably costed all the way down to, you know, a major interconnection centre, then you have effectively future-proofed it.
498 COMMISSIONER MOLNAR: Exactly, exactly. So setting some kind aspirational targets is perhaps not what you require?
499 MR. DUMOULIN: No at this point, yes.
500 COMMISSIONER MOLNAR: From us.
501 MR. DUMOULIN: No.
502 COMMISSIONER MOLNAR: But having some performance and operational targets and information and standards upon which you can be assessed by your customers is something you would find useful?
503 MR. DUMOULIN: Yeah, I think it would be use ---
504 COMMISSIONER MOLNAR: As it regards ongoing operations of the network; is that true?
505 MR. DUMOULIN: Yeah, I think it would be useful for us to know where we stand and whether we are meeting our goals or not. I think what really what's critical in terms of what we are trying to achieve is, are we able to deliver the right level of service? Are we able to meet the needs?
506 Are people able to go home and do what they need to do to participate in the digital economy in terms of needs, not necessarily wants? And are we doing it in a way that's affordable so that our adoption rate is as high as it can be within reason? I'm not advocating giving it away but, certainly the cost should be equitable.
507 And that cost, I think, is a big concern for us in terms of how do we make that monthly cost something that is within reach of these low-income families in an environment where, you know, you just don't have the market density to generate enough revenue to bring that cost down.
508 COMMISSIONER MOLNAR: Are any of the programs that you have participated in to date, have they been to support operational costs?
509 MR. DUMOULIN: No. To date, we have supported all the operational costs.
510 COMMISSIONER MOLNAR: And based on your submission where you suggested that CRTC funding -- that there should be a CRTC funding mechanism put in place, was your thought that that should be focused on the operational cost, the ongoing perhaps last-mile cost; is that what you're talking about essentially?
511 MR. DUMOULIN: I think there is two ways that go about it. The ultimate -- the end-goal is reducing price to the consumer. For us that can be done in two ways. It can either be through a direct subsidy to the consumer or it can be done through a subsidy to the provider that allows them to lower their operating cost. Either way it would work.
512 COMMISSIONER MOLNAR: But that's where you would see perhaps the role from any kind of subsidy mechanism as we do for telephone today, to do this similar thing rather than looking -- I mean as you know, a few years back we suggested that there needed to be a transport subsidy. Now, it appears perhaps your transport might be addressed by this fibre but the ongoing last mile distribution -- and I am using last mile in a broad sense outside of your transport that the operational costs of that have no ongoing funding mechanism. Is that where you would see that the Commission could play a role?
513 MR. DUMOULIN: Yes, so that ---
514 COMMISSIONER MOLNAR: Similar to voice
515 MR. DUMOULIN: Yes. So if the targeted initiatives continue in the sense -- and if we are going in the direction we think we are going in the Province of Quebec and the Government of Canada will contribute, as will the Kativik Regional Government contribute to building this network, then that's the last -- for us that's the last loose thing, how do we get that cost down so that we can increase the penetration and really give everybody a chance to get onto the internet?
516 You know, the line that we have often said is that the low income -- the children of low-income families have as much of a right to get an education through broadband as anybody else, right?
517 If those targeted initiatives do not happen and we wind up in a situation five years down the road where we haven't solved transport then we are back to square one and certainly we would be looking for some sort of solution to renew transport in any way we can, whether that's satellite or fibre. Obviously, we prefer low latency for obvious technical reasons.
518 So there is a lot of uncertainty right now in terms of where we are going because there is a lot of good intentions that are not necessarily funded.
519 COMMISSIONER MOLNAR: Fair enough.
520 Talking about that price or affordability, what kind of adoption ratios do you have today?
521 MR. DUMOULIN: I don't have concrete figures. The estimate that we have is about 70 percent adoption rate through homes, and that's just based on looking at the number of subscribers we have versus the number of households in the region. It could be a little bit higher because some people are not necessarily subscribing to our services. They are with Xplornet. However, the penetration is fairly limited.
522 So 70 percent, 70 to 70 percent, I would say, is an accurate gauge. Compare that to the Let's Talk Broadband report from EKOS where I think the figure was, what, 98 percent of homes in Canada have internet. So we have got some catching up to do.
523 COMMISSIONER MOLNAR: So you don't have any sense of that 30 percent how many have subscribed to alternate providers and, I guess, maybe there is really just one alternate provider where you are, Xplornet?
524 MR. DUMOULIN: Yeah. So right now University of Laval is working with KRG to do a consumer spending study and we are hoping that some numbers are going to come out of that consumer spending study that let us get an idea of the number of homes -- the number of homes that are spending on broadband based on their spending habits. But no study has been done to date to survey in Inuvik the adoption rate, outside of us looking at our customer numbers and counting Xplornet.
525 COMMISSIONER MOLNAR: So that work that's going forward, I guess until you have that work you wouldn't be able to speak about what might have limit adoption? So whether it's their comfort with technology or their viewed need of internet or whether it's the price or whatever it might be, at this point you have no information on that?
526 MR. DUMOULIN: No, we don't, unfortunately.
527 COMMISSIONER MOLNAR: Do you do any work to educate consumers or potential consumers?
528 MR. DUMOULIN: So our role specifically with regards to KRG and development of telecom is very focused on infrastructure. The KRG is a -- is not a territorial government so it doesn't have the same structure as, say, the Yukon Government or the Government of Nunavut. Education is not in our mandate. So that's the mandate of the Kativik School Board.
529 A lot of the digital literacy questions that are addressed would be addressed by the Kativik School Board but I don't necessarily have visibility. The KRG does not necessarily have direct visibility into their activities. We know that they do have some programs but I could not give you precise details of what their activities are.
530 COMMISSIONER MOLNAR: So you don't work together with them?
531 MR. DUMOULIN: Not formally.
532 COMMISSIONER MOLNAR: A couple other questions. Is there anything particular -- I don't know the extent to which small and medium business are within your communities. If there is a lot of small and medium business, are there any particular needs as it regards business within your community?
533 MR. DUMOULIN: That's a difficult question to answer in terms of specific needs. I think the vast number of businesses, small businesses are connected. Some of them may opt for a consumer agreement, a residential account. They won't necessarily, you know, want to pay for a corporate account. We have -- we offer a range of services that go from residential grade to, you know, a somewhat higher level, a corporate level to what we do for the Province of Quebec which is dedicated IP transport that's not even connected to the internet and is very, very costly.
534 Every organization, I guess, has its own specific needs. Some of the things we hear that are, I guess, maybe in the more kind of larger organizations like the schoolboard and the housing board and so forth, is a frustration with you know, multi hub and latency and not being able to have centralized infrastructure because of the latency involved in it.
535 In fact, I guess the largest business in Inuvik which would be the mining operations they have told us, "We don't need more bandwidth because we can't use it. We have to have distributor infrastructure. It has to be at the mine. My technicians have to be at the mine. My servers have to be at the mine. Until you can get me latency that's at a reasonable rate I can't even use the bandwidth. I just need enough to synchronize the data and then everything gets done on site".
536 And this has to do with the fact that you cannot have a distributed or active directory infrastructure across a high latency network because it doesn't work. And in spite of the fact that latency can be mitigated for certain applications, once you get into kind of a more corporate level it's very, very difficult to operate on high latency now.
537 COMMISSIONER MOLNAR: Okay, and just so I understand as well, when you’re putting in your LTE network, you are going to provide voice and data over that network?
538 MR. DUMOULIN: The intention is to provide voice over HSPA and residential broadband over LTE. So initially we had a plan to do everything on HSPA+. As we did testing we realized that even in our small communities even at relatively lower speeds, when you start getting monthly data caps of 45 gigabytes per month, you can’t do that on HSPA+. So we’re just adding an overlay to do LTE just for residential broadband and then the HSPA we’ll do voice and what we call mobility. So the internet on your smartphone will go through 3G and internet at home will go through 4G.
539 COMMISSIONER MOLNAR: Would you see that in your new environment that you’re planning where you have fibre to the home and the LTE, that you may see a large uptake of VoIP and removal or, I guess, less reliance on the voice network?
540 MR. DUMOULIN: It’s a possibility and we’ve started doing some work with VoIP internally, specifically for internal use for emergency phones.
541 VoIP remains tricky with satellite latency, especially when you get into multi-hop scenarios. So I don’t know that it’s really -- I can’t tell you at this point whether we’re going to be able to do a complete replacement of phone with VoIP and whether it will work adequately or not.
542 I mean, from what we’ve seen in the tests there’s still issues where you get into sort of these routing problems where you have to, you know, go up, go back down, go up again and then your latency winds up not even in the milliseconds; you’re talking two, three seconds. And you can’t have a phone conversation with that level of latency. And depending on which VoIP provider and so on and so forth.
543 So the KRG itself does not have an intention at this point of offering a VoIP service.
544 COMMISSIONER MOLNAR: Okay.
545 Just for the record, because you made the point both in your submission and today again about the importance of the existing voice network, and the fact that perhaps it is not meeting the standards or the needs of the citizens today, and what is it exactly you would propose that we should do?
546 MR. DUMOULIN: We’d like to see the same level of review that was done with NorthwestTel in terms of the modernization. You know, how long has the equipment been there? Is it end of life? What will it be replaced with? What would that look like? Is there opportunities to perhaps reduce costs and improve services?
547 Certainly reliability I think is a big, big issue, especially for organizations like the healthcare sector that have been negatively impacted by some of the reliability issues.
548 COMMISSIONER MOLNAR: So I just want to stop you because I’m becoming a little perhaps confused about priorities of your region. You would see as you build an HSPA, LTE wireless voice network, fibre to the home, fibre back home into your community. We should be looking separately at whether or not there needs to be a reinvestment into the traditional voice network?
549 MR. DUMOULIN: Yeah, or how we can get those to work together.
550 COMMISSIONER MOLNAR: Or why you wouldn’t take on those obligations if you’ve been receiving funding to build HSPA, LTE, and fibre transport?
551 MR. DUMOULIN: Yeah, at this point the KRG doesn’t have a mandate to offer voice services. So from I guess an organizational point of view I don’t know if we even can do it. Yeah.
552 COMMISSIONER MOLNAR: But I mean, on the face of it it would seem a bit confusing to suggest with all the money being placed into your organization to expand broadband, that we would then look and put obligations on another organization requiring additional funding to support voice on a parallel network. Am I missing something?
553 MR. DUMOULIN: Yeah. Well, we’re open to working together with the voice provider. But at this point, like I mentioned in my presentation, it’s very important for us to have the reliability that you get of having the broadband not being integrated with the voice service because when you have an issue you don’t want these communities to be isolated.
554 So if you want to compare that to what happened in Nunavut in 2011 when there was a satellite outage that is used both by the voice network and the broadband network, the region went completely dark. And we feel that it’s critical for us not to be put in that position because it’s a public safety issue.
555 COMMISSIONER MOLNAR: I understand your position.
556 Just one more thing I want to ask you about before I leave you to my colleagues. And that’s the whole issue of the pricing. You mentioned that today the price is $80 and you’d like some standards or otherwise to be able to assess that price and to move it down to something else. And I guess I’m interested to know from you, if we were to set a standard, what kind of standard are we looking to set?
557 As you know well, you know, there are arguments at some point that urban and high-cost areas -- perhaps there should be some equity between, you know, rural and urban or north and south. And then there’s others who speak about means-tested programs to address the needs of low-income. There’s been some suggestions about a basic service to provide an entry-level affordability service across all territories.
558 I wonder what you think should be the priority as it regards establishing pricing and assuring affordability?
559 MR. DUMOULIN: I think for us the priority is definitely targeting low-income households. I mean, at the current price that we sell, I’m pretty comfortable saying that some of the professionals that are in the region can afford that price and the subsistence hunters cannot. So we really want to see the target on those families that can’t afford their service to make it more affordable and more comparable to what they would pay for the same level of service down south. So a basic plan. I don’t know. I don’t have specific numbers.
560 COMMISSIONER MOLNAR: So you would see that it is not unreasonable to have a higher price in the north if there was some kind of basic plan available to those who had income needs to address it?
561 MR. DUMOULIN: Yeah, as long as that basic plan meets, you know, the needs of what you need to do to participate in the digital economy. So it had to be useable. So if you have a useable-level plan that’s set with a baseline and specifically with assistance for low-income families, then I think that would acceptable.
562 COMMISSIONER MOLNAR: Thank you. Those are my questions.
563 THE CHAIRPERSON: Thank you.
564 Vice-chair Menzies?
565 COMMISSIONER MENZIES: I just have one question. Just when you mentioned latency I just wanted to get your impressions on how emerging technologies such as those outlined by OneWeb for low-latency satellite with the low-orbit satellite clusters, how that might inform your view or what your thoughts are on those technologies?
566 MR. DUMOULIN: So interesting because we had a similar discussion very recently.
567 So we’ve had a very cursory look at OneWeb. We don’t have a lot of information on what they’re proposing yet. And there’s a lot of questions for us in terms of whether it will be able to meet the needs and whether it’s going to be just a consumer-level product or whether we can use that and do what we do now, which is combine the consumer network with the organization’s networks and be able to achieve economy of scales to offer -- can you get enough critical mass to actually run our operations.
568 So you know, is it going to be affordable? Is it actually going to work? You know, they haven’t launched their system yet. And is it going to meet the capacity needs ---
569 COMMISSIONER MENZIES: If it works or not would be an important feature, yes.
570 MR. DUMOULIN: Yeah. So at this point it’s too critical for us, I think, to pin our hopes on, you know, a future technology that's been announced but that's not necessarily in operations.
571 We have this, you know, coming deadline, which is, you know, five years, where we need to have something in place and working and functional, and we know from past experiences that it takes two, three, four years to get funding agreements in place, to get all the structure in place. And so, you know, we're certainly not close to looking at OneWeb, but I would be very apprehensive about saying that it's going to, you know, come in and solve our problems at this point.
572 COMMISSIONER MENZIES: Thank you.
573 THE CHAIRPERSON: Thank you. I believe legal has a couple of questions?
574 MS. DE SOMMA: Thank you, Mr. Chairman.
575 We have a couple of questions which I suspect he may need to take away and provide us with an answer. The undertaking deadline is set at the 5th of May.
576 So first, in the proceeding to review Telesat Canada's price ceiling for C-band fixed satellite services, the KRG indicated that he had awarded a contract to SES for the provision of C-band at that time. However, the details of that contract were not made available at that time.
577 Could you please provide details of that contract for the Commission, including the following information by transponder or transponder equivalent: first, the capacity purchased in megahertz; second, the price per month; and third, the start date and end date of that contract.
578 And our second question refers to paragraph 7 of your initial intervention, in which the KRG stated that it relies on contributions obtained by federal and provincial programs in order to make the cost of its service more affordable.
579 It indicated that these initiatives are of a finite term and cover only the capital costs of network upgrades.
580 Could you please provide for the Commission how much government funding you have received from each of the programs identified in paragraph 7 of your intervention by year?
581 And further, for each year in which you received funding for these programs, what were the annual costs and capacity for satellite transport services used in order to provide broadband internet services in your serving territory? Thank you.
582 THE CHAIRPERSON: Just for the record, can we hear you say that you actually undertake to do that?
583 MR. DUMOULIN: Yes, I'll get back to you on that.
584 THE CHAIRPERSON: Okay, thank you very much -- for the 5th of May. Thank you.
586 I believe those are our questions, but before I let you go, you did mention the two percent number for number of homes connected.
587 You know, U.S. Senator Moynihan, he used to say, "Everyone's entitled to their own opinion, not to their own facts."
588 I'm not attacking you; widely expressed view, but this 2 percent number, it's actually 11 percent. Just because the CBC says it, it doesn’t make it so.
589 Sometimes I wonder if, in the battle of clicks and revenues, truth doesn’t become a victim to all that. I just wonder whether we should have a compulsory statistics course for all Canadians, particularly reporters.
590 I don't know how many times we've tried to correct the error in the CBC reporter's story, but apparently the truth will -- does get in the way to reporting and getting clicks.
591 Anyways, that's this morning's editorial. Thank you very much for your participation.
592 Madame la Secretaire?
593 MS. ROY: Thank you. I will now ask First Mile Connectivity Consortium to come to the presentation table.
594 MS. ROY: Please introduce yourself and your colleagues, and you have 15 minutes.
595 THE CHAIRPERSON: Before you do that, maybe I'll take the opportunity to point out to other intervenors, it's very helpful if you identify your panel ahead of time, both for the stenographers and for the people that are covering the hearing so they know how to identify you on the video stream. You just happen to be first, so thank you for doing that.
596 Go ahead, please.
597 MR. WHITEDUCK: (Speaking in Ojibway). Good morning. My name is Tim Whiteduck, Mr. Chairman and the members of the Commission.
598 I'm the IT director for the First Nations Education Counsel, based in Wendake, Quebec, which is just adjacent to Quebec City.
599 First and foremost, as an Algonquin member from the Kitigan Zibi First Nation, I would like to take this opportunity to welcome the Commission, the presenters, and participants to unceded Algonquin territory.
600 We've been looking forward to this presentation and would like to thank the Commission for the opportunity to present our case at these hearings.
601 So now I would like it to turn over to Rob McMahon as our first speaker.
602 DR. McMAHON: Hello? We thank the Commission for the opportunity to speak today and acknowledge and thank the Algonquin people for allowing us to meet on their territory.
603 The First Mile Connectivity Consortium, FMCC, is a non-profit association of community-based local and regional First Nation service providers concentrated in rural and remote regions of the provinces.
604 Our work builds on the long history of telecommunications development, operations, capacity building, technical support, and policy engagement by a national network of Indigenous technology organizations.
605 Along with Tim, with me are Penny Carpenter, manager of the Kuhkenah Network in northern Ontario, known as K-Net; Mark Awashish, the technology coordinator in Obedjiwan First Nation in northern Quebec; and Professor Heather Hudson, an expert in rural and northern communications.
606 The FMCC focuses on community involvement in the development and operations of telecommunications to support local and regional development. Communities can be providers and not just consumers of the services and infrastructures that make up the digital economy.
607 Indigenous peoples are digital innovators and entrepreneurs, and they have spent decades developing facilities, services, and applications in regions that are poorly served or unserved by incumbents.
608 We have two panelists today who will discuss these Indigenous providers, but first, I want to outline FMCC's proposal for how the Commission can expand access to affordable broadband in northern regions.
609 Broadband must be a basic service. Without access to adequate, reliable, and affordable broadband ---
610 THE CHAIRPERSON: Could -- could you -- excuse me, could you just slow down so the interpreter can actually follow you?
611 DR. McMAHON: Oh, yeah.
612 THE CHAIRPERSON: Thank you.
613 DR. McMAHON: Excuse me. Sorry.
614 Without access to affordable, reliable, and adequate broadband, citizens of northern and remote regions simply cannot participate in modern society, but the Commission needs to go further than mandating broadband for all.
615 In its notice of consultation, the Commission stated it would,
616 “Examine whether a mechanism is required in Northwestel's operating territory to support the provision of modern telecommunication services by funding capital infrastructure investment in transport facilities, as well as the cost of maintaining and enhancing these facilities."
617 It said it would also examine,
618 "Whether such a mechanism should be considered for other rural and remote areas of Canada."
619 We believe that such a mechanism is required for all northern and remote regions, and therefore, propose the creation of a northern infrastructure and services fund, NISF.
620 NISF support would not be limited to incumbent providers. It would enable local and regional community-based service providers to access funding to support the construction and operations of facilities and services in the north. The regions eligible for NISF funding would include the Northern Territories and northern parts of the provinces.
621 The NISFs would provide a stable, sustainable, long-term source of funding. It is not designated to replace, consolidate, or reduce current federal funding programs; rather, it complements them by supporting an increased role for community-base providers.
622 In addition to infrastructure, operations, and maintenance, the proposed NSIF would also fund training for Northern residents in technical skills and digital literacies. Priority access to the funds should be given to community-based regional organizations either as stand-alone providers or in partnership with other entities.
623 We envision the NSIF as an independent entity licensed by the commission and governed by a board of directors including representatives with strong ties to rural, remote, and northern regions.
624 As you will hear from our next speakers, FMCC members demonstrate the advantages of community-owned regional and local networks. Residents can operate networks and services such as internet, voice-over IP phones and data hosting, or they can lease their networks to service providers. Otherwise, residents have but one choice, to rely on incumbents that charge high prices and have shown little commitment to maintaining or upgrading facilities in isolated communities.
625 Indigenous peoples should retain control. They should not simply hand over their assets including their revenue, their rights of way, or their political support for the privilege of becoming customers.
626 Our next speakers represent providers, not just consumers, in the digital economy and they should be encouraged and supported in that role. We now turn to our first speaker, Penny Carpenter, director of K.NET Services in Northwestern Ontario.
627 MS. CARPENTER: Good morning. My name is Penny Carpenter and, as Rob has mentioned, I am the Manager of K.NET Services located in Sioux Lookout, Ontario.
628 K.NET is a First Nations owned and operated broadband network. It’s owned by the Keewaytinook Okimakanak Tribal Council and we provide broadband connections to First Nation communities in Northern Ontario and then there’s a few connected in more Southern and Northeastern Ontario.
629 We support the development, maintenance and operations of services including satellite (inaudible), data and voice, and we also provide our own cellular service to 20 communities. We are part of a joint venture that provides satellite service with other Indigenous organizations in Northern Manitoba and Northern Quebec.
630 It’s just important to note that 80 percent of the K.NET staff is First Nation. In the last 20 years we have really focused on building the First Nation community to deliver its own services including our staff located in Sioux Lookout. Our staff work in the network; they’re technicians; they’re network technicians, service technicians, sales people, and they work in digital media.
631 We built the K.Net Network without partners because telecommunications companies would not or could not do it for us in a way that is sustainable, affordable, and meets our communities’ development requirements. Our services are being deployed to overcome barriers of distance and isolation, to improve community well-being, enhance learning opportunities, and support economic development.
632 For example, in February, Nishnawbe Aski Nation, what is the local political organization for Treaty 9 and Treaty 5 in Ontario -- the Grand Chief Alvin Fidler declared a state of emergency in health for First Nations in the NAN region. K.NET is able to help that crisis by delivering telemedicine services and other E-health services to the community.
633 Our services also include a centralized IT helpdesk for First Nation schools and we deliver the SchoolNet Program to all First Nation schools on reserve in Ontario. We also are able to provide technical support for member First Nations; this includes websites and emailing.
634 Within our tribal council we operate an internet high school which enables Northern residents to complete high school in their communities. We developed a broad range of technical training programs that we offer depending on funding availability. We also operate a videoconferencing network which we are currently using for justice services that link remote communities to the justice system.
635 My own history, I’ve been with the tribal council for over 25 years and I have worked with K.NET for 20 years in different capacities. I have experience in the telemedicine, internet high school, and the videoconferencing, promoting these services in the communities and with government users.
636 We support First Nation communities to develop, operate, and sustain telecommunication services on their traditional territories. Though K.NET doesn’t operate the local ISP in each community, we bring the broadband connection to the community and support the local community operate their own ISP through either a cable infrastructure or wireless.
637 For example, in Sleigh Falls, they were part of the NAN fibre build and they have fibre to Sleigh Falls, the local point of presence. They have purchased a 100 meg fibre and they’re able to provide voiceover IP to their home customers along with internet services.
638 But not all these communities have these services. For example, there are five communities that are in the Matawa Tribal Council area that did not receive the broadband project six years ago. It was an $81 million project the government funded.
639 We require a finding mechanism that will enable our communities to install, manage, and maintain their own telecommunication facilities. That is why we worked with our partners and colleagues at FMCC to develop a new approach to support telecommunications in rural, remote, and northern regions, which is called the Northern Infrastructure and Services Fund.
640 Now Mark will speak.
641 M. AWASHISH: Désolez, je parle seulement Français.
642 LE PRÉSIDENT: Vous ne devriez pas vous excusez pour ça, Monsieur. On peut travailler dans les deux langues officielles.
643 M. AWASHISH: O.k.
644 LE PRÉSIDENT: On vous entend.
645 M. AWASHISH: Bonjour, je m’appelle Marc Awashish. Je suis le Coordonnateur de la technologie de l’information de la Première Nation Atikamekw d’Obedjiwan et ça depuis 20 ans.
646 Je suis accompagné de Tim Whiteduck, Directeur de technologie au conseil en éducation des Premières Nations, qui dessert 29 communautés Autochtones au Québec.
647 Obedjiwan est une communauté Atikamekw isolée, située à environ 300 kilomètres au Nord-ouest de Roberval, au Québec.
648 Un trajet dont plus de la moitié ce fait sur une route de gravier, il y a plus de 700 kilomètres, au nord de Roberval.
649 Nous faisons partie des communautés mal desservies qui sont toujours en marge du réseau de télécommunication.
650 Le fournisseur titulaire assure des services téléphoniques de base, mais tous les appels interurbains sont rédigés par satellite.
651 Voilà pourquoi que certains services, tel que l’Interac, ne sont plus fiables.
652 De plus, les résidents ne permettent -- ne peuvent profiter d’aucun forfait avantageux du fournisseur titulaire, par exemple la téléphonie, la vidéo ou l’internet, car ces regroupements de services ne sont pas offerts dans notre région.
653 La Première Nation Antikamekw d’Obedjiwan et le Conseil d’éducation des Premières Nations travaillent de concert pour faire avancer les télécommunications dans notre région éloignée du Québec.
654 Il y a toujours eut une demande élevée pour ces services de communications à Obedjiwan, mais notre fournisseur titulaire n’a pas intérêt à desservir notre communauté éloignée.
655 Une entreprise nous a proposé des services de micro-ondes mais c’est une solution couteuse et à court terme qui ne répondait pas à nos besoins à long terme dans notre communauté.
656 Par conséquent, nous voulons -- nous avons du construire à nos frais notre propre infrastructure en fonction des fonds disponibles.
657 Il y a 10 ans nous avons obtenu une liaison par satellite par l’intermédiaire du N-I-C-S-N, NICSN, en collaboration avec K-Net et le CEPN.
658 Nous avons aussi bâti notre propre réseau local sans-fil en vue de relier les maisons à liaison par satellite pour assurer des services résidentiels.
659 Puis en 2009 nous avons fait équipe avec une entreprise forestière locale pour construire une liaison terrestre sans-fil jusque la dorsale la plus proche du réseau à fibre optique.
660 Le CEPN nous a aidés à trouver les ressources nécessaires pour réaliser ce projet.
661 Nous travaillons depuis des années pour renforcer nos capacités locales et mettre au point des applications de formation à distance et de télémédicine, entre autre. Ces expériences s’étaient révélées difficiles.
662 Nous avons dû trouver des programmes de financement redirigés -- rédiger des demandes de financement, fournir des analyses techniques et de rentabilité, tout en assurant le soutien technique dans la communauté. Le tout sans un environnement -- le tout dans un environnement très difficile.
663 Notre organisation régionale, le CEPN, a toujours appuyé nos efforts et travaillée de concert avec nous.
664 Finalement ce n’est que récemment que nous avons trouvé les fonds nécessaire pour construire notre propre infrastructure régionale de transport à fibre optique de 160 kilomètres avec nos partenaires.
665 Nous prévoyons maintenant mettre sur pied notre propre réseau local à fibre optique afin de l’utiliser pour mieux servir les entreprises, les organisations et les résidents de notre communauté.
666 Le contrôle par notre communauté est crucial pour notre peuple et nécessaire pour répondre à nos besoins futurs pendant des générations.
667 Nous savons que nous aurons aussi besoin de financement pour assurer l’entretien et la modernisation, de même que la formation technique.
668 Nous demandons au Conseil d’appuyer la création du fond pour les services et les infrastructures du nord, afin que d’autres communautés puissent éviter le retard et les obstacles qui ont empêché notre communauté d’obtenir le réseau que nous voulions il y a 20 ans.
669 Un tel fond nous permettra à tous d’assurer l’entretien et la modernisation de nos réseaux et de renforcer notre capacité pour les générer nous-mêmes.
670 Tim Whiteduck et moi serons heureux de répondre à vos questions. Merci.
671 DR. HUDSON: Good morning, Mr. Chairman and fellow Commissioners.
672 My name is Heather Hudson. I’m a Canadian citizen and a professor specializing in communication for rural development and communication policy.
673 I’m going to try to shorten my short remarks because I realize we’re close to time.
674 But I would like to make the point that the experience of Canada’s Indigenous technology organizations of which you just heard two examples, I believe is unique. I know of no other country or region in the world where Indigenous people have developed such expertise and taken on such responsibilities for the provision of telecommunications infrastructure and services. So it’s a really interesting and unique situation with lots of opportunities.
675 I’d like to make several brief points and I’ll shorten them because you’ve heard about some of them already.
676 The Chairman talked about real and reasonable needs and the importance of broadband for northern development. We’re not making a frivolous argument here about streaming and entertainment and games, although people are interested in doing that obviously.
677 You’ve heard about essential services such as telemedicine; telehealth; telemonitoring of patients who come home from hospitals; education so people can complete high school or take additional training or even do their homework, as you’ve heard from others; continuing education and training; and there was a reference to small business. And I would also add local governments.
678 And we do have information we can share with you on their needs because we’ve recently completed a study for Industry Canada, which is not formally released, but where we did collect information from small businesses as well as non-profits and local governments. And so I did mention there they do payroll; they do banking; they do logistics and personnel services. A lot of that material is often based in the cloud or relies on back offices somewhere else as well as what they do locally. And communication among the communities in the region is also really important for regional development.
679 Second, broadband must continue to be a moving target. And I won’t get into the debate you’ve just had about specific speeds; we can discuss that if you like. But we think 5 megs down and 1 up are definitely now and will remain inadequate. And we quote several references to that extent as well as what you’ve heard. The bar should be higher than 5-1, but most importantly it should be a moving target revised regularly and monitored because as you heard I think just in the previous discussion, it’s going to change over time.
680 Third, broadband must be not only available but also affordable. And research by FMCC and some comparable research that I’ve led in Alaska is frustrating in that it shows even if the infrastructure goes in affordability can remain a barrier to usage.
681 I think the key points that you’ve heard are incomes are low in the north and some people live on subsistence at least part of the year. The population is very young and that means that there’s a lot of new users or there will be; but also that there are a lot of dependents to support and that households are large. And there’s a lot of important concerns about even institutions and small businesses that can’t afford to do some of the services to the extent they would like.
682 Fourth, funding programs must include not only infrastructure investment costs or capex, but also operating costs or opex in remote regions. Sustainable funding models are needed; otherwise access to connectivity remains unaffordable and service quality deteriorates as I’ve seen in several projects in many countries including the Canadian North.
683 And finally, funding programs of all types must not be limited to incumbents but open to all providers, especially Indigenous providers in northern regions, that can demonstrate the technical and organizational expertise required.
684 In the US, the Federal Communications Commission has required competitive bids with Indigenous preferences in some of the programs in its funding for remote and Native regions and also has included opex support.
685 I provided additional supporting documentation as part of FMCC’s written evidence and would be happy to answer your questions. Thank you.
686 THE CHAIRPERSON: Thank you very much.
687 Vice-Chair Menzies, please?
688 COMMISSIONER MENZIES: Thank you.
689 Perhaps we could start with you could give me a geography lesson. North of 60 is easy. North of 55 isn’t even too hard. But when you’re dealing with definitions of northern, you said sort of the northern portions provinces and in particular when you’re talking about your proposed NISF fund, how are you defining northern communities? Because in this part of Canada, I mean, you can go an hour north of here and you’re fairly remote and that’s nowhere near 60 or I don’t know if it’s even near 47 let alone 49. Maybe you can help me out?
690 DR. McMAHON: Sure. I was just going to refer to -- I don’t have it in front of me but we did generate a map that was in one of our interventions that took a look at a similar ---
691 COMMISSIONER MENZIES: I think I have it.
692 DR. McMAHON: Oh, okay. So that was a methodology also used by a recent report by the Centre for the North in the Conference Board of Canada that established what was the northern regions I think based on a combination of factors from Stats Canada and other sources.
693 COMMISSIONER MENZIES: Go ahead.
694 MR. WHITEDUCK: Maybe just to add to that, we would like the fund to be available to remote communities as well. So in Mark’s case, Mark’s community is considered -- the Plan Northern Quebec ---
695 COMMISSIONER MENZIES: That’s what I was thinking because his doesn’t meet the definition of north.
696 MR. WHITEDUCK: It’s kind of confusing. Yeah, the Plan Northern Quebec defines the parallel I believe it’s the 49th. I’d have to verify but it’s the 49th parallel. So it doesn’t apply to 60th parallel as a nationwide northern definition. But I could verify that.
697 Maybe Jean-Francois could tell us that because he’s familiar with the Plan Nord more than I am. But Mark’s community is below that boundary.
698 COMMISSIONER MENZIES: Right. So when it came to the establishment of your proposed northern infrastructure fund and services, it wouldn’t just be that map? Some sort of process would have to be involved to be fair. Because I know you talk in there about rural and remote as well and, I mean, I can think of some areas that are fairly far south that have been mentioned to us in the past as struggling. I mean, the south shore of Nova Scotia, south-eastern Manitoba, places like that; they would have access to this fund as well, would they?
699 DR. HUDSON: Yeah, I think our first cut was communities without some form of year-round road access which includes seasonal roads. And that certainly includes a lot of northern Ontario and much of northern Quebec. But we found in consultation with our members that there are other examples. For example, in northern B.C. there’s a community, it is on a road but it’s 500 miles from the nearest hospital or airport. And there are communities such as Obedjiwan that are on dirt roads that are very, very remote in the sense of providing transport access. So we’ve tried to expand our definition somewhat as well as to include some other demographic information.
700 COMMISSIONER MENZIES: Okay, thanks.
701 Just talk about your proposal here in terms of the speeds. You talk about 25 down and 3 up in your presentation, and I would like you to explain to us how that’s necessary. And this gets into the -- what would be the ongoing needs versus wants.
702 Ms. Carpenter mentioned three or four items there; I think, Telehealth, Tele Education and Telejustice, any number of things that -- issues particular -- remote areas that they need good communications access for.
703 So I think that’s non-contentious. I guess what goes beyond that is like what do you need -- let’s use that as an example for Telejustice, Education, Telehealth, those areas of which you spoke and keeping in mind Exhibit 1, which the Chairman referred to earlier. What sort of speeds are required to meet those basic needs and how does that fit with your ask of 25 and 3?
704 MS. CARPENTER: Okay, so Rob is going to talk to the speed, but I’ll just talk to the examples.
705 Under the Tribal Council our KO Education Board has just deployed Google Chrome books like other Ontario provincial school boards have done. And so those Google Chrome books go to the students in all the schools and they do assignments in the school. The information is all in the cloud and they’re able to take them home and continue to do their homework.
706 So that is -- the students are wanting to continue their education. So they need that access at home.
707 Under Telemedicine, we are starting to work with the Ontario Telemedicine Network to deploy telehomecare, so there’s monitoring at home for aftercare when the patient comes home from the urban hospital of Thunder Bay or Iqaluit.
708 So you know, there is a need to make sure that there’s bandwidth available in the home.
709 DR. McMAHON: And I was just going to speak a little bit about just in terms of what we’ve heard from some of the other interventions as well around changeover time for the requirements of applications.
710 So of course recognizing emerging technologies, you know, cloud computing, the internet of things, of course, this chair would probably be connected five years from now kind of thing. So more and more devices require more and more bandwidth.
711 And sort of, as well, just the characteristics of northern households; so we heard from KRG’s presentation, the large number of users per household is significantly higher in the North. We’ve also heard that, I think, Mark was saying, you know, I think he said -- correct me if I’m wrong, Mark, but over half of the households having between eight to 10 people living in them, kind of thing.
712 So we have -- if we’re looking at these types of applications at a household level, you may get multiple users, for example, using some of these higher bandwidth requirements such as videoconferencing or that sort of thing.
714 COMMISSIONER MENZIES: There. Let me understand that a little bit. The number of users per household makes sense.
715 It’s challenged a little bit when you discuss it in terms of affordability though at the same time, because if you have eight or 10 users in the household who can afford eight or 10 iPads or other mobile devices, that sort of undermines the argument about affordability being an issue in terms of subsidy and that sort of thing.
716 So can you square that off for me?
717 DR. HUDSON: I don’t know if you -- I mean we sort of jumped from the services to the affordability.
718 Just coming back to the services and the reference to data caps, I think, you know, people can find it, it appears some -- to buy an inexpensive smartphone or some kind of tablet or is as -- Penny mentioned to now bring one home from school. We’re seeing more of that.
719 So one-time cost versus monthly costs with then with data caps, I think, and you’ve heard a bit about that. And your own Let’s Talk Broadband had some very good examples of people saying, well, by the middle of the month, we’ve blown through the cap. Now, I have homework assignments.
720 KNET works with operating an internet high school in Northern Ontario so students who never finished high school, adults or ones who dropped out or didn’t have the opportunity can finish high school but -- sort of take continuing education courses.
721 But partway through the month they say, “I can’t go online anymore because we don’t have the money. We’ve blown through the caps.”
722 Another option that we found in some of our research was Webinars for professional development, so people working in the community and maybe they’re doing them from home or wherever. But there’s a lot of training opportunities available for people to upgrade their skills or to get certification, which they need to advance in their jobs or qualify for other jobs. And they’re saying, even the small businesses and organizations, “We can’t afford to use enough bandwidth to participate in those and it’s very expensive or perhaps totally impractical to send our people away for face-to-face training somewhere.”
723 So those are a few examples. You know, the issue of affordability I think is, as you point out, difficult because sometimes people can find a one shot way of paying for something but the monthly charges and the unpredictability of those charges is difficult.
724 But I don’t know if Mark or others would like to add any examples to that.
725 COMMISSIONER MENZIES: Okay, that’s fine. I don’t want to get bogged down in it.
726 But what should a monthly data cap be? You’re clear on the 25 and 3 in your proposal but I’m not quite so clear on data cap.
727 MS. CARPENTER: So just -- I guess I can’t really answer that question and maybe we can get back to that. But I just want to just note that the communities that run their own cable plants or their wireless system, they were developed in the early 2000s and they were -- the cable plants weren’t developed to have caps because at the time when the broadband infrastructure was first developed, we were only bringing T1 technology to the community. So the community was sharing a T1 so there wasn’t a lot of bandwidth to cap.
728 So just only recently after the NAN fibre build, our communities with the cable plants are now able to deliver more bandwidth to the home.
729 So they’re just struggling to come up to speed with setting caps or maybe changing their infrastructure to utilize the more bandwidth and to change their cable plant to be able to control it and manage it.
730 COMMISSIONER MENZIES: Thank you. I’ll take that as your answer on the data cap issue.
731 So I just want to refer to in paragraph 61 to 64 of your written submission, you speak of the need for digital literacy. You spoke of it again today. And today you mentioned I think at least twice technical training.
732 You may have heard the previous questions on this, but we need to understand how such an initiative would be justified within the CRTC’s mandate and why it doesn’t properly belong within the mandate of others.
733 DR. McMAHON: I was just going to say in terms of our definition of digital literacy, we very much see it as both sort of using things like Microsoft Word, programs like this, devices, et cetera, but we also see it as very much connected to the operations and maintenance of these types of, you know, organizations that are presenting here today. So we see network management and sort of that side of things as being a component of digital literacy.
734 And also connected to that, we also see a component linked into community-based internet performance monitoring. So you know supplementing -- you know, the CRTC already has SamKnows and is already rolling out internet performance monitoring. But just in some regions as well, we thought sort of a community-based model using tools such as that developed by the Canadian internet Registration Authority has like an online platform, for example.
735 So digital literacy sort of consisting of some of those issues that we think may be of interest to the Commission.
736 DR. HUDSON: I think considering the monitoring, just looking at the initial report that you have just issued, it struck us that although it's preliminary, I mean, it groups all of Canada into three huge regions so that it sounds as if there is not enough datapoints to disaggregate even at the provincial level, let alone -- and territorial, let alone at sub-districts to really understand what's going on.
737 We thought community-based participation in that monitoring could be useful. But I think that the larger point is, as the Chairman pointed out, we are talking about development here and development involves informed usage as well as taking responsibility for providing facilities and services wherever possible. And there isn't any mechanism. That's why some of the OPEX funding, to my mind, should actually include some training for funding because we have seen that it's very hit or miss.
738 Maybe Tim, who is in education, can explain that there isn't that kind of support for training in the region.
739 COMMISSIONER MENZIES: Thanks. I guess what I am trying to get around to; is our mandate to ensure provision of basic telecommunications services and whether or not digital literacy and technical training didn't perhaps belong with CanNor or any education ministries or something like that that we weren't blending it? But I think I got an initial answer that will suffice.
740 DR. HUDSON: Okay. I mean it's a very scattershot -- I think we can make the case that it's well-justified as part of OPEX but also that if there were some universally-available program tied into with some other place, but there isn't ---
741 COMMISSIONER MENZIES: Right.
742 DR. HUDSON: --- that could be useful.
743 COMMISSIONER MENZIES: Okay, good.
744 In going back to your July 14th intervention, and just to be specific or try to be helpful, to paragraph 78, you discuss voice telephone and internet as basic services, which is understood. But you also -- you also spoke or wrote reasonably enthusiastically about a provision or accessibility to VoIP services.
745 So I was just unclear when I came out of it, whether you were asking that voice as in VoIP services be available as or defined as a basic telecommunication service or if you wished to retain the current definition plus the addition of internet services as you define them. So is it both or just making sure voice wasn't lost in the transition given that the speeds you are talking about there is no issue about voice, let alone Skype or video.
746 DR. McMAHON: Sure. Yeah, I thought prior to -- oh, sorry -- prior to our presentation KRG discussed the need for that kind of redundancy between voice and internet. So I think that really highlighted that importance in these remote communities of having sort of a redundant connection which is absolutely key in terms of sort of basic telecommunication service as well as broadband. We saw that happen when both got knocked out in the North in 2011.
747 COMMISSIONER MENZIES: So if the world unfolded as you are asking and internet services were available as they are, would there be any need still for hard copy telephone directories?
748 DR. HUDSON: We have had some discussion about that. I think that we found that the responses vary. You saw in our submission that the Cree have definitely a phonebook. We heard from Mark in this discussion yesterday that their phonebook would be useful if it included the right sub-region. So the content is the wrong particular content. And we have also heard about the need to update but update regularly.
749 But I think that what does come out is that not everybody can find all the information that they need online in terms of numbers both of individuals and also of government agencies which is a point that I think Tim was raising in our preparatory discussion and we can certainly amplify that, if you like.
750 MR. WHITEDUCK: Maybe just to add that I have seen phonebooks across Canada in my travels where the First Nations community is listed as a government in the government section. It makes a lot of sense when I see my band office number in the government section, but it's not the case. It's not a standard.
751 From my community we still use the phonebook a lot. internet is not available everywhere. I mean high speed internet. So it's still used quite a bit in my community.
752 For Mark's case it's different because he tells me that his -- the individual listing for his community is in the Mauricie Region telephone book but his community deals with Lac St-Jean. So you can see what's the use of using that book when he needs the numbers for that area?
753 COMMISSIONER MENZIES: Okay, thank you.
754 DR. HUDSON: Thank you.
755 We will also hear from the people from Nunavut tomorrow about their sense of the material. I feel perhaps a little of the institutional memory of this group in that it was testimony before this Commission several decades ago from people in Northern Ontario that first got translated versions of telephone books required to be introduced as well as some other translated information services.
756 COMMISSIONER MENZIES: Okay. Thanks for your answer.
757 Can you expand a little bit, please, for clarity on how the Northern transport funding mechanism you propose would work? How would it work? How would it function differently from existing relationships with ---
758 DR. McMAHON: Okay. So in terms of the Northern Infrastructure and Services Fund, I think that one of the key issues is that it's open to non-incumbents.
759 COMMISSIONER MENZIES: I just want to clear something. When you refer -- in your written submission you refer to a Northern transport funding mechanism. You were referring to the NISF?
760 DR. HUDSON: I think so. I'm not sure what para you are talking to.
761 COMMISSIONER MENZIES: I just want to clarify whether you are talking about two funds, two ---
762 DR. HUDSON: No.
763 COMMISSIONER MENZIES: --- separate mechanisms or a single mechanism because you introduced that ---
764 DR. HUDSON: A single mechanism.
765 COMMISSIONER MENZIES: --- thought before you went -- in the submission before you introduced the NISF thought so it just confused -- so just one?
766 DR. HUDSON: One fund.
767 COMMISSIONER MENZIES: Okay.
768 DR. HUDSON: We can clarify that.
769 COMMISSIONER MENZIES: Okay, thanks. So how would it work?
770 DR. McMAHON: Okay. So the idea being that it's complementary to existing federal funding programs such as that provided through ISED and others whereby it focuses on -- those are typically focused on one-time capital builds for infrastructure so this would be around ongoing operations, maintenance, upgrades, et cetera.
771 And then the other sort of distinction is that it would be open to non-incumbents, so open to these community-based organizations.
772 We discussed this idea of prioritization of the fund, so you know sort of the first two unserved communities, second to underserved communities that require updated infrastructure; third to ongoing operational funds which will be prioritized based on needs to address the BSO requirement and then, fourth, to other qualified projects.
773 We did talk about the governance of the fund, so it being established through sort of an independent licence body organized by the CRTC whereby the representatives that would be on that body would include representatives from Northern organizations and Northern regions.
774 We talked about the process used by the Commission to select representatives to this Board should be open, transparent, ensure balanced representation of cultural populations in geographic regions across the North including remote regions of the provinces; be based on nomination including self-nomination; include enough positions to ensure the directors are representative of the diverse communities and entities involved and include representatives from private, public and civil society organizations with ties to rural, remote and Northern regions and/or communities.
775 COMMISSIONER MENZIES: And would southern communities that are underserved be able to access this as well?
776 MR. WHITEDUCK: Yeah, the purpose of the fund is to support all First Nation communities that are isolated and remote.
777 COMMISSIONER MENZIES: Okay. Okay, good.
778 I am a little unclear on your answer to question E which is in your written submission on paragraphs 126 to 132 when you discuss an obligation to serve.
779 If the world unfolded as you propose, who would bear -- can you just clarify who would bear the obligation to serve burden and why?
780 DR. HUDSON: I think that we’re trying to point out that we understand that funding to support competitive providers or whoever would win the right to provide these, would incur a basic service obligation where we’re trying to fit into the criteria that the Commission has already had in the past and say that, “All right, this would have to be the responsibility of somebody who was funded, if they were funded, to provide the expanded definition of basic service that could be adopted.” So we’re ---
781 COMMISSIONER MENZIES: So under your proposal there’s essentially a bidding process for a license to serve a community, correct?
782 DR. HUDSON: Yes. It could a license and it could be open.
783 COMMISSIONER MENZIES: So that obligation goes to that provider?
784 DR. HUDSON: There are various mechanisms and an obligation would go with it.
785 COMMISSIONER MENZIES: Okay, thank you.
786 DR. HUDSON: As one example of how it could work.
787 COMMISSIONER MENZIES: Right.
788 MS. CARPENTER: Can I just point out that ---
789 COMMISSIONER MENZIES: Please.
790 MS. CARPENTER: --- the areas that we have served in the last 20 years are areas that the other telcos across Canada, or at least in Ontario, did not have a business case to serve, you know, so we moved ahead and worked to develop broadband in those areas.
791 COMMISSIONER MENZIES: I think you’ve illustrated there’s not a business case to serve about 80 percent of Canada’s landmass when you get right down to it.
792 DR. HUDSON: I think K-Net has been very creative in how they’ve managed to provide this service. But they’ve also had the experience of addressing a question previously raised that if you keep the prices down for the users -- they’ve tried very hard to follow that model -- but then that means that it’s very difficult to have enough revenue to provide or expand the service.
793 COMMISSIONER MENZIES: Okay, can you just clarify for us, please, your position on who should contribute to the national contribution fund? You indicated that all TSPs with revenues above 10 million. Would or would that not include ISPs?
794 DR. HUDSON: That’s an interesting question for debate. But I think we share a general view with some of the other participants that there should be broad contribution to the fund and that should include retail internet. So I guess that’s a way of responding to your answer.
795 COMMISSIONER MENZIES: So that’s ISPs?
796 DR. HUDSON: M’hm.
797 COMMISSIONER MENZIES: Yes?
798 DR. HUDSON: Yes, I think so.
799 COMMISSIONER MENZIES: Okay, thank you.
800 So what do you estimate the cost would be of including everything you suggest, training digital literacy, capital required to get 25 and 3 to all of the regions, and the size of an annual subsidy to maintain it?
801 MR. WHITEDUCK: Maybe I could just start by what exists a little bit in Quebec.
802 Our organization supports schools with software licensing and et cetera. We do training for technicians. We’ve offered accredited training in the past.
803 Our experience is that you’re looking for a certain criteria for students who would succeed in technical training and you need people with high school diploma. And this is another bar to set or to work towards for us because we need to build that capacity up to that level before we get to the next level of training. So we’re working towards that.
804 However, financing for training is piecemeal when we do this type of training. Educational funding don’t offer that. We’re looking at post-secondary. Post=secondary funding is limited. The First Nations have asked the government for new investment in that area.
805 So that said, the fund would support these type of activities where we could offer this accredited training for technicians who can manage the infrastructure in the communities.
806 COMMISSIONER MENZIES: Okay. I understand your point there. But what I’m trying to get to is, assume that I accept your argument that all of those things are good things. Tell me how much it costs.
807 DR. HUDSON: I think it’s a good question for which we do not at this point have a definitive answer.
808 But we did review the Affordable Access Coalition’s proposal for a broadband deployment mechanism, which is slightly different but somewhat comparable. And they came up with 315 million using somewhat different criteria and kind of a way of, I think, looking at what’s a reasonable pod. And we think bottom-up might be a better way to approach it, but 315 is probably a low-end estimate.
809 We’d really need to look harder to give you a definitive number, but we are happy to try to do that and to work with -- I think you’ll hear from several other groups that have variations on a similar approach and perhaps we can come up with something more concrete for you.
810 COMMISSIONER MENZIES: Yeah, that would be useful. It’s kind of one thing if you can try to empathize with our position for a moment; it’s one thing to look at each presentation on its own and when you go through a whole week and you start trying to figure out how much it all costs it can be a little intimidating, especially when the answer is, “We don’t know.”
811 So anything you can come up with in terms of what would be infrastructure and what would be operational in your view, would be useful because it goes to the affordability of the whole system.
812 So just moving on. You reference how the FCC has designated funds for tribal lands. And I need to understand how you would suggest those be defined. They are defined in treaty areas, but in non-treaty areas they are less well-defined and where you’ve got ongoing land claims. I mean, most of the north I think fits the definition of that, if you wish. But I need to know what sort of definition we’d be working with in terms of where there are treaties and where there aren’t treaties, where there are land claims resolved, where there are unresolved land claims.
813 MR. WHITEDUCK: Maybe we could come back with a clear definition just for the sake of being accurate on that one. But like, Kitigan Zibi is a non-treaty community. So anything to the east of Ontario is non-treaty if my memory serves me correctly. But we would have to come back with a more precise answer on the territorial ---
814 COMMISSIONER MENZIES: I will defer to your expertise in that area over mine, thanks. May 5th, I believe is the date.
816 DR. HUDSON: And I would point out, in the U.S. too this is not an easy question because there are tribal regions and then regions that are Indigenous but not tribal. And so we want to try to be inclusive and we realize that one definition doesn’t fit all across the northern regions and across the provinces as well as in the territories.
817 So it’s addressable, I think, but in both countries it hasn’t been so easy just to say, “Okay, here’s exactly the geographic criteria that makes sense because of the history of how Indigenous populations have evolved and the legal obligations.
818 COMMISSIONER MENZIES: Thank you for empathizing.
819 DR. McMAHON: Oh, excuse me. Could I just add one more point to that?
820 COMMISSIONER MENZIES: Quickly.
821 DR. McMAHON: In some of our later interventions as well we had broadened the definition to include both Indigenous and non-Indigenous providers. But we set out some criteria around a community-based provider, which would include things that -- you know, for example the recipient would be able to demonstrate that ---
822 COMMISSIONER MENZIES: I understood that one.
823 MR. MCMAHON: Okay.
824 COMMISSIONER MENZIES: It was just that specific reference and those two paragraphs to the FCC and tribal lands that I was trying to get a handle on.
825 DR. HUDSON: Yeah. Just to point out that yes, the FCC has learned that, for example, they’ve had to consider all of Alaska as tribal, although there are really no treaties in Alaska. So it’s somewhat analogous to the variations you find here.
826 COMMISSIONER MENZIES: Right.
827 In your answer to question 13, I think, G, you’re talking about retail rate regulation. Do you have any estimate or aspiration for what you think those retail rates would be for a basic service?
828 DR. HUDSON: I don’t think we’ve come up with a specific number unless our colleagues have. But they can probably tell you what a ceiling -- I think there’s two issues or perhaps three. What should a ceiling be that people are expected to pay? How is that influenced by caps, which people tend to know about and ---
829 COMMISSIONER MENZIES: That’s the question I’m asking.
830 DR. HUDSON: Okay. And then third point, which we’re trying to address, is, you know, should there be some kind of subsidy which could be administered in a variety of ways through providers or end-users to reduce what people pay who have trouble meeting it.
831 COMMISSIONER MENZIES: Right, so what’s the answer?
832 DR. HUDSON: So do we have any comments from our ---
833 MS. CARPENTER: So I can just share what’s happened in some communities today. So we don’t set rates for, like, the First Nation communities.
834 COMMISSIONER MENZIES: How much would – what is the rate that you charge? There’s a minimum ---
835 MS. CARPENTER: So we charge -- we -- well we bill the connection to the communities based on getting our costs back, so some of their circuits -- so for -- I can just use an example.
836 So in our community, such as Big Trout Lake, they ordered a 1 gig circuit, so it might cost them $4,500 to buy a 1 gig circuit with 500 meg of internet on it, but that same circuit in a more rural area south of Sioux Lookout might be half the cost.
837 So the -- but the communities --
838 COMMISSIONER MENZIES: What I’m looking for is ---
839 MS. CARPENTER: -- when they set ---
840 COMMISSIONER MENZIES: What I’m looking for is --
841 MS. CARPENTER: When they’re setting up ---
842 COMMISSIONER MENZIES: -- an answer that --
843 MS. CARPENTER: So when they’re setting their basic --
844 COMMISSIONER MENZIES: -- sort of mentions -- that sort of like a household --
845 MS. CARPENTER: Yeah, so they’re -- they’re charging between $35 to $50 a month.
846 COMMISSIONER MENZIES: -- basic internet connection and I’m looking for something that says dollar in it.
847 MS. CARPENTER: Yeah, yeah.
848 DR. HUDSON: She just said that.
849 COMMISSIONER MENZIES: Sorry? I missed it.
850 MS. CARPENTER: Yeah, $35 to $50.
851 COMMISSIONER MENZIES: Thirty-five (35) to $50 range?
852 MS. CARPENTER: Yeah, that’s right.
853 COMMISSIONER MENZIES: Great, that’s what I was looking for. Thank you. Sure.
854 M. AWASHISH: Peut-être continuer un peu dans la discussion, je vais peut-être parler pour mon -- ma communauté.
855 Nous on donne le service quand même internet dans le village, puis on charge en moyenne $50 par mois.
856 C’est un -- c’est un tarif qu’on a décidé de choisir parce que c’est un service qu’on voulait donner à la communauté. C’est un tarif qu’on a des visiteurs(Ph) pareil, mais c’était quelque chose qu’on a -- qu’on on s’est -- qu’on a dit dans la communauté.
857 On dit regarde on veut te donner un service puis c’est 50$, mais ce n’est -- ce n’est pas rentable pour nous là.
858 Et en même temps on sait que certaines familles à faible revenus c’est quand même assez juste, mais souvent -- je remarque souvent qu’il y a des -- surtout ceux qui sont sur l’assistance sociale il privilégie souvent ce -- payer ce service-là que de payer autre chose-là.
859 C’est quand même un grand besoin, tu sais, pour vous informer là.
860 COMMISSAIRE MENZIES: Merci.
861 What impact do you think -- there’s been a few developments, public policy developments, going on that I wanted to ask you about and how you think those might impact the availability of internet services to the communities you’re speaking of?
862 The -- recent federal budget had $8.4 billion including 255 million for community infrastructure in accelerating broadband availability in northern and indigenous communities.
863 Northwestel’s modernisation plan is pushing forward, there’s the Mackenzie Valley Fibre, Dempster Highway plans.
864 How do you see those -- those are just some that come to mind. How do you see those impacting ---
865 DR. McMAHON: Sure. So in terms of our members’ experience, it’s been the majority of the federal funding programs such as those you mentioned, is typically a one-time allocation for capital infrastructure, so there’s also a need for ongoing funding for sustainability to maintain and upgrade these networks; okay?
866 In the past there’s also been little continuity to this type of government funding, so providers don’t know when the next funding will be available and over what time period and also what criteria will apply.
867 Funding is also spread across a range of federal departments and programs, which make it very difficult for our members to track the different deadlines, application requirements and funding opportunities.
868 We wanted to mention we’ve recently completed a comprehensive review of existing federal funding programs.
869 Not necessarily new ones that were recently announced, but other ones across different federal departments from Health Canada, you know to INAC, et cetera, for Aboriginal broadband and I’d invite the Commission to read it when it’s available quite soon at firstmile.ca.
870 We wanted to mention that these federal programs did not need to be consolidated or reduced. This is the last thing the communities and regional organisations require.
871 But we do suggest they may be reformed in order to accommodate the need to combine and coordinate these different program dollars to support ongoing sustainability and management of operations.
872 So the Northern infrastructure and services fund approach that we’re recommending the commission adopt, would play a complimentary role to these other existing funding initiatives and could set a positive example for how and where future government programs could be allocated or designed.
873 We feel that the CRTC is an administrative tribunal with technical expertise and insight into the Canadian communications environment, unavailable elsewhere in government, could view this as an opportunity to play a leadership role in this area.
874 COMMISSIONER MENZIES: Okay, thank you. Those are my questions. My colleagues may have some more.
875 THE CHAIRPERSON: Commissioner Molnar?
876 COMMISSIONER MOLNAR: Thank you. Excuse-me.
877 I wanted to provide you folks an opportunity to comment on the positions put forward by those parties who say no funding is required.
878 And I want to -- just because I think it’s quite relevant to your community, speak particularly about Xplornet, who have said the basic service today is met, 25-1 is coming soon, there is no need for government intervention.
879 So tell me the difference between these two positions if you don’t mind.
880 MR. WHITEDUCK: Well I’m just going to translate for Mark so he could respond.
881 COMMISSIONER MOLNAR: Please feel free to speak in your language of choice.
882 M. AWASHISH: C’est sûr que dans notre communauté on a quand même quelques clients Xplornet. C’est sûr que c’est un besoin de base.
883 Je comprends que c’est comme le dernière nécessité, mais ce n’est pas -- ce n’est pas rapide ça l’internet.
884 Faut l’avoir vécue, puis je ne sais pas si vous l’avez déjà utilisé aussi-là, mais au début c’est rapide puis à la longue ça devient de plus en plus lent, puis c’est toujours la -- un peu comme ce qu’expliquait le groupe avant-là à chaque fois il faut qu’il renouvelle leur pack(Ph), donc c’est un service qui est je dirais de base, mais qui répond pas à nos besoins vraiment à long terme.
885 Je ne sais pas si c’était le sens de la question. Je n’ai pas compris la question au début. La traduction des fois n’est pas évident-là.
886 COMMISSIONER MOLNAR: So you didn’t understand my question?
887 --- (NO ANSWER)
888 COMMISSIONER MOLNAR: Okay I’ll repeat my question.
889 M. AWASHISH: O.k.
890 COMMISSIONER MOLNAR: You folks -- and you’re not alone in coming forward and saying that there needs to be additional subsidies in the system, whether it’s government -- you know additional government funding or CRTC involvement in creating new funds and you’ve asked for one here yourself.
891 There is other parties in this proceeding who have stated market forces can do this, there is no additional government intervention required.
892 One of those parties who states that and I thought might be particularly relevant to the areas where you serve is Xplornet who say they can today deliver 5-1 to all communities, to all residents, not even communities, to residents.
893 Because of course there’s many Canadians who live outside of a formal community, but they can deliver it today and in a couple of years they’re going to be at 25-1 and so there is no need for additional funding.
894 So tell me why they are wrong and there is a need for funding? From your experience in serving your community.
895 M. AWASHISH: Moi ce que je peux -- ce que je peux dire pour le satellite, le 5-1 ce n’est pas -- aujourd’hui on ne peut plus parler de 5-1. Ce n’est pas assez rapide.
896 Je comprends que vous dites que le satellite on peut l’offrir avec la base que vous parlez, mais moi je dis que ce qu’on demande, pour ma communauté je parle, c’est que on veut avoir les mêmes services qu’à l’extérieur.
897 On est à 300 kilomètres de Roberval, eux ils ont tous les services, fibre optique puis toute la patente. Nous on -- le 5-1 c’est une demande -- c’est un besoin qu’on peut parler il y a 10 ans, mais pas aujourd’hui.
898 Puis j’entends souvent les gens dire que c’est le minimum de base que ça devrait être le 5-1, mais il ne faut pas que ça devienne le maximum pour nous. C’est pas un -- ça ne devrait pas être un plafond. Ça devrait être un minimum.
899 Puis soit dit en passant, le satellite, le Xplornet que vous parlez-là, le secteur où est-ce qu’on habite on a fait des demandes l’année dernière, puis on n’avait pas accès au dernier -- la quatrième génération du service, parce que l’emprunte elle ne touchait pas notre communauté.
900 Elle touchait à quelques -- cinquante kilomètres à l’Ouest d’Obedjiwan mais pas -- là aujourd’hui je ne peux pas répondre si ils l’ont réglé, mais souvent c’est des -- il y a ça.
901 Puis il y a aussi le tarif. L’Xplornet c’est quand même plus cher. On parle de 80$-90$ par mois.
902 Ce que j’en comprends c’est des contrats de trois ans puis si -- il y a des familles qui ne sont quand même pas capable de le payer.
903 J’ai bien répondu à votre question, si j’ai bien compris?
904 COMMISSIONER MOLNAR: Would you like to add a little more?
905 DR. McMAHON: I was just going to say I’m not -- in terms of the type of local distribution model deployed by a lot of the First Mile members, including K-Net and KRG, is very different from that kind of, what we call a decentralized household model where you would install an individual satellite dish on each person’s home.
906 So this model that K-Net’s employed, and FNEC and others -- and I think KRG also mentioned it -- this idea of building up that last mile infrastructure so that you would have local distribution through fibre helps future-proof it so that -- you know, in the event that more robust and faster transport would become available than -- you know, that initial infrastructure is in place ideally with, as well, the local capacity and, you know, the various applications, data centres, local ISPs, et cetera, that could be developed on the human resources or economic development so that when that transport piece is put in place you already have that type of, you know, organizational infrastructure and human resources in place.
907 So it’s kind of an economic development argument, I suppose, as a different type of approach.
908 DR. HUDSON: I think also that the high-throughput satellite approach -- I mean we’ll see; it’s just coming so we’ll see how well it works but in many ways it’s a supplement not the basic solution. There are certainly regions where it’s very -- it should be very useful to use that approach because anything terrestrial with enough bandwidth just isn’t either technically possible or feasible.
909 But you still have the latency problem and you don’t have any connectivity within the community or within the region, which seems like a better model and a less expensive model, although we were not able to get some figures from Xplornet about the comparative costs of their model.
910 But I think Mark’s point about the monthly pricing and I would say experience to date with Xplornet and reliability, which could change, would mean that one shouldn’t rely only that solution as both the only technology and only business model to serve the North.
911 MS. CARPENTER: So I’ll just speak to the local community ISPs. So it’s been about since 2000, so 20 years, of local communities developing their own ISP and building their local capacity. So there’s been a lot of different investment, different government investments and developing those connections, training locally.
912 For us to have maybe Xplornet serve different locations, you know, that means flying in a technician from an urban centre and I know right now in Sioux Lookout and Red Lake, which are sort of the pocket areas where there’s providers, they don’t really have a trained technician in the area so, you know, you might be waiting days or weeks, where if it’s through the local ISP connected through K-Net there’s people on the ground that can service an area that goes down a home or government office.
913 I do have some larger businesses like the Northern Store or the MTL Buildings who have had experience with Xplornet dishes who have approached the local ISP and K-Net to provide our service to their buildings just because they need the reliability in the service. Thank you.
914 COMMISSIONER MOLNAR: Thank you. Just a comment and no question but I’m very impressed with the way that the communities have come together to become, you know, the technical -- have provided the ISP service within their communities when the established businesses did not move in.
915 Separate and apart from what’s going on here and whether now new technologies and business models might occur as well, I mean the fact that you folks moved in to deliver that to your residents is really impressive.
916 THE CHAIRPERSON: Commissioner Vennard?
917 COMMISSIONER VENNARD: I have a couple of questions, and it’s more a request for clarification and some clarity on -- you reference the community intermediary organizations. This is on point number 15 of your February 1st submission. And I’m wondering, is this community broadband -- is this some sort of an organization that’s in the middle, some sort of entity that’s in the middle? What sort of role do you see that as having?
918 I notice that you refer to it as a concept at this time. Does it have a role of advocacy or -- can you just expand on that because you sort of -- you referred to it throughout your submission without really -- without it being really clear. Again at page 168 you talk about -- or paragraph 168 you refer to it not having to serve the needs of for-profit organizations and how it could put money back in. Can you just explain what that is?
919 DR. McMAHON: Sure, yeah. Sorry, it’s a bit of a jargony term.
920 COMMISSIONER VENNARD: Yeah.
921 DR. McMAHON: The reason why we came up with this and used this term of community intermediary organization is that we wanted to stress, first off, that we’re talking not just about autonomous local organizations but, as well, regional organizations, okay?
922 The reason why we call it a community intermediary organization is because typically these organizations would be non-profits established by these local communities in order to represent them in various ways or provide support for them in various ways, right? So we have ---
923 COMMISSIONER VENNARD: How is that different from, say, a town council department or something of that nature?
924 DR. McMAHON: Well ---
925 COMMISSIONER VENNARD: Like, what’s the difference between -- what does that bring to the situation compared to what might be there in another form and why wouldn’t that be working in, say, a town council?
926 DR. McMAHON: So not so much -- I would say, like, more of a -- so in Alberta, for example, there’s the REDAs, the Regional Economic Development Agencies.
927 COMMISSIONER VENNARD: Yeah.
928 DR. McMAHON: I think I’m getting that acronym right.
929 COMMISSIONER VENNARD: M’hm.
930 DR. McMAHON: So it’s similar to that, right? So you would have a regional group that is composed of a membership of these various communities inside of it. So we have two examples here of First Nations sort of regional groups like this. So K-Net is actually established by a council of First Nations and then -- I believe there’s six First Nations members there?
931 MS. CARPENTER: Yes.
932 DR. McMAHON: So Penny can speak more about the specifics in a moment but, as well, the First Nations Education Council. So this would be individual First Nations have actually come together in order to aggregate, you know, various sort of economies of scale around purchasing things like bandwidth for redistribution, technical support.
933 They operate things like a helpdesk for schools. They would do things like support local communities such as Obedjiwan that want to set up their own local infrastructure. They might support it with something like an application to ISED or other government agencies.
934 COMMISSIONER VENNARD: So this would be just -- essentially, would it be more accurate to describe it as a regional intermediary organization?
935 DR. McMAHON: Well, the reason why ---
936 COMMISSIONER VENNARD: But then a community -- I guess maybe the word community ---
937 DR. McMAHON: Yeah.
938 COMMISSIONER VENNARD: --- implies that it would be -- it would have a local function of some kind.
939 DR. McMAHON: Yeah, I think so but we really wanted to highlight that they are the intermediary groups between the communities and, you know, other external entities to the region such as governments or other industry that they may be purchasing services from. So the reason why we foreground community there is because these groups are sort of -- like, we recognize, like, individual communities, local communities, wouldn’t have the capacity to do a lot of this work without this type of support so therefore ---
940 COMMISSIONER VENNARD: So would that -- would this organization -- would these organizations also perform almost like a consultancy type of role as well, as an advocacy role? Would they do funding applications for the community or the region or whatever? Is that the concept?
941 MR. WHITEDUCK: Yeah, in our case at the FNEC, we do get -- we do have the mandate from the chiefs of the communities to advance education objectives for the communities by representing them, advocating for them, applying for program support, and all these things. So the range is wide.
942 And for the service we offer, it all depends on the level of funding the we get currently so ---
943 COMMISSIONER VENNARD: M’hm.
944 MR. WHITEDUCK: For example, we do offer special education support services, technologies, in-school supports. So it all depends on the level of funding. That’s it.
945 DR. HUDSON: Just to clarify, I think your point -- we realized it did sound a bit confusing that, yes, local and regional organizations could be implied under that term, that community is not necessarily one individual site. So that is a confusing way of perhaps using that term.
946 COMMISSIONER VENNARD: So the function of this type of this organization would be to do the things that seem to maybe fall through the cracks or to help things move along more quickly, more efficiently; is that ---
947 MR. WHITEDUCK: Or provide equitable service to everybody.
948 COMMISSIONER VENNARD: Okay.
949 MR. WHITEDUCK: Yeah.
950 COMMISSIONER VENNARD: Where would these -- because as I understand your submission, it’s at the level of concept at this point. Where would these people -- oh, because you talked here about the concept of this.
951 DR. McMAHON: Sorry, that’s just the terminology we use. I think we mean the definition, I suppose, or the term community and community organization. These absolutely exist and have existed for many years. I think that Penny at K-Net is a really strong example of one such organization that has been around since the earlier nineties, I guess?
952 MS. CARPENTER: Yeah, we started in about 1995 when there was no broadband in the north. And it was under a school program that we had to provide teachers with information. So we would send floppy disks up to the north. So that’s the start of K-Net.
953 But quickly we knew broadband was needed in our communities. So it was really banding, starting with the tribal council of First Nation Communities. We worked with five of the six to develop broadband. And it quickly expanded to the rest of the remote communities, the 26 communities.
954 COMMISSIONER VENNARD: So is there like an organization in each of the 26 communities or is there -- I’m trying to understand what the structure of this is.
955 MS. CARPENTER: No. It’s usually working with a First Nation band. Yeah, so it’s usually the local ISP is usually run by the First Nation band office or maybe their active arm at the local level.
956 But K-Net, so as (inaudible) at the regional network delivering broadband to the communities, they take that broadband and develop their ISP.
957 But over the years we also developed different needed programs such as video conferencing so that communities could use video conferencing in the schools, the band office, health centres.
958 And then we got involved in SchoolNet. We delivered connectivity to First Nation schools in Ontario. So we as a regional group deliver broadband to the schools.
959 And then we also developed Telemedicine as a program under the tribal council so it connected the health centres, 26 health centres, to deliver Telemedicine.
960 COMMISSIONER VENNARD: Okay.
961 MS. CARPENTER: So that’s kind of how, like, the economy (inaudible). Sometimes funding-wise it’s easier for a group to apply for funding to start a program or to get capital dollars.
962 MR. WHITEDUCK: I think since we’re giving information back to the Commission about territorial information, we could add the regional entities that exist in Canada for First Nations. That would clear it up.
963 COMMISSIONER VENNARD: Thank you. I think that would be helpful.
964 DR. McMAHON: And I just wanted to say that a lot of these organizations were establish back in, I believe, you know, the earlier 2000s, maybe even the late nineties associated with Industry Canada had that time had the First Nations SchoolNet program. So at that time they were called regional management organizations. That was a national network across Canada of these groups. So almost all provinces have one of these. You have Atlantic Canada’s First Nations Help Desk; you have K-Net in Ontario, FNEC in Alberta, various others, the Technical Services Advisory Group in Alberta.
965 And so these organizations were initially -- I mean, they were already doing connectivity work but then they were mandated to connect schools, very much an education focus.
966 COMMISSIONER VENNARD: How does that fit into your scheme for the mechanism for subsidy and funding and so on? How does that fit in? Because clearly if they’ve been around for a while, they are being funded and paid for by someone and that has probably changed over time. And as we’re looking forward into these, you know, potentially new funding mechanisms, there’s new funding programs and so on going up, do you see them maintaining pretty much the same role that they always have or role expanding?
967 DR. MCMAHON: Absolutely their role has very much expanded. They began with education. Now, as Penny and Tim have mentioned, they’ve expanded into health; they’ve expanded into different public service provision, human resources et cetera in First Nations communities. They’ve also expanded the range of services to video-conferencing networks, you know, data centres, these type of things. So their applications and services have expanded.
968 But at the same time, on an annual basis there’s very much uncertainty over the availability of continuing funds. So oftentimes we keep hearing that, you know, it’s very hard for strategic planning for the continuing development of these various services. Like, as I mentioned, they’re increasing all the time.
969 And so having something like a coordinated approach like the NISF that would work with the various other sources of federal funding, could help in terms of coordination that and then also address some of the gaps, as you mentioned.
970 COMMISSIONER VENNARD: It sounds like these organizations might be very useful in terms of giving us some information on the sorts of applications and uses, which is one of the things that we’re after here, is what are the applications and uses that might require certain capacities, speeds and so on.
971 DR. HUDSON: I think our approach is to sort of build on existing institutions where they exist and allow them or facilitate them to compete for some sources of funding that previously would have been limited only to incumbents, and that if there are any additional requirements, and we’ve outlined some, that they would be the type of group that we think could apply and could participate in providing those services among others. So that’s the model rather than starting from scratch.
972 COMMISSIONER VENNARD: Yeah. It sounds like maybe some of those groups should have done submissions as well.
973 DR. HUDSON: Well, we’re trying to represent them.
974 COMMISSIONER VENNARD: Yeah, okay.
975 DR. HUDSON: We are representing them.
976 DR. MCMAHON: Oh, I should say, yeah, the FMCC membership includes these organizations. We have, you know, Time and Penny here from Ontario and Quebec, but also among our membership are TSAG from Alberta, First Nations Help Desk from Atlantic Canada, First Nations Technology Council in B.C. -- did I miss anybody? Oh yeah, the Assembly of Manitoba Chiefs in Manitoba.
977 So I just wanted to say that, you know, we’re appearing here today but we’re also appearing on behalf of several of these other organizations who couldn’t make it today.
978 COMMISSIONER VENNARD: Okay, thank you very much.
979 THE CHAIRPERSON: All right, just a few final questions before we take our lunch break, which I’m sure everybody is anticipating.
980 So your proposal for a transport funding mechanism, just to make clear, would it include satellite transport, in your view? Could it? Should it?
981 DR. HUDSON: I think our approach was to be technology-neutral so that if satellite is the best or only solution, that wouldn’t be excluded. As you’ve heard, many of our members are moving to terrestrial-based local networks and backhaul networks as they are able to do that.
982 THE CHAIRPERSON: Okay. If it were satellite would it include capital expenditures and operation expenditures?
983 DR. MCMAHON: Yeah. I did want to speak to one thing that I think K-Net and as well KRG, Tamaani Internet, they established satellite transport as infrastructure over a long period of time, right? It’s set over that in order to support strategic planning over a long period of time. I think it’s very challenging for these groups if, you know, satellite is a year over year. So I think that idea of satellite is opex versus capex. I just wanted to make that point about it was very successful in terms of ---
984 THE CHAIRPERSON: Right. But in your view it could cover both. And I took your point earlier with respect to ongoing maintenance as well and let the accountants figure out if that’s a capital expenditure or an operating expenditure. But that would cover both?
985 DR. HUDSON: I think our main point was yes, that many of these other government programs which we’re very glad exist and some new ones, but they are typically one-shot capex infrastructure programs. And that’s certainly better than not having capex programs, but it doesn’t really address the ongoing issues of operation and maintenance and then designing, you know --whether you call them a business model, at least a break-even model, as you’ve heard here.
986 Some of these organizations are eating the cost to keep the prices low. Others are saying, “Well, you know --” but that’s not really very sustainable so that we realize that the capex isn’t the only thing that’s needed for the future.
987 THE CHAIRPERSON: Right.
988 So my next question you’ll probably want to answer by an undertaking because you’ll see I’m looking for detailed numbers. And it was very useful for you to identify which of the First Nation community intermediary you’re representing. So that will be helpful.
989 But for those that you do represent, would it be possible for you to provide us the amount of contribution or funding that each one of them have received from the federal, provincial, or territorial governments for offsetting satellite transport costs, okay?
990 And if you could break it down by program, by the ISPs benefitting from the program, and by year, that would be useful.
991 And by the same token, so that’s the supply side -- as to what you actually have spent in those various organizations, what were the annual costs and what satellite capacity was obtained?
992 And then if you could do the same thing now this time with respect to broadband internet infrastructure. The first question was satellite relating to capital costs this time, and breaking it down in a similar way. Could you do that?
993 DR. HUDSON: We could try. I think there's certainly some of our organizations, such as the one sitting in front of you, who have -- who could break out that information. Not all of them use satellites, but they should -- we can try and get you as much as we can.
994 THE CHAIRPERSON: Sure. So for the 5th of May, and whatever caveats you need to add you can add to your -- the response to that undertaking, if that's okay, all right? Okay, thank you very much.
996 I think legal has one more question for you.
997 MS. HANLEY: Professor Hudson, you referred in your opening remarks to a study that looks at these as a small -- by small businesses and government of Internet services. Is that something you can file on the record of (inaudible)?
998 DR. HUDSON: We believe so. We had some funding from what was Industry Canada, now ISED, and to do a pilot study on methodology for trying to understand adoption in the north and as soon as we've submitted the draft final report and as soon as they give us the clearance, we would be happy to file that.
999 I can also give you some additional research that I've done that addresses some similar issues, if that's helpful.
1000 But in terms of that particular study, as soon as they tell us it's okay, we're happy to share it with you.
1001 MS. HANLEY: Do you think you could just update us by May 5th as to the status of that?
1002 DR. HUDSON: Sure, we'll go back and ask them and I would think it will -- they'll clear it. They wanted it done by the end of the fiscal year, which was a couple of weeks ago, so they just have to look it over.
1003 THE CHAIRPERSON: My knowledge of the rules, when I was at Treasury Board, if you've been paid for it, it should be public. It was paid by public taxpayers, so ---
1004 DR. HUDSON: Oh, yes.
1005 THE CHAIRPERSON: And I'm sure the people are ---
1006 DR. HUDSON: We haven't got the final payment yet, but yes, of course.
1007 THE CHAIRPERSON: Well, there you go.
1008 DR. HUDSON: We believe it's public, but they wanted to just have a couple of weeks to review it. That's the point.
1009 THE CHAIRPERSON: Yeah. Well, they better be careful which financial year they're applying that expense against.
1010 All right ---
1011 DR. HUDSON: Could I ask you a question of clarification?
1012 THE CHAIRPERSON: Certainly, about -- yes?
1013 DR. HUDSON: All right. So the points that you just asked for, I understood those were separate undertakings. The questions that Mr. Menzies asked about Indigenous regions and pricing, does that go in our final submission or is that also an undertaking?
1014 THE CHAIRPERSON: No, the rule is for undertakings, so that other people can -- taking those into consideration when making their final comments, have to be filed by May 5th.
1015 DR. HUDSON: Okay, and one other question.
1016 Mr. Chairman, you raised a lot of questions with the Yukon initially and said those were questions that interested you. If we have any additional thoughts on those, do we put those in our final submission, or what?
1017 THE CHAIRPERSON: Yes, well, as long as it's not new evidence, because we're beyond that.
1018 DR. HUDSON: No, no, but ---
1019 THE CHAIRPERSON: But yeah, that would be in your final comments.
1020 DR. HUDSON: Thank you.
1021 THE CHAIRPERSON: Okay? Is that clear? Appreciate it.
1022 Okay, so I believe that has been long morning, but it's 1:15. Why don’t we take a break until 2:15, donc en pause jusqu’à 14h15. Merci.
--- Upon recessing at 1:15 p.m.
*--- Upon resuming at 2:16 p.m.
1023 LE PRÉSIDENT: À l’ordre, s’il vous plait. Madame la secrétaire?
1024 MS. ROY: Thank you. We'll now hear the presentation of TCPub Media Inc. Please introduce yourself, and you have 10 minutes.
1025 LE PRÉSIDENT: Ça doit être TCPub, n’est-ce pas?
1026 M. CARON: Les deux sont (inaudible).
1027 LE PRÉSIDENT: Ah, o.k. bon voilà. Merci bien. Allez-y. On vous écoutes.
1028 MR. CARON: Hello, I'm François Caron, president of TCPub Media Incorporated, and I would like to begin by thanking the Commission for allowing me to present my intervention in the form of a video.
1029 During the "Let's Talk TV" hearing, I presented to the Commission my first video intervention titled, "The Canadian Content", a video about the problems with Canadian television and how we can make it better.
1030 The Commission's response to my video was overwhelmingly positive, to say the least, so when the subject of B.C. Telecom Services came up, I decided once again to present my intervention in the form of a video.
1031 Here's my plan on how to fix Canada's Internet, which has now become an urgent matter because today, "Everything is Data." Roll it.
1032 ---VIDEO PRESENTATION: "Everything is Data" by François Caron.
1033 MR. CARON: And that’s it.
1034 THE CHAIRPERSON: There’s a group of students from the Department of Communication Studies at Concordia University who will now have a completely unique perspective on CRTC hearings, assuming that we do this all the time which, of course, we don’t. It’s out of the normal scope.
1035 So thank you for that and Commissioner MacDonald will start us off.
1036 COMMISSIONER MacDONALD: Good afternoon and thank you for that video. I had a chance before the hearing to view some of the other videos that you’ve done online.
1037 MR. CARON: Oh, good.
1038 COMMISSIONER MacDONALD: So very interesting, indeed.
1039 In your video, you’re mentioning the need to invest in fibre optic infrastructure across the country.
1040 MR. CARON: Yes.
1041 COMMISSIONER MacDONALD: And that older delivery platforms are not suited for the task of the current situation or moving forward.
1042 Some may take some exception with the idea that some technologies such as cable and Coax services can’t keep pace or aren’t viable, at least in this day and age.
1043 Can you maybe comment on your belief that everything should be fibre wherever possible?
1044 MR. CARON: For one thing, for fibre, it really hasn’t reached its technological limitation. While the problems with cable, satellite and also DSL is that we’ve already arrived -- we’re already arriving at the limits of what we can do with it technologically. It’s already showing some strain. And even when somebody is offered faster speed Internet, there seems to be a lot of problems with maintaining the stability of the connexion.
1045 So I’ve been -- we’re seeing that in this case -- it didn’t seem very practical to keep using old technology that’s actually falling behind on our needs for data.
1046 Even the Chair mentioned earlier in the day about the ring road around London that it was built to last a few decades but suddenly everybody wanted to buy cars and the next thing you know, it’s full of traffic jams.
1047 We’re coming up to the same situation right now where the Internet is requiring a lot more speed because more people are getting onto it and more people have a need for it, as I’ve explained in the beginning. To the point where we need to overbuild the network at this stage. We cannot just -- we can no longer just catch up to what we need -- a level that we need and then just hope that it’s enough for what we need.
1048 Right now, we’re in the situation where gigabit Ethernet will become a necessity. Just a 4K video, for example; that takes 25 megabits per second by itself, and that’s just now. We could actually go higher later on, depending on if we evolve to a 8K video, which is even more demanding.
1049 And we are at the stage where we really need to overbuild the network instead of just trying to do -- deal with the status quo. Push for limits in which we won’t have to worry about if we have enough bandwidth to deal with -- to do the things we need to do and not have to come back here every five or six years to review the limits.
1050 COMMISSIONER MacDONALD: I’m on the Website right now for a large service provider in the country who will remain nameless but they’re offering, over their traditional technologies, 250 Megs down and 20 Megs up.
1051 And this is a basic service here and we’re trying to determine what the ---
1052 MR. CARON: Is this fibre-based?
1053 COMMISSIONER MacDONALD: No, it’s not fibre-based.
1054 MR. CARON: We have to be careful with that because I’ve seen some of the sites using the word, “hybrid fibre”. I know one, I think it’s Vidéotron that uses hybrid fibre but what it means is essentially -- they do have fibre going to a node. It’s more like fibre to the node but then it still goes from copper up to people’s lodgings.
1055 And it is the same case with Bell with their Fibe system. They make it sound like it’s fibre but it’s actually copper. It’s just that they brought the plant or a subsidy of the plant closer to the lodgings.
1056 COMMISSIONER MacDONALD: And in this particular case, it wouldn’t be copper-based, but their advertised speeds are 250 Megs down and 20 Megs up. And given that this is a basic hearing and we’re trying to determine what the basic needs are ---
1057 MR. CARON: Right.
1058 COMMISSIONER MacDONALD: --- of Canadians, they may take exception to the fact that you’re implying that their current networks are not capable of, at least at the basic level, meeting the needs of Canadians.
1059 MR. CARON: Well, if they were really concerned about that, I mean they would have already met the needs of Canadians by now.
1060 But what I’m hearing more than anything else is that a lot of Canadians are really getting fed up of having inadequate speeds and also high prices along with the usage-based billing, which to me is questionable on the legal sense of the word to the point where they really would like to see better services or at least something a little bit more consistent than what they’re getting right now.
1061 COMMISSIONER MacDONALD: In your video, you talked a lot about the last mile access into the home ---
1062 MR. CARON: Yes.
1063 COMMISSIONER MacDONALD: --- or into the premises.
1064 Are you of the view that the current backbone infrastructure that’s in place is adequate on the go forward and any funding should be targeting the last mile, as opposed to ---
1065 MR. CARON: I would prefer targeting the last mile because I’ve already had a -- some servers in the data centre, and this was with Cogent, Cogent Communications. And their policy was to give me the speed that I needed without any usage caps, and I could even go over my speed from time to time if I wanted to, without any worries about extra billing as long as it wasn’t more than 10 percent of my monthly usage.
1066 They seemed to have absolutely -- I even spoke to them and they had absolutely no problems giving me what I needed, even going full-throttle if I needed to, which left me with the impression, along with the information I studied, that the backbone is actually in pretty good shape. In the backbone side there’s already many transports available. The ones I listed was mainly for public access points because the private access points they won’t reveal any information.
1067 But still, when you add up the potential of what these private access points may have on top of what we already have on the public access points, and at the rate they’re upgrading it -- like I said in the video, within a period of 12 years they had 1 gigabit ports for their clients at the beginning. And then with the 12 years they went to 100 gigabit ports, 100-fold in just 12 years. And they’re handling the loads pretty well. It’s very rare that they ever have any problems with overloads.
1068 So on the case of the backbone, I really have no worries about it. Just like I don’t have any worries about the service providers who take advantage of the backbone. It really comes down only to the last mile, to the old technology that’s really clogging us up.
1069 It’s becoming a serious problem at this stage where these companies really are profit-oriented to the point of excluding all else. I really feel that they’re not doing the job they need to do, especially in remote communities where the information -- even tomorrow you’ll be meeting with Nunavut’s government and I saw their presentation and saw that a satellite link was just 5-1 with a 30-gig cap, $179 a month.
1070 And unfortunately 5-1 service to me is the dial-up of the 21st century. We really need to go much higher than that and much higher than just 25 down. And also especially the uplink is also a problem because I always see that the uplinks are always much slower.
1071 We need to also concentrate on maybe offering as close to symmetrical speeds as possible. Not only the 25 down -- well, not 25, but I would prefer something like 100 down and 100 up as a minimum. This way we would at least have enough bandwidth to deal with families having some heavy applications.
1072 COMMISSIONER MacDONALD: If you’re advocating for 100 meg down or perhaps even symmetrical service, what do you view are the basic needs of a residential or even a small business customer? You know, how much is enough to meet that basic need? Because you mentioned, you know, high-definition videos a second ago.
1073 MR. CARON: Right. But I can tell you also from my experience of automating truck skills, which I do in remote sites all across the country where the internet service is not very good, we have to send them updates. And these can be pretty big files. And unfortunately their service is actually -- they’re below 25-1 in some cases. Or even in one of the offices where I work from they also have very slow service. And it becomes a very long process; it can take over half an hour just to send them an update.
1074 I’ll give you an example. If you had a 100 megabit network in your office, which is actually pretty standard for Ethernet -- I mean, you can go 1 gigabit in an internal office and 100 megabits a second, it’s a legacy speed. And yet, it’s more than enough to do the job we need to do inside an office. We’re coming to the point where we need that kind of speed outside the office between regional office, between homes and offices, between all different kinds of points of access.
1075 COMMISSIONER MacDONALD: Okay, you had suggested that federal government funding should be targeted towards your community.
1076 MR. CARON: Both federal and provincial.
1077 COMMISSIONER MacDONALD: Both federal and provincial?
1078 MR. CARON: Yes.
1079 COMMISSIONER MacDONALD: So you weren’t anticipating any additional fees from service providers being levied on the end-user. You’re thinking that would come from general tax revenue, potentially tax increases to fund all of this, on the part of provincial and federal governments?
1080 MR. CARON: Well, on that I know that for the last budget, the federal budget, that they had allocated a substantial amount of money, although it’s spread in a few years, 6 million in this year, 81 million in the next year. That’s one source of revenue they could use for it.
1081 Another possibility is to use any residuals that are available in infrastructure budgets. Because essentially the internet is becoming an infrastructure element and an essential one just as much as roads have become essential.
1082 And with this method, in fact, it actually mimics a bit what we do with the roads already. The government pays for the roads but it’s private industry that actually sells the cars. And with the internet we could actually do the same principle where we can at least build a network that any service provider could use and bill the customers accordingly.
1083 The other advantage with this is because these communities will be more service-oriented instead of profit-oriented, the fees they would be charging to either independent or already larger service providers, will maybe be much more reasonable than what these service providers can get from the incumbents as it is now. not only on the level of the fees themselves, but also on the support.
1084 I know that TekSavvy is following afterwards. I don’t know if they’re going to be mentioning their issues they’ve had with Rogers recently, but it might be something interesting to ask them about it and to see how their relationships with the incumbents are and what they would think about if they would have to deal with a community instead of a private company.
1085 Or another possibility is that a few communities get together, create a consortium which negotiates together with the service providers the same way the Canadian Cable Systems Alliance works with smaller cable operators in creating a single point where all the contracts can be negotiated.
1086 COMMISSIONER MacDONALD: So just so I’m clear, are you suggesting that targeted funding would only go to un-served or underserved communities, not communities that are ---
1087 MR. CARON: No, it will go to existing communities because even in a city you will have spots in the city where the service is underserved and where a need for improvement is needed. I’ve already had people comment on me where they moved into a newly-built suburb and they found out there was an argument between the contractor and the service provider and suddenly they found they have absolutely no service whatsoever.
1088 COMMISSIONER MacDONALD: Thank you for that clarification because I was interested to see on page 7 of your submission when you’re talking about the cost factor to do this that you cited Toronto and the fact that there are just shy of 5,400 kilometres of roads in Toronto.
1089 MR. CARON: Yes, if you assume that you’re going to be running -- well, not necessarily running fiber-optics cabling over very single kilometre of road. But you will probably have to run a significant amount if you want to reach every single business.
1090 COMMISSIONER MacDONALD: There could be those living in remote areas of the country or in Canada’s north that would find it hard to believe that additional investment infrastructure is required beyond what the TSPs are doing today in large centres like Toronto. Would you care to speak to that?
1091 MR. CARON: It’s not as much as -- how can I say this? It’s more like -- I’m just trying to find a way. The reason for this whole proposal of mine was to try to find a balance in which the needs of the people are actually satisfied by a partially government-run operation.
1092 Yes, and I’m aware that the people in the north will be a little miffed if people in larger cities get better internet much sooner than what they have now, which is actually pre-21st century technology and speeds. Well, that’s why I also had the other option of asking for a research and development program so we can at least find a solution to covering large distances.
1093 We have to understand we’re a very large country. It’s 8,000 kilometres wide just driving on the Trans-Canada Highway. And then I can’t remember how far it is north. And we have to live with these conditions; we have to adapt to these conditions. And that’s something I feel that hasn’t really been done yet.
1094 And I know that the gadget that I portrayed in there is a little ludicrous at first, but it is actually based on old technology. Here it is. We’ve already done this before crossing large distances in what’s called the Trans-Canada microwave. This was completed in 1958. You might even have seen the Heritage Minute about it.
1095 And just to give you some details, it was 139 towers over 6,275 kilometres of distance. It was 50 million back there, 336 million in 2003 dollars. It had a latency of only 20 milliseconds, which if you have that on your internet service would be pretty good. And this was in the era of vacuum tubes.
1096 They managed to do something with vacuum tubes that we can’t seem to be able to do today with modern technology. And I’d like to see a research and development program developed for this so that we can bring the north up to date and up to speed with the rest of the country and not have them face a situation where as technology becomes more prevalent in their society that they would actually have to consider moving out of the north. I don’t see that as an option; I’d rather see us do a push to actually find a solution to this.
1097 CHAIRPERSON MacDONALD: Then if there is going to be a significant amount of government funding that would go into a program like this, isn’t it best to spend the money in those areas versus overbuilding markets that many might suggest are very, very well served?
1098 MR. CARON: Would could set the priority for the northern communities; we can do that. Because I mean if a city or a community has decent internet, if a service provider already -- a last-mile owner has already set up fibre in the area and is already offering the service that’s needed, we don’t really need to build in those areas. We just need to try and start building in areas where the service is severely lacking and get -- just try to get people up to speed at least with different internet speed so they could get their services -- their daily lives going.
1099 Already most of the government services that we have are already available only online, not only online but primarily online. Just to give you an example, registering my business at the federal level, incorporating, was $200 -- $200, if I did it online, $250 if you did it on paper. So already there’s a financial penalty imposed on people who already don’t have internet access.
1100 CHAIRPERSON MacDONALD: You cited Australia having invested $56 billion in a program to bring facilities to its ---
1101 MR. CARON: That is the current estimate. They’re still building out but they’ve already busted their budget, the original budget that they figure it would take. They’ve had a few problems, unfortunately, developing the system, a few technical glitches here and there, and it actually inflated the amount.
1102 I’ve actually found that amount of $56 million on multiple sites reporting just how bad it was getting that -- it was a nice idea at the time. I even supported it because I thought it was a great idea to have a national broadband network. But then seeing that they’ve had serious problems with it just made me realize that maybe the national level was not the best idea for it.
1103 On a provincial level it’s hit or miss if you’re going to have province able to run a broadband network as well as they run some of their utilities.
1104 CHAIRPERSON MacDONALD: So if the number is $56 billion in Australia and it’s growing ---
1105 MR. CARON: M’hm.
1106 CHAIRPERSON MacDONALD: --- and Australia is roughly two-thirds the size of the Canadian land mass ---
1107 MR. CARON: Yeah.
1108 CHAIRPERSON MacDONALD: --- do you have any idea what a similar program would cost in Canada?
1109 MR. CARON: Like I said in my video, we have to do the research on this. This is something that I haven’t anybody really produce concrete numbers on what it would cost to pursue such a program, a community network. The information that’s really missing is it doesn’t always take into account the technologies that are being developed.
1110 I mean, I have some pieces of equipment. I have a device with me. This thing would have cost -- like, 20 years ago it would have been a computer that cost you a couple thousand dollars. Now I buy this little thing on line; it’s called a Raspberry Pie and it only cost me, I think it was, like, $50 just for the board.
1111 We’ve evolved so much in technology. Technology’s evolving so fast and it’s bringing solutions forward much faster than I believe the regulatory regime is able to handle or even to catch up. I’d like to see some research done that takes into account the possibility of technology being released -- being developed to actually solve a lot of these problems at minimal cost.
1112 Even my gadget that I saw, a lot of the technology already exists. You’ve got the solar panels; you’ve got the turbine. The system core is actually the part that’s still a big question mark but everything else is all part of equipment that already exists on the market; it’s just a matter of seeing what can we do with it and how can we push this technology forward in such a way that we realize -- do the studies to find out if we really need to spend that much to develop and to market the -- and to produce these technologies.
1113 We could end up in a situation where these kind of relay towers, if the idea is even feasible, could cost one-tenth of what it would cost normally to run fibre all the way up to the north. Suddenly you have a much more attractive proposition; in wiring up the north they would get the service and we’d find a way to cut the cost to a point where it would be feasible for the government.
1114 CHAIRPERSON MacDONALD: What if the community didn’t want to take up the challenge?
1115 MR. CARON: They don’t have to; this would be entirely voluntary.
1116 CHAIRPERSON MacDONALD: Entirely voluntary?
1117 MR. CARON: The communities have -- this is another thing I’d like to see. It’s a bit of a reflection of what I’ve been seeing at the hearings, is that a lot of people, a lot of communities, a lot of government entities, they always come here and they say about what are there current problems and maybe to a certain level what they need but nobody seems to ever bring up any solutions on how they want to accomplish it.
1118 So this would give them an opportunity -- this project, if it ever comes to fruition, would actually encourage communities to work a bit to bring a proposal forward on how they would wire up their community, and then they would actually apply to the government for the funding necessary to actually build the network. It would be voluntary but it would require the communities to work a bit to get the kind of service that maybe for a very long time they’ve never been able to receive from the existing service providers or last-mile owners.
1119 CHAIRPERSON MacDONALD: If, be it a community, be it an organization, be it a TSP, received federal government funding to deploy a network in a given region ---
1120 MR. CARON: Yes.
1121 CHAIRPERSON MacDONALD: Should they have an obligation to serve every single ---
1122 MR. CARON: No.
1123 CHAIRPERSON MacDONALD: --- individual and residence within that community?
1124 MR. CARON: No, not necessarily. There’s going to be some spots where the service may be adequate and where it doesn’t need to be covered but it would be -- I’d say it would be at least at minimum that it would -- they would have to at least provide service to the areas that actually really need it the most, where there -- where it’s actually becoming an impedence to their daily lives.
1125 CHAIRPERSON MacDONALD: If organizations in your model, the community, were to deploy a network, should those rates be regulated, what they can charge?
1126 MR. CARON: I would say, if you want to regulate it, I would -- the best thing I could find is maybe putting a limit on the salaries paid to some of the upper managements because I -- we’ve see a few horror stories about that at certain times in certain sectors.
1127 I would say probably the full operating costs of the network plus maybe 10 percent and then use that as a base for leasing the network to the other service providers.
1128 There’s also the possibility if it’s a consortium of multiple municipalities working together to provide service to an entire area including the interconnects between the communities. In that case I would like to see -- I would probably put in the same principle where it would be the cost plus 10 percent and then you lease that out to any service provider who wants to deliver services to the individual customers.
1129 CHAIRPERSON MacDONALD: In your video you also note that the municipality would have to maintain ownership for a minimum of 10 years and then after that ---
1130 MR. CARON: Yeah.
1131 CHAIRPERSON MacDONALD: --- they could divest themselves of those assets but they couldn’t sell it to another service provider.
1132 MR. CARON: Yeah.
1133 CHAIRPERSON MacDONALD: So ---
1134 MR. CARON: I’ve got another cheat sheet for that. Unfortunately, Ottawa has had that experience where they had a fibre-based network and they had sold it to a company. Yeah, this was -- Telecom Ottawa was owned by Ottawa Hydro. It was sold to a company, Atria, in 2008, and then Atria was sold to Rogers in 2011. So essentially Rogers bought out a publically-funded network within a span of only three years.
1135 CHAIRPERSON MacDONALD: So the follow-up to that is, if they can’t sell to a TSP, who else would be interested in that asset? If I owned a fibre-optic network connecting every building in a given municipality and I wanted to divest, the first people I would talk to would be the TSPs. So ---
1136 MR. CARON: TSP? Can you just ---
1137 CHAIRPERSON MacDONALD: Sorry, telecommunications service providers.
1138 MR. CARON: Okay.
1139 CHAIRPERSON MacDONALD: So, you know, I would want to be beating down the doors of some of those service providers. So if they’re not allowed to sell to them, who else would be interested in that asset?
1140 MR. CARON: Oh, no you can sell -- oh, no, the community could to sell to the transport service providers under the condition that the transport -- the telecommunications service providers also lease access to their networks to other service providers.
1141 CHAIRPERSON MacDONALD: Okay.
1142 MR. CARON: And as I pointed out in the video, there is a challenge going on where the Commission asked that the -- ordered that the bigger companies share their fibre access to third-party service providers and then the Bell actually challenged -- I think it was Bell that challenged it in court. I think it was the day after the election was called, I believe. And that brought up an interesting situation.
1143 That’s where I got the idea for saying that, okay, if it’s a service provider, if it’s a company that already owns a last-mile network, as long as they’re showing access to their network to other service providers, they can also use the community’s service -- the community’s network to deliver their own services. But as soon as they say that they don’t want to share it with anything, I don’t see any reason why anybody should share their network with them.
1144 CHAIRPERSON MacDONALD: Okay, thanks for that clarification. I guess my next question would be -- let’s fast forward 10 years to 2026 and … the federal government has invested $50 million to build a community infrastructure network throughout Ottawa, for example.
1145 MR. CARON: Right.
1146 MR. MacDONALD: And Ottawa decides it wants to sell. What happens with the windfall? This was built with public money. Should they have ---
1147 MR. CARON: Well, for ---
1148 MR. MacDONALD: --- to return that to the provincial or the federal government or would that just ---
1149 MR. CARON: That one, I haven't figured out what to do with that. The only thing I thought about at that point is that whichever mayor is in power at the time that sells the community network at the time that it's most needed is not going to be re-elected. So there's incentive for the politicians to hold onto their jobs.
1150 And also, there's the example of Hydro Quebec. As we know, it's a utility that's completely owned by Hydro -- by the province of Quebec. And even its chairman, this is the chairman that replaced Pierre Karl Péladeau -- unfortunately, I don’t remember who this chairman is -- and he said there's about as much chance of Quebec selling Hydro Quebec as Egypt has of selling the Pyramids.
1151 So if a utility is actually solid enough, if after 10 years the utility becomes solid enough that it creates a huge benefit for the community, there's very less likelihood that it's going to be sold off to anybody.
1152 If, however, the network is a complete disaster, then maybe it would be better off if the community got rid of it and let somebody else deal with the problem.
1153 I figure a 10-year period would be good enough to find out if a publicly-funded utility, a last-mile utility is viable or not.
1154 MR. MacDONALD: Unless that municipality decided it was better to liquidate the assets to keep the snowplows on the road or build a new convention centre.
1155 MR. CARON: Well, that becomes a problem of managing a budget then.
1156 MR. MacDONALD: Okay, just a couple of other questions before I hand it over to my colleagues.
1157 The Affordability Access Coalition has suggested a funding model that would see funds going towards building out of network facilities ---
1158 MR. CARON: M'hm.
1159 MR. MacDONALD: --- and they also suggested that a need was required to offset some of the costs that low-income Canadians are confronted with when buying communications services.
1160 Would you at all care to speak to that type of concept?
1161 MR. CARON: I've actually had an idea about how to deal with that situation this morning.
1162 I read about it in the newspaper and realized, oh, right, the low-income people, they will need their Internet service, and in fact, it's becoming a serious problem, where a lot of them have to decide between the Internet and food. That's how important the Internet has become, to the point where they actually have to decide between one and the other.
1163 But what I thought was, if you had like, a one gigabit ethernet connection connected to a -- just for example, to low-income housing, essentially that gigabit ethernet connection could be split up in many different ways. You can have ten 100 megabit connections or even 100 ten megabit connections. There's different ways of splitting it up, and then you end up finding out that you can actually charge a much lower rate per connection.
1164 This won't give them high definition streaming or anything like that, although considering they're already in a very low-income position, it's not -- probably not in their top list of priorities.
1165 But what would be in their priorities is to be able to access the government services that actually allow them to keep living day in, day out. And from there it would be possible to split up a gigabit connection to multiple residents, and probably even give them a rate so low that they end up paying maybe $2 or $5 a month just for, like, 25 megabits per second.
1166 And with that, the advantage if you -- not -- I wouldn't say giving them for free would be a good idea, because if you actually have them pay a token fee and have it marked as a utility payment, even if it's just $5, it will also help their credit rating and probably give them a boost and help them try to get out of the predicament they may have been, in many cases through no fault of their own.
1167 MR. MacDONALD: Last week Rogers made an announcement that it was expanding its Connected for Success program throughout -- for low-income Canadians in supported housing throughout their service territory.
1168 If service providers are already taking these steps without being forced to and without the creation of an affordability fund, is it better to leave this to market forces to deal with versus government and CRTC intervention?
1169 MR. CARON: The problem with such a proposition is that I don't know if that's what Rogers really wants to do or if they have ulterior motives. I really don’t know what is the -- I haven't read up much on the proposition -- the proposal. I understand what it means.
1170 The only thing is, whenever a large company says they're doing something for the community, I always question it at this stage, especially with Bell with their "Let's Talk" campaigns for mental health. It doesn’t seem as much as a campaign for mental health as brand reinforcement for the Bell name.
1171 So whenever I see these big companies do these kind of charitable events, I always put into question, what is the motivation behind it? Is it really a charitable benefit they're trying to do here or do they have any other intentions?
1172 MR. MacDONALD: Just switching gears for just a final few moments, can you speak to the importance of phone services, how important a traditional wire line telephone is in a day and age from -- where people can place a VoIP call or log on to the wireless network? We've seen one in five Canadians have already cut the cord.
1173 MR. CARON: Right. Yes, in my case it's funny, because I actually applied for a television licence many years ago and it was approved for it. And while the television channel didn’t work out, that's okay, because in the end, I found out that I just cancelled my cable, cancelled my phone line.
1174 Right now today, just my example, everything I do is on the Internet. If I want to watch TV I just bring out the rabbit ears and if I want to make a phone call I just use my cell phone. I'm with WIND Mobile and they have some pretty decent rates there, so right now, wire line service and such, the traditional one, the analog one, I don’t see that lasting very long at this stage.
1175 If you wire everybody up with decent Internet service, anybody can make a call very easily over data networks. Just that -- you know, there's still some adaptations that need to be done, because even though Skype seems like a convenient item and I do use it every day during my business dealings, there's still the advantage of having a network, a phone network, at least a wireless one that makes it easy to place a call to just about anybody in the world without having to worry about if you have the right Internet service plan to make it work.
1176 So I see the wired side disappearing eventually but I don’t see the wireless side disappearing anytime soon.
1177 MR. MacDONALD: Okay, thank you.
1178 With respect to the telephone directory, your business, do you use a telephone directory to advertise yourself or make yourself known?
1179 MR. CARON: No, I have a limited number of clients. I don’t really advertise that much at this stage. I deal mainly with my main client, Circa Design Corporation. That's the company with which I automate (inaudible).
1180 MR. MacDONALD: Okay.
1181 MR. CARON: So no, but even then, in terms of advertising, I think that the most advertising I do, basically, is from my websites. Just making sure that it's on Google helps.
1182 I have a software package that I do sell online. I don’t sell it full-scale because it's not a priority for my business, but I did put it online just in case anybody needed it and I discovered that not only I've already sold it to a Russian company, and also I've sold it -- I won't name the company, but I sold it to the same company that originally made it but discontinued it many years ago. We asked for the source code, we fixed it up and then they said, "Oh, we need it again. Can we buy yours?"
1183 MR. MacDONALD: So would you say that online applications have replaced the need for a traditional printed telephone directory?
1184 MR. CARON: I don't see it. I mean, if you need a service you just Google it.
1185 MR. MacDONALD: Okay.
1186 MR. CARON: And that's -- Google has pretty much become the phonebook.
1187 MR. MacDONALD: Okay.
1188 MR. CARON: The paper phonebook, most people just put that in their recycling bin at this stage.
1189 MR. MacDONALD: Okay, thank you. Those are my questions.
1190 THE CHAIRPERSON: Thank you. I'll just check with my colleagues. Apparently no other questions. Thank you very much. Merci.
1191 Madame la secrétaire?
1192 THE SECRETARY: Thank you. I will now ask TekSavvy Solutions Inc. to come to the presentation table.
1193 Please introduce yourself and your colleagues, and you have 10 minutes.
1194 MR. ABRAMSON: Thank you. We'll introduce ourselves, starting from your right.
1195 MR. STEWART: Good afternoon.
1196 My name is Paul Stewart. I'm the Director of Network Operations at TekSavvy. My team designs and operates our internet protocol and voice services networks, plans and delivers network upgrades, and coordinates the IP and voice networks with the underlying physical network capacity.
1197 MS. LO: Good afternoon. My name is Janet Lo. I am the Director of Consumer Agreements. I work to translate consumer law and policy objectives, including the direction taken by the Commission into TekSavvy's consumer policies and processes.
1198 MR. ABRAMSON: Bram Abramson, Chief Legal and Regulatory Officer. I coordinate our legal regulatory and public policy activities.
1199 MR. KAPLAN-MYRTH: I'm Andy Kaplan-Myrth, Director for Regulated Agreements. I act as the point of contact for regulated agreements and tariffs and general carrier relations.
1200 MR. STEWART: TekSavvy is an independent telecom provider based in Chatham, southwestern Ontario, and also down the street here in Gatineau. In terms of services, we provide consumer internet and voice to more than 300,000 Canadian homes. It's what we specialize in.
1201 We're heavily invested in people, plant, equipment, and software development to excel at those services. We're proud to be one of Chatham's three largest employers and to be a growing part of Hull's and Gatineau's economy.
1202 In terms of access facilities, we have a small fixed wireless footprint in southwestern Ontario and also in eastern Ontario, serving approximately 1,500 homes.
1203 Building and operating access facilities is a different kind of business. We do it where there's a gap in coverage and where we are the best option to get those people connected.
1204 MR. ABRAMSON: As you'll have seen, that distinction between providing access and transport facilities and providing services that they support, is at the core of our filings in this proceeding.
1205 This afternoon, we'd like to speak to our submissions on broadband access and transport.
1206 So, first of all, access. We've asked you to redraft the basic service objective to place broadband access at its core, and that really consists of -- we've included a black line in your -- in the copy of our notes so that you can see how it compares with the current basic service objective.
1207 But it amounts to mandating individual line local broadband service and capability to connect to the internet via high speed data transmission made available, where feasible, at reasonable wholesale rates.
1208 And I guess I said "mandated". I want to be clear, that's an objective. How it's to be achieved is a different question, I think.
1209 The old basic service objective was very clear on the capability to connect to the internet via low-speed data transmission. The new objective needs to be about high-speed data transmission. I think you'll hear that lots in this proceeding, but respectfully, the distinction at its core should stay the capability to connect to an internet provider.
1210 What I mean is this: broadband access is physical network access delivery at the lowest layer of the telecom reference model that is practical to deliver that, bundled with no more than has to be. Internet service is a connectivity service delivered over broadband access. In other words, they're different.
1211 We think that both internet service and broadband access are required to be able to meaningfully participate in the digital economy, including -- digital society, including the digital economy. And both are basic as opposed to enhanced services.
1212 But your job in this proceeding is not to draw lines to identify which services are basic as opposed to enhanced services. It's to identify which basic services are so important and so scarce that all Canadians ought to have access to them.
1213 We say the answer is upgradable broadband access that supports the provision of retail internet services. And that distinction is not a new technical nor a new regulatory concept. It's at the heart of the current basic service objective, and as you said last July:
1214 “Wholesale high-speed access services may be used to offer a variety of retail services, including local phone, television, and internet access services. Retail internet access services permit users to access a wide variety of services including email, the web, audio, and video services."
1215 MR. KAPLAN-MYRTH: Even regions that can support competition in a lot of sectors cannot sustain significant competition for access facilities. Intuitively, that makes sense. The economic case for building out multiple parallel access facilities to the same endpoint, and leaving most of them to sit fallow, is weak. That is why access facilities pass an essentiality test in Canada.
1216 And that is how, rather than being locked into an oligopoly or a monopoly, consumers benefit from competition, and insufficient market forces are overcome.
1217 Commissioners, those insufficient market forces are all the more evident in markets where, but for subsidy, there wouldn’t even be a single-provider monopoly. Access facilities meet the essentiality test. Subsidized access facilities certainly meet the essentiality test.
1218 That is what we mean when we say that ordinary regulatory principles apply. There is no reason why Canadians in underserved communities should be locked into a vertically-integrated monopoly, where the broadband provider is the only one who can interconnect and offer internet services over it. There is no technical reason for it and there's no economic reason for it.
1219 Today, we ask you to keep this distinction in mind as this proceeding unfolds over the next three weeks. When an intervenor comes before you and asks that you mandate or subsidize or that you invite your political counterparts to subsidize internet or broadband internet, challenge them.
1220 Do they really mean that a monopoly internet service provider ought to be locked in, or do they mean that broadband access facilities are badly needed and ought to be subject to the ordinary rules that apply to scarce access facilities?
1221 MR. STEWART: On the availability of transport facilities, there is a real problem to be solved. You can have broadband access facilities, but you need backhaul to get there.
1222 We have asked that you not move immediately to subsidy as the solution to the transport quandary, because we do not think that this is the first step. Our experience has been that the location of transport facilities is difficult to discover, the pricing too high, and the coordination too difficult.
1223 The first step is to see if there is someone who already has a network, who we can work with. A lot of times, however, that’s still hard to do.
1224 MR. ABRAMSON: The Commission has an opportunity to build tools and information to support the discoverability of middle mile facilities and coordinate transport opportunities where it's required, to act as a trusted and, where appropriate, confidential clearing house.
1225 Now, to be clear, that's not the case everywhere and it's often not the case in dense areas and places where it's obvious where to go and get transport, but it's a case where it's badly needed.
1226 If there is no transport to get from Point A to Point B, under our proposal, an access seeker could ask the Commission to identify competitive alternatives, or consider identifying the route if there are no alternatives for potential subsidy.
1227 But where there is insufficient competition for transport on a route, there is some transport on that route, and prices are neither just nor reasonable, then we think that section 34 of the Telecom Act requires the Commission to tariff that transport, before considering subsidizing additional players.
1228 In other words, if there's already something there, and the issue is that its price is not reasonable, then that's the problem.
1229 In that regard, a big piece of the puzzle might be to take a hard look at your forbearance regime for inter-exchange private line transport. It is a forbearance regime invented in 1997 and 1999 that says that if any non-incumbent sells one 45 megabit per second circuit on a route, then policy goals would be better achieved if the CRTC does not regulate the price of transport on that route.
1230 That forbearance regime is older than the basic service objective. So we have two suggestions.
1231 One, on the record of this proceeding, issue a consolidated list of all of the community-to-community private line routes that you have forborne from regulation, along with the number of providers you believe operate on that route. That is information that you have within the DCS system, and on reading other parties’ submissions, it would greatly benefit this proceeding.
1232 And second, of your own motion, launch a review of that forbearance framework. Inter-community transport matters a great deal. The time has come to examine it in light of what the framework is now.
1233 MS. LO: Mr. Chair, Mr. Vice Chair, Commissioners, this is an important proceeding. We have seen a lot of things proposed. Today, we have emphasized that these proposals must be thought through the Commission’s existing regulatory frameworks and ordinary principles.
1234 We are happy to speak to that, and to our other proposals, like revising the $10 million rule for National Contribution Fund participation in your questions.
1235 But we do want to leave you with one last proposal, in response to the zoomable pictures of broadband deployment that you published last week in the lead-up to this proceeding. It is a simple ask. Pictures are great, but data is much better.
1236 We ask that the Commission strongly consider publishing the data set underlying those pictures.
1237 As you know, there is a real lack of publicly available data on telecom network deployment. As buyers of wholesale network access, we don’t even have access to data sets of where that wholesale network access is deployed. So imagine the difficulty of public interest intervenors and others who want to sustain an informed debate but don’t have the data sets that would let them best contribute meaningfully.
1238 Thank you very much for your time and we welcome your questions.
1239 THE CHAIRPERSON: Thank you very much for your presentation and your participation.
1240 Commissioner Molnar will start us off.
1241 COMMISSIONER MOLNAR: Good afternoon. I’m going to start from the back and move forward on your comments today.
1242 So on this issue of publishing data, you say that:
1243 “As buyers of wholesale network access, we don’t...have access to data sets of where that wholesale network access is deployed.”
1244 What do you mean, “...where that wholesale network access is deployed”?
1245 MR. ABRAMSON: If an end-user comes to TekSavvy and wants to become our end-user or our subscriber, we don’t have any data set that we can go into and look at where, for example, wholesale network access is available to us. What we can do is push a single request for that particular address at a particular point in time.
1246 It’s not an efficient tool depending on the carrier who is -- depending on the vendor of wholesaler network access. And at times there have been, you know, out-of-date data sets and so on and some real problems with coordinating the moment-by-moment queries that we’re able to do when we’re able to do them especially at scale.
1247 It’s not a system that works well. If we were only to be able to use the tools that are made available to us at the pleasure of vendors of wholesale network access, customers would phone us, ask us for service and we’d call them back a couple days later and tell them whether we could offer them service. That’s not a sustainable model. And so we’ve have to try and work around it.
1248 COMMISSIONER MOLNAR: Right. So I’m just trying to understand. So today a customer calls you and you make a request to the underlying service provider within that, I’ll use the term, community. And you may make two requests I guess, you know, whether you’re going to the ILEC or the cableco. And perhaps you do. And is it your thought that somehow this data would replace you making those requests?
1249 MR. ABRAMSON: No. What we have to do is kind of triangulate what we think is available to us on best-available information.
1250 I mean, in our case, the more information that’s available to us, the more informed a guess we can make. And so we may not be able to tell the end-user right then and there, “Yes, we can certainly provide you service there”. We can say, “Yes, I think there’s a good likelihood of it. We will try and schedule something and get right back to you.” So the more that’s out there, the more helpful it is.
1251 But to clear, that was meant as an example of the limited information that’s available. The purpose of putting it on the public record here wouldn’t be, you know, to assist the wholesale network access model. And I think that’s, you know, kind of over there and we’re over here. You know, if ---
1252 COMMISSIONER MOLNAR: Okay. So that’s fair enough. I understood your broader request that said, “Okay, you’ve given to us pictorially, you know, big data, feed us data.”
1253 MR. ABRAMSON: Yeah, absolutely.
1254 COMMISSIONER MOLNAR: I was just confused a bit or surprised by what you suggested might be the use of that data because I think that you have operational, you know, processes in place that hopefully would be much more efficient than this.
1255 MR. ABRAMSON: We do. But when you talk about big data, that’s exactly the game we’re into.
1256 COMMISSIONER MOLNAR: Yes.
1257 MR. ABRAMSON: And the more data that’s out there, we’ll use it in some ways but I think, you know, people use it in all kinds of different ways.
1258 COMMISSIONER MOLNAR: Hopefully not that one, though, because that would not seem to be the best source of that.
1259 So, okay, moving backwards again, as I said, to ensure I’m understanding well your discussion on transport discoverability.
1260 I actually was a little, I guess, surprised. So from your point of view, right now where the IXPL routes have been forborne, you do not have access to information on who might be the competitive suppliers on those routes?
1261 MR. ABRAMSON: It’s happenstance. It really depends on the route. And I don’t know, Paul, you may be able to speak a little bit better to this than me.
1262 But, you know, the example that I’ll give is sort of like shopping for a house but there’s no MLS. You know, you say, “Look, this is the area I want to be in” and maybe it’s not quite where you’re at; it’s a completely different area. And you say, “Well, who do I know over there” or, “Who might have some transport? Who can I call?” And it’s very much a -- I don’t know if this is the right word, but a manual process in terms of, sort of, reaching out and just sort of seeing who might have some transport in the area; “Who can I talk to? How can I get there?”
1263 COMMISSIONER MOLNAR: But do you consider some of this to be competitively-sensitive information?
1264 MR. ABRAMSON: Yeah. I think that absolutely some of it -- some companies may say, “It’s none of your business where I provide transport.” But I think before we start ---
1265 COMMISSIONER MOLNAR: Well, then it shouldn’t be our business to provide you that info; do you think?
1266 MR. ABRAMSON: I don’t agree.
1267 COMMISSIONER MOLNAR: No, you think that we should tell you?
1268 MR. ABRAMSON: No, I think that the Commission -- and I want to be clear, right? What we’re asking is not, sort of, “Well, you’re not telling us but you tell the Commission and then the Commission will tell us by ricochet.”
1269 What we’re saying is where there’s a real problem -- and I think you’ve heard and will hear during these next three weeks that there is a real problem here. This is information that, to be honest, the Commission already has in many cases or can ask for. And it’s not necessarily the Commission’s job to say, “Well, now I’m just going to publish all of it”. The only thing we’ve asked to be published is what’s already on the record. And it’s a simple aggregation of decisions that you’ve made in the past.
1270 So there’s semi-annual decisions going back 15 years saying, “We’re now, you know, forbearing from regulation on the following routes”. And we’ve suggested going further and actually saying the number of the providers on that route so that somebody might say, “Well, I didn’t know there’s four different people I could be able to go to on that particular route. Maybe I should be looking harder instead of calling for subsidy.” It wouldn’t compromise anyone’s information I hope and think.
1271 But that said, we’ve also said is where it may be sensitive, even if the Commission doesn’t publish it, that where we’ve described as adding a trusted clearing house would be a useful one. In other words, a carrier in rural Canada can go to the Commission and say, “You know, I don’t know where to turn to get carriage on this route.” And the Commission might say, “Well, I’m going to go ask someone who’s filed that data with us and ask them if they’re interested in speaking with this potential customer”.
1272 COMMISSIONER MOLNAR: And the notion you have that we should re-look at the forbearance regime, it is actually quite significant or I don’t know. It struck me. Like you said, it was 45 megs at the time when forbearance was granted.
1273 MR. ABRAMSON: It still is.
1274 COMMISSIONER MOLNAR: Yeah. Is there any sense that the competitive marketplace has changed or less has become available as some of the facilities have frankly been used up? Do you have any sense that there’s maybe less available for competitive supply than there was?
1275 MR. ABRAMSON: Yeah. I mean, it’s hard to say without a -- I mean and that's ---
1276 COMMISSIONER MOLNAR: You don’t have that sense. That’s fair.
1277 MR. ABRAMSON: We don’t have that data.
1278 COMMISSIONER MOLNAR: I’m just trying to understand what you think might be the outcome here.
1279 MR. ABRAMSON: Yeah, what’s driving this is really -- I mean sure, there’s a sense that there’s been some consolidation in the marketplace. We’ve seen a number of independent fiber players who have been acquired by incumbents in this country pretty steadily over the years.
1280 But sort of separately from that, I think we’ve seen on the record, and that’s certainly my impression in this proceeding, that there’s a lot of companies in rural areas that are saying, “It’s really hard to get transport at reasonable rates”. These companies may not realize that that’s actually the route they’re looking on. It’s one that’s been forborne from regulation.
1281 And at some point just by putting that information out, by collating it in a way that’s digestible for folks, I think it really creates the basis on which to move the discussion forward. It may be that we ought not to regulate pricing on rural routes where people are having a hard time finding transport; I don’t know.
1282 But certainly if that was foregrounded and it was put to people, “This is where we’re at now. Here’s the regulatory framework we adopted 17 years ago or 20 years ago. Is it still appropriate,” it may be something that would prove a good input into the process that we’re talking about here in terms of transport, I think.
1283 COMMISSIONER MOLNAR: Okay, thank you. And do you say that that would be a first step before there would be any kind of middle mile subsidies or otherwise? Would you agree that’s a terrestrial issue?
1284 MR. ABRAMSON: Look, it’s hard to know because we simply don’t have that kind of information; that’s part of the issue. But I would imagine so. I mean, it’s hard to think that there’s a lot of fiber going to the north. I don’t know what the situation is with different hydro companies and so on and I don’t know what fiber they’ve laid. It’s part of the problem we’re pointing to. But I mean, that’s a very reasonable hypothesis, I think.
1285 COMMISSIONER MOLNAR: Okay.
1286 So I left the broadband access for last because I feel I might need a little more explanation to perhaps understand your proposal.
1287 So your proposal of individual line local broadband and capability to connect to the internet, first off... just to -- as confirmation, you say this replaces the requirement for individual line voice service?
1288 MR. ABRAMSON: Yes, our ---
1289 COMMISSIONER MOLNAR: That’s removed from the BSO?
1290 MR. ABRAMSON: Our proposal was that, yes.
1291 COMMISSIONER MOLNAR: So it -- is it your view that it would be appropriate for Canadians for -- and I’ll use consumers again, because these folks will all be consumers of services, would and could be reliant on their IP connection for voice services?
1292 MR. ABRAMSON: Yes, I mean I want to qualify that a little bit in two stages.
1293 First of all, we said that, you know, they ought to be able to rely on the retail service delivered over broadband access to them. That would typically be internet access.
1294 Certainly voice providers can setup over that broadband access. And as you said in your decision last July, that’s one of the services that can be delivered as opposed to retail internet access over wholesale broadband, so I don’t think it has to be either or.
1295 COMMISSIONER MOLNAR: Okay so --
1296 MR. ABRAMSON: But ---
1297 COMMISSIONER MOLNAR: -- not sort of a nomadic voice service, but use the broadband access for -- yes.
1298 MR. ABRAMSON: If there were demand for it.
1299 COMMISSIONER MOLNAR: Yes.
1300 MR. ABRAMSON: The nice thing would be you’d be in a situation where that were doable, because the broadband access was present in communities that were high cost, because we would have found some sort of way of trying to meet this basic service objective.
1301 But certainly when we -- when we made our proposal it was oriented towards a world where more and more things are migrating to an internet protocol environment; that’s certainly the case.
1302 One of the things that we’ve heard today, and it’s been interesting, has been the idea that while that’s great, the internet just isn’t always reliable. I can’t always trust it.
1303 When I pick up the phone I know that the dial tone is going to be there and so if there’s an emergency I have a lifeline. That’s something that we understand.
1304 We offer two different voice services. We offer voice over IP, one. For TekSavvy customers that voice over IP service does not run over the internet, but it’s also nomadic so that if you were to access it from some other end point it would run over the internet to our network and from there to our voice -- our voice network.
1305 But we also offer re-sold Bell home phone. It’s simply a resale service that we -- that we have and there’s been real demand for it in -- especially in rural areas and I can understand why.
1306 And so without changing our proposal I understand the desire and the need for liability. One of the areas that you asked about in this proceeding was quality of service.
1307 And I think I suppose that a -- corollary of this kind of a proposal no longer worked towards voice as part of the basic service objective, but work towards the underlying broadband access is to make sure that it’s delivered reliably.
1308 COMMISSIONER MOLNAR: Did you change your answer or did you just go back to reliable individual line local broadband?
1309 MR. ABRMASON: No, I guess we’re not changing our answer, but I’m highlighting the importance of the reliability aspect to it.
1310 COMMISSIONER MOLNAR: Yes.
1311 MR. ABRAMSON: You know, it’s something that wasn’t ---
1312 COMMISSIONER MOLNAR: You know many Canadians obviously participated and they did speak of voice.
1313 They spoke of, you know, their fixed voice and they -- actually many, many spoke of mobile voice or mobile service, you know, upon which to receive all of their services; so you’re sticking to yours broadband?
1314 MR. ABRAMSON: Yes. I mean I guess what I’d say is any basic service objective clearly that we propose today won’t be implemented for -- in the next week, or month, or maybe won’t be -- won’t be started to be worked towards for the next day, or week, or month, or even year. It’ll take a little while.
1315 And what we think we see in the marketplace certainly is things evolving towards everything on IP. The challenge is to deliver that reliably, but I don’t see voice and broadband as opposites.
1316 I see voice as a service that’s increasingly delivered over broadband and the next generations of mobile. I think that’s where we’re headed and certainly a great -- more and more we see that in fixed wireline as well.
1317 COMMISSIONER MOLNAR: M’hm.
1318 So the second bullet:
1319 “Capability to connect to the internet via high speed data transmission.” (As read)
1320 I understand what you intend there and then it goes on to say:
1321 “Made available where feasible at reasonable wholesale rates.” (As read)
1322 If this is a basic service objective for Canadians, for consumers, how does “at reasonable wholesale rates” fit into that?
1323 MR. ABRAMSON: I think the goal is to create an environment in which all consumers have the essential services that we decide it’s essential for them to have and by doing this you enable the creation -- the delivery of those services to them.
1324 In other words, I don’t think this that this is a definition whose goal is to be sort of, you know, emblazoned on the back of stickers and said yes this is what I want in my home.
1325 I think the goal is to create a definition that from a regulatory standpoint will deliver that end goal. And I think that end goal is -- is reliable internet access and not being locked into only one provider who delivers it.
1326 It’s reliable voice service and not being locked into that one provider who will tell you whether you can have it or not and how much money.
1327 COMMISSIONER MOLNAR: M’hm.
1328 MR. ABRAMSON: Now I do assume, and I think we do assume, that if you have someone delivering the broadband access they’ll have every reason to also want to sell internet service over it.
1329 And so it would be pretty shocking, to be honest, if somebody decided to go forward if they were subsidized to deliver this, that they used that subsidy and said we’re not going to also try and earn additional revenue by providing that retail service.
1330 In the unlikely event that that happened and nobody else wanted to provide a retail service there either, then I think we might have something to deal with, but every market incentive points in the opposite direction.
1331 COMMISSIONER MOLNAR: M’hm.
1332 I mean I understand that your focus is to create opportunities for competitive -- competition within all broadband access. I understand that.
1333 The BSO has traditionally been defining what end customers receive, what is it that Canadians require.
1334 So, you know, the individual local broadband capability to connect the internet, capability to send and receive voice communications, access to competition where feasible, would that be another way of saying it where it would become more of an end-users objective versus, you know, an inter-carrier objective?
1335 MR. ABRAMSON: I think that may make sense, yes. I mean ---
1336 COMMISSIONER MOLNAR: That’s what you’re talking about? All you -- yes.
1337 MR. ABRAMSON: Yes.
1338 COMMISSIONER MOLNAR: Like capability for competition where feasible.
1339 MR. ABRAMSON: Yes, capability to access that marketplace of folks who are providing services over the broadband access.
1340 COMMISSIONER MOLNAR: Yes. So ---
1341 MR. ABRAMSON: Which ---
1342 COMMISSIONER MOLNAR: Let me ask another question, as we’re in this proceeding, you know, we begin -- we begin from the status of our communication system today and have people coming with visions of 100 meg, you know, up and down and so on.
1343 And I mean those are wonderful visions and all of us here would love to be talking about that stuff instead of what do we do next. What do we do about the fact that there are Canadians today who have one and a half meg down?
1344 So talking 100 is harder, you know, when you -- when you know that there’s costs for people who are still at one and a half, so.
1345 Would you see it to make sense to create the basic service objective for tomorrow saying that, you know, the vision is that we’re transitioning to a BSO where it is broadband and, you know, access with -- to competition, and internet, and voice, and all broadband, all the time.
1346 However, you know, we need a -- we need a minimum standard for today and a vision for tomorrow and as we build we build to tomorrow.
1347 Would that make more sense so we could talk about today and, you know, all bask in the future?
1348 MR. ABRAMSON: I hear what you’re saying and certainly, you know, a lot of times when we talk about competition we see it as part of sort of a shiny new future with all kinds of bells and whistles and so on.
1349 I mean what will say is competition has been present over wholesale broadband access on DSL and still is present in many parts of Canada where the top speed we offer is 6 megabits per second, because that’s the fastest we can do. There is no fibre to the node there yet.
1350 We don’t see those things as opposites. We believe and we’ve seen -- we have experience, that competition is certainly deliverable, even where facilities -- and every community, and every environment is different, so it’s hard to generalize, but -- and that’s why we say we’re feasible, but in many, many cases it is deliverable and is today delivered, to be honest, over incumbent networks in relatively remote areas.
1351 And I guess what we are asking is that as the broadband -- the basic, I should say, service objective is implemented, that that not be forgotten. In other words, it's not a question either of securing that Internet access and that broadband service or of having competition for that Internet access.
1352 If there is a good technical reason we are happy to hear it, and we have certainly incorporated into our proposal the idea that below a certain number of locations served across one's footprint. So if one serves less -- we said 25,000 locations -- then a company may not have the scale to build up that ability to deliver wholesale services.
1353 In those instances we said all we are asking is that you be careful because what you now have is a subsidized monopoly. You have a company that by definition is being subsidized because there was no case for competition there. They are not providing wholesale access to their broadband.
1354 And, I guess, once again, I would say you know the Telecom Act should be looked at very carefully. Internet access as a whole was deregulated some time ago. I think if we were to look at the date on that it would not necessarily be recent. There were a bunch of decisions through which it was done on different platforms. But it may be that if Internet access is an essential service or the kind of basic service that should be included in the basic service objective that having unregulated retail monopolies may not lead to the consequences that are in the best interest of users.
1355 COMMISSIONER MOLNAR: I hear what you say but some of this -- I don't need to argue with you. I am just thinking you know we saw the First Mile Consortium in front of you who essentially are monopoly providers because nobody else wanted to serve and they stepped in. So you know I suppose if you ask them perhaps they would let you offer services to their communities too. Have you ever asked?
1356 MR. ABRAMSON: I can't say that we have.
1357 COMMISSIONER MOLNAR: No.
1358 MR. ABRAMSON: We have our hands full with our current numbers ---
1359 COMMISSIONER MOLNAR: But I understand the principle of where feasible, competition where feasible.
1360 MR. ABRAMSON: Yeah.
1361 COMMISSIONER MOLNAR: And that should form part of what a consumer should expect where feasible and there are some parameters where -- I mean if you are subsidizing to one point it's hard to imagine that you perhaps should also subsidize competitive offers.
1362 MR. ABRAMSON: Well, I'm not entirely sure I follow, but I guess if I have understood correctly I would say if you are subsidizing the broadband access then all the more so to make sure that that doesn't enable a vertical monopoly on the service side as well.
1363 COMMISSIONER MOLNAR: Right.
1364 MR. ABRAMSON: In other words, it's ---
1365 COMMISSIONER MOLNAR: Right, as long as it's -- as long as it is ---
1366 MR. ABRAMSON: Feasible.
1367 COMMISSIONER MOLNAR: --- there is a sustainable business plan for the Internet access. As I said, if you want to go into the First Mile communities ---
1368 MR. ABRAMSON: Yeah.
1369 COMMISSIONER MOLNAR: --- and can make a sustainable business plan.
1370 MR. ABRAMSON: Absolutely. And I should emphasise we're on the cusp -- I should say we hope that we are on the cusp of a significant change in the architecture of how that is delivered. So if you asked me that question five years ago I would say, "Look, a lot of this is aggregated to one point and there aren't a lot of smaller players who make a business of going to every" -- well, of focusing necessarily on geographic areas that does exist but to a lesser degree.
1371 We are heading towards a place and a time in which competition will be much more localized. That will be interesting.
1372 COMMISSIONER MOLNAR: You've been very careful in defining your basic service objective to not identify a speed or any other characteristics. Is there a reason for that?
1373 MR. ABRAMSON: Yes. We think it's consistent with our proposal. In other words, we have -- I mean we have been crystal clear. Broadband access isn't Internet service. It's the underlying physical access. And physical access is -- the capacity of physical access is different than the speed a provider may choose to offer over it that's also upgradable. And so we think that where you want to be is in a situation where you have physical access that will stand the test of time and over which reasonable speeds can be offered, and those speeds will change.
1374 Your decision last week, I think, or the week before but 2016-117, the Telecom Decision, and this was the costing one, you said that you expect Internet traffic to grow by 32 percent a year for the next five years. So I would expect that any floor that we define for today would need to similarly grow by 32 percent if it's going to continue to keep pace with what's happening with the Internet for those years.
1375 I think that when you don't have infrastructure in place that where possible -- I mean again it's hard to generalize, but can be upgraded, that's the objective that we are working towards is reliable, upgradable infrastructure. And, yes, where the choice exists that will be fibre. Other options are possible.
1376 Certainly, we see that hybrid fibre coax, we see the fibre-to-the-node; different forms of DSL may do a lot of good for years to come and may certainly be adequate to meet demand in many areas for years to come. But where the basic service objective is currently not met; in other words the infrastructure is not there, we would assume that the objective ought to be to put in place access infrastructure that will stand the test of time that's upgradeable and that makes sense.
1377 Yeah, we believe that that will typically be fibre.
1378 COMMISSIONER MOLNAR: So you think it would be reasonable for us to not define it, that we would say we want individual local line, broadband, capable of meeting future needs, undefined future needs ---
1379 MR. ABRAMSON: I mean ---
1380 COMMISSIONER MOLNAR: --- scalable?
1381 MR. ABRAMSON: --- scalable, upgradable, reliable.
1382 If we are going to, I suppose, you know get into further detail into inserting that into the basic service objective in a way that it wasn't done the last time because it wasn't done the last time, I suppose that you can say that it meets the ability to use the applications and services that are prevalent at the time.
1383 COMMISSIONER MOLNAR: You might be the only one in this proceeding who doesn't think that we need to set a number whether that number is the floor or some aspirational goal, you know. And we have heard folks. You have heard them even today saying that by defining that it defines -- you know sort of helps define funding requirements and unfortunately for some it defines the floor surface or the ceiling surface that they are receiving into those communities.
1384 MR. ABRAMSON: I mean I hear what you saying and I do -- I guess I am trying to emphasize the reason for that is we really think that the thing that needs to be paid attention to be, if necessary, subsidized but certainly to be mandated as an objective to meet and invite the government to participate and all the rest of it, is to say we need to have in place a physical network infrastructure that can meet demand going forward. If we keep on sort of throwing Band-Aids at it and saying, "Well, right now we think we can achieve this and hopefully that will last for a while" then we are going to keep going to the well.
1385 If the goal really is to say what's our objective here, not what would -- you know, what do we think we can manage in the next couple of years but what's the objective? Then ultimately the speed will be what the service provider decides that they are able to deliver over the physical network that is in place. We are very ---
1386 COMMISSIONER MOLNAR: But isn't part of this -- I believe part of this is to defining what is that physical network? What are the requirements of that physical network? Not where it is today, but there are still gaps from an old target.
1387 MR. ABRAMSON: Yeah. We are happy to sharpen our pencils and spend more time looking at the demand that we do have from our end-users and applying the 32 percent growth that you have settled onto that and see where that shakes out. And I suppose that would be a minimum speed that a service provider getting access to the broadband infrastructure would need to be able to deliver over it.
1388 I suppose in our minds at the end of the day, upgradable physical infrastructure that you are today building from scratch will be fibre and we think that fibre is adequate.
1389 COMMISSIONER MOLNAR: Yeah, I’m not -- well, I don't know if it's all fibre. You know there is fixed wireless, there is satellite.
1390 MR. ABRAMSON: There is and we -- you know as we mentioned, we operate fixed wireless. We are very familiar with it. It's a good stop gap.
1391 COMMISSIONER MOLNAR: So under your proposal there would be no requirement to define the Internet service that somebody would receive. You know, and I think for example the record here speaks significantly about people's frustration with data caps and the amount of capacity they have.
1392 MR. ABRAMSON: So I agree. Look, this is how we propose to redefine the core of the basic service objective that's to be met in terms of why do we want to upgrade it or update it in that way? What is the end goal that we hope to achieve?
1393 Yes, I can well imagine. I mean people want good, high quality fast Internet access. That is hard to deliver without the necessary physical infrastructure in place, certainly, but you are saying what does that look like, right, when you have actually achieved it?
1394 Well, what we think we have proposed is an instrument intended to achieve it.
1395 But in terms of what do we hope to have achieved when we get there, sure, it’s absolutely that good quality high speed reliable Internet access. And I don’t disagree at all. I suppose we’re focusing on a different part of the problem.
1396 COMMISSIONER MOLNAR: Right. And maybe I’ll ask if you wouldn’t mind to undertake to provide us some detail.
1397 So you say good quality. Would you be able to define how you would lay that out?
1398 MR. ABRAMSON: Sure.
1399 COMMISSIONER MOLNAR: You know, what are the parameters around jitter latency and so on that would define quality?
1400 MR. ABRAMSON: Sure.
1401 COMMISSIONER MOLNAR: You say, “fast”; define “fast”.
1402 MR. ABRAMSON: Yes.
1404 COMMISSIONER MOLNAR: And the data as well. You know, where would you sit? What do you think is appropriate on data?
1405 MR. ABRAMSON: Yeah, I mean and I don’t want to belabour the point but I -- we will certainly file that ---
1406 COMMISSIONER MOLNAR: I know but you want a wholesale service.
1407 MR. ABRAMSON: --- and we undertake to do so.
1408 COMMISSIONER MOLNAR: You want us to focus on the infrastructure.
1409 MR. ABRAMSON: Well, but there’s a -- we hope that at the end that a different service provider will be in a position to make those choices based on market demand.
1410 So if someone says, no, no, I need to offer an extremely low latency service at a much higher price over that infrastructure, I can deliver it. And somebody else says, you know what, I’m going to oversubscribe more. I’m going to not worry about my jitter as much, and I’m going to charge way less for it over that infrastructure, they can do that.
1411 And those would be two different offerings in that market.
1412 COMMISSIONER MOLNAR: Okay. Well, thanks for that. So you think quality is a competitive element versus a base element of the infrastructure?
1413 MR. ABRAMSON: I think that when you have competition, different service providers can come in and allow consumers to choose what kind of quality they’re interested in buying.
1414 COMMISSIONER MOLNAR: Okay.
1415 I want to ask you something on that, as it regards data caps. Because I was really interested, I went on your Website and looked at your services, and I liked the little test you have to do to get in to decide how fast, you know, what service you need and so on.
1416 I had to make up a postal code but -- anyway.
1417 But I noticed that you don’t cap data, I think what is it, 2:00 a.m. to 8:00 a.m. Do you have usage through that period?
1418 MR. ABRAMSON: I’ll probably ask Paul to speak to it a little bit because he sees those statistics every day and every night.
1419 But generally that’s right. We don’t -- we have a limited usage from 2:00 a.m. to 8:00 a.m., what we sometimes call “the wee hours”. Because usage is much lower, then we simply don’t need to cap data.
1420 And similarly, we have unlimited uploads at all times of the day because we just -- we don’t need to. There is less scarcity there. It’s really downloads at peak times that define how much capacity we provision for our network.
1421 And so other times of day and things flowing the other way, we have lots of capacity for.
1422 Paul, do you want to address that a little bit?
1423 MR. STEWART: Yes, sure.
1424 So yeah, if we -- you know, if we had it all graphed out, it’s an aggregate of melt and definitely between approximately 2:00 a.m. and the 8:00 a.m. timeframe it drops right off and then at early morning it starts to pick back up again.
1425 That encourages some customers to kind of go off peak more and peak -- planning for that peak capacity is our most costly part of operating at the end of the day.
1426 And we do weekly capacity planning and we, you know, try and project and see where those numbers sit. And that’s the part that hits the operational costs the most, is those peaks.
1427 So by encouraging users to go off hours for perhaps backups to the cloud and different types of services like that, then it helps us perhaps flatten down that peak a little bit.
1428 COMMISSIONER MOLNAR: So it helps you and potentially helps your customers. Do you consider that to be a competitive advantage to you that you are pricing differently?
1429 MR. ABRAMSON: I mean I don’t know if Paul -- I’d say we think so.
1430 You know, we’re able to do it. It’s simply -- it’s of much greater cost to us.
1431 COMMISSIONER MOLNAR: So if we were to define some kind of basic service that had some kind -- those elements, would that be taking away some of your competitive advantage or pricing discipline or otherwise?
1432 MR. ABRAMSON: It’s hard to say. It’s a good question.
1433 I mean for us, it’s both something we think is nice for the end user. You know, we shouldn’t cap what we don’t need to cap. And at the same time, it’s -- as Paul said it’s a little bit of a behavioural nudge almost like energy utilities do, run your dishwasher at night and so on.
1434 COMMISSIONER MOLNAR: Well, I’ve had people comment to me about when Windows 10 came out ---
1435 MR. ABRAMSON: Yes. We certainly hoped then that that would happen at night.
1436 COMMISSIONER MOLNAR: And they couldn’t make any more communications around Christmas because they had, you know -- I mean, that’s unfortunate and unnecessary.
1437 MR. ABRAMSON: Yes.
1438 COMMISSIONER MOLNAR: That’s an aside, I guess.
1439 One more thing and I do understand that you would consider competition to be the first means of addressing issues of service, defining service, creating portable services and so on. But there has been a lot of discussion in this proceeding today on issues of affordability.
1440 And there’s kind of three different, I think, general themes around that, if you will. One is whether or not prices should be the same in urban versus rural areas or same? I mean what kind of pricing should exist in urban versus more high-cost areas.
1441 One is whether there should be means tested; some kind of lifeline or other program to address people of lower income.
1442 And the other thing that’s been also brought up and these words are not mine. They’re off the record, kind of the skinny basic for Internet service.
1443 Can you tell me your thoughts on those types of programs and where your company sits on that?
1444 MR. ABRAMSON: I’ll try.
1445 So you know it’s interesting. We talked a little bit about this amongst ourselves. This is, you know, something that was in the news a lot all of a sudden last week and then this week, and it really gave us the occasion to discuss it.
1446 But first of all, on geographic disparities or what I guess you almost might call postalized pricing, whether where you are should matter as to what the price you pay is. I mean certainly, look, there’s different costs in different areas.
1447 In the past, the Commission -- when I think about the banding for different loop bands I suppose -- has tried to get at those different costs and think about what to do with them.
1448 You know, it’s hard to take a position on whether as a matter of social policy, it ought to be, you know, one ought to cause prices to be very similar in urban areas, where it’s cheaper to live, and in rural areas, where it’s more expensive.
1449 I can certainly understand, you know, speaking personally I suppose that needs would be very great; the more isolated you are, the more the Internet is an enabler of being less remote.
1450 But what to do with that in terms of as a social policy matter on pricing? As a company, I don’t know that we would have a position on it. I mean we’ve consistently tried to deliver low prices to consumers as a way of attracting people to our offering. And to say look, we’re fairly transparent about our practices and one of the things that we do is try and price things reasonably, not rock bottom. And we don’t believe in rates to the bottom for those who sometimes accuse some companies of doing that sort of thing.
1451 We want to provide a good quality service at a reasonable rate.
1452 And so, you know, as our prices become higher in a rural area, we’re not able to deliver the same rate we are in an urban area, unless we either charge more in an urban area and cross-subsidize or unless there’s some sort of external factor that today just doesn’t exist.
1453 Were there to be some sort of portable credit that people could take with them, we’d be happy to participate in that market. But at the end of the day, what we focus on is try to deliver a good quality service at as reasonable a rate as we can.
1454 And I’m sorry that that doesn’t really give you an answer as to whether you ought to subsidize rural prices to make them more similar to non-rural prices. It’s just not something that TekSavvy probably is able to take a position on.
1455 Certainly, we have customers in all different kinds of parts of Canada.
1456 COMMISSIONER MOLNAR: I think it’s fair if you don’t want to -- perhaps you could take a position on the notion of -- of you know the skinny Internet for all provided by all ISPs.
1457 MR. ABRAMSON: Yeah.
1458 I mean I’d like to and certainly when we saw Rogers’ announcement of providing a $10 broadband offering in subsidized housing, not just in a part of Toronto or I’m not exactly sure, but in I think all subsidized housing in Canada or something -- within its footprint or something of that nature, and I apologize, I’m likely getting some of the details wrong. We thought that was great that they’re able to afford to do that.
1459 We -- again, we are all about affordability as a company. We’ve often historically attracted people looking for a good price for Internet access. But in terms of cross-subsidizing supra-normal profits in one area to sell things below cost in another area, we don’t have those kinds of margins. We pay very high wholesale rates. We're able to deliver services that we think are of good quality and very price competitive. We'd love to be in a position to sell them for 10 or $5. We wouldn’t stay in business long if we made a general practice of that.
1460 We think that -- you know, we're happy to see skinny price and skinny broadband. We think that the best way to achieve affordable rates is skinny profit margins because you have a vigorously competitive market.
1461 COMMISSIONER MOLNAR: Thank you. Those were my questions.
1462 THE CHAIRMAN: No questions from the others. I may have one.
1463 I listened with great attention at the conversation you had because you do have a different perspective on the BSO issue and still early day. So I'll try to, you know, middling around it, although part of me thinks it sounds like a Section 7 objective as opposed to a BSO because, historically, it's been seen from the perspective of the end user.
1464 But you've had a conversation with that and I'll reflect on it but if it is BSO in more of the classic sense and not just policy objective, who has that wholesale obligation? Because if you're going to create an obligation, somebody has to be the payee of that obligation. Who would that be in your view? Is it large and small suppliers? Is it fixed, mobile, satellite? Whose obligation is it?
1465 MR. ABRAMSON: What we propose is that the Commission -- and we're not the only one certainly to propose this in this proceeding -- is that the Commission identify goals within defined geographic regions and invite proposals for those who are willing to bid on meeting those goals. And so the obligation would lie on the person who won the bid and signed the contract.
1466 THE CHAIRMAN: And we would do that sort of like community by community. So it's a lot of follow-up proceedings.
1467 MR. ABRAMSON: It is a lot of follow-up proceedings I must say. I mean the nicer -- I don’t know if the nice thing but certainly one thing we do have is clear experience in this area in this country because, as we know, there have a whole wack of funding programs that have done exactly that over the years and we've, I think, developed a good expertise in Canada in creating those kinds of programs.
1468 We participated in one program recently at the federal level. They were nice enough to put out a press release at the appropriate time about -- about our participation in that program to expand our fixed wireless footprint in southwestern Ontario and we felt -- I mean we feel it's a well-administered program.
1469 Who ought to administer that program going forward? You know, now we're into real program delivery details that we think can be worked out once the policy direction -- if that is the policy direction that's adopted.
1470 I think in our initial intervention we sort of took the inspiration of the Canada Media Fund which was reconstituted from the Canada Television Fund I suppose, anyway that succeeded it, and we said if the Commission wished to similarly recommend the Canada Broadband Fund and propose to fund up to half of it through the contributions of service providers using that Section 46.5 power that you mentioned requiring any TSP to contribute to a fund to support continuing access by Canadians to basic telecommunications services, then that's the BSO they refer to.
1471 So, you know, I think that the details of this thing can be worked out and we're certainly not wedded to something called the Canada Broadband Fund or whatever it is, but we do think it's the right approach and we think it's one that’s worked reasonably well in terms of striking that balance between incenting people to find innovative ways of delivering the physical network access and doing it in a way that connects it up with the local community that doesn't necessarily subsidize, you know, folks who are not as close to the ground and so on.
1472 THE CHAIRMAN: Having been involved in the reform of the Canada Media Fund, I do have a nightmare sometimes but, anyhow, perhaps we can learn from the lessons from there if we go down that road. So much appreciated and I'll continue to noodle this idea.
1473 I believe those are our questions and nothing from legal? No, okay. Thank you very much.
1474 MR. ABRAMSON: Thank you.
1475 MR. STEWART: Thank you.
1476 THE CHAIRMAN: So we'll take a short break until 10 past 4:00 and continue with the last two intervenors.
--- Upon recessing at 3:57 p.m.
--- Upon resuming at 4:10 p.m.
1477 THE SECRETARY: Please take your seats.
1478 LE PRÉSIDENT: À l’ordre, s'il vous plaît.
1479 Madame la secrétaire?
1480 LA SECRÉTAIRE: Merci.
1481 We will now hear the presentation of the Canadian Media Concentration Research Project.
1482 Please introduce yourself and you have 10 minutes. Sorry, please open your mic.
1483 MR. WINSECK: Thought I had that. There we go. All right.
1484 Thank you very much for having me here, Chairman Blais, Vice-Chair Menzies, and fellow commissioners.
1485 Thank you for having me here. I also want to thank some students that helped me to put together my submission for this project: Ben Klass, Holly Price, and Chelsea Nash from Carleton University.
1486 Canadians use the internet, mobile phones, and other communications media a lot. This is not new. We've long been extensive users of all kinds of communications media for over a century and by international standards.
1487 Your review of basic services offers a valuable opportunity to reflect these long-standing realities and people’s evolving communication needs into a revised and enlarged concept of affordable universal broadband internet fit for all IP universe in the 21st Century.
1488 Policy makers have debated for over 100 years how to achieve universal service and they've relied on a variety of tools to do so, including regulated monopolies, competition, charters granted for the general advantage of Canada, subsidies, cross-subsidies, price-cap regulation, obligations to serve, encouragements to investment, and so.
1489 Each of these tools has helped to encourage or have contributed to improving people’s access to modern telecommunications services. People have also agitated for such goals, beginning with the post office, then POTS, libraries, broadcasting, and not surprisingly the internet today.
1490 The original goal of the U.S. Post Office, for example, was to bring general intelligence to every citizen’s doorstep, while also serving as a heavily subsidized vehicle for delivering newspapers across the nation with the aim of helping the nation's journalism flourish.
1491 It largely worked. Universal postal policy, in other words, was also press, information, social and economic policy, all rolled into one. People also pushed hard to change the telephone from a luxury good for business and government into a social necessity for interpersonal communication.
1492 In an all-IP world, universal service can build on this track record by not only bringing intelligence to every citizen’s doorstep, but by helping to make that doorstep the perch from which we can see and speak to the world.
1493 Establishing appropriate standards for and right level of adoption is not easy but the OECD, for instance, says that perhaps we can take the high point of POTS adoption as a proxy for desired levels of broadband adoption.
1494 As FCC Chairman Wheeler is also fond of saying, neither the concept of broadband nor universal service is static. Both must be continuously revisited in light of emergent telecommunications services and people's needs.
1495 When Verizon claimed last year that the old standard of five -- the old standard was sufficient and worth keeping, the FCC dismissed these comments as self-serving and adopted a new standard of 25 down and 3 up to be available to all Americans in a timely fashion.
1496 At a minimum, we urge the CRTC to follow a similar course by expanding universal service to include, at a minimum, access to affordable high-speed broadband at between 25 and 30 megabits based on current uses, projected growth patterns, and international experience; to restrict the excessive use of data caps that we find in Canada; and to work closely with Innovation, Science and Economic Development Canada to come with a coherent policy agenda on the issues of broadband subsidies, spectrum policy, and fostering competitive markets.
1497 Several rationales support the adoption of universal service policies: economic benefits for individuals and the economy as a whole; communication networks display public utility characteristics, and thus have an obligation to serve; network effects whereby the value of the network increases the more people use it and the more services that are supported; also mitigates social exclusion and problems of inequalities; and also recognize that the internet is now essential to the practical exercise of freedom of expression and access to information, health services and education.
1498 The pursuit of universal service, of course, must also be mindful that the cost of achieving it should not interfere with --must be mindful of the cost of achieving it; also be mindful of not interfering with market forces that could deter network investment; reinforcing incumbent firms’ dominance by requiring others to finance their network expansion in underserved areas; and the need to be future proof so as not to lock in developments down the road into the standards of today.
1499 There’s no one-size-fits-all approach to universal service policies. Most countries do not legislate specific broadband speed benchmarks but pursue broadband targets as a matter of public policy, developed and back-stopped by regulators and policy-makers who have the legal and political mandate to do what they need to do to achieve outcomes that are in the public interest.
1500 The number of national broadband plans worldwide has soared from 34 in 2007 to over 148 in 2014. When well done, such initiatives set out meaningful and achievable broadband access and adoption goals. They allocate resources fit for the task and establish specific timelines.
1501 Let’s take an example to illustrate the point, the United States. In 2015, the FCC set the goal to ensure that all Americans have access to actual download speeds of at least 25 megabits per second and actual upload speeds of at least 3 megabits per second. It did not point to an explicit legal mandate to do this, but rather to the requirements of the Telecommunications Act that it take steps necessary to ensure that all Americans have the capability to originate and to receive high-quality voice, data, graphics, and video services. The Telecommunications Act in Canada points in a similar direction.
1502 The FCC’s efforts are also backed by a significant amount of funding, as well as the injunction that these targets should be met in a very timely fashion.
1503 We can also look to the European Commission’s Digital Agenda and see that it too is instructive. Once again, it is not a formal legal standard but a set of policy pillars designed to promote connectivity, human development, use of the internet by business and the public alike, and also digital public services.
1504 The Digital Agenda’s central aims are much more ambitious than those of either the FCC or the CRTC, and unlike either the CRTC or FCC, they’re not just access goals but also adoption goals. The main ones are all Europeans will have basic access by 2013. That’s been accomplished. All Europeans will have access above 30 megabits per second by 2020. At least half of all households will subscribe to internet connections above 100 megabits per second by 2020.
1505 The Digital Agenda is not a fixed and immoveable template. The caricature of a single EU broadband model is a myth. Individual countries from Austria to the UK have a great deal of flexibility in how they’re going to work with the Digital Agenda policy objective. Some see them as the floor; others, typically the less well-developed countries in central and Eastern Europe, see them as aspirational targets.
1506 We completed a review of the EU and OECD situation outlining the broadband policies for 41 specific countries, the speed targets they’ve set, the access and adoption levels that have been met, and the range of subsidies. We’ve attached those to our notes today and they were submitted onto the public record in response to Telus’s interrogatory of November 2nd.
1507 The Digital Agenda has sparked significant government investment in broadband projects. At the low end of the scale, we look at Bulgaria, Romania, and Austria that spend around a buck or two per year per person and have done so over the period from 2009 to 2014.
1508 Looking at the middle range of the scale, we find countries like Sweden, Estonia, the UK, Germany spending between $5 and $12 a year.
1509 Standing in a league of their own and outside Europe, of course, we have Australia and New Zealand. New Zealand and Australia invest $25 and $163 per person per year respectively.
1510 In Canada, in stark contrast, total federal subsidies over the last five years have been around $2 per person per year. We can look to the CBC for another contrast as well. It gets about $33 per person per year. So $33 per person per year for the CBC, $2 for broadband.
1511 Too often Canadian policy-makers and incumbent operators shine a bright light on broadcast access across the backdrop of a vast land while downplaying issues of affordability and adoption.
1512 In some ways this is understandable; access to basic broadband is nearly universal in Canada. Coverage levels for NGA, or above 25 and 30 megabits per second, and ultrafast broadband at 100 megabits per second or more, are higher than the EU average and similar to those in the US.
1513 What we also need to remember is that there are at least a dozen countries in the European Union that have comparable or even higher levels of achievement than Canada’s.
1514 4G LTE coverage in Canada has been greater than the EU average for the last couple of years. However, by 2015, that gap had mostly vanished. When it comes to fiber to the doorstep, the information infrastructure for the 21st century, EU levels on average were three times those in Canada and Canada fell quite significantly behind the United States.
1515 So the idea in some circles that the EU model has been a failure relative to the successes of the Canadian/American models is a myth.
1516 So looking closer to home, the CRTC’s goal that all Canadian households should have access to broadband of at least 5 megabits per second by 2015 has not been met. The higher up the ladder speed we go, the further away from universal coverage we have, and the less choice and competition is available.
1517 This is crucial for all that success and access is important when it comes to broadband internet adoption, the gap between rich and poor in Canada is stark. Two out of five households in the lowest income bracket do not have broadband and one in three do not have a mobile phone while adoption rates at the top of income ladder are nearly universal.
1518 Canada stands modestly by international standards as well in terms of wireline and wireless broadband adoption. On wireline we used to do quite well; we ranked around 7th in 2005. We’ve fallen to 11th place by 2010 and that’s where we sit today. We do terribly for mobile wireless. We are now at 26 out of 34 countries.
1519 What explains these trends? Do poor Canadians not want to use the internet? One after another, independent studies consistently point to one thing that goes a long way to explaining our low rates of adoption: the high price of broadband services in Canada as our review of the latest Wall, OECD, and FCC reports show.
1520 The results published in last year’s Wall report, for example, show that Canada does not fare well across the board with a few exceptions. The FCC’s analysis of broadband plans across 40 countries shows that prices for wireline broadband in Canada consistently fall on the high side of the scale.
1521 And things have got worse over time, not better. Its data on small, medium, and large-sized smartphone prices with data plans consistently show that Canada ranks at the bottom of the pack in terms of average monthly prices, or I should say, the bottom of the pack in terms of being the most expensive, and for monthly prices as well as for the cost of a gigabyte of data.
1522 Recent OECD data for a dozen and a half wireline broadband basket similarly confirms the case with Canadian prices above average and in the bottom quartile relative to its peers in all but two cases.
1523 Some of the operators’ hired experts assert that these comparative studies are fundamentally flawed stating for example:
1524 “For Canada...[the OECD] appears to extract list prices only from Bell...thus [making it very] difficult to reach any conclusions about the relative price of Canadian fixed-wire broadband service from these [studies].”
1525 This criticism is wrong. The OECD does not use one company as a proxy for all prices in Canada, it uses four: Bell, Shaw, Videotron, and Rogers for wireline. And for wireless, it uses three: Bell, Rogers, and Telus.
1526 What we really need to look at is how people actually use the internet to really get a sense of what our target should be.
1527 As we started out, Canadians have long been very extensive users of telecommunications and other electronic media since the development of the telephone at the turn of the 20th century. This continues to be the case today.
1528 When determining what levels of service should be available to everyone, we need to consider how people actually use the internet now and how their uses will evolve in the future. The CRTC itself identifies a variety of services that already require more than today’s 5 mega bits per second downstream standard for performance consistency.
1529 So we have a standard-definition IPTV, high-definition IPTV, high-definition video streaming, video conferencing, software downloads, and video downloads. Netflix recommends a minimum of 5 megabits per second for HD-quality video or 25 megabits for ultra high-DEF quality. Even the carriers’ own websites advertise that moderate levels of streaming audio-video subscribers should use 25 megabits per second. For those who fall on the heavier side of things, they recommend 50 to 100 megabits per second services.
1530 Despite this, the same carriers urge the CRTC to base any revised idea of basic broadband service strictly on serious uses. But we should be very mindful of such advice, remembering that what people actually do with the media at their disposal has a long and hoary history of being cast as second in line to more important users, and often frowned upon and discouraged as a result.
1531 The U.S. Supreme Court, for example, in 1915, denied First Amendment protection to movies because they were seen as crassly commercial and aimed only at entertaining the masses rather than drawing them in to the public life of the nation. Women's early use of the telephone was also discouraged.
1532 While it might be easy to pooh-pooh Netflix and watching YouTube as frivolous activities, as a matter of fact, it doesn’t matter if one is using Netflix or watching CPAC and the NDP Convention over the last weekend, or if you're watching YouTube for instruction videos, as I did last year to learn how to do wainscoting around the house.
1533 There are many instructive uses of the media. It is not the task of the CRTC or the carriers to tell Canadians what they should be doing with their broadband internet connections.
1534 The CRTC must also take much better account of the fact that households are running multiple devices at the same time, and the fact that there are multiple users in a single household routinely using these devices over the same connection at the same time.
1535 The FCC currently puts the average number of devices per home at around seven. Cisco puts it around six and suggests that it's going to grow in the next five years to about 11.
1536 With the automated downloads and the mass commercialization of the Cloud and the internet of things, the demand for bandwidth is going -- only going to grow over the near-to-mid-term future.
1537 A few more points and I will finish up. Data caps and speed limits, we've already heard a lot about this today, and I think it's very important what we've heard.
1538 Data caps are really critical factors. And a 5 megabits per second service might be technically capable of supporting a single HD video stream, but what people quickly find is that data caps associated with lower-tier plans prevent them from fully enjoying the services that they pay for.
1539 Data caps are an excessively blunt constraint that discourages communication. The goal of public policy should be to encourage communication. To the extent that network congestion is a problem, it stems from peak traffic loads, not from individual usage by so-called "bandwidth hogs".
1540 Insofar that data caps are justified or can be justified, Sandvine imagines a scenario where users are allocated 200 gigabytes caps per month for use during peak periods and unlimited thereafter, a bit of a version on the TekSavvy model we just heard about.
1541 From an economic point of view, there's no link between charges and cost. The use of data caps also puts an unregulated pricing tool in the hands of ISPs with significant market power. Also, people find data caps confusing.
1542 In close, my recommendations.
1543 First, the Commission has the authority to bring in substantial BSO reform and should use it.
1544 Second, the Commission should expand universal basic service to include, at a minimum, access to affordable high-speed broadband of between 25 and 30 megabits per second based on how Canadians currently use the internet, reasonable projections of growth from a wide variety of sources, as well as international experience.
1545 Data caps should also be phased out, or at least, a floor associated with basic broadband put under them at say, 200 gigabytes per month for households and maybe 90 to 100 gigabytes for individual subscribers, or 200 gigabyte or gigabyte caps per month during peak use and unlimited use thereafter.
1546 As a general principle, broadband service should be differentiated by speed, customer service, price, and other factors, not by use.
1547 Four, the Commission must move beyond its focus on access and geography and its research monitoring and actions to focus more on adoption and affordability.
1548 And last, I would encourage the Commission to work more closely and coherently with Innovation, Science and Economic Development and the federal government, develop a more coherent policy agenda in relation to subsidies, spectrum, and competition.
1549 Thank you very much.
1550 THE CHAIRPERSON: Thank you. I'll put you in the hands of the Vice-Chair of Telecom, please.
1551 COMMISSIONER MENZIES: Thank you, and thank you for your very thorough submissions. I hope you were generous to your students who assisted you in terms of all their hard work.
1552 I want to start with something not a lot of people raised, and that's -- and you raise it fairly frequently -- is adoption. Why is that important as opposed to availability?
1553 MR. WINSECK: Yeah. I think that's the Gold Standard of what we really want to accomplish, and what we want to use as our compass for how to act, I think, instead of imputing what people need or what they even want. I think by looking at what they do, we get a good guide as to how people are thinking about the internet, how it fits into their daily life, and then we can use that as the guide for overcoming any gaps in adoption. Because it seems to me, the question is always whether or not the service is affordable. And once people have access to it, they demonstrate for us very clearly how they're going to use it.
1554 COMMISSIONER MENZIES: So you're using adoption as a measure of affordability, in a sense, because that's what I was trying to get my head around, because you mentioned adoption perhaps even more than affordability in that sense.
1555 MR. WINSECK: M'hm.
1556 COMMISSIONER MENZIES: So you're using adoption like a -- even if it was an aspirational target by the Commission, you're asking that we set that so that we can more thoroughly measure all issues around affordability?
1557 MR. WINSECK: Yeah. What I was suggesting here is that you put as much emphasis on adoption as you do on access, as much emphasis on adoption and affordability as you do on access and geography. We have CMR and we have reports and various studies, one after another, showing this incredible amount of detail with respect to geography and access, but correspondingly, very little information on adoption and affordability.
1558 And what I'm suggesting is that we recalibrate the balance between there so that we can know a lot more about these issues. From what we do know, I think there are some serious issues that we need to take account of.
1559 COMMISSIONER MENZIES: On Table 1 of your August 14th submission, you have charts, and they may be repeated here for all I know, but -- on availability and adoption. And one of the issues -- and you point out there that it's difficult to understand if this reflects upon affordability.
1560 MR. WINSECK: Right.
1561 COMMISSIONER MENZIES: And I was curious to know if you have any data on whether it reflects upon preference, in other words, people whose internet needs are relatively modest, when you look at adoptability of higher speeds and that sort of stuff?
1562 Because not -- I mean, there are -- you know, in the context of this hearing and that sort of stuff and these general discussions, we're talking about a lot of discussions about people who are fairly frequent and heavy users of the internet. But there are lots of people who are connected who maybe, you know, check the weather and send a few emails a month.
1563 So is there any sense of personal preference, in terms ---
1564 MR. WINSECK: Oh, absolutely, and you know, people do make preferences, and this is why I suggest in the last -- in my last -- one of my recommendations there that we should reflect those preferences on a basis of prices, customer service, and so on. And so you can buy lower or higher speed tiers, and so we're not asking that everybody has to have, you know, a gigabit service or 100 megs to the home or even 50 or 60.
1565 But we are -- I am suggesting that we don’t use data caps to regulate their use. And then I also think that, you know, in terms of preference, you know, that again -- you know, it kind of individuates the problem, so to speak, as opposed to looking at the adoption patterns, looking at the gap, as I said, between the high level of POTS that was achieved and where we're at now with respect to the internet, and then get to the question of affordability as well.
1566 And so basically, I think too often, we skirt the hard issues and we focus on subjective ones like preferences and so on.
1567 COMMISSIONER MENZIES: Can I go back to your initial submission there too? In paragraph 54, you're talking about adoptability again and the need for higher speeds. And you reference a previous hearing we had and I recall in that same hearing the company describing its experience with fiber to the home uptake, that people would take it on trial and agree that it was a superior service.
1568 But then when it came to the point of wanting to pay an extra $25 a month for it the response was frequently thanks but no thanks.
1569 Yes, this was better but it’s in my mind not $25 a month better. The other stuff was actually -- it met my basic needs and therefore I don’t really want to invest anymore.
1570 In that part of your statement you seem to object to that as a market reality and I wanted to know why.
1571 MR. WINSECK: Well for one I think it’s dodging this question of price and that’s why I put so much emphasis on prices here and from such a range of studies to try to show that consistently we’re faced with this one reality and to me this point of view raises some very interesting issues and I want to get to that.
1572 But I think it dodges price and I really want to insist on that point first. But it does -- it does get at this issue of demand and there is definitely a problem in terms of is demand sufficient to pay for these -- for these kinds of infrastructures.
1573 This has been a long standing concern. I remember the first book that I wrote on this topic 20 years ago, I dealt head on with that particular question, at that time and I had kind of a sharply formulated question.
1574 You know, information superhighways who wants them; right? And that was to point out that the question was that there was –- there was demand -- there’s questions around demand; right?
1575 So I don’t want to sit here and pretend that there are no questions around demand and so on, because I think there is.
1576 But I also think that, you know, we have to kind of establish a hierarchy of kind of priorities here and we also have to realize that I think that price is an -- is a very extensive consideration in peoples’ preferences here.
1577 And I think where we do see greater levels of availability and less expensive pricing options, we do have greater uptake.
1578 And again I’ve tried to include some of that in the tables that I provided with you today, but are we going to, you know, if we were to lay out, you know, fiber to the doorstep for all Canadians are, you know, all Canadians want to -- going to want to pay for -- pay for the bill? No.
1579 But are we going to experience more generalized economic and social benefits from having this general purpose network? I think we will.
1580 And will we be able to discriminate, price discriminate, on top of that general purpose network to allow people to express their preferences for lower-end services and higher -- you know, versus higher-end services, I think absolutely.
1581 COMMISSIONER MENZIES: Okay, but just to -- to test that a little bit, when you talk about demand, the previous targets we set, five and one, demand grew that -- blew through that pretty quickly; right?
1582 MR. WINSECK: M'hm.
1583 COMMISSIONER MENZIES: Because I can remember -- and as much as I know you said we low-balled it, at the time most folks in that hearing were asking us to look at between three and five.
1584 So it seemed like a pushed target at the time, no matter what it seems like today, and the FCC was four at the time in terms of -- in terms of its targets, but once people got five then they accessed video; right?
1585 MR. WINSECK: M'hm.
1586 COMMISSIONER MENZIES: You know buffering, et cetera, et cetera. But they knew if they got 10 then they could have more and the market discovered fairly quickly that people would pay more to get that.
1587 So the demand for that, sort of, online -- for the video streaming and others, grew the market quite a bit.
1588 So kind of getting back to what about leaving -- and within the context of, you know, it’s always incumbent upon the agents of change to prove its necessity, what about that using market forces and targeted government funding has failed?
1589 Because it -- a reasonable person could argue that that target was not only met, but in most areas far exceeded by deferring to demand and supply market forces.
1590 MR. WINSECK: M'hm. Yes, you know, I remember reading, you know, through the setting of that standard and I think, you know, I think I gave you guys credit for being fairly reasonable there.
1591 You basically had a shorter timeline then the FCC, the target was higher than the FCC’s, so I thought that was -- you know, it was -- it was not a bad first effort.
1592 I thought you low-balled things with respect to things that we started out with today and coming right from the Chair out of the gate this morning, you know, this idea of multiple users using multiple devices simultaneously in a single residence or single premise; right?
1593 And so there’s where I thought perhaps the understanding of the demand that was -- that -- it was used to set the targets last time was a bit low.
1594 But, you know, this is -- this is it and I mean I had a lot of talks with people as I put this together and I thought through this and many people urged me don’t put a -- don’t put a speed target in; you know?
1595 Don’t put a speed target in, because you’re going to blow through that very, very quickly.
1596 And so I felt that I -- what I wanted to do to kind of demonstrate that I was coming in here and, you know, being reasonable as opposed to kind of starking at the -- staking out some, you know, incredibly radical idea, was to say okay let’s take a look around the world and let’s see what is being set as reasonable standards.
1597 And let’s see what, you know, peoples actual uses and, you know, what are CISCO saying? What is Sandvine -- you know, the people that actually make the gear upon, you know, that the tel. cos are buying; right? And so that’s what I based my standards.
1598 Now could, you know, could we blow through this quickly? Very well may.
1599 And some are going to urge you to adopt much higher levels than what I’ve done. I’ve -- basically what I’ve tried to do is establish a floor.
1600 COMMISSIONER MENZIES: So what’s wrong with that? What’s wrong with establishing the floor as a -- for a basic service?
1601 When you’re talking about I mean -- because that’s what we are talking about is basic needs; right? Not -- not enhanced -- call it enhanced needs, similar to the current framework in terms of that. What’s wrong with mandating a floor; right?
1602 MR. WINSECK: M'hm.
1603 COMMISSIONER MENZIES: And indicating that part of that mandate might include eventual access to these enhanced services, which allow the system to grow -- grow up on its own while ensuring people have -- their basic needs are met and the market and other investment can meet their wants.
1604 MR. WINSECK: Yes. My concern here is that this distinction between basic and enhanced is substituting the Commission’s judgement for personal preferences and this has -- it really does have a very hoary past.
1605 I mean in my field of communication and media studies, you know, the idea of, you know, that people have been consuming the wrong media or doing the wrong thing with the media, from the telephone, to romance novels, to movies, to television today, has a really long history and the idea that, you know, somehow peoples’ behaviour should be kind of discouraged.
1606 And so I don’t want to smuggle in some normative judgements about peoples’ behaviours under benign sounding distinctions.
1607 And so this is what I’m thinking about with this idea and -- of, you know, looking at what people are actually doing.
1608 You know, you asked for evidence to base a judgement on; okay? And so I -- you know I have -- I have a standard method of thinking.
1609 I always look for, you know, what are people actually doing, what is the situation on the ground, how can I best understand this.
1610 Second, what are the historical kind of realities that I can point to?
1611 Third, what are the comparative realities that I can point to and then I look at normative kind of moral and ethical considerations to make judgements.
1612 So here I tried to do the -- you know, really kind of ground it on those first three and I don’t want to let anybody get -- like I said with the YouTube videos, you know we can poo poo those all we want, but the fact of the matter is people are doing really important stuff with things that, you know, could easily be cast as frivolous.
1613 COMMISSIONER MENZIES: Okay.
1614 In a non-subsidized world I think we would all agree on that, but when you’re looking to other people to subsidize and, you know, for the most part Canadians access these services. Most Canadians access these services at high speeds.
1615 So a lot of this is about areas where people are on the low end of advantage and very high-cost serving areas and that sort of stuff. They need subsidy.
1616 Isn’t there some sense of responsibility that’s incumbent upon the regulator to say ‘okay, if you were going to apply to subsidy, we can subsidize needs but not romance novels’? Or is it fair?
1617 MR. WINSECK: Yes.
1618 COMMISSIONER MENZIES: Or is it important to have that discussion about people?
1619 I mean, we talked to First Nations representatives today who talk about education and e-health and access to justice.
1620 So you could actually, in some of these communities you could, you know, if you were in trouble with the law, you could actually make your court appearance via video conference and meet your lawyer via video conference, because right now it’s by telephone call; right?
1621 MR. WINSECK: Yes.
1622 COMMISSIONER MENZIES: Et cetera, et cetera.
1623 There’s a fairly profound argument for subsidy in terms of that area, but to add onto that the addition of want as a subsidized service rather than something you can access as an enhanced service, doesn’t that make sense?
1624 MR. WINSECK: See the problem is now we’re substituting, you know, needs and want for basic and enhanced and, you know, we can keep going around this circle.
1625 But the thing is, you know, when you look at these things, and what I’ve learned as a communication scholar and media scholar, is that, you know, sure one can poo-poo the romance novel and good Lord knows that I do it when I look at one and I want to, you know, cast it aside.
1626 But you know what the romance novel is for women and for others who read them is it’s a way of transporting themselves imaginatively into fictional worlds, which is really good for mental health.
1627 It’s a currency; it’s a social currency around which they, you know, they generate communication with others and social activity.
1628 But let me, you know, try to -- if that one is a bit too far out for you, let’s bring it back to things like, you know, video conferencing.
1629 You know, what’s the difference? Video conference, Netflix video; t’s both video, right? So the idea is it’s video; this is what people are doing with it.
1630 Gaming; you know? They’re showing more and more the benefits of gaming, especially for older people in terms of Alzheimer’s, dementia, eye-hand coordination.
1631 You know, one of the things that we learn about media is that what people do with media is surprisingly enriching; right?
1632 And that any judgements that people like ourselves, either from a scholarly community or from the kind of bureaucratic government community, or anybody else who’s in a position of doling out who gets what, all right, is that we undervalue what people use; all right?
1633 And what I’m not talking about here is giving everybody a Lamborghini; all right?
1634 But what I am talking about here is providing a damn good road for people to get to where they want to go and me standing aside and letting them do what they want to do.
1635 And I don’t want to be telling people what to do and this is what I think. You know, this is why I think the Commission has done really interesting work in the last couple of years with the emphasis on structure.
1636 Get the structure right -- and this is what I understand TekSavvy and Bram talking about. Get the structure right and a lot of this other stuff will take care of things.
1637 And to start, you know, trying to, you know, envision a distinctions between basic and enhanced, needs and wants, and capping one and, you know, green-lighting the others, I don’t think cuts it and ---
1638 COMMISSIONER MENZIES: Okay. Yes.
1639 I’ll let others argue with you on that because I think there’s some consensus about building a good road and then we could mix metaphors about whether you get a subsidized Studebaker or Lamborghini on it and away we go.
1640 MR. WINSECK: I’m not asking for ---
1641 COMMISSIONER MENZIES: But anyway, my purpose here is just to help you articulate your argument and not to argue with you just to test it.
1642 What are your thoughts on, say, Rogers’ suggestion for an immediate 5 and 1 basic service objective and with 25 megs by 2020?
1643 MR. WINSECK: I’m sorry; could you repeat the question? I didn’t ---
1644 COMMISSIONER MENZIES: Rogers’ suggestion for an immediate basic service objective of 5 and 1 mandated, with 25 by 2020? What are your thoughts on that? Did you have a chance to -- if you haven’t had a chance to look at it it’s not really a question.
1645 MR. WINSECK: Yeah, I haven’t -- I haven’t had a chance to look at it, but you know, I think this is one of the interesting things.
1646 We call this kind of results by regulation through raised eyebrow. So you folks convene the meeting and we see some things already starting to stir. So, you know, it’s not a bad thing just to, you know, the regulator raises the eyebrow and watch people -- watch people dance.
1647 COMMISSIONER MENZIES: What -- you’ve mentioned POTS a couple of times; what should we do with that?
1648 MR. WINSECK: I sat there and I hoped you weren’t going to ask me this question.
1649 COMMISSIONER MENZIES: I’m sorry to disappoint you.
1650 MR. WINSECK: Yes. You know, it’s a tricky one. I mean, we all know what the deal is. People are giving up on POTS or at least the landline POTS.
1651 Revenues are going down, continuing to support that is a diversion of revenues away from, you know, new investment and networks.
1652 So I’m not sure how helpful I can be on that one. You know, I think we need to have some minimal level of POTS-like functionality enhanced, you know, access to emergency services, 9-1-1, to basic voice telephone services.
1653 I think, you know, can we do that in a platform-agnostic or technology-agnostic way, so that we can build mobile or VoIP? I think those are the things that we have to -- that we have to look at.
1654 COMMISSIONER MENZIES: Okay.
1655 What about separation between -- if we’re talking about subsidy in areas, where do you think the line should be drawn between well-served areas on subsidy, in terms of rural/remote and other areas or are you in favour of subsidized networks everywhere?
1656 MR. WINSECK: No, not in favour of subsidized networks everywhere.
1657 I’m in favour of realizing that we have markets that are highly imperfect, that they have developed reasonably good levels of access in many areas of the country, but that there are also underserved populations both in urban areas and in rural areas.
1658 So I am, you know, I don’t think that we need to shy away from subsidies. I mean I -- you know, I go and I look at this stuff, I try to look at it with an open mind and I didn’t know what the subsidy levels would look like when I compared them across countries and how things would look and I had -- I compiled them all from the EU and the OECD and Canada at the federal level.
1659 And I was shocked, I mean, quite shocked really by the range of these things. Second, that Canada really does fall at the very, very low end, if we’re just looking at just federal subsidies.
1660 And, you know, the comparison to me jumped off the page between, you know, funding for broadband and funding for the CBC.
1661 I mean if people -- you know, people by and large, they’re not up in arms about, you know, a $1 billion subsidy to the CBC.
1662 I mean, of course there are some; you know? But we have managed to deal with that pocket of things.
1663 So I think we have a lot more room that we could go to subsidize people who are underserved and we ought not to tie that idea of underserved just to rural and remote areas.
1664 I am, you know, very mindful though, and I think that the First Mile Connectivity Consortium this morning did a great job on just how badly served some of their communities are.
1665 COMMISSIONER MENZIES: I expect you might get a broader discussion on that in some of those areas.
1666 So when we look at your data, and I know you sort of go back and forth on its fairness of comparison. I mean talking access and broadband speeds and you’re using European comparisons.
1667 I just want to give you the opportunity to deal with this question, because some people will look at it and say well, there’s 750 million people in Europe. There’s 36 million people in Canada. Surely there must be economies of scales. How fair is it to rank Canada, you know, on a chart with Luxembourg? I mean, you can fit Belgium and the Netherlands into Nova Scotia, into about two-thirds -- well, you can fit Belgium into about two-thirds of Nova Scotia, I think. Luxembourg is about the size of the City of Calgary, I think, or something like that. We got -- you know, some of those countries listed and sometimes when you look at the top 10 you could fit them all into British Columbia.
1668 Isn't Canada's geography and population density a feature that should be taken into consideration when people view this?
1669 MR. WINSECK: The short answer to your last question, yes. But my longer answer is I just -- I kind of reconfirmed this before coming up here today.
1670 Seventy-one (71) percent of Canadians live in a -- in central -- census metropolitan areas. All right? So you know, it's 35 percent -- a third of the population lives in three cities.
1671 Your broadband map that you released the other day, one of the most outstanding features that struck me when I looked at your broadband map the other day, was -- I mean, we're talking blank space. The country is by and large blank space.
1672 And if there's a problem of, you know, dealing with the 10 percent of the population -- and I'm working loosely with that number -- that's in a scattered remote rural areas, then we have lots of room with subsidies to deal with it.
1673 But we cannot keep turning to this idea about big country, small population as an excuse for low levels of adoption and high prices, and the data caps, the things that curb and restrict what people actually do, and just taking a generally parsimonious and flinty-eyed view of what Canadians ought to have at their disposal in the internet age.
1674 COMMISSIONER MENZIES: But just to test that, surely price has to be a feature when you look at geography, in terms of that.
1675 And if you look at, you know, meeting basic needs such as sovereignty, security, public safety with a telecommunications system and these vast expanses where very few people live, but they are Canadians and we do want them to live there and we do want them to prosper there, and we want economies to grow there and that sort of stuff, wouldn't it be more -- to go back to that -- first of all, isn't price an issue?
1676 And when we're comparing EU countries to Canada, wouldn't it be more fair, from what you said about 71 percent, to compare Toronto to France or to compare Winnipeg to Luxembourg -- which is an interesting comparison.
1677 But in terms of connectivity or size and that sort of stuff, in terms of challenges and economies and economies of scale, wouldn't it be more relevant to do that to people, and then compare connectivity in northern Sweden to connectivity in northern Canada, for instance?
1678 MR. WINSECK: I think, you know, if we compared Winnipeg to Luxembourg, we'd be shocked at the discrepancy, and ---
1679 COMMISSIONER MENZIES: I'm not saying we wouldn't be, but I'm just saying geographically, wouldn't that be more fair?
1680 MR. WINSECK: No, and see, this is what I was saying about the -- I was saying about your broadband map. It's not that there are people there that I'm saying we shouldn’t be serving. It's that there aren't that many people there, and they aren't being served now.
1681 Okay, and so what are the -- if you look at the broadband map, basically you have -- you know, and you’ve used your hexagon method there for identifying where there are users in a particular area of the country. And the thing is it shows that we have, you know, huge swaths of the land that (a) people aren't living in, and (b) even where there are people living in some of those areas, there are no broadband connexions.
1682 And you know -- yeah; so what I'm saying is we are not -- it's not like we are seeing the 71 percent of the country that lives in the 30 central metropolitan -- or census metropolitan areas are all having to subsidize the 5 or 10 percent of the population that lives in the remote areas of the country with an extra $5 to $10 a month on their internet bill or on their phone bill.
1683 The levels of subsidies that would be generated by the discrepancy between the costs of -- the prices of services in Canada, all right, and prices that we see elsewhere are of such a great difference that it just doesn’t -- it doesn’t add up.
1684 And what I'm saying is if we take these studies as a guide and we stop trying to disparage them for a variety of reasons; I pulled out, you know, one example today. I mean, and which it's just -- it's like dead wrong.
1685 I mean, the hired expert who makes appearance here -- is here generally and is part of this general kind of production of a narrative about Canada and his telecom system is dead wrong. I've known that he's been dead wrong for several years, but I finally decided, okay, I need to -- since I'm going to be here, this is the way I work. I called people at the OACD, okay, and I said, "Look, you know, this is what's going on," and they directed me to the right published source where they lay out the methodology.
1686 So anyway, of course -- the geography is a factor but it's become a crutch.
1687 COMMISSIONER MENZIES: I appreciate your view that these should be used as guidelines rather than -- that the data should be used as a guide.
1688 MR. WINSECK: M'hm.
1689 COMMISSIONER MENZIES: Is what you’re saying. I appreciate that remark.
1690 I just want to touch -- if we go to the end of your presentation there where you summarize your recommendations, I don't want to be the guy who says this every time, but I'm going to say it again. How much does it cost to do all of those things? And who is going to pay for it?
1691 I mean, we've heard today Australia may be into 56 billion or something like that. I don't know. I haven't double checked that.
1692 MR. WINSECK: I got 42, 42 billion.
1693 COMMISSIONER MENZIES: You could run the Canadian military for three years on $60 billion. Like it's real money, right? If you're talking that kind of money, and it's got to be generated somehow.
1694 So help us understand what the size of the ask it is, because we don’t have any money. We just have access to other people's money. So it would be important for us to know how much money we're talking about and how big the ask we might be making on a broader community in order to fulfil these things.
1695 MR. WINSECK: Just a second and I'll just try to figure out, you know, something that I think would be a large number for you.
1696 Okay, so we are looking at -- well, if we did 10 million lines, right, and we did 1,000 bucks a line at the low end, all right, we're looking at $10 billion.
1697 If we did 5,000 -- I'm just pulling these numbers off the top of my head in terms of these are ones that I've seen bandied about. So I don’t have the touchstone for them, but 1,000 to 5,000 is a range that you see, right?
1698 So you know, let's just -- so if we said every one of them costs 1,000, which is probably too high already, we're looking at -- you know, we're looking at 10 to 50 billion. And then we’d have to spread that out over 10 years. And then, you know, I don’t -- you know, we're looking at -- so I guess we're moving up there.
1699 But you know -- so we're probably in the same range, somewhere around what -- you know, I'm trying to do the math really quickly. And I don’t -- not good at math doing it on the fly. Like when I do these tables, I have to sit down and be very, very careful. All right, so I'm doing this on the fly.
1700 My guess is that we're going to be inside of what it costs us every year for the CBC.
1701 COMMISSIONER MENZIES: Okay. I appreciate ---
1702 MR. WINSECK: So I don't think this ---
1703 COMMISSIONER MENZIES: I appreciate that. I mean, I don’t expect people to come in with a -- you know, we've done the study and that sort of stuff. But I do appreciate the -- an in the ballpark best guess, in terms of that.
1704 I don't have any more direct questions. My colleagues might. I'd like to add that I really appreciate and I believe my colleagues do as well. When academics or others who have no direct skin in the game other than a study take the time to put together an intervention for us, it's much more fun to have it beforehand than after the fact because it's actually more useful. So thank you very much.
1705 Commissioner Molnar.
1706 COMMISSIONER MOLNAR: Thank you.
1707 You talk about minimum speed and then you talk about data caps. What would you see to be the most significant improvement to adoption that could occur? Like, I am going to re-ask that question.
1708 How important is speed versus addressing when it's on a consumer's ability to fully utilize internet in the time they want for example?
1709 MR. WINSECK: I think we have to go -- you are basically asking me if I had to kill one of my babies, right, speed target or ---
1710 COMMISSIONER MOLNAR: Well, could you ---
1711 MR. WINSECK: --- the data cap, like which one would it be?
1712 COMMISSIONER MOLNAR: --- could you put a priority to it? I mean, you know, speed is a sexy thing to speak of but it's not always obvious to me how the speed targets being presented relate to the use that's occurring.
1713 MR. WINSECK: Yeah. I mean just, you know, personal experience I was at my brother's last Christmas and there was about nine of us and he is on 60 Mbps and we took down his network, basically.
1714 COMMISSIONER MOLNAR: But we are not designing networks for Christmas time.
1715 MR. WINSECK: Well, you have to ---
1716 COMMISSIONER MOLNAR: So find a different ---
1717 MR. WINSECK: --- well, networks have to be designed for peak use, right? That is, you know, within homes and across society and economy as a whole, right?
1718 And you know I was surprised. It wasn't like it was outrageous. I mean there is a couple. There is two televisions going on and a bunch of folks on cell phones. But anyway, that was -- that's just an anecdote.
1719 I mean there's some -- you know there is a trade-off there. But I really believe like I did try not to ask for the moon on the speed targets. I really tried to sharpen my pencil, so to speak, and come in with something that I really thought was kind of mapping onto current needs with some room for growth, okay.
1720 So if we could say that the 25/3 standard is reasonable, I think the data cap is really a big -- a big problem here that needs to be whittled down to size if not eliminated altogether. I mean Sandvine had a great idea, I thought, a couple of years ago. They published it, and that was you limit the use of data caps to peak internet time and they threw out a target number for North America of a 200 gigabyte cap at peak for peak internet times that they were defining, I believe it was 7:00 to 11:00, you know standard kind of primetime and unlimited thereafter.
1721 To me that sounded like a reasonable thing. I mean we looked at -- I looked at Cisco estimates. Cisco has already got Canadians on average households at 56 gigabytes per month and they project it is to go up around 180 by 2019. So that's why I said -- so I tried to also be reasonable there with, you know, look, either eliminate these things. That's my big ask, climb down and, you know, like, you don't get what you ask for, right, it's not just one person here. The 200 here or, you know, do it on individual, right, because we have to recognize this whole idea of a variety of users and a variety of scenarios.
1722 COMMISSIONER MOLNAR: Well, I realize you didn't provide a priority but that's fair. You don't need to.
1723 MR. WINSECK: Sorry.
1724 COMMISSIONER MOLNAR: You would not kill one of your babies.
1725 MR. WINSECK: Thank you.
1726 COMMISSIONER MOLNAR: Just on the issue of data caps you don't consider that they might be part -- I mean they would essentially become part of a pricing. They become a pricing tool. They were initially presented to us as an economic ITMP but no more. You would see them going back to being more of an ITMP kind of an application?
1727 MR. WINSECK: M'hm.
1728 COMMISSIONER MOLNAR: Yeah?
1729 MR. WINSECK: Yeah, that's basically ---
1730 COMMISSIONER MOLNAR: That could cause prices of the base service to increase, however.
1731 MR. WINSECK: I don't think so.
1732 COMMISSIONER MOLNAR: No?
1733 MR. WINSECK: I mean, you know we have to sometimes say things that some people don't like to hear which is we have got some pretty fat profit margins and they have been enduringly fat. Bringing those things down to size is not out of the realm of discussion.
1734 COMMISSIONER MOLNAR: Okay, thank you.
1735 THE CHAIRPERSON: Perhaps one area. I mean I would like to ask you about video streaming but even if I put on all kinds of caveats on my questions and a journalist reports on it with all those caveats, somebody is going to slam a headline on it and all the digital media will be on it. So I won't.
1736 But I will ask you about video conferencing because there is a neutral way of talking about the same issue, because I get your point about normative judgments. But you saw our Exhibit 1 this morning and you might have it there for you.
1737 So video conferencing does take a certain amount of speed and one of my colleagues mentioned it would probably help -- it would probably have some impact on data caps. But if I follow your logic that we could have concurrent users in a household, perhaps even as many as six or seven, that we have to create a standard that allows six or seven people to concurrently do videoconferencing, yet our basic service obligation for telephony, voice telephony, has never envisaged more than one person talking at the same time in the house that we manage that.
1738 So help me understand why isn't it reasonable for the Commission to ask itself is there a minimum amount that we should be concerned about but not, you know, everybody getting concurrently on the phone at the same time?
1739 MR. WINSECK: Yeah. I mean, as I tried to say at the very beginning in my thing, this is tricky stuff and I don't envy you for having to make the decisions at the end of the day.
1740 I think one easy way to kind of get out of the difficult choice there is to say, you know, a telephone line didn't enable, to the best of my knowledge, multiple conversations at the same time. That just wasn't a kind of standard practice even if it was technically possible in some way. It wasn't what people had.
1741 THE CHAIRPERSON: Right.
1742 MR. WINSECK: Right. And you know, but your point is well taken.
1743 But I guess what I am trying to do is to say be wary. There be dragons when you start to draw lines around what is basic and enhanced or wants and needs.
1744 You know, and this is why I really think that proper respect for people is to -- and to try to -- because academics have a long history too of standing in and offering their judgments for everybody else, right. One of the big things in the last 20 years of scholarship and it just happens to be when I have kind of grown up as an academic has been this kind of backlash against academics kind of hiding their moral preferences behind a jargonistic language and just having to come clean about this.
1745 And so what I have tried to do in my own research is to basically reflect my own experience and to say, "Look, I am suspicious about normally judgments being a cloak behind things" so we really -- you know let's -- my way of kind of getting out of that conundrum about not making judgments about people and telling them what they ought to do and being sensitive to anybody else doing that is to say, "Let's look around. Let's open our eyes and let's as clear-eyed as we possibly can and non-judgmentally try to find what they are doing and then use that as our guide".
1746 THE CHAIRPERSON: Right. Okay, that's helpful.
1747 And strangely enough, I thought you would have mentioned you know that we did go from party lines to single lines at one point, but maybe that was well before your time.
1748 MR. WINSECK: It was well before my time but an interesting part of history nonetheless.
1749 THE CHAIRPERSON: We find people that still, even though they’re youngish, lived it because sometimes it was the reality in cottage country inevitably.
1750 So I appreciate and I do echo my colleague’s point about having folks like yourself from academia join us in the hearing, putting forward your perspective on issues and not waiting for our decisions to come out and criticizing them as, you know, often we see in certain circles and in certain think tanks.
1751 If you have a view and -- show up and have that view tested and it’s part of the game, but we probably get better outcomes in the end. So thank you.
1752 MR. WINSECK: For sure. Thank you again for having me here.
1753 THE CHAIRPERSON: Thank you. I don’t think we have legal questions? No. Good for you.
1754 So Madame la secrétaire?
1755 Thank you very much, Professor.
1756 MR. WINSECK: Thank you.
1757 THE SECRETARY: Thank you. I will now ask Mr. Fenwick McKelvey to come to the presentation table.
1758 THE CHAIRPERSON: Well, that’s a first.
1759 THE SECRETARY: Please introduce yourself and your colleagues and you have 10 minutes.
1760 MR. McKELVEY: I would like to thank the Commission for the opportunity to present today at this hearing and also I would like to acknowledge and thank the Algonquin people for allowing us to meet on their territory.
1761 I am here today to explain an important source of internet measurement in Canada. It is collected by the public and intended for public use. Along with my colleagues, we will clarify how this internet measurement inform my intervention and its potential applications to this hearing as well as the broader internet policy community in Canada.
1762 I am joined by two experts in the field of internet measurement. To my right, Mr. Jacques Latour, Chief Technology Officer at the Canadian Internet Registration Authority or CIRA, who I have had the great privilege to help with the launch of its Internet Performance Test.
1763 I am also joined by telephone by Mr. Chris Ritzo, Senior Technologist at the Open Technology Institute at the New America Foundation. In addition to his tireless support with my intervention, Mr. Ritzo has supported the development and application of Measurement Lab across the globe.
1764 We hope this presentation explains the value of the Measurement Lab Internet Performance Test as a source of valuable internet performance data.
1765 In my intervention, I submitted 1.9 Gigs of internet measurement to conduct it in Canada. Data came from a test administered by a reliable third-party internet measurement initiative known as the Measurement Lab Consortium or M-Lab.
1766 My intervention consisted of data generated from 717,788 tests run in Canada over the course of 2014. For more information, I would like to invite Mr. Ritzo to speak about Measurement Lab.
1767 MR. RITZO: Hello. Can anybody hear me?
1768 THE CHAIRPERSON: Yes, we can. Please go ahead.
1769 MR. RITZO: Good afternoon everyone and thank you for the opportunity to speak about Measurement Lab. And thank you, Mr. McKelvey, for the invitation.
1770 M-Lab is a consortium of academic institutions, private foundations, companies and public interest organizations who collaboratively provide the largest open-source, open-data public interest focused internet measurement effort globally.
1771 New America Open Technology Institute, which is a non-profit think tank in Washington, D.C., where I work provides the operational leadership of the M-Lab platform and coordinates the contributions of other partners in the pursuit of the project’s mission, which is to advance internet research by empowering consumers with useful information about their internet performance.
1772 By providing free and open internet measurement data, M-Lab supports researchers, regulators having -- in the general public and provides a sense of how the internet is performing now for them when they run a test and how it can be maintained and improved for the future.
1773 The M-Lab project was launched in 2009 after one of the fathers of the internet, Vinton Cerf had a series of conversations with internet researchers to learn more about the challenges they face while trying to study internet performance.
1774 The problems that emerged included lack of widely deployed servers with ample connectivity to support internet measurement experiments; the difficulty at the time of sharing large data sets with one another easily; and the lack of public resource that could provide combined performance data to policy makers or to consumers interested in understanding their internet performance over time.
1775 M-Lab was founded to help address these problems and to promote large-scale open-source measurement of the internet.
1776 And today, M-Lab hosts 10 active internet measurement tests at 90 measurement points in 31 countries worldwide providing tests that can be used to measure broadband speed, analyze application performance and run network diagnostics.
1777 The result is a rich crown sourced dataset of tests conducted by consumers, year round, from all over the world. To give you a sense of that scale, in March of this year, our Network Diagnostic Test or NDT was run approximately two million times worldwide and nearly 65,000 times by people in Canada.
1778 Those data along with the data from other M-Lab posted tests are all freely available to researchers, governments, municipalities and the general public.
1779 In short, M-Lab is a multi-organizational collaborative initiative that supports the work of regulators in the U.S. and a number of other countries as well as the internet research community in which we were founded.
1780 M-Lab NDT data is complementary to other internet measurement initiatives, and we are thankful for partners and researchers like Mr. McKelvey and Mr. Latour for promoting our initiative and the use of our data in Canada.
1781 Thank you.
1782 MR. McKELVEY: Thank you.
1783 The Network Diagnostic Test or NDT includes many metrics to evaluate internet performance. In the context of these hearings, I would like to highlight the Round-Trip Time also known as lag or latency. It refers to the time between sending a response (sic) and receiving a response.
1784 Online games as well as websites rely on these short, quick interactions to function reliably. Ask any gamer and they can tell you all about lag. Data submitted suggests that latency varied from 344 milliseconds in rural areas compared to 144 milliseconds in non-rural areas.
1785 While it is beyond the scope of my intervention to recommend minimum ping times, it is an important metric when considering basic internet service.
1786 My intervention also included a small sample of the potential use of M-Lab in Canada. NDT uses WeblOO standards that provide over 50 different measurements of broadband performance such as congestion in addition to mapping the route a test takes on the internet or what is called traceroutes. These traceroutes can help evaluate whether routing impacts internet performance or help evaluate Section 7(e) of the Telecommunications Act by measuring when domestic traffic travels outside of Canada or what is called boomerang routing.
1787 Traceroute and NDT, as Mr. Ritzo mentioned, are just two of the 10 currently active tests running on the M-Lab consortium.
1788 The global scope of the M-Lab project also allows for international comparisons of internet performances like the studies conducted by the OACD.
1789 The national scope of the M-Lab data can help reveal inequities of access. Internet performance is always comparative. The data, for example, found that maximum download speed could be up to 12 times faster than the lowest speed.
1790 I am optimistic about internet measurement in Canada due to the tremendous efforts of CIRA. As I noted in my submission, CIRA has launched a new internet measurement building on the M-Lab project. For more details, I would like to invite Mr. Latour to introduce the IPT project.
1791 MR. LATOUR: Thank you. I am Jacques Latour, CTO with CIRA.
1792 So what we did at CIRA, we developed the internet performance tool. It’s a platform that uses the same NDT, network diagnostic tool measurement that Dr. McKelvey referenced, so.
1793 And we added a few tests to measure the state of the Canadian internet such as IPv6 and DNSSEC adoption.
1794 So we added CIRA; we added three M-Lab nodes specifically located in -- co-located in Canadian IXPs to measure the Canadian internet from a Canadian perspective.
1795 So the new M-Lab probes are located in a Canadian internet exchange point in Toronto, Montreal, and Calgary and we have more to come. And these IXPs, they form the heart of the Canadian internet.
1796 CIRA will develop and deploy an IPT portal, which is at performance.cira.ca, to measure the broadband performance of Canadians and to the new M-Lab nodes.
1797 So we build a portal to display on the Canadian map an aggregated view by postal code of upload, download, IPv6 adoption and the DNSSEC results on the map graphically.
1798 So before publishing the data, CIRA, we had to ensure that the data was valid. We contracted a third-party organization to assess the quality of the data and conduct a numerical analysis.
1799 So the methodology consisted of univariate statistics, peer-group analysis, and outlier detection. So the intent was to make sure that we had to confident before publishing the data and making it available and it is.
1800 And we are confident that the data in our IPT portal can be used to measure the state of the Canadian internet.
1801 So IPT is an evolving platform. Every day we add new features. We have over 140,000 test performed by more than 59,000 individual users in Canada.
1802 And it’s growing. We have an exciting list of new features that people keep asking us to add to entice Canadians to measure their internet performance and see where their traffic flows.
1803 And when we meet we measure the internet performance. We measure the quality of the performance at home. It’s not about measuring the raw speed that a port or an internet access can provide.
1804 Thank you.
1805 MR. McKELVEY: To conclude, my intervention relies on crowdsourcing for internet measurement.
1806 Crowdsourcing is a term used to describe internet-enabled research where large-scale participation investigates specific research questions.
1807 As the Commission understands, public participation presents many challenges, but crowdsourcing remains a vital direction to the future of media policy. In the words of John Dewey:
1808 “[The person] who wears the [shoe] knows best that it pinches and where it pinches, even if the shoemaker is the best judge of how [to remedy the problem].”
1809 Crowdsourcing helps the shoemaker understand where it pinches.
1810 In my presentation I have demonstrated the sophistication of M-Lab and ITP, and from my understanding other participants have made productive us of M-Lab data for this hearing.
1811 These tools also help everyday Canadians understand where the shoe pinches. The Let’s Talk T.V. Survey -- the Let’s Talk Broadband Survey found that a representative sample of 50 percent of Canadians did not know or did not respond to the question about their internet speed. The tools mentioned here can help everyday Canadians better understand their internet performance.
1812 I started researching internet measurements six years ago, because I sought new ways to encourage and value public participation in internet policy.
1813 More than 700,000 tests later, Canadians have participated. I hope my intervention in a small part shows the value of their contributions.
1814 Thank you very much and I welcome your questions.
1815 THE CHAIRPERSON: Thank you very much and thank you for having brought some of your students to the hearing so that they could get a better appreciation of what the regulatory side sometimes looks like from the inside, so thank you.
1816 I’ll put you in the hands of Commissioner Molnar who has a question for you.
1817 COMMISSIONER MIOLNAR: So one of the things that occurs when you have a three-week hearing is you get to hear from many different parties on many different issues.
1818 And I appreciate you coming with a different issue, a related but different issue, and to provide us information in quite a different direction than what we’ve been talking about.
1819 And you have a lot of big data that I will be honest I have not seen, so let me help to understand this better.
1820 And I -- you know I get that you have been able, with your data, to help inform others that are participating in here and I think that’s a great use.
1821 Help me understand how individual Canadians can use your data?
1822 MR. McKELVEY: Certainly.
1823 And I would just like to acknowledge that the specificity of my hearing, in that this really is a contribution of trying to defend and explain one potential source of internet measurement in Canada to the hearing and the potential participants.
1824 COMMISSIONER MOLNAR: M'hm.
1825 MR. McKELVEY: And so it is hopefully a valuable source of evidence, in that I felt as though if I wasn’t here no one else would be able to defend or justify some of the methodology and so it’s in that spirit I’m contributing.
1826 The underlying principle to me about M-Labs is one of public participation and the idea that it’s a tool that enables everyday Canadians to run a small test that measure their internet speeds and that test pools into a national-wide dataset that can be used to evaluate internet policies; so two aspects run in tandem.
1827 But the tool itself provides, and this is both with the NDT tool and with the IPT tool, a very clear explanation of what can be perceived as an actual internet speed and that is a speed running from a home computer to a centre or a major point of the internet.
1828 So basically trying to simulate what would be the everyday experiences of a user and so a user can leave with an example of how fast and how their upload and download speed.
1829 And so this is one, I think, important function of the tool, is media literacy.
1830 One of the things that we’ve talked both with NDT and the M-Lab Consortium, as well as Mr. Latour and the IPT, is in ensuring that the portal itself includes frequently asked questions or ways that Canadians can learn more about their connections and be able to -- and sometimes self-diagnose what are the potential problems.
1831 And many times it has to do with their own internet connections that are some of the issues behind poor performance.
1832 And so I think in some ways the portal itself is a media literacy tool and what I’m excited about is the IPT is that, as it develops, is it’s trying to encourage and foster Canadians to have a better understanding of their internet connection.
1833 COMMISSIONER MIOLNAR: Thank you for that.
1834 And you did answer part way my next question and that was going to be does your tool allow folks to understand where the constraint is?
1835 If their speed is constrained from what they have purchased, does it help them understand where that constraint exists?
1836 Because you know much better than I that it can be from the device; you know? Like, there’s all kind of fail point along the network, so does it help folks to understand that?
1837 MR. McKELVEY: As I noted in my intervention, the device -- the NDT tool and the IPT tool is not a smoking gun. I mean, there’s no way of laying direct blame on what is the cause of the network malfunction.
1838 However, there are ways of using the tool, and home users being able to run the tool multiple times, to start to be able to diagnose their own connection.
1839 So in the -- if I’m correct in the frequently asks questions the suggestion of unplugging your router and plugging your computer directly into the internet connection.
1840 So all to say is that a home user might be able to diagnose up until a point where they think that it’s no longer their end of the connection.
1841 And then it becomes -- and hopefully would stimulate, some discussion of where the end might be and hopefully be of benefit to internet service providers who are trying to say that maybe it’s a connection of initial line or in a particular neighbourhood.
1842 So by no means can you say who’s at fault, but you can say that there’s some cause for concern about the performance and that can prompt further investigation.
1843 COMMISSIONER MIOLNAR: Right. The Commission itself has published some performance results not so long ago; are you aware of those?
1844 MR. McKELVEY: Yes.
1845 COMMISSIONER MIOLNAR: Would they align with the kind of results that you folks are getting?
1846 MR. McKELVEY: Yes.
1847 I think the thing to keep in mind is that they’re complimentary projects and so what I look forward to is the release of further data.
1848 One of the things which is the challenge, is that the data as it’s currently released is difficult to make cross-comparisons and so what I was excited by is the release last week about the broadband map.
1849 And one of the things that in preparing this intervention was devising the appropriate geographic information system that would allow for comparative data and trying to kind of align different big datasets in Canada.
1850 And I think that’s kind of a really important, you know, an important to make about this is that when I was designing the intervention I decided to use the Statistics Canada dissemination areas and the Industry Canada hexagon system, which I believe, although I’m not entirely clear, is what’s driving behind the broadband map. And so I think there is some opportunity if these data can be used and geo-located using a common GIS system, some effective use -- some effective comparison of these two.
1851 The one thing to note is that the SamKnows project that the SamKnows dataset that was released by the CRTC too, you know, it’s a different testing methodology and that while I’m not comfortable commenting on the particularities of that testing methodology, I do think it’s important to realize that we can learn different aspects of how the internet performs using both of these tools.
1852 And they offer very -- they both offer very important insight into how the internet is actually performing.
1853 Jacques do you have any ---?
1854 MR. LATOUR: M'hm. Well the both tests actually measure off-net performance and I think SamKnows also measures on-net.
1855 Meaning measuring the performance to inside a carrier and -- a telecomm service provider, is a different metrics then measuring how fast it can go to YouTube outside on the internet.
1856 So our test is to measure the IPT test, NDT is based on the performance from an end-user to M-Lab node. So how fast can you go outside on the internet to that node inside a Canadian internet exchange point.
1857 And SamKnows also performs the same test as part of their test platform, so we can collaborate on both tests and align the data, make ours and the whole thing more relevant as a single dataset.
1858 COMMISSIONER MOLNAR: Thank you.
1859 MR. McKELVEY: I just have -- I just wanted to just invite Mr. Rizo who is going to talk about the experiences of the SamKnows and M-Lab in the United States and particularly just comment a bit about the difference of onsite and offsite testing, if he appears from the sky.
1860 MR. RIZO: Thank you, Fen. As Jacques and Mr. McKelvey have indicated the -- there are different methodologies for different tests and Mr. Latour has covered the differences in your -- the -- how M-Lab tests are run to a cost-net server.
1861 Our servers are placed in well-connected data centres outside of the Last Mile network, so via ISPs, so our tests that people run must cross the network boundary of the ISP they buy service from and into the internet.
1862 That methodology is the one we -- M-Lab particularly focus on, since it replicates the consumer experience of requesting content, but SamKnows as well does the same combination of on-net and off-net tests.
1863 M-Lab and SamKnows actually have -- we have a relationship in an ongoing way, where they provide us feedback and they use our platforms to post their off-net measurements for the FCC’s measuring of broadband America program and I’m ostensibly guessing they use that platform globally for other clients as well.
1864 So we have that existing relationship and they are collaborator and partner in M-Lab as -- and they have been from the start.
1865 MR. McELVEY: Thanks, Chris.
1866 MR. RIZO: Sure.
1867 COMMISSIONER MOLNAR: Thank you.
1868 I have just one last question and I think this might be an undertaking, because you rapidly get beyond my technical capacity to understand what you’re saying, so in writing is easier for me.
1869 You stated in here that it is beyond the scope of your intervention to recommend minimum ping times, but you did say ping times was an important element of measuring the quality of an internet connection.
1870 So we’re very interested in defining “high quality”. Would you first be able to define what you view to be the appropriate characteristics and measurements that should be contained if you were to define “quality”?
1871 You know there’s ping, is it -- is it -- or -- you know, what are -- what are the proper metric or measurements that we should look at in defining “quality”.
1872 And if you reconsider whether or not it is within your scope or intervention to actually define appropriate standards you could include your standards too.
1873 And can you do that as an undertaking to define those, what those metrics would be? What are the appropriate elements to measure?
1875 MR. McELVEY: I’m not entirely sure of my like rights here, so I’m just –- I want to say that I’m interested in understanding whether I can conduct an undertaking. I just have concerns about timing.
1876 Do you have to take pity on a poor professor in grading season? But I would like to discuss with my colleague ---
1877 COMMISSIONER MOLNAR: You have -- you clearly have some colleagues with you here --
1878 MR. McELVEY: And I just -- yes, I know and I would like to ---
1879 COMMISSIONER MOLNAR: -- and all kinds of experts.
1880 MR. McELVEY: I would -- I would certainly -- I’m -- I would like to discuss with them whether it’s feasible within the May 5th timeline and am I allowed to say that I will get back to you on whether that’s feasible?
1881 COMMISSIONER MOLNAR: I wouldn’t think so.
1882 MR. McELVEY: I don’t -- I mean it’s my first time. I really do mean it as a genuine ---
1883 THE CHAIRPERSON: Well I appreciate that, that it’s your first time, but normally people come ready for the possibility of having to answer within that timeline.
1884 What I might suggest is that you take it away and if for some reason you cannot meet that deadline then you raise that further in time, so is -- and try best efforts to do so; right?
1885 MR. McELVEY: Okay. So I will just say that yes I will certainly -- that I can provide some indication of what metrics are important in the evaluation of basic internet service.
1886 And I will particularly be able to reference that towards what M-Lab currently collects, because I think that that you -- and that’s something that I can discuss with Mr. Rizo as well, because they have a history of deciding and discussing what are important metrics in evaluating actual or basic speeds.
1887 I’d like to -- I have a -- I have a further comment and then -- but before that I would like to invite Mr. Latour to speak for ---
1888 Did you -- did you ---
1889 MR. LATOUR: Yes, so we’re going to get back on that. So one key -- there’s another aspect you need to look at for basic telecommunication is in the last year we ran out of IPV4 addresses.
1890 And I think a basic telecomm service should have -- a basic internet access should have IPV6 enabled. Because killer app -- people are going to start developing new application on the internet on IPV6, because we’re out of V4, and it’s mandatory that the internet is IPV4 and IPV6. It’s not one or the other. The internet is both, so monitoring the basic service should be V6.
1891 COMMISSIONER MOLNAR: Okay.
1892 MR. LATOUR: In this conference room the Wi-Fi is V6.
1893 COMMISSIONER MOLNAR: And I -- and I think just to be fair since you were able to make your advertisement you should undertake to do my undertaking.
1894 MR. LATOUR: Okay.
1895 MR. McELVEY: I mean, to be clear, Mr. Latour is here to help also interpret the NDT stuff. So I found the two best experts I could track down, so ---
1896 COMMISSIONER MOLNAR: No and that -- and that’s great and you folks are clearly experts, which is why I’m looking for you folks for your input. Thank you very much, those are my questions.
1897 MR. McELVEY: Okay, thank you.
1898 THE CHAIRPERSON: I’m looking around to see if my colleagues have any -- yes? Okay, go ahead, please, Commissioner Vennard. I’ve just spilled my drink.
1899 COMMISSIONER VENNARD: First of all, good luck with all that marking at this of year. Been there, done that.
1900 I have a few –- just a couple of questions and some comments with respect to a couple of -- actually a couple of things. There are three different things.
1901 First of all, in your submission you say that you are going to talk about the tools.
1902 So you’ve got the big dataset, which is collected in a certain way, certain parameters, certain things around that, which could be active testing, passive testing, but there’s a certain set of assumptions and that dataset came from somewhere. Large as it is it came from somewhere.
1903 The second thing is that you also have the tool with which to mine that data, if you will, and both of those -- both the dataset itself, as well as the tool, come with a certain set of assumptions and they’re -- they don’t just randomly sort of appear out of nowhere.
1904 So I’m just wondering when it comes to big data and when it comes to basically what we’re talking about here is mining that big data, would there be a commercial value to that?
1905 Obviously you need to check with other people, so there might be something like that going on. Do you work closely with the internet service providers?
1906 Just wondering about that. How you shape the tool, which will shape the -- what you pull out of your data, which was shaped in the first place by a certain set of assumptions.
1907 MR. McKELVEY: Just to be clear, I think that there's three things we're talking about.
1908 COMMISSIONER VENNARD: Yeah.
1909 MR. McKELVEY: So one, we have a tool that we've used to perform an internet measurement test, which is an active end user enabled test using web browser, and that's the NDT test.
1910 COMMISSIONER VENNARD: So you had users that would -- you were getting the data for this from users? It wasn’t just a passive see what the internet is doing? You had people? That's basically what I was referring to, is that it's a certain set of things, people, activities, or whatever, that are going there versus something like, just a random testing of, you know, latency or whatever on the internet?
1911 MR. McKELVEY: Yes, precisely. So the test that I was -- the NDT test and the tests in general that I'm discussing with the IPTO as well are what we refer to as crowd sourcing. But they're forms of active measurement where they actually require users to participate and initiate the test.
1912 COMMISSIONER VENNARD: M'hm. Where did you get your users from? Like, I'm curious about that.
1913 MR. McKELVEY: Well, the initial -- the Measurement Lab project, as Chris mentioned, has been around from -- since 2009, and so it's one of, you know, a few but, you know, a handful of internet measurement tests that exist. And so people popularly use them as a way of analyzing their home internet speeds.
1914 So it's self-selecting, but it is one of the more popular tools for people to kind of select and evaluate their home internet service.
1915 COMMISSIONER VENNARD: M'hm.
1916 MR. McKELVEY: So it's -- and actually, we can -- I think if Chris is listening, he might also mention that some applications too also embed NDT within their testing suites, like, so some programs actually include it.
1917 COMMISSIONER VENNARD: M'hm.
1918 MR. McKELVEY: But so all to say is -- oh.
1919 MR. RITZO: I'm here on the line. I'm happy to address that if you'd like.
1920 MR. McKELVEY: Yeah, do you mind?
1921 MR. RITZO: Not at all. So yeah, Fen, you did a nice job of explaining that our measurements are active and initiated by users.
1922 The NDT test is an open-source test that is developed and maintained by the Internet Too Education Consortium, and so they are a research-driven institution that developed the test and, of course, it's used in research and education networks worldwide. And we host it on the Measurement Lab servers to provide consumers with access to run that test.
1923 And also, as Fen was alluding, because the testers have been sourced, it can be integrated into software or other websites, such as the Sierra Internet Performance tool for people who are interested in, you know, providing bandwidth performance information to the users of the sites or software.
1924 Sierra Internet Performance tool site is one example, but we have others as well where -- which we could talk about. Given the time, I will hold back on that, but we have a recent partnership with the City of Seattle, Washington, who is doing something very similar to what Sierra is doing, but localized for the Seattle area. They evaluate their options for providing new service via ISPs and evaluate that service. But in any case, all of the tests are initiated actively by my people.
1925 MR. LATOUR: And for Sierra for the IPT tool, we did standard marketing outreach with our dot.ca member base and press release and we had about 60,000 individual users test the performance tool last summer. So this summer we're planning to do another round to get more people.
1926 COMMISSIONER VENNARD: Okay, so that's how you get to the big data.
1927 Now, what about -- you mention your tool. How flexible is that? You put in the parameters you want or whoever wants the results, who wants to mine your data?
1928 MR. LATOUR: So there's two parts. There's the front end. So we build the front end piece to get a user to perform their own test, and then once they do their own performance test, it shows how fast it is and latency and IPV 6 and all that.
1929 COMMISSIONER VENNARD: M'hm.
1930 MR. LATOUR: And then we show a map of where they fit performance-wise compared to their neighbours, so based on postal code.
1931 So that's a level of aggregation we have at that level, and then the data is open source inside M-Lab freely available.
1932 MR. McKELVEY: And just to explain and to walk you through the intervention, so in -- there were 717,000 tests run and that was data-generated from the NDT, and so some number of people and I'm not entirely sure. With the IPT, we have better data. Ran a test and that generated a number of different records. And one of the other services that M-Lab provides is a query language or a way of asking for that data.
1933 So very simply, my intervention was, over the year course of 2014, and with the help of Mr. Ritzo into writing the scripts, I was able to extract data for all the tests that were run in Canada for 2014.
1934 And so it's an open source -- well, it's not -- I mean, it's a well-documented way of accessing the data and it's held in the public domain. So anybody can access it.
1935 So really, my intervention was just trying to do that one step of downloading the data, which is a little technical, and then the second thing, in collaboration with the research assistant, Trevor Smith, at Concordia University, who works in the Geography Department, I geo-located each test with a known GIS system, and I use two, and we use a tool called Quantum GIS. It was just -- it's the public domain. I'm just loading it up here. It's the public domain GIS system.
1936 And so we were able to load up those two data sites and then very simply in that tool merge them.
1937 COMMISSIONER VENNARD: M'hm.
1938 MR. McKELVEY: And so that's one of the things we released, the data file created from this public GIS system, and then finally, I took and extracted some aggregated portions of that data and included that as part of the intervention.
1939 So you can think of it as three things. There's the broad data, there was the maps that were generated at the point of these aggregations, and then finally, there was the kind of aggregated data that was released in CFB -- CSV, sorry, in kind of open source -- or, you know, just in easily accessible spreadsheets.
1940 So the idea was, in a way, of going from NDT test, doing a little bit of legwork but nothing fancy, to actually get the data in a way that we could use and then doing a little bit of analysis of that data only -- and I would emphasize -- only to make it more legible for typical regulators. Like, my intervention wasn’t performing analysis of the data itself.
1941 COMMISSIONER VENNARD: Yeah. Yeah, I picked that part up.
1942 Is it continuing, your -- is the project continuous?
1943 MR. LATOUR: Oh, absolutely. It's live right now. You can go there and anybody can run a test from home. We have a list -- a huge backlog of new feature that people want built on that. So we added, like, you can log in now and track your test, an auto-run test for a week every hour. And the backlog of feature, one of the main one I think is relevant to here is what we did is for when a user logs in, they say, "I'm with such and such ISP and I have a package with these parameters".
1944 Then when you run a test, you compare your performance against what you're subscribed to and then I don't know if you noticed the radar but there's been a lot of rumble and changes and change in the landscape on how services are sold. So there's lessons learned from there.
1945 COMMISSIONER VENNARD: It seems like it would be a very valuable tool for -- on a lot of levels for people to figure out what's going on.
1946 I have one final question for you. You're with universities, obviously. I'm wondering, everything costs money and everything is funded. Are you funded through NSERC or where does your funding come from?
1947 MR. LATOUR: No, we're dot.ca, so we're -- this is a project that's funded through our community investment program.
1948 COMMISSIONER VENNARD: Okay.
1949 MR. LATOUR: So we run dot.ca domain. We have 2.4 million domain. We have -- this is one of our community projects.
1950 COMMISSIONER VENNARD: Okay. I thought Concordia, sorry. I thought maybe you were funding it through Concordia. Okay.
1951 MR. McKELVEY: And just to be clear though, there was some discussion about what my -- like, how I was appearing and how I was funded, and so I used $500 of my start up money to pay Trevor Smith to do some quantum GIS mapping for me because it was a bit outside of my ability and time.
1952 And I have had -- I'm not paid or I have no financial relationship with Sierra. This has been something that I've been doing since 2011 and basically in part appearing at one of this year events, Jacques and I started talking about how we'd build and internet measurement platform in Canada and I'm really proud to be here today, that we've done it, and that I hope that it's really useful. And something that I know and why I'm here defending it so that Canadians across Canada might be able to learn a little bit about their internet speed and be able to contribute some more data about the internet in Canada.
1953 COMMISSIONER VENNARD: Yes, that’s very interesting and we appreciate your time to come here. It’s interesting to have another different perspective on the things that we’re dealing with, so thank you.
1954 THE CHAIRPERSON: Well thank you very much for having participated. We very much appreciate it. I apologize the lateness of your appearance today.
1955 It seems that every time we try to plan the first day of a hearing it always takes a little longer and then it speeds up near the end and so forth.
1956 So I apologize for that and if you are looking for a project to discuss in class or perhaps Professor Winseck as well, you might now analyze the star.com’s headline today:
1957 “CRTC won’t guarantee basic internet speeds, Chairman says.”
1958 You might want to look actually -- if I actually said that and how that ends up being in the media, but anyhow.
1959 THE CHAIRPERSON: That’s a little project if you’re needing some issues, so thank you very much. So we’re adjourned until 9 o’clock tomorrow morning. Thank you.
--- Upon adjourning at 5:55 p.m./
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