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Canada Government Move to Make Digital Content More ‘Canadian’ Comes Under Fire

The lower house of Canada’s Parliament has passed a Bill called C-10 which gives the Canadian Radio-television and Telecommunications Commission (CRTC) the authority to monitor and regulate online platforms like YouTube and Facebook. The goal is to motivate these giant digital platforms to promote the production and financing of Canadian content. The Bill will be sent to the Senate for review in the fall.

As with any potential law regarding the monitoring of online social platforms, this Bill has been controversial since its early stages. Questions have been raised over whether the Bill infringes on Canadians’ Charter Rights, including freedom of speech. There have already been numerous amendments to the Bill until the minute before the MPs voted on it. One amendment says that individual users and content creators will not be affected by the proposed law.

Any review of the Bill by the Senate will have to be exhaustive and check any infringement of the Charter. But the monitoring of algorithms that are used to recommend content to Canadians will be a hard sell against the backdrop of outrage and pushback coming from citizens.

Various political analysts believe the Bill will die out before it is even taken up by the Senate, as the coming election will overshadow the Bill. Besides, the political climate in Canada already has enough on its plate with COVID-19 and indigenous residential school protests.

However, even as there are prospects of the Bill falling by the wayside, steps have already been taken in the direction of more government control over cross-border digital consumption. July 1st, saw an increase in digital media subscription fees as taxes were imposed on the cost of these services. Platforms like Spotify and Netflix will see a 5-13% increase depending on the tax rate in each province. The move also covers all forms of digital cross-border purchases, including short-term accommodation like Airbnb.

The idea of making Canadian content more accessible and prevalent is a good step to promote production within the country that often must compete with the US. The problem arises when the method to push Canadian content to the top of algorithms, and possibly restrict cross-border content being consumed by the Canadian public, becomes a risky tactic in a country that presents itself on the international stage as a country that promotes freedom of its citizens. Overall, Bill C-10 may have positive motives on the surface, but in practice it may cause more backlash and stifle more freedom than it intends to.

Canada Plan to Increase Telecom Competition Runs Into Weak Signals

The Canadian Radio-television and Telecommunications Commission (CRTC) announced on April 15 that the country’s ‘Big 3’ telecommunication companies will be mandated to give smaller regional operators access to their networks. These smaller companies would be considered mobile virtual network operators (MVNOs) and buy wholesale access to these networks and resell it. The CRTC aim here is to increase competition in the Canadian telecom market through these MVNOs. However, the criteria laid down for these MVNOs has put a question mark on the success of this plan.

Dominant Networks

The focus is on distributing networks from the ‘Big 3’ – Bell, Rogers and Telus – but the CRTC has also incorporated regional network provider SaskTel as a dominant network provider in Saskatchewan. The CRTC outlines that the wireless carriers will be able to sell their networks to MVNOs based on the following provincial distribution:

  • Bell, Rogers and Telus in all areas except Saskatchewan and the territories
  • SaskTel in Saskatchewan
  • Bell Mobility in the three territories of Yukon, NWT and Nunavut

The layout of where these networks can be sold has been made clear, but the CRTC has not outlined any mandated pricing or rates at which the networks can be sold to the MVNOs.

Qualification for MVNOs

The CTRC has laid out some criteria for the prospective MVNOs. The major qualification needed here is that these regional companies must have existing Canadian networks. This complicates the definition of what a true MVNO would be in Canada, as in the normal course an MVNO has no previous infrastructure of its own. With the CRTC granting access to companies which have already contributed to the development of competition in the Canadian market, the eligible regional companies would be:

  • Eastlink
  • Videotron
  • Xplornet
  • Ice Wireless
  • TBayTel

The announcement of this MVNO mandate has come days after the deadline for the bid to participate in the 3500MHz spectrum auction in mid-June.

Timelines

The CRTC will play an active role in mandating the wholesale MVNO access service for seven years to encourage individual MVNOs to build their own network. The national carriers must also give the CRTC a breakdown of their plans and updates on the progress to lower-cost and introduction of occasional-use plans every six months.

However, considering that the CRTC intends to improve the level of competition in the Canadian market, the latest move seems to be only a baby step where a giant leap is needed. This mandate states that it will be targeted towards helping MVNOs introduce competition. But if these regional companies already must have their own spectrums, are they really MVNOs? The power is still left to the national carriers to decide the rates at which they will sell these network shares, and it is safe to assume they will not be willing to lose money over this mandate.

Canada Moves to Expand Broadband Access to Remaining 10%

The Canadian Radio-television and Telecommunications Commission (CRTC) has announced that it will be awarding $84.4 million in funding to 12 projects to enhance broadband connectivity in underserved rural regions in northern Quebec, Ontario, Saskatchewan and British Columbia. These projects will collectively include laying of around 2,000 km of fiber network cable to benefit 56 communities. The timeline for the projects is yet to be announced but they are expected to be completed by the end of 2021.

The money for these projects will be coming from the CRTC’s designated ‘Broadband Fund’. The CRTC made a call-out for applications to communities and municipalities to outline their need for broadband expansion, including how much funding and materials would be required for the project. More than 600 applications were received from across the country, resulting in a total request of $1.5 billion. The CRTC continues to evaluate and announce new projects once they have been approved.

In the current global climate, access to internet outside of urban hubs is important for those under a stay-at-home order due to COVID-19. Besides, these expansions will help rural development and setting up of infrastructure in unoccupied lands. This, in turn, may encourage population dispersion that the Canadian government wants.

Canada has an expansive landmass, which makes implementing broadband internet connectivity an expensive endeavor for the country. Concentration of population has made it easier for network providers like Rogers and Bell to access most of the population without having to expand infrastructure to cover large areas. Under 25% of Canada’s landmass has broadband connectivity but it can reach over 90% of the population, as most of the country’s population can be found concentrated in provinces like Ontario, British Columbia, Quebec and Alberta. Outside of such areas, internet connectivity is extremely limited, necessitating public investments in infrastructure improvement.

When comparing the country’s rural internet access with that in countries like the US, Canada is at a significant disadvantage due to the lack of internet carriers. Canada’s ‘Big 3’ – Rogers, Bell and TELUS – have a strong monopoly over the country’s wireless market. The US has internet carriers like Broadband Q that target rural areas to close the ‘digital divide’ between rural and urban centers. Canada has limited competition between carriers to trigger an expansion of broadband internet to areas considered “unprofitable”. This causes the need for government organizations to provide funding and resources to unite rural and urban centers in the expansion of broadband internet access.

The need for rural development has become a focus for the Broadband Fund, which has so far committed around $156.5 million to improve connectivity in 107 communities.

For more information about the Broadband Fund projects or on the CRTC, visit crtc.gc.ca.

 

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