With new telecom companies poised to hit next year, you’d think Canada’s long history of monopolistic telecoms would be at an end. But a recent CRTC decision that lifted restrictions on incumbent service providers like Bell and Telus regarding competitor access to their networks to competitors is raising not only the ire of smaller broadband firms but a new group called the Campaign for Competitive Broadband consisting of many of the smaller Canadian broadband players, and spearheaded by MTSallstram.
Canada’s telcos built out a massive amount of infrastructure when they established their networks, and in return the CRTC has allowed them what amounts to a monopoly to amortize their admittedly quite large expense. Rules were put in place later to ensure new competitors would have access to those networks. But now those rules are being lifted, allowing for what the CCB says is a return to monopoly and a potential dramatic rise in broadband rates. Some industry leaders agree. Bill Campbell, the president of Vancouver-based Skyway West, said his company derives value from adding services to broadband purchased from Telus and Bell. With these new rules, that business could be threatened.
“The demand for faster service is continuing to grow as people/business make more use of the Internet. For example, businesses are gravitating to off site back up and cloud computing. Our customers will gradually evaporate if we cannot match the speed of Internet services offered by Bell and Telus, despite how much value we add,” Campbell said.
The CCB has set up a website for broadband users to email the Prime Minister, their local MP, the Opposition Leader and Industry Minister Tony Clement to voice opposition to the CRTC decision.
For their part, the incumbent telcos have said they oppose letting their competitors access their networks at cost, and to be fair they have a point, since they spent so much of their own capital to establish the infrastructure. But looking at the problem in the longer term, reducing competition now will inevitably hobble the big players when technology changes the rules of the game, as it always does. The developing world has skipped over landlines and gone straight for wireless, and there’s no reason that a stagnant system such as the one in place in Canada won’t inevitably be outpaced by something smaller, faster and cheaper.