Last February 24th, Ottawa City Council voted on a resolution tabled by councillors Jeff Leiper and Diane Deans to support a now pretty well known CRTC ruling. The Commission decided last July to require the incumbent ISPs to provide their smaller competitors with access to their new fibre networks, which are the future of the Internet.
The resolution called for “the city of Ottawa [to] support the CRTC’s decision to require the sharing of fiber-optic networks between large and small competitors.” That position took an implicit stand against the petition submitted by Bell to the federal cabinet last November calling for the government to over-rule the CRTC on sharing fibre networks.
Fibreoptic connections use extremely fine strands of glass to transmit data across networks. Instead of electrical pulses, they use beams of light to carry information inside each strand, sometimes with several different wavelengths each carrying huge amounts of data (hence the reference to “optical”). Fibreoptic technology has major advantages over the copper infrastructure used by telcos and cablecos. Fibre has far greater bandwidth and can readily achieve speeds in the tens or even 100s of gigabits per second (1 Gbps = 1000 megabits per sec, 50 times faster than a typical home connection). Optical fibre is much sturdier and cheaper to maintain than copper. It can also carry data over much longer distances without the need for powered devices like repeaters. Optical fibre is being introduced in “last-mile” connections between end-users and ISPs as fibre to the premises (FTTP). It’s FTTP technology that’s at the heart of the debate between Bell and proponents of competitive, affordable Internet access.
I watched the live stream of the Ottawa debate and was surprised at the extent to which some councillors had swallowed Bell’s party line. The nays voted down the resolution by a wide margin – 17 to 7. I had an op-ed on the subject published by the Ottawa Citizen the day of the vote, as part of a push by OpenMedia to support the CRTC and discredit Bell’s campaign against competition in Internet access: “Ultra-fast broadband is a local issue, Ottawa.” The Ottawa vote stood in sharp contrast to the very similar exercise that took place in Toronto on February 4 – a triumph for the good guys at 28 for and 5 against a resolution supporting the CRTC decision.
This phase of the battle for cheaper, faster Internet access in Canada is over. Other fights will break out about the role of municipalities in supporting or providing access over next-generation networks. For now, the most important takeaway from these political battles is the power of Bell’s disinformation in swaying opinions on complex, important public issues.
The Ottawa debate brought a hard lesson home. In oral remarks, many councillors not only repeated Bell’s talking points; they actually said they were repeating Bell’s talking points. Few seemed to understand how much of their material was and is based on bogus information.
For future reference, here the five most egregious assertions made by Bell and its fellow travellers, with a brief counter:
1 – There’s no role for municipalities in our broadband future. There are many reasons why this assertion is not merely untrue, but also bad for city governance. Municipalities have a deep vested interest in the handling of rights of way, pole attachments, trenching and all the activities that go with building new networks. And they certainly have an interest in the kind of economic development that will help their residents get better, cheaper services. Most of all, unless and until other network providers besides the incumbents get behind new networks, better and cheaper will never happen. US cities are now bustling with government-supported fibre projects aka muni broadband: over 450 of them as of last June.
2 – Under the new rules, the incumbents will spend billions and the smaller ISPs then get a free ride. It’s hard to imagine how any diligent politician could be persuaded that the incumbents are being forced to lose money on the sharing arrangements. On the contrary, the CRTC has made sure that the incumbents are compensated for the value of their investments and all associated costs, plus a meaningful markup. Some argue the compensation is too generous.
3 – The new rules are unfair because they represent a big departure from the past. Nope. They in fact follow the regulatory regime that’s been in place for many years. It requires the incumbents to share their legacy networks with competitive new entrants: that’s the DSL services from the telcos and high-speed cable from the cable guys. If this earlier sharing had never happened, I can guarantee that you would have no smaller ISPs to choose from in most places. No Distributel, no TekSavvy, no Acanac, no E-box.
4 – Sharing will kill investment. Bell’s favorite line of patter and a handy threat to make to politicians. Bell has threatened that if the fibre rules stand, it will stop building fibre networks. Yet Bell and the other incumbents have had years to build fibre networks without any CRTC regulation. What happened? Very little, leaving Canada behind much of the developed world in fibre-to-the-home (the latest OECD data say the group as a whole has a 17.1% fibre average; the US has 8.9%; Canada 4.7%). But the big disconnect here is Bell can’t stop building fibre. You may have noticed Rogers and other cablecos offer mostly faster speeds than Bell and the telcos. Rogers is beating the crap out of Bell, thanks in part to superior technology. For once, those magical market forces are going to encourage a little competition.
5 – Make the little guys build their own damn fibre connections. Bell knows most smaller ISPs can’t possibly finance their own fibre builds: it’s way too expensive. But if they did build their own fibre connections to subscribers, the result would be a consumer and public interest fiasco. Imagine a world in which you had the old telco copper wire and cable’s coaxial wire coming into your home – and then Bell, Rogers and a couple of small ISPs all offered to run their own fibre strands on top. That would not only represent a terrible waste of investment capital; it would also make the prices you pay for Internet access even higher than they already are.