WireIE Comments on Canadian Government’s Digital Economy Strategy

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WireIE President & CEO Rob Barlow today formally commented to the federal government on it’s consultation entitled: “Improving Canada’s Digital Advantage, Strategies for Sustainable Prosperity.”

Removing Broadband Deployment Obstacles in Rural Canada

I appreciate the opportunity to share my views in response to the Government of Canada’s Consultation Paper on a Digital Economy Strategy.

As President & CEO of a Canadian based global broadband wireless company, I am keenly aware of the benefits modernized ICT infrastructure bring to an economy. Economic and social development varies from one economy to another, but in every case, significant, measurable increases in GDP are realized when access to broadband is made universal.

Much of my company’s work is in the developing world where access to broadband is extremely limited if available at all. By providing universal broadband access to education, health, industry, business and individual citizens, societies have been transformed in very dramatic ways. Creative minds are unleashed and given access to develop new products and services, not only for their local economy, but often for the world at large.

As a proud Canadian, I am profoundly disappointed that rural Canada is now lagging behind much of the developing world in terms of broadband access. Recognizing the enormity of our nation’s geography, along with the reality that we are one of the most urbanized countries on the planet, it is somewhat understandable that little attention has been paid to rural broadband access up to this point.

A look at the devil in the details reveals further concerns. For example, there is no clear, consistent delineation between urban and rural broadband service offerings. My office, for example, is located in the “technology centre” of York Region, mere kilometers from the City of Toronto boundary. Within five kilometers of my office, broadband service availability becomes very sporadic, even nonexistent in certain peripheral areas. Many businesses and residences encircling our country’s largest city have no access to broadband.

The Government’s digital economy initiative is a vital element in Canada reclaiming it’s prominence as a global telecommunications leader. The government’s paper on the matter does a good job of capturing the challenges, along with the necessity to address them. With that in mind, I offer the following comments.

I believe serious consideration should be given to defining broadband access as an essential service – much in the way access to electricity and traditional telephony services have been regarded for several decades now. I say this fully recognizing that political and economic realities of today are very different from the days when universal telephone service was being deployed in rural Canada.

It is my belief that one of the reasons our country has fallen so far behind is due to the lack of genuine competition in the telecommunications sector. With that in mind, and factoring in the significant capital infusion required to provide such universality, a structure based on private / public partnerships should be seriously considered.

I also recognize that our deregulated, competitive telecommunications environment necessitates that capital is allocated for broadband expansion based on Return on Investment per project. Understandably, areas with low population densities produce poor and very often negative ROIs.

The digital economy, however, is a broad, complex, multilayered concept as the Government’s paper describes so well. While the delivery systems (i.e.: telecommunications infrastructure) may yield poor or negative ROIs in many areas of the country, the creation of content, new products and services as a result of universal broadband have the potential to generate enormous wealth in the longer term. Put another way, universal broadband provides a consistent foundation from which immeasurable wealth can be generated over and above network operator revenue. This modernized infrastructure has the added benefit of providing remote and rural government offices and facilities with broadband, allowing for operational cost reductions, along with greater opportunity to offer services in more areas at a consistent level of quality and overall user experience.

A likely reciprocal result of this creation of wealth would be made-in-Canada innovation in the telecommunications sector itself. Our once global reputation as an innovator in telecommunications would be reestablished, but this time it would be substantially reinforced by services afforded by universal broadband access to the Internet and World Wide Web.

Realizing the longer term return on such a scenario, it is essential to incent telecommunications providers to expand where shorter-term ROIs are unattractive – even when augmented by public funds. Tax breaks are an obvious option but other incentive-oriented mechanisms should also be explored. For example, an easing, or where practical, elimination of radio frequency license fees in rural areas would aid in the provision of both broadband backhaul and access. Another deterrent for network operators in rural areas – both from a cost and logistical perspective – relates to inflexibility in accessing rights-of-way. Rigidity around collocation of multi-operator telecommunications facilities is another impediment. I believe that by clearing these obstacles, significant progress can be made in delivering universal broadband in rural Canada.

We deservingly pride ourselves on being a well educated society. Creation of wealth and the sharing of knowledge need not be confined to parts of our country where broadband is available. Our rural areas are bursting with clever, creative, educated people driven by an entrepreneurial spirit. Other rural residents long to learn and have access to the same infinitely rich resources enjoyed by their urban counterparts who take broadband access for granted.

I thank you for considering my comments on this extremely important matter and look forward to a bright future where every Canadian has the choice to participate in the Digital Economy.

Robert Barlow

President & CEO

WireIE Holdings International Inc.

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