Now playing at the CRTC: your precarious future on the Internet

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If the Competition Bureau is too short of “facts” on Canadian broadband to advise regulation, as it told the CRTC, here’s a start (source: Open Technology Institute).

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THIS week’s CRTC hearing, launched in October 2013, will cover the changing market in Canada for wholesale wireline telecommunications services, including Internet access. The Commission is hearing arguments as to whether any of its existing policies on wireline services should be eliminated or updated. The biggest bone of contention will involve the treatment of fiberoptic delivery platforms. New entrant ISPs want the Commission to guarantee wholesale access to these next-generation platforms. Deciding in their favor would be an important barometer of the health of Canadian broadband, but that goal is far from a sure thing. Meanwhile, recent data on broadband in 24 cities around the globe, compiled by the Open Technology Institute (OTI), shows once again how terrible the prices and speeds are here in Toronto.

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In my previous post on Barack Obama’s stunning pronouncement on open Internet policy, I misrepresented what the CRTC is up to these days. I claimed the CRTC is fiddling over the fate of broadcast television with few signs it’s prepared to address the much more important problems of broadband availability, high prices, slow speeds and unaccountable service.”

Not exactly. First, the CRTC recently finished a proceeding on the wholesale market for mobile wireless services. Second, this week features the hearings phase of a proceeding launched in the fall of 2013 that tackles many of the same policy problems on the wireline side. While the scope is all wholesale telecomm services, what really counts here is the Internet access market.

Thanks to the usual tumultuous changes in technology, markets and business models, the Commission has set itself an obscure but potentially far-reaching task (Telecom Notice of Consultation CRTC 2013-551, pdf uploaded here):

“The Commission initiates a proceeding to review the regulatory status of wholesale services and their associated policies, including the wholesale services framework, wholesale service pricing, and the appropriateness of mandating new wholesale services, including fibre-to-the-premises facilities. The purpose of wholesale services is to facilitate competition in retail markets to provide Canadians with increased choice.”

Why the CRTC regulates wholesale Internet access

It may not be clear as to why wholesale services should exist to make retail markets competitive. (Ironically, one of the least convincing arguments made by the incumbents during the wholesale wireless proceeding was that the wholesale arrangements they make with the smaller carriers like Wind have no effect on the health of the retail market for wireless.) Continue reading

Barack Obama for Prime Minister

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As net neutrality boils over, Obama calls for much tighter regulation of Internet access

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If you care about the Internet and don’t care to see it co-opted and controlled by gatekeepers like Bell and Rogers, President Obama is your man. Yesterday he made a speech from the White House that has electrified the nation (theirs, not ours). He has called not merely for proactive regulation from the FCC to protect the open Internet. He has explicitly called on the agency to invoke Title II, that part of the Communications Act of 1934 intended to regulate common carriers like phone companies. Obama wants the regulator to treat the Internet like what it has become: a utility-like lifeline, not just an add-on to cable-TV service. Continue reading

Rogers loses a sub: a study in price gouging & lousy service

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The point of this street-level story is to show how Canada’s broadband oligopoly works in practice, especially the incumbents’ freedom to collect economic rents as ISPs – i.e. charge prices they would never get away with in a competitive market.

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Rogers drives a furious customer into the waiting arms of TekSavvy

I’ve known Jacky and Jimmy* for many years (*not their real names). They’re a happy, successful couple raising a terrific teenage daughter. But after months of terrible service as Rogers subscribers, they were anything but happy. In due course I got a phone call from Jimmy, who was beside himself, wanting to be rescued from their ISP hell. And btw, would I still recommend TekSavvy? Continue reading

Netflix? it’s not the content, stupid, it’s the connectivity (2)

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Fresh evidence from Akamai about Canada’s lousy broadband speeds

Time now for some empirical evidence, featuring Akamai’s recently published State of the Internet report for Q2 of 2014. 

Akamai’s Intelligent Platform is a cloud computing technology that operates in some 90 countries around the world. Because of the scale and sophistication of its operations, it collects and analyzes huge amounts of real-time (not advertised) data about broadband speeds and related variables (based on roughly two trillion requests for Web content every day). Akamai includes in its analysis every country from which it receives requests for content from more than 25,000 unique IP addresses. Currently that’s 139 countries. Continue reading

Netflix redux: it’s not the content, stupid, it’s the connectivity (1)

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“We are now ready to take our place as the most technologically advanced nation on the planet.” -- Stephen Harper, Digital Canada 150, April 2014, p.4

In my previous post I argued that the showdown last month between Netflix and the CRTC has a silver lining: it has pointed the way to a new role for the Commission. That role would acknowledge that the job of trying to regulate “broadcasting” content in the Internet age has become a mug’s game. On the other hand, Canadians have never had world-class broadband connectivity, no matter how much the Harper gang try to spin the story. Speeds here are too slow, service is lousy and prices are way too high. Hence the new role: make connectivity – not content – the Commission’s top priority.

Ottawa has given us low expectations to go with our low bandwidth

What should Canada be aiming for in the broadband future? Continue reading

The Netflix boogeyman and a 21st-century role for the CRTC

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“Though some intervenors think this proceeding is all about Netflix, it’s not.” –Corie Wright of Netflix

“If the Commission fails to act swiftly after this proceeding, a service such as Netflix will become … one of the largest broadcasters in this country in the near future.” –Pierre Dion, CEO, Quebecor

“Canadian consumers can rest assured that our government will continue to stand up for them. We will not allow any moves to impose new regulations and taxes on Internet video that would create a Netflix and YouTube tax.” –Shelly Glover, Minister of Canadian Heritage

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The thesis: Netflix has handed the CRTC a new lease on life

CRTC ordered Netflix to share its highly sensitive Canadian customer data. Netflix demurred (“stonewalled” by some accounts). The Commission has responded by making Netflix disappear from the history books, expunging its official testimony. Does that mean, as we read recently, that “It’s over, CRTC, Netflix and globalization have won”? Continue reading

Sept 29: CRTC hearing on wholesale mobile wireless services

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Canada is a world leader for high mobile prices, low handset penetration and astronomical revenue per user. These are the results that typify a market in which incumbents aren’t disciplined by either competition or regulation.

Price-gouging and prejudicial contract terms are an established feature of both retail and wholesale markets – one important reason among many for all the failures among Canada’s new entrants. Some of us believe strongly we will never enjoy a fair and competitive retail market unless and until major reforms are made to the way the wholesale market has been allowed to develop.

The CRTC announced in February it was launching a proceeding to look into a number of contentious issues, in particular “to determine whether the wholesale mobile wireless services market is sufficiently competitive, both now and in the future” (Notice of hearing, Telecom Notice of Consultation CRTC 2014-76, para 11). The public hearing phase begins on September 29. Ben Klass and I are intervenors in this proceeding, and the staff liked our filings so much they’ve invited us to appear at the hearing. Continue reading

Net neutrality now as momentous as Janet Jackson’s nipple (2)

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Happy updates (July 25)

1) Ms Marsha. One of the best illustrations of the political clout wielded by the incumbent US broadband providers lies in their ability to kill any attempt at the creation of muni broadband networks. Twenty states have passed laws banning public-sector broadband alternatives, encouraged by the industry lobbies and those who might be harmed by competition, like poor, struggling Comcast. As I note in the 2nd para below, Marsha Blackburn of Tennessee is one of the great congressional champions of this free-market exercise. She is more determined than ever to ensure nobody in her own state or any state ever gets better, more affordable service. Such is her reputation that in a comment posted to a story in Ars yesterday, a reader added this apology:

A bit off topic: As a Tennessee state resident, I’d like to personally apologize to the rest of the country, hell the world maybe for that matter, for Marsha Blackburn. Another fine example of what you can buy of [sic] you are a corporation with enough money to line the right pockets.

On the upside, Brodkin’s story is entitled “FCC gets its chance to overturn state limits on broadband competition” – reporting on a petition to the FCC from a community-owned electric utility to overturn the state law barring it from providing fiber-based Internet access – in Chattanooga (Tennessee!).

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2) Transparency enforcement. And in other good news related to policing the ISPs, the FCC on Wednesday issued an Enforcement Advisory that holds two surprises. The FCC will fine any broadband provider that intentionally misleads its customers; and the rule behind this notice is one of the few survivors of the DC Circuit appeal by Verizon that vacated most of the 2010 Open Internet Order. The advisory begins thusly:

Providers of broadband Internet access services must disclose accurate information about their service offerings and make this information accessible to the public. This requirement, known as the Open Internet Transparency Rule, has been in full force and effect since 2011. The Transparency Rule ensures that consumers have access to information that helps them make informed choices about the broadband Internet access services they buy, so that consumers are not misled or surprised by the quality or cost of the services they actually receive.

I’ve uploaded the pdf here.

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How about we blame the Republicans instead? (cont’d)

As I was saying in the previous post, FCC Chairman Tom Wheeler should not be getting the rap for the open Internet NPRM issued in May. Especially not for his alleged determination to push through paid prioritization, since a) Wheeler has plainly disavowed it, and b) the Notice spends far more time analyzing other issues I see as a greater threat, like the utter lack of transparency or accountability in what broadband providers sell to the public. And picking this fight with paid prioritization is going to do nothing for the pro-Internet movement in the US or elsewhere (NPRM pdf here).

rep.-blackburn-2Instead, say I, opponents of the big-business, anti-consumer school of thought should pay more attention to what the black hats are saying – who, for convenience, we’ll call “Republicans.” These guys include a broad swath of personalities, from the FCC’s two Republican Commissioners, to the incumbents like Verizon that want no regulation and lots of “flexibility,” to my favorite right-wing curmudgeon, Marsha Blackburn, the Tennessee congresswoman who has succeded in getting a bill passed to call a halt to all that outrageous muni broadband that competes with Comcast, TWC et al. They have main three arguments, all of them pure sophistry, but great headline-grabbers. Continue reading