Internet is an essential service, but it is not provided that way
As everyone is now acutely aware due to work and school from home requirements driven by Covid-19 public health policy, broadband Internet is as an essential service on the basis that Internet access is a determinant of one’s equal ability to participate in and benefit from our economy and society. Equal access to services, which are essential and have statutory universal service mandates, such as public safety, social services, education, healthcare, and government, increasingly depend on a broadband Internet connection as these services are digitized. How a person finds a job, starts a business, connects back to the office, communicates with suppliers and customers, more and more is dependent upon a robust and reliable Internet connection.
However, not all “broadband” is created equal. The CRTC voluntary “Universal Service Objective” or USO of 50 Mbps download /10 Mbps upload bandwidth (speed x capacity) by 2030 will systemically entrench unequal access to the Internet for rural and low-income urban residents for decades to come on the basis that many high-income urban neighbourhoods have 1/1 Gbps access today, scalable to 40/40 Gbps and 100/100 Gbps by 2025 and 2030 according to announcements made by Bell and Rogers for example.[1]
With the CRTC aiming at 50/10 Mbps by 2030, they have effectively set in motion a policy that will make the digital divide wider. In many higher-income urban neighbourhoods today incumbents and competitors have deployed fibre-to-the-premises (FTTP) networks. For example, in downtown Toronto, Bell offers 1.5 Gbps/940 Mbps Internet at $120.00 per month over FTTP, Roger’s offers 1 Gbps/30 Mbps at $120.00 per month over FTTP, Beanfield Connect offers 1/1 Gbps at $50.00 per month over FTTP and Fibrestream offers 500/500 Mbps for $35.00 per month over FTTP. In most rural communities the best available is 50/10 Mbps Internet for $75.00 per month because FTTP in generally not available. So, for $45.00 or 1.2 times more per month, the urban Bell subscriber receives 1,500 Mbps compared the rural subscriber at 50 Mbps or 60 times more bandwidth. The cost per Mbps for the rural subscriber is $3.00 while the cost per Mbps for the urban subscriber is $0.08. Most importantly, the rural and low-income urban subscriber, including businesses, can not get 1.5 Gbps or 500 Mbps at any price.
The lack of affordable Internet connectivity is largely due to fewer competitive Telecom Service Providers (TSPs) choices for consumers, which creates the conditions for price discrimination; and substandard, legacy, or aged copper and coaxial infrastructure limping along in rural areas over incumbent networks, which carry high operating overheads such that these TSPs must charge higher retail prices to recover operating costs. The higher cost per subscriber to construct FTTP due to lower dwelling densities is a primary barrier to this situation being rectified by incumbents. With no regulatory mandate or competitive imperative to drive TSPs investment behaviour in rural and low-income urban areas, they will continue to “sweat the copper,” so the price/performance gap will continue to grow rapidly.
From the CRTC “Communications Monitoring Report,” the following Table 2 shows the relatively low penetration of FTTP access in Canada, and we know anecdotally that FTTP availability is largely concentrated in large urban areas, particularly in neighbourhoods where dwelling densities are greater and incomes are higher.
Table 2 CRTC Telecom availability by access media type[2]
As shown in Figure 5, the OECD FTTP percentage of total fixed broadband[3] shows that Canada is ranked 26 out of 38 countries and 9 below the OECD average. So, to be competitive domestically and internationally every Canadian household and business needs to have an FTTP Internet connection. For those who do not have an FTTP connection to the Internet, they are being systemically locked-into a perpetual economic and social disadvantage versus their FTTP connected, higher-income urban peers.
Figure 5 OECD FTTP percentage of total fixed broadband, 2020
Therefore, since federal and provincial governments are spending billions of taxpayers’ dollars to bridge the digital divide and these builds take several years or more to complete, we need to be investing in next generation FTTP infrastructure that high-income urban neighbourhoods have had for years. FTTP permanently bridges the digital divide because the fibre optic glass is infinitely scalable. Building FTTP would unburden taxpayers from continually having to subsidize the largest most profitable companies in Canada to hit the next arbitrary incremental anemic bandwidth target and ensure equitable Internet access for everyone.
With an FTTP connection, a parent in a rural community no longer has to drive their daughter to Tim Horton’s to upload her homework, or a father drive many kilometres to have his cancer treatment monitored, or a mother be required to commute for hours by car every day to get to work. With the advent of smart home apps and devices, which may be employed to improve the livability, security, safety, and convenience of the day-to-day lives of residents, a FTTP Internet connection has the capacity and reliability to support everyone in the household running Internet sessions simultaneously and concurrently while all these IoT devices run in the background. Automated management of home appliances, heating and cooling systems, indoor lighting control, entertainment systems, outdoor lighting, and sprinkler systems which are possible over FTTP in high-income urban areas today, now become available to all rural and low-income urban residents too. There are dozens of new smart home apps created every day and while it is unknown how many apps will have practical application, with a FTTP Internet connection residents and businesses never have to worry whether their Internet connection will scale to meet these rapidly growing demands.
In conclusion, we need to replace the CRTC 50/10 Mbps “objective” with a 1/1 Gbps universal service “mandate” and then subsidize the FTTP infrastructure needed to get us there by 2030 on the basis that this will drive investment of TSPs in geographic and demographic areas where they would otherwise not invest.
Through potential research partners like CIRA, Queen’s University, Limestone Analytics, and/or the University of Guelph’s R2B2 Project, ongoing monitoring and periodic regular reporting of deployments against the universal service mandate, taking into account changes in technology and market conditions, bandwidth targets for the universal service mandate could be adjusted as needed to ensure equitable access is maintained and capacity is keeping up with demand. For example, the universal service mandate could be 1/1 Gbps by 2025, increased to 10/10 Gbps by 2030.
An approach just like this was taken to ensure universal telephone access (a universal service mandate and rural subsidy regime) and today all Canadians have access to wireline telephone if they want it. Had there not been universal telephone access mandate and rural subsidy regime, many rural Canadians would still be without telephone service or be connected via party lines today, because the incumbent telephone companies would get around to it when it suited them. Just like they do with broadband today.
In addition to mandating a bandwidth objective, Canada must also mandate targets for price, scalability, availability, symmetry, differentiation, latency, jitter and mean-time-to-restore, on the basis that useful connectivity is about more than bandwidth. As part of this broader service mandate, Service Level Agreements (SLAs) must be mandated for all subscribers, committing retail TSPs to deliver on advertised performance and providing subscribers remedies for non-performance which are absent today, which routinely leave consumers twisting in the wind with no remedies when their network connections fail to perform as advertised or when there is catastrophic failure of the network such as recent extended outages of Rogers[4] and Bell[5] highlight.
Broadband is not binary choice between “good” and “bad” Internet solely defined by download and upload speeds. Rather, broadband Internet is provided along a spectrum of quality using various technologies which can be categorized from “poor” to “best.”
As Figure 6 shows, from an Internet user’s perspective (read table from top to bottom), fibre-to-the-premises (FTTP) also known as fibre-to-the-home (FTTH) offers the most bandwidth today, can scale up as users’ bandwidth needs as they grow in the future, provides symmetrical speeds that are the same up and down which many applications require, allows users to prioritize their most important applications, like voice and video, to guarantee they perform properly through differentiation or Quality of Service (QoS) support, and low latency so voice and video work smoothly. Perhaps most importantly, FTTP delivers the best value for the dollar spent with the lowest cost per megabit of bandwidth used of all access media.
Figure 6 Internet Service Performance Attributes by Access Media Type
While fixed wireless and low orbit earth satellites can help bridge the digital divide in rural areas more quickly and less expensively than FTTP deployment, these solutions are only temporary, as these access media can never offer the equitable Internet access rural and low-income urban users must have to be on par with their higher income urban peers as shown in Figure 6. Therefore, any long-term strategy to permanently bridge the digital divide must include an objective to achieve universal FTTP and other access media should only be considered as Band-Aid or transitory solutions employed to ease the pain of no Internet access or poor Internet access until FTTP is ubiquitously available. Ideally, satellite and fixed wireless connections can be deployed to provide a transitory improvement in connectivity from the current state to the future FTTP state and then once FTTP is deployed, satellite and fixed wireless connections can provide redundancy, for occasions when there are disruptions in FTTP service.
[1] http://www.bce.ca/news-and-media/releases/show/It-s-On-Bell-s-all-fibre-broadband-network-is-now-lighting-up-Toronto-1
[2] https://crtc.gc.ca/eng/publications/reports/policymonitoring/2018/cmr3c.htm
[3] https://www.oecd.org/sti/broadband/broadband-statistics/
[4] https://www.theglobeandmail.com/business/article-rogers-says-wireless-service-has-been-fully-restored-after-massive/
[5] https://www.therecord.com/news/waterloo-region/2020/08/07/bell-telus-still-looking-into-cause-of-massive-network-outage.html