Originally published by The Globe and Mail
Author: Robert Ghiz
Last week saw two major developments that demonstrate the critical role investment plays in maintaining Canada’s wireless technology leadership.
The week opened with the governments of Canada, Ontario and Quebec announcing their support for ENCQOR, a $400-million collaboration among the private sector, government and academia to accelerate the development of 5G (fifth-generation) technology in Canada. Minister of Innovation, Science and Economic Development Navdeep Bains stated that investing in 5G is important because “to prepare for the future, we must be bold, visionary and decisive.”
The week ended with the Canadian Radio-television and Telecommunications Commission releasing its long-awaited review of certain aspects of its wholesale mobile wireless framework. The CRTC maintained its long-standing policy that resellers who do not invest in building their own wireless networks should not be given the same level of access to the national carrier networks as mandated for new wireless providers who are making substantial investments in building their own infrastructure.
In doing so, the CRTC reaffirmed that granting such a right to resellers would have a negative impact on investment in wireless technology and coverage, particularly in remote and rural areas where network expansion remains a public policy priority.
Consider what was at stake. Canada’s wireless networks are some of the most advanced in the world and Canadians among the biggest users of mobile wireless services. Cisco reports that Canada has the second-fastest networks in terms of average download speeds of 18 major countries; faster than countries such as Japan, China, the United States, Britain and France. Only South Korea’s are faster.
Equally important, despite Canada’s vast and challenging geography, our wireless networks reach every province and territory. According to the CRTC’s own data, advanced LTE (long-term evolution, or 4G) networks are available to 99 per cent of Canadians.
And rural investment continues to grow, as Canadian wireless providers expand into new communities each year, helping consumers and businesses in all parts of the country participate in the global digital economy.
Access to world-class networks has placed Canadians among the world’s largest consumers of mobile data. Mobile data usage by Canadians grew 35 per cent between 2015 and 2016 and is predicted to grow fivefold between 2016 and 2021.
This level of growth would not have been possible had facilities-based wireless operators not invested heavily in building, expanding and enhancing the capabilities and capacity of their networks. Since the mid-1980s, Canadian facilities-based operators have invested close to $50-billion in building and continuously upgrading our country’s mobile wireless networks – a percentage of revenue higher than those of wireless service providers in any other member of the Group of Seven countries.
This level of investment can only be maintained if there is a regulatory environment that supports facilities-based competition and the role it plays in encouraging investment. To understand the importance of this, one only has to look at Europe, once the world leader in wireless but now far behind North America and Asia, due in large part to pro-resale policies that reduced the incentive for facilities-based operators to invest in wireless infrastructure. As a result, in many European countries that were once leaders in broadband, excessive regulation of access to broadband infrastructure had a devastating impact on investment, network quality and innovation. They are still trying to play catch-up.
The world is now on the cusp of the next great wireless revolution: the introduction of 5G networks. These networks will offer incredible speeds and almost zero latency, or delay, revolutionizing the way we work, play and interact. Smart cities, remote medicine and advanced agriculture are just a few of the applications that 5G will further enable, and with them deliver the innovation, economic growth and well-paying middle-class jobs that the Government of Canada has identified as cornerstones of its agenda. But 5G networks requires significant investments by Canada’s facilities-based wireless operators.
Last week’s announcements come at a critical time for the wireless sector and they are the right approach for Canada’s economic future. Investment in wireless networks is critical to Canada’s ability to participate in the global digital economy and to create jobs and opportunities in all provinces and territories.
For Canada to maintain its wireless technology leadership and for Canadians to benefit from the investment, economic growth and new jobs that will be generated by 5G wireless networks, the Government of Canada must continue to support telecommunications infrastructure investment.
Robert Ghiz is the president and CEO of the Canadian Wireless Telecommunications Association and a former premier of Prince Edward Island.