Originally Published by Financial Post
Author: Paul Burbank
I’m a lawyer who works on telecommunications issues. The opinions that follow are my own and don’t necessarily reflect the views of my firm or any of its clients. A few weeks ago, I sat in the Canadian Radio-television and Telecommunications Commission (CRTC) hearing room and listened to commissioners grill executives from Canada’s blue chip telecom companies on the state of our wireless industry. To my surprise, I heard them question these companies’ motives in cutting prices and shifting to unlimited data packages over the past year, implying this was simply an attempt to escape greater regulatory scrutiny.
For years now, the CRTC has been considering whether to force telecom companies to provide competitors with access to their wireless networks at regulated prices. The competitors would then use the networks to provide retail competition for wireless services without having to undertake any serious investment in telecom facilities of their own. Executives from the large telecoms naturally warned the CRTC that creating “competition” by regulatory fiat would be a major disincentive to capital investment in networks at an important stage in the evolution of wireless telecommunications.
I don’t want to revisit their precise arguments here. I do want to make the point that the past month has radically changed our use of telecoms services and the CRTC ought to rethink some of its preliminary views with respect to retail competition.
The unprecedented global response to COVID-19 has shown that modern telecommunications services are a crucial stopgap in times of crisis, allowing people to flourish in the midst of immense societal disruption. This could be a watershed moment for telecom. Policy-makers should be using all the tools at their disposal to incentivize the upgrading, improving and expanding of our networks.
Public life has turned upside down in just days. Friends and family are catching up over FaceTime instead of over coffee at shops. Candidates for public office are foregoing rallies in community centres in favour of town halls on social media platforms. Businesses are struggling to find ways to safeguard the health of employees and customers while continuing to provide services, generate revenue and pay salaries.
With all the competition for bandwidth as more Canadians work from home and all Canadians seek in-home entertainment alternatives, we need to make sure our networks can withstand this sudden surge in demand for capacity. Organizations that monitor internet traffic are already reporting average daily traffic increases of more than 80 per cent.
At the micro level, organizations with telecommunications-centred business continuity strategies are being rewarded for their investments. Stable and reliable VPNs (virtual private networks) are facilitating a seamless shift of employees to mass remote work. Telecom companies are also intent on doing their part in this crisis, with all major carriers suspending data limits on home internet plans to facilitate the system-wide shift in traffic from offices to homes.
Which brings me to 5G wireless, the benefits of which are already well-documented. 5G networks will carry exponentially more data traffic, have a fraction of the latency, and possess remarkable reliability characteristics.
All of these features of 5G wireless would improve business processes in the current crisis. Right now, Canadians everywhere are confronting the limitations of video conferencing, which simply does not replicate true human contact. A fixed wireless 5G connection could slash round-trip latency (the time it takes data to travel to and from the source and destination) and make remote conferencing seamless and life-like, not to mention more reliable.
Even more promising than improving existing business functions are the creative disruption and new uses this 5th generation of radio technology and the “internet of things” will bring. To paraphrase one forward-thinking U.S. regulator, we need to shed the status quo bias in thinking that the next “big thing” will simply be a faster and better version of what we have today. With 5G, remote, robotic health care and other forms of advanced telemedicine are on the horizon and could help to rationalize our underwhelming care system.
If this crisis has taught us anything, it is that any measure taken now to incentivize and speed up investment in networks will pay long-term social and economic dividends. So we should listen to telecom carriers when they say federal policy is creating an unfavourable investment climate. We should also worry about falling behind the United States and other countries in releasing key 5G spectrum frequencies.
With all of us so dependent on telecommunications to arrest the global pandemic and restore consumer confidence, political leaders and regulators should scrap their shortsighted pricing ambitions and leave this crisis with a renewed sense that a stable regulatory environment for capital is not a luxury, but an absolute necessity, especially as we enter the 5G era.
Read original article at business.financialpost.com.