Intervention: Manitoba Keewatinowi Okimakinak Inc.

Document Name: 2015-134.223988.2394498.Intervention(1fbl%01!).html

The comments of the Manitoba Keewatinowi Okimakinak Inc. are attached.Raisons pour comparaitre / Reasons for appearanceThe MKO wishes to discuss the digital divide especially as it relates to remote First Nations in high cost serving areas. It will provide insight into the unique barriers faced by the 30 MKO First Nations and its more than 65,000 citizens. MKO will present innovative recommendations to address the digital divide. As noted in decision 2014-267 MKO communities are among the most expensive to serve in all of Canada. A disproportionate of MKO communities are served by C-model community aggregator infrastructure. These can pose significant barriers to the digital economy.Given the significant barriers faced by high cost to serve MKO communities in its unique perspective, MKO believes it is important that a distinct indigenous voice from a province with distinct challenges would be of assistance to the panel's deliberations.

Intervention: Manitoba Keewatinowi Okimakinak (Intervenor 264)

Document Name: 2015-134.223988.2394498.Intervention(1fbl%01!).html

The comments of the Manitoba Keewatinowi Okimakinak Inc. are attached.Raisons pour comparaitre / Reasons for appearanceThe MKO wishes to discuss the digital divide especially as it relates to remote First Nations in high cost serving areas. It will provide insight into the unique barriers faced by the 30 MKO First Nations and its more than 65,000 citizens. MKO will present innovative recommendations to address the digital divide. As noted in decision 2014-267 MKO communities are among the most expensive to serve in all of Canada. A disproportionate of MKO communities are served by C-model community aggregator infrastructure. These can pose significant barriers to the digital economy.Given the significant barriers faced by high cost to serve MKO communities in its unique perspective, MKO believes it is important that a distinct indigenous voice from a province with distinct challenges would be of assistance to the panel's deliberations.

Intervention: Manitoba Keewatinowi Okimakinak Inc.

Document Name: 2015-134.223988.2394496.Intervention(1fbls01!).pdf
Initial comments of the Manitoba Keewatinowi
Okimakinak Inc. in the review of basic
telecommunications services
PN 2015-134-1
**** Williams
Public Interest Law Centre
of Legal Aid Manitoba
200 - 393 Portage Avenue
Winnipeg, MB *** ***
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Re: Intervention of the Manitoba Keewatinowi Okimakinak Inc. in the CRTC review of basic telecommunications services (2015-134)

1. The Public Interest Law Centre is pleased to provide the preliminary comments of the Manitoba Keewatinowi Okimakinak Inc. (MKO) relating to the review of basic telecommunications services.1

Overview

2. In Part 1 of its comments, the MKO provides an introduction to its organization as well as initial observations on issues raised by this review. In Part 2, it provides a preliminary response to the questions posed by the CRTC in Appendix B to CRTC 2015-134.

Common themes with the Affordable Access Coalition

3. Based on preliminary discussions with counsel for the Affordable Access Coalition (AAC), a number of common themes have emerged. MKO endorses the conclusions of the AAC that:

• Broadband has become an essential telecommunications service• There is a digital divide. With regard to broadband, unacceptably high access and socio-economic barriers persist

• Market forces and targeted government funding have not solved the problem • This hearing presents an important opportunity to address barriers to access and to affordability

1 Pursuant to s. 26 of the CRTC Rules of Procedure, the MKO wishes to be considered as an intervenor in the proceeding.

It designates Ms **** Fenske of the Public Interest Law Centre as its representative. Ms Fenske's address is 200 - 393 Portage Avenue, Winnipeg, MB *** ***. Her email address is: ******@***.com. The MKO reserves the right to seek the leave of the CRTC to add further parties to its intervention.

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mailto:******@***.com
Addressing the digital divide

4. Considerable work needs to be done by the MKO before its final position is developed. However, based on initial conversations with selected Manitobans and a literature review, it offers a number of preliminary observations.

5. The purpose of the CRTC consultation is to determine appropriate policies for ensuring that all Canadians have affordable access to the telecommunications services they require to participate meaningfully in the digital economy. To achieve this goal, it will be important to establish policies that provide a smooth transition from the existing regime that treats wireline voice service as the central element of basic telephone service to the digital telecommunications world of the future.

6. In making this transition, it is critical that no consumer be left behind and that affordable access to wireline voice service is maintained for consumers seeking this option.

7. However, in the context of high cost serving areas, there is a risk that excessive focus on the preservation of technologies that do not accommodate meaningful participation in the digital economy risk may impede progress toward universal access to the full range of digital services.2

8. The existing definition of basic telecommunications services underpins the local service subsidy regime, which uses the National Contribution Fund (NCF) to subsidize the provision of basic residential local service, including video relay service (VRS) in high-cost serving areas (HCSAs). As a consequence, the funding mechanism supports only the incumbent local exchange carriers (ILECs).3

9. The subsidy regime needs to be expanded to accelerate the deployment of wideband service and provide affordable access to the telecommunications services that rural and remote communities require to participate meaningfully in the digital economy.

10. Limiting price cap regulation to the retail telecommunications services of ILECs is also rooted in a reality that was valid in the past but inadequate for the future. The affordability of broadband is equally important within rural and remote communities.

11. The rationale for the current limited subsidy regime is outdated. Looking to the future, the regime should evolve in parallel with the evolution of the digital telecommunications services that are becoming increasing integral to the daily lives of 2 Some observers might argue that touchtone wireline service is no longer central to the obligation to serve and the related basic service objective and is already redundant in regions of the country where alternative technologies have been fully deployed.

3 It is arguable that the existing regime reinforces continued reliance on historic technologies rather than being used as an incentive for innovation in transitioning HCSAs to technologies that enable Canadians in rural and remote areas to participate fully in the digital economy of the future.

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Canadians in HCSAs just as they are for Canadians living in major urban areas.

12. If anything, the reliance on new technologies is greater in rural and remote areas since it is digital services that can surmount the disadvantages of rural and remote living and facilitate improved access to health, educational and social services as well as economic opportunity.

13. In reviewing the existing policies related to the obligation to serve, the basic service objective, the use of the NCF and the role of price cap regulation, it is necessary to recognize that services meeting the existing definition of the basic service objective do not, in and of themselves, allow Canadians to participate meaningfully in the digital economy. Recognizing that broadband access is an essential element of basic telecommunications services, it may be appropriate to simply add that element to the definition of basic service objective.

14. Alternatively, a definition of basic service based on digital bandwidth would support the deployment of the digital equivalent of **** Old Telephone Service (POTS) while at the same time ensuring that every Canadian in able to participate in the digital economy to the full extent of their ability and interest.

15. The availability of affordable telecommunications services should mean that any Canadian that has difficulty adapting to new technologies is able to utilize voice over Internet Protocol (VOIP) service that is equivalent to POTS. At the same time, the same broadband connection would be capable of being used for all existing and future internet-based services.

16. The transition to a fully digital world would require the adoption of an expanded definition of the basic service objective that includes the relevant characteristics of digital services: capacity, high speed and low latency. However, in the context of rural and remote communities, it is also important to recognize that capacity standards need to be established not only on the basis of individual services (e.g., an ADSL connection), but also on the basis of the aggregate capacity of the link from the community to the outside world.

17. For reasons detailed in the responses to the specific questions posed by the CRTC in its notice (Part 2), the volume of traffic generated on a per connection basis may be inconsistent with the bandwidth that is sufficient in non-HCSAs where employment rates and incomes tend to be higher.

18. To satisfy the requirement that all Canadians have access to affordable basic wideband telecommunications services, it is clear that rates for broadband service in markets with limited or no competition will have to be regulated. For example, basic wideband service that is VOIP capable could be defined and the price constraints currently imposed by the price cap regime could be applied to the equivalent digital 4

service.

19. Using that price as a reference point for the cost-to-bandwidth relationship, price caps for other broadband services with higher capacity could then be established for markets in which the price cap regime applies.

20. To support the transition to fully digital telecommunications services, it might also be appropriate to implement a competitive bidding process for providing service to each existing HCSA in Canada.

21. A process of inviting bids to serve each HCSA subject to carefully defined performance standards related to capacity, high speed and low latency could be initiated. The service provider that requires the lowest subsidy for the right to provide service at the established price and service levels, would be granted a multi-year license as the exclusive service provider in that community.

22. Enforcement of the standards will be a critical element of this innovation. In the event that the service provider fails to meet the contractual service standards, the license would be revoked and a new auction would be initiated.

23. This approach could be used to gradually introduce high standards of digital service that would be comparable in all characteristics, including price, to the telecommunications services that are available in non-HCSAs.

24. While there will be some HCSAs where competitive service providers will be able to provide new digital service at a cost that is below the subsidies provided by the existing subsidy regime not all locations will attract bids on that basis.

25. As “headroom” is established through the transition of the most attractive HCSAs to digital service, the NCF money saved can be reallocated to attract service providers into the less attractive HCSAs by increasing the cap on the bids. Ultimately, the higher value of universal broadband service will justify an increase in the available subsidy when necessary.4

4 The MKO appreciates the input of Mr. John **** of Elenchus in developing its preliminary comments.

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Part 1 – Introduction of MKO – Preliminary Conversations with Manitobans and Literature Review

Who is the MKO?

26. Incorporated in 1981, MKO represents the 30 northern most First Nations in Manitoba5 and 65,000 treaty First Nation citizens. MKO is a non-profit, political advocacy organization that provides a collective voice on issues of inherent Treaty, Aboriginal and human rights for its citizens.6 Its citizens speak a variety of languages including Oji-Cree, Dene, Cree and Ojibway.

27. Geographically the MKO region covers approximately three quarters of the surface area of Manitoba. Forty-nine percent of the population of Northern Manitoba is aboriginal.7

28. As recognized by the CRTC in Decision 2014-267, MKO communities in the G Band of High Cost Serving areas are among the most expensive to serve in all of Canada.8 As detailed in Map 1, MKO communities also account for a significant proportion of the communities in which C-model community aggregator infrastructure is in place. Manitoba communities account for 20 of the 89 communities and more than 3,000 households of the roughly 18,000 Canadian households receiving Internet Service through this model.9

29. The MKO has participated in a number of CRTC Telecom proceedings including proceedings related to High Cost Serving Areas,10 Local Service pricing options,11 MTS Service Improvement Plans12 and the use of deferral account funds to expand 5 Signatories of treaties number 4, 5, 6, and 10.

6 MKO receives its mandate by resolution of the MKO Chiefs in General Assembly. The **** Chief, elected for a three-year term, serves as the principal spokesperson. A regionally representative Executive Council of Chiefs provides ongoing direction between General Assemblies.

7 ****, Anja, **** Fiser, **** Brender, and **** Dowdall. Building a Resilient and Prosperous ****: Centre for the **** Five-Year Compendium Report. Ottawa: The Conference Board of Canada, 2015., p. 9. In Manitoba, over 15 per cent of the population is Aboriginal. The Aboriginal population is very young (median age 28 years) compared with the non-Aboriginal population (median of 41 years), p. 10.

8 See Table 1 of Telecom Decision 2014-627 in which the CRTC directed a monthly subsidy per residential NAS to the HCSA Band G in Manitoba of $60.48 as compared to the next highest province of Quebec receiving a subsidy of $43.58 in HCSA Band G. It is recognized that HCSAs in the territory served by Northwestel also receive very significant subsidies.

9 Satellite Inquiry, para 134. See also Satellite Inquiry, Key Findings, Chapter 4.

10 PN 97-42.
11 PNs 95-49 and 95-56.
12 CRTC Decisions 2003-68 and 2002-63.
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broadband services.13

30. The CRTC has found that the MKO is representative of a class of subscribers, First Nations people living in Manitoba,14 with an interest in the outcome of its proceedings.15 MKO is a regular participant in hearings before the Manitoba Public Utilities Board on matters relating to Manitoba Hydro.

Map 1

The Canadian Radio-Television and Telecommunications Commission, Satellite Inquiry Report (2014) at 29.

13 CRTC Decision 2008-1.
14 Telecom Costs Order CRTC 2002-3, para 22.

15 See for example, Telecom Costs Order CRTC 2007-11, para 9. Please also see Telecom Costs Order CRTC 96-21 and Telecom Costs Order CRTC 99-11.

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What is the Public Interest Law Centre?

31. The Public Interest Law Centre (PILC) was established in 1982 with the objective of representing groups and individuals on matters relating to issues of public interest including consumer and environmental issues.

32. PILC has represented MKO in all prior proceedings before the CRTC. Staff at the Centre frequently appears before tribunals such as the Manitoba Public Utilities Board.16

How has the MKO prepared its preliminary comments?

33. MKO presents the perspective of its citizens who live in all parts of Manitoba but are disproportionately represented in Northern and remote communities. In developing its preliminary comments, MKO has undertaken17:

• an initial conversation with MKO staff, selected First Nation citizens, consumer representatives, a staff person from an organization representing the Metis people and a representative from a food bank (“initial conversations with Manitobans”)• discussions with legal counsel to the Affordable Access Coalition (AAC) with a view to minimizing duplication, identifying common themes and specifying areas of distinct focus, and

• a preliminary review of relevant CRTC decisions, grey literature and peer reviewed literature with a particular focus on issues relevant to Indigenous people, remote communities and newcomers (the literature review)34. The comments of MKO are preliminary based on its initial conversations and literature review.18 It is committed to listening carefully to others in this proceeding prior to developing its final recommendations.

16 Including matters relating to the regulation of Manitoba Hydro, Manitoba Public Insurance and government cheque cashers and payday lenders. PILC staff frequently appear before the Manitoba Clean Environment Commission. They have or are representing First Nations, Elders and Traditional Knowledge holders in a number of regulatory and judicial proceedings. They are currently appearing before the National Energy Board on matters relating to Enbridge Line 3.

17 MKO appreciates the extensive efforts of CAC Manitoba in organizing and facilitating current discussions.

18 While MKO is greatly appreciative of the insight provided by Mr. John **** of Elenchus, the preliminary comments in this document were developed under the direction and control of MKO.

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35. MKO regularly employ feedback tools to gather insight from its citizens, other ratepayers and from organizations representing the perspectives of community groups, government agencies and business. For the purposes of its pending February 1, 2016 intervention, MKO intends to consider the results of future community surveys as well as “focus group like” conversations with consumers including low income consumers and newcomers.19 It reserves the right to amend its comments based on future learnings.

What have we learned from our initial conversations with Manitobans?20Manitobans seek affordable, reliable and modern connections to family, essential services and opportunity

36. In our initial conversations, Manitobans highlighted the importance of basic telecommunications services including the Internet, wireless and wired services as tools to:

• feel safe21
• connect with family
• access essential health services22
• improve their education
• participate in the marketplace
• seek employment, and
• entertain themselves and family

37. In the context of First Nation people living on reserve, it was noted that there is a significant movement from reserve to urban communities coupled with the need for First Nation residents to leave their communities for educational opportunities and essential health care.

38. This has prompted an increased reliance on social networking tools such as Facebook to remain affordably connected to family. Many First Nation citizens also are required to make regular micro-logistical communications just to manage the sheer volume of movement from and to their communities.

19 They also will seek additional information and analysis from Mr. ****.

20 Participants in the discussion were advised that while their comments might be shared their identify would not be revealed. Comments were typed and not taped and represent best efforts to accurately reflect the conversations.

21 “The cell phone is very important for my son for safety reasons. Critical sometimes. Its important for a parent to always have that link.”

22 ie. Tele health in remote communities
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39. Telecommunications were seen as a vital element of social inclusion with at least two persons pointing out that for low income persons including homeless person, a pre-paid cell phone might be their primary way to connect to society and the only form of safety.23

40. The importance of basic telecommunications services as a means of social inclusion also was highlighted by those with experience with newcomers who seek to maintain ties with families who may live in disparate parts of Canada and the world.

The nature of basic telecommunications services is changing due to technology, choice and to market barriers

41. Our conversations with Manitobans highlighted the rapidly evolving nature of their views of telecommunication services. From the perspective of one person experienced with working with Indigenous people:

“Demand” has to be restated; people feel like they've had a body part removed without their phone; people cannot function without this level of connectivity;

People do not want to wait anymore, they want instantly available tele-communication connectivity wherever you are at all times in the cheapest way; if the monopoly will not give it, they'll find it another way.2442. The same person highlighted increased social pressure to communicate in First Nation communities with people feeling obliged to respond and wanting to respond to “everything”. A number of persons suggested that the basic services world has shifted with Internet being the new centre. For some Manitoba First Nations citizens:

Facebook is popular everywhere. It is “the” feature.

43. Others noted that cell phones with voice detects have “opened up the world” for many clients with literacy challenges.

44. While conceding the reality of a rapidly changing marketplace, a number of 23 “There are limited links to family and friends as it is and they don't have a land line. Cell phone is the only way they might have to reach out.” “Smart phones are very important for people to stay socially connected. A lot of the people we were experiencing said their only way to connect was by phone. If that meant they had to sleep at a shelter, that was ok.”24 The person identified a number of ways in which First Nation communities are adopting creative approaches to provide access to service.

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participants suggested that barriers to accessing land lines such as credit checks, damage deposits and costs were other factors contributing to the shift to Internet access and smart phones.

Mixed levels of allegiance to traditional wired services

45. We heard a mixture of comments regarding the issue of whether wired service should remain an element of the basic service offering.

46. It was suggested that “people in the city are dropping their land lines because of cost” and that many young Indigenous people on reserve do not care how their service is delivered. The perception was that they did not have any particular brand loyalty and would use “whatever works”.

47. By contrast, others suggested that “if we are giving up land line we are less secure and private” noting that you can “give up the land line but at what cost? Are you using a “pay as you go phone” for your primary phone?”25 It also was suggested that older people on reserve tend to have significant loyalty to traditional services despite their distrust of the quality of service.

Material inequities in access to affordable, modern basic telecommunication services48. The Manitobans we spoke with identified inequities in access to affordable, modern services. Many comments focused on bandwidth constraints and reliability challenges leading to an inequity between service between the urbanized south and remote and rural communities. Similar inequities were identified among the MKO communities with the suggestion that there are “islands of connectivity” despite most communities having significant connectivity and reliability challenges.26 49. Financial barriers to land lines were also noted for low income persons and newcomers:

**** distance ends up being expensive. Pre-pay phones run out which is concerning. Credit checks are often done when applying for phones or internet.

25 Another person noted: “A lot of people use pay as you go – problem when you get put on hold for a long period of time.

Then you need to rely on land lines.”

26 It was observed that when the system “goes down” that certain service providers such as the RCMP and Nursing Station have emergency backup satellite phones that leave them able to connect with the outside world even if persons within the community cannot reach them.

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Newcomers – your credit history doesn't come with you. Your score will be low or you may not have a credit history at all. If you don't have money to put down a big deposit, you may need to go with pre-pay. This is an issue.

The reliance on market forces and government funding has led to piecemeal access to basic telecommunication services for certain communities

50. In terms of access to critical services such as broadband and smartphones for First Nations people living on reserve, the point was made that:

Consumer demand is outstripping market supply and the regulatory response51. It was suggested that:

it is hard for the regulator to respond to market-driven change when there is no market

52. From the perspective of one observer, “an ad hoc” response to market failure was leading to “piecemeal access” to essential telecommunications services in remote and rural communities. Two participants identified a dichotomy between service gaps and government insistence upon using the Internet:

They seem to be aggressive with people using the Internet. Almost like you're not a part of society if you don't use the Internet.

What are the key themes from our literature review?

53. Our literature review identified similar themes to our conversations with Manitobans with a focus on inclusion, opportunity and the need to overcome barriers.

No one should be left behind

54. A number of commentators have highlighted the risk that certain consumers might be left behind by the push to a digital society:

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Barth and Veit (2011) highlight the significant paradox that exists between massive efforts to digitize many government and public sector services without sufficient attention directed towards ensuring that internet access and use does not lag behind. Thus, it is those individuals who do not have internet access as well as those who engage in a limited number of activities online who are unable to fully participate in a digital society and take full advantage of resources, information, and social contacts.27 (emphasis added)Broadband as an essential element of basic telecommunications services55. Whether the move to broadband is characterized as a revolution or an evolution, there is general recognition that it an essential tool for social and economic inclusion for all Canadians including First Nations:

Recently, broadband has evolved from being a luxury to an essential type of infrastructure for business development, banking, communication, health care, education, tourism and entertainment. Access to the internet at broadband speeds has now become a necessary tool for engagement in the modern economy and culture.28 (emphasis added)

If designed to meet the needs of First Nations, a digital economy and Aboriginal connectivity can act as a powerful source of jobs and growth and help create stronger First Nations communities. 29

56. In a US context, the importance of broadband as a mechanism for inclusion of low income persons also has been noted:

Broadband access is increasingly a requirement of socio-economic inclusion, not an outcome of it—and residents of low-income communities know this.

**** is only one factor shaping the fragile equilibrium of home broadband adoption, and price pressures go beyond the obvious challenge of high monthly fees. Hardware costs, hidden fees, billing transparency, quality of 27 **** Haight, Anabel ****-Haase & **** A **** (2014) Revisiting the digital divide in Canada: the impact of demographic factors on access to the internet, level of online activity, and social networking site usage, Information, Communication & Society, 17:4, 503-519, DOI: 10.1080/1369118X.2014.891633, p. 515.

28 BROADBAND - AN EFFECTIVE TOOL FOR RURAL DEVELOPMENT, Government of Alberta, p. 229 Whiteduck, J. (2010). Building the First Nation e-community. In J. P. ****, J. ****, D. ****, & P. **** (Eds.), Aboriginal policy research VI: Learning, technology and traditions (pp. 95-103). Toronto: **** Educational Publishing

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service, and availability are major issues for low-income communities.30Broadband connectivity is essential to First Nation's Health, Education and Community Development

57. First Nation leaders have recognized the importance of broadband connectivity as a way to achieve better health and educational outcomes and community development:31

• Health Care – Broadband connectivity can support better access to health care and better health outcomes for people in remote or isolated communities, better management of patients with chronic conditions and reduced health related travel expenses.

• Education - Access to online learning tools and programs increases learning opportunities and improves outcomes for students and adult learners. It also supports teacher retention and training through access to professional development and networking for teachers from within their communities.

• Economic Development – Connectivity enables access to Internet based business tools, which is essential for business retention and development. It also provides access to global markets.

• Administrative Management – Broadband connectivity enables access to modern business tools, to web based government information and processes necessary for access to funding, for community operations, for natural resource management and land claims.

Broadband connectivity is essential for First Nation's families58. While broadband access makes good economic and social policy sense for First Nation communities, the ability to connect with family is of equally critical value.

Results from an “on-line” qualitative survey of First Nation women highlight the importance of the Internet as a means to connect with their families as well as to preserve their culture and to enhance their health and education:3230 Dharma Dailey, **** Byrne, **** Powell, Joe Karaganis and Jaewon ****, BROADBAND ADOPTION IN LOW-INCOME COMMUNITIES, A Social Science Research Council Report, Version, 1,1, **** 2010.

31 The Chiefs of Ontario, First Nations in Ontario Strategic Broadband Connectivity Business ****, **** 2013.

32 ****, ****, Kakekaspan & O’Donnell, How Women in Remote and Rural First Nation Communities are Using14

Until the advent of the Internet and broadband technology, maintaining closerelationships with friends and family members who have had to leave thecommunities for these or other reasons have posed challenges. Now, communitymembers can stay connected with each other across distances via video calls, instant text messages, and other means facilitated by broadband. Community members can in many instances also stay in their home communities while receiving health and wellness treatments, and engaging in educational opportunities.33 (emphasis added)

The digital divide remains - connectivity and affordability barriers remain for First Nations people

59. For much of the past two decades, commentators and First Nations citizens have expressed the concern that a digital divide between First Nations and other communites would only exacerbate existing patterns of economic underdevelopment, cultural marginalization and social exclusion. Writing in 2001, Bredin commented:

Geographic or social isolation, high costs, and lack of infrastructure contribute to a "digital divide" between First Nations peoples and other Canadians. Designed for profitable urban markets, digital networks and content that might address Native needs for education and information have not yet been fully extended to remote communities.34

60. Well over a decade after Bredin's comments, the qualitative “on-line” survey of First Nations women suggests there are ongoing inequities flowing from connectivity and affordability barriers:

Information and Communication Technologies, Journal of Rural and Community Development 8, 2 (2013) 79–97 (ICT) ISSN: 1712-8277 © Journal of Rural and Community Development, www.jrcd.cap, 80, 82,83 and 86. See also page 92.

Women are using the internet enthusiastically in their daily lives, communicating with people in their First Nations and other First Nations on a regular basis via the internet, and are using it to help preserve their culture in meaningful ways.

Many women are also using broadband-based health services, are interested in how this service can be useful to their community, and are thinking critically about it (e.g., in terms of privacy).

33 ****, ****, Kakekaspan & O’Donnell, How Women in Remote and Rural First Nation Communities are UsingInformation and Communication Technologies, Journal of Rural and Community Development 8, 2 (2013) 79–97 (ICT) ISSN: 1712-8277 © Journal of Rural and Community Development, www.jrcd.ca p. 80. The authors note that “... in many communities, limited access to health and educational services and opportunities means that many First Nations youth and individuals who need certain medical procedures are often required to leave their communities to have access to schools and medical facilities in urban centres.”

34 **** Bredin, BRIDGING CANADA'S DIGITAL DIVIDE: FIRST NATIONS' ACCESS TO NEW INFORMATION TECHNOLOGIES, The Canadian Journal of Native Studies XXI, 2{2001}:191-215, p. 191.

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http://www.jrcd.ca/
http://www.jrcd.cap/

Despite the vigorous use of ICT, the demand for better broadband and reasonably priced broadband was clearly identified: this would allow First Nation women users to operate at the same level as someone in a town or city.35As one woman wrote:

When you depend on technology in order to provide services for thecommunity and the Internet is always down then it is frustrating. Right now I am doing this survey on my emergency dial up because the Internet is up and down every 5 minutes. If not that it is so slow it boots you off because it takes too long to turn pages. Same for ordering or doing banking....36 (emphasis added)The digital divide and infrastructure deficit exacerbate existing inequities in social, health and economic development

61. While they are far from the only culprits in an complex social and cultural dynamic, the digital divide and infrastructure deficit exacerbate existing First Nation inequities in social, health and economic development.

62. As noted by the Auditor General, First Nations people face unique challenges in obtaining essential health services.37 They do not enjoy the same quality of service as other Canadians including other residents living in similar geographic locations.38 63. A recent report by the Conference Board of Canada appears to draw a link between poor infrastructure and health inequities in Northern Aboriginal communities:

35 ****, ****, Kakekaspan & O’Donnell Journal of Rural and Community Development 8, 2 (2013) 79–97, p. 93.

36 ****, ****, Kakekaspan & O’Donnell, How Women in Remote and Rural First Nation Communities are Using Information and Communication Technologies, Journal of Rural and Community Development 8, 2 (2013) 79–97 (ICT) ISSN: 1712-8277 © Journal of Rural and Community Development, www.jrcd.ca p. 86. In descending order, 81% of women indicated that “better or faster internet” was a high priority.

37 “. . . First Nations individuals living in remote communities face unique challenges in obtaining essential health services.

They rely on the federal government’s support to access health services within their communities, and on federally supported transportation benefits to access health services outside their communities.” Reports of the Auditor General of Canada, Access to Health Services for Remote First Nations Communities, REPORT 4, **** 2015, para 4.6. The report notes that “according to Health Canada, the life expectancy of the First Nations population increased between 1980 and 2010; however, it was about eight years shorter than the life expectancy of other Canadians in 2010.

Furthermore, the health status of the First Nations population remained considerably poorer than that of the rest of the Canadian population,” para 4.4.

38 “We also found that Health Canada had not implemented its objective of ensuring that First Nations individuals living in remote communities have comparable access to clinical and client care services as other provincial residents living in similar geographic locations.” Reports of the Auditor General of Canada, Access to Health Services for Remote First Nations Communities, REPORT 4, **** 2015, para 4.93.

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When geography is coupled with poor infrastructure, health care is not easily accessible for most. Add in well-documented evidence of unhealthy socio-economic conditions—including poverty, cost of living, and housing—and it should come as no surprise that the state of health in the **** is poor, particularly among Aboriginal populations.

The Conference Board’s 2014 assessment of health outcomes in the territories saw them rank below all Canadian provinces and peer countries. As well, three Canadian provinces with Northern regions (Manitoba, Saskatchewan, and Newfoundland and Labrador) get D grades on the overall health report card.39Telecommunications infrastructure investments can be a critical element of social inclusion and economic opportunity

64. The Conference Board of Canada has identified telecommunications infrastructure as a “critical enabler of both economic opportunity and social cohesion”:

Canada’s Northern communities require critical connectivity infrastructure that is reliable, scalable, and supportive of locally affordable services. Though the state of telecommunications infrastructure varies widely across Canada’s ****, many remote Northern communities continue to be vulnerable to “bottlenecks” and service disruptions. It is not easy or cheap to connect remote communities, and no single type of telecommunications investment is most appropriate for all Northern regions.40 (emphasis added)

In a survey conducted by GE Canada, which involved more than 350 respondents, including Northern business and community leaders, infrastructure was ranked by 70 per cent of those surveyed as “the single most important criteria [sic]” for attracting investment and facilitating business development in remote communities.

(emphasis added)

The kinds of infrastructure most correlated with increased productivity and growth are transportation, energy, and telecommunications. . . The link between natural resource 39 ****, Anja, **** Fiser, **** Brender, and **** Dowdall. Building a Resilient and Prosperous ****: Centre for the **** Five-Year Compendium Report. Ottawa: The Conference Board of Canada, 2015, p. 16. The Conference Board of Canada has noted that “In regions such as Nunavut and Nunavik, the state of technology over the past decade has hampered attempts to deploy information communications technologies for applications such as distance education and e health”, p. 15. It is strongly arguable that these same challenges impact a number of MKO First Nations.‐40 ****, Anja, **** Fiser, **** Brender, and **** Dowdall. Building a Resilient and Prosperous ****: Centre for the **** Five-Year Compendium Report. Ottawa: The Conference Board of Canada, 2015, p. 45.

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development and transportation, energy, and telecommunications infrastructure is particularly important for regional governments, Aboriginal businesses, and strategically located communities in the ****.41

The digital divide extends beyond First Nation communities65. The Satellite Inquiry observes that “approximately 1.2 million households do not have access to broadband Internet access at the Commission’s 5/1 target.”42 Consistent with our conversations with selected Manitoba consumers, a 2014 study based on the 2010 Canadian Internet Use Survey suggests that the digital divide is not limited to remote First Nation Communities:

The present study relies on the 2010 Canadian Internet Use Survey to investigate differences in people’s access to the internet and level of online activity. The study not only revisits the digital divide in the Canadian context . . . The findings demonstrate that access to the internet reflects existing inequalities in society with income, education, rural/urban, immigration status, and age all affecting adoption patterns.4366. The finding show “large discrepancies” in Internet access by income, education, rural/urban location and age.44 The authors note that:

A surprising finding to emerge from this study is that recent immigrants to Canada are significantly less likely to have internet access; however, among those online they have a higher level of online activity than earlier immigrants and Canadian born residents.45 (emphasis added)41 ****, Anja, **** Fiser, **** Brender, and **** Dowdall. Building a Resilient and Prosperous ****: Centre for the **** Five-Year Compendium Report. Ottawa: The Conference Board of Canada, 2015, p. 42/43.

42 Satellite Inquiry, para 134. See also Satellite Inquiry, Key Findings, Chapter 4. The target is 5 Mbps (download speed) and 1 Mbps (upload speed). These communities are also covered by Xplornet for direct-to-home satellite Internet service. Seven of these communities have access to broadband Internet service at speeds that meet the 5/1 Mbps target speeds. The 7 communities are from Manitoba.

43 **** Haight, Anabel ****-Haase & **** A **** (2014) Revisiting the digital divide in Canada: the impact of demographic factors on access to the internet, level of online activity, and social networking site usage, Information, Communication & Society, 17:4, 503-519, DOI: 10.1080/1369118X.2014.891633, p. 503. The authors observe that “More recent immigrants to Canada have lower rates of internet access; however, recent immigrants who are online have significantly higher levels of online activity than Canadian born residents and earlier immigrants.”44 **** Haight, Anabel ****-Haase & **** A **** (2014) Revisiting the digital divide in Canada: the impact of demographic factors on access to the internet, level of online activity, and social networking site usage, Information, Communication & Society, 17:4, 503-519, DOI: 10.1080/1369118X.2014.891633, p. 51145 **** Haight, Anabel ****-Haase & **** A **** (2014) Revisiting the digital divide in Canada: the impact of demographic factors on access to the internet, level of online activity, and social networking site usage, Information, Communication & Society, 17:4, 503-519, DOI: 10.1080/1369118X.2014.891633, p. 515.

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67. In the author's view, the fact that 20% of Canadians continue to remain unconnected has serious implications and requires strategic policy interventions.46 Part 2 – Preliminary Comments on the Commission's QuestionsCommon themes with the Affordable Access Coalition

68. Based on preliminary conversations to date with legal counsel for the Affordable Access Coalition (AAC), a number of common themes have emerged. MKO endorses the conclusions of the AAC that:

• Broadband has become an essential telecommunications service. It is essential to individuals of all ages, to households, to businesses, and to Canada’s competitive advantage

• The digital divide exists. Access and socio-economic barriers persist• Market forces and targeted government funding have not solved the problem.

• This hearing presents an important opportunity to address barriers to access and to affordability

Constitutional and Statutory Context

69. The conclusions of MKO on the importance of committing to broadband access as a basic service objective is reinforced by its review of the Constitutional and statutory context. By virtue of the Constitution Act, 1982, the Government of Canada and the Provincial Governments are committed to:

• promoting equal opportunities for the well being of Canadians• furthering economic development to reduce disparities in opportunities• providing essential public services of a reasonable quality to all Canadians.4770. These constitutional commitments dictate a statutory affirmation of the objectives 46 **** Haight, Anabel ****-Haase & **** A **** (2014) Revisiting the digital divide in Canada: the impact of demographic factors on access to the internet, level of online activity, and social networking site usage, Information, Communication & Society, 17:4, 503-519, DOI: 10.1080/1369118X.2014.891633, p. 514/515.

47 Section 36 (1) of The Constitution Act, 1982, being Schedule B to the Canada Act 1982 (UK), 1982, c 11 19

http://www.statutelaw.gov.uk/documents/1982/11/ukpga
under the Telecommunications Act:48

(a) to facilitate the orderly development throughout Canada of a telecommunications system that serves to safeguard, enrich and strengthen the social and economic fabric of Canada and its regions;

(b) to render reliable and affordable telecommunications services of high quality accessible to Canadians in both urban and rural areas in all regions of Canada;

(h) to respond to the economic and social requirements of users of telecommunications services;

71. The Telecommunications Act also highlights the need:

(f) to foster increased reliance on market forces for the provision of telecommunications services and to ensure that regulation, where required, is efficient and effective;

Preliminary response of the MKO to the Commission's questions regarding Canadians’ evolving needs for telecommunications services

72. The preliminary views of the MKO are best summarized in the Overview appearing at the beginning of this document. The responses below should be read along with the Overview.

1. Canadians are using telecommunications services to fulfill many social, economic, and cultural needs in today’s digital economy.

a) Explain how telecommunications services are used to meet these needs. For example, uses may include e-commerce (i.e. the online purchase and trade of products or services), e-banking and/or telephone banking, e-health or telehealth services, telework, and distance education. Which of these uses of telecommunications services are the most important to ensure that Canadians meaningfully participate in the digital economy?

b) Explain which telecommunications services are most important to support these needs and uses. What characteristics (e.g. capacity, mobility, high speed, and low latency) should these telecommunications services have?

c) Identify and explain the barriers that limit or prevent Canadians from meaningfully 48 Telecommunications Act ( 1993, c. 38)

20

participating in the digital economy (e.g. availability, quality, price, digital literacy, and concerns related to privacy and security). Identify which segments of the Canadian population are experiencing such barriers.

d) Identify and explain any enablers that allow Canadians to meaningfully participate in the digital economy (e.g. connected devices and applications).

e) As Canada’s digital economy continues to grow and evolve during the next 5 to 10 years, which telecommunications services are Canadians expected to need to participate meaningfully? Specify how your responses to parts a) through d) above would change based on your answer.

Response to questions:
1 (a)

73. In the preliminary view of the MKO, the uses of telecommunications services and the needs of Canadians to participate in the digital economy cannot be usefully defined in terms of a list of e-commerce, e-social and e-cultural uses. Any list that is created is likely to be out-of-date by the time it is finalized due to the rate of innovation of e-services.

74. It is far more useful to define the needs of Canadians in terms of bandwidth. A bandwidth based definition has several important features:

• Bandwidth identifies what is required to meet the full spectrum of user requirements since it can be defined as the total bandwidth requirements of Canadians, individually and in aggregate

• A bandwidth definition avoids any assessment of the value or social merit of particular uses, which is important since the value of particular uses will be very different in different circumstances. Facebook may be seen as frivolous by some but may in fact be the primary means of keeping families members connected.

For example, family members in First Nations communities can become geographically dispersed and social networking has become the primary, and most affordable, means of connecting, despite that challenges of accessing these services (we are advised that traditional phone service are often even less available due to traffic capacity limits)

• Bandwidth trends are much more likely to be predictable than specific uses• Bandwidth requirements can be defined in terms that relate to the adequacy of 21

facilities. The overall usage of facilities can be monitored to determine the extent of capacity problems due to high usage

1 (b)

75. The relative “importance” of different services is extremely difficult to establish in a way that would be appropriate for policy purposes. Canadians are very diverse and would have widely different priorities depending on their circumstances.

76. It may seem obvious that TeleHealth should have a higher priority than Skype calls among family members. But within a family that is living with chronic mental of physical life-threatening challenges, being able to connect reliably at any time may be far more important than most telehealth conversations.

77. Minimum standards for the characteristics of telecommunications services that apply on a community by community and service-by-service basis will be far more meaningful. Essentially, capacity should be sufficient to ensure that actual upload and download speeds are above the level defined as basic service most of the time with low latency.

1 (c)

78. The barriers that limit or prevent Canadians from meaningfully participating in the digital economy vary significantly among Canadians. It is important to distinguish barriers that are related to the telecommunications services that are available from those that not technology/facilities related.

79. Remote First Nations communities face challenges that are distinct from those faced by most other Canadians. Many of these communities are located in regions of the country that are high cost of service areas for traditional telephone service. As a result, they continue to be underserved in that all trunks are busy, which blocks additional calls, far more frequently than in other regions. This problem has been aggravated with increased use of e-services. When circuits are used for Internet connections as well as voice calls, the overloading increases.

80. A number of communities have been forced to find alternate solutions to their communications requirements. It is the practice in certain First Nations for the Band Office to provide unsecured WiFi access to the Internet over a dedicated facility. Since this cannot be provided on a community-wide basis, there are “pools of “WiFi” in 22

selected locations such as around the Band Office, schools and other public areas.

81. Individual users may find that dialup access is often unavailable and always costly, so they instead rely on the “free” WiFi connections that can be found in selected locations in the community. Unfortunately, the consequence of widespread reliance on this option is that immediate access is not available on demand (e.g., connecting from home in the event of an emergency may not be possible) and the access that is available is very slow.

82. Essentially, the key barrier is the limited bandwidth and limited coverage of WiFi service that is typical in these communities.49

1 (d)

83. The advent of cheap smart phones and pools of WiFi have been important enablers of access to e-services. However, the limited coverage and heavy use of limited shared bandwidth results in a low service quality. When a single high-speed connection is being relied on by a large proportion of families and individuals in a community, the available service is inadequate.

84. An important implication of this observation is that defining standards for a high speed service that is suitable for a typical household in a major urban centre is not appropriate for a remote community where many people within the community are sharing a single high speed connection.

85. The situation faced in these areas is equivalent to the entire neighbourhood in a city having to rely on a single ****’s location to meet all of their telecommunications needs.

1 (e)

86. Bandwidth requirements will keep expanding both because of new uses and increasing digital literacy and because needs that have been met with POTS in the past are migrating to digital service. As First Nations users discover that a Skype call can be made instead of an old fashioned phone call, they may tend to choose the digital option, even when the quality is poor and calls frequently fail. Digital quality suffers with congestion, but at least calls are not totally blocked because all circuits are busy.

2. The Commission’s current target speeds for broadband Internet access service are a 49 (e.g., availability, quality, price, digital literacy, and concerns related to privacy and security).

23

minimum of 5 Mbps download and 1 Mbps upload, based on uses that consumers should reasonably expect to make of the Internet. Are these target speeds sufficient to meet the minimum needs of Canadians today? If not, what should the new targets be and what time frame would be reasonable to achieve these new targets?

87. Our understanding is that these targets are based on the requirements of typical individual users during what might be referred to as single internet user peak period requirements.

88. The preliminary view of MKO is that these standards do not reflect the reality of use in remote communities, or in other areas where there is a high ratio of users-to-connections to access service.

89. In a typical moderate-to-high income area of a city, the ratio of households-to-connections is approaching the ratio of persons per household since most households will have their own high speed internet service connection, usually either cable or ADSL. In areas where affordability is a problem, the average number of users per connection may tend to increase both because average household size tends to be larger and because more households share connections.

90. In the most extreme cases, such as remote communities where unemployment rates can exceed 50%, many users of Internet service do not have their own connections. First Nations citizens and the MKO representative interviewed suggest that while a number of households have internet-capable hardware (smartphones, tablet devices such as iPads, and computers), a relatively small proportion of households have their own Internet connections.

91. In a number of communities, many internet users access the internet through public WiFi connections provided by the Band Office, schools or community centres.

As a consequence, the volume of internet traffic is much higher per internet connection than would be typical where the ratio of households or users per connection is lower.

92. In addition, it is our perception that in low income communities fewer households have landline telephone service or cell phone service due to affordability issues. In remote communities, all options may not even be available, or the only options available are expensive (satellite service).

93. Even where cellular service is available, low-income households are more likely to rely on pay-as-you go plans since they are the households/individuals that are more likely not to have credit ratings that will enable them to be offered plans without 24

deposit requirements that they cannot afford.

94. Since pay-as-you-go plans are the most expensive on a per minute basis, it is households/individuals in low-income areas, including remote communities, that may be more likely to rely heavily on open-access WiFi service. One consequence of this reality is that the consumers may be more likely to rely more heavily on open-access WiFi as a substitute for landline and cellular voice calls than they are in locations where households face fewer affordability challenges in making their purchase decisions.

95. Based on its understanding of this social reality, it is the preliminary view of MKO that the number of users per connection in low-income and remote communities may tend to be higher. As a result, the required bandwidth to maintain acceptable internet service quality standards may be greater. If the bandwidth available in connecting a remote community with high user per connection to the internet is similar to the available bandwidth in higher income, lower use per connection areas, the broadband connections will be far more congested.

96. To maintain reasonable service levels in remote communities, it may be necessary to maintain comparatively high bandwidth per connection.

The Commission’s role regarding access to basic telecommunications services3. Which services should be considered by the Commission as basic telecommunications services necessary for Canadians to be able to meaningfully participate in the digital economy? Explain why.

a) Explain whether the underlying technology (e.g. cable, digital subscriber line, fibre, fixed wireless, mobile wireless, and satellite technology) should be a factor in defining whether a telecommunications service should be considered a basic service.

b) Identify, with supporting rationale, the terms, conditions, and service characteristics under which basic telecommunications services should be provided. Should any obligations be placed on the provider(s) of these services? If so, what obligations and on which service provider(s)?

c) What should be the prices for basic telecommunications services and how should these prices be determined? Provide rationale to support your answer.

3 (a)
25

97. In the preliminary view of our clients, it is only the characteristics of the service being provided that is important in defining basic telecommunication service. Each service provider that is responsible for meeting minimum standards for basic service should be permitted to do so using the technology that meets the standards at minimum cost. In general, the least cost technology will be the technology that is in place, provided that it is capable of providing all aspects of basic service, including internet access with acceptable bandwidth.

98. In some locations, for example in remote communities, existing infrastructure and technologies may not be adequate to provide the functionality need to provide basic telecommunications service, including Internet access for the entire community. Where subsidies are appropriate, alternative technologies should be considered so that the increased capacity can be provided at least cost. In some circumstances the least-cost high bandwidth solution may make the existing infrastructure redundant. In such cases, the existing technology and owner may be able to offer competitive unsubsidized services using the existing technology.

3 (b) (c)

99. Some observers might suggest that **** Old Telephone Service (POTS) no longer provides a service that is not replaceable by digital services. In particular, VOIP service can be provided as a simple alternative for customers that do not want anything other than basic voice service, provided that Internet access is available and bandwidth meets the requirements of basic telecommunications service.

100. All licensed providers of telecommunications services should be obliged to include in their service options basic telecommunications services, as defined by the CRTC at a standard published price.

101. Any community (geographic area) that is served by only one licensed telecommunications service provider should be entitled to initiate a competitive process for the right to be the monopoly provider of service to that community.

4. Can market forces and government funding be relied on to ensure that all Canadians have access to basic telecommunications services? What are the roles of the private sector and the various levels of government (federal, provincial, territorial, and municipal) in ensuring that investment in telecommunications infrastructure results in the availability of modern telecommunications services to all Canadians?

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102. Our client's preliminary view is that market forces and government funding have not proved adequate to address both affordability and adequate bandwidth infrastructure issues. It appears there is little prospect of an easing of constraints on government funding.

103. Our client expects the CRTC will have to achieve its telecommunications objectives through a combination of market forces, telecommunications policy and industry-specific funding mechanisms. The National Subsidy Mechanism and Contribution Regime will have to be continued although consideration should be given to changing what is funded in order to align the subsidy mechanism with current telecommunications requirements.

104. A critical aspect of “ensuring that investment in telecommunications infrastructure results in the availability of modern telecommunications services to all Canadians” is the provision of adequate bandwidth to all segments of the network. In particular, the quality of digital service (capacity, mobility, high speed and latency) depends not only on the technical capacity of individual connections but also on the upstream connections to common backbone infrastructure that accommodates the aggregated use of all downstream users.

105. For example, representatives of remote communities observe that while the existing infrastructure may be sufficient in these communities to allow all users to get online, this is possible only because many users are able to share a single Internet connection through each WiFi router that is connected to the Internet.

106. They suggest however that due to limited capacity connecting the community to the main internet backbone, the total volume of digital traffic overloads the system which results in very slow Internet service. This problem is aggravated by the reality that most websites are designed for mainstream users; it is assumed that users have high speed connections.

107. Connecting to a website, including critical websites such as TeleHealth, involves the transmission of large volumes of data for every web page accessed. Due to the small number of connections from a remote community to the outside world, the aggregate bandwidth required can make wait times for each web page to load impracticably long.

108. Quality of service standards should include measures of latency that provide an indicator of the time it takes during periods of heavy use for the transmission of a standardized quantity of data.

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109. Any service provider operating in a non-competitive market should be required to meet the defined standard under normal heavy use conditions (i.e., during busy periods such as early evenings).

110. At the present time, some remote communities report that the periods of heavy congestion include most hours other than usual low-use hours (middle of the night).

The problem is serious enough that some users adjust their lifestyles so that they can shift their internet use to hours when most people are asleep and therefore offline.

5. What should be the Commission’s role in ensuring the availability of basic telecommunications services to all Canadians? What action, if any, should the Commission take where Canadians do not have access to telecommunications services that are considered to be basic services?

111. The question posed raises both policy and legal opinions. Our client has not developed a legal position at this point in time and the development of its policy position is ongoing.

112. We are advised that some remote communities have contracted with service providers to provide Internet service for the community. They have opted for competitive Internet service providers because they have been unable to obtain a standard of backbone internet service that meets the needs of the community from the ILEC that they are dependent on. They have been challenged, however, to ensure that performance standards are met.

113. In order to ensure that these communities receive telecommunications services that function at a level that meets mandated standards, enforcement mechanisms are required that ensure that any licensed service provider meets those standards.

114. Given the limited choice, remote communities are likely to have great difficulty enforcing contractual standards on a timely basis through normal legal processes. It is therefore desirable to have the CRTC oversee the commitments in non-competitive markets.

6. In Telecom Regulatory Policy 2011-291, the Commission stated that it would closely monitor developments in the industry regarding the achievement of its broadband Internet target speeds to determine whether regulatory intervention may be needed.

What action, if any, should the Commission take in cases where its target speeds will not be achieved by the end of 2015?

28

115. MKO is of the view that regulatory intervention is required to bridge the digital divide. One element of the intervention should include an expansion of the subsidy regime to accelerate the deployment of wideband service and provide affordable access to the telecommunications services that rural and remote communities require to participate meaningfully in the digital economy. A defined timeframe in which the target is expected to be met may be advisable.50

7. In Telecom Regulatory Policy 2013-711, the Commission stated its intention to establish a mechanism, as required, in Northwestel’s operating territory to support the provision of modern telecommunications services. Such a mechanism would fund capital infrastructure investment in transport facilities (e.g. fibre, microwave, and satellite), as well as the cost of maintaining and enhancing these facilities. The Commission considered that this mechanism should complement, and not replace, other investments from the private sector and governments, including public-private partnerships.

a) Explain, with supporting rationale, whether there is a need for the Commission to establish such a mechanism in Northwestel’s operating territory. As well, explain whether there is a need for such a mechanism in other regions of Canada.

b) What impact would the establishment of such a mechanism have on private sector investment and government programs to fund the provision of modern telecommunications services?

116. Northwestel has historically received special treatment because its entire service area is essentially a high cost service area. As a consequence, internal cross subsidies similar to the other former monopolies have faced special challenges. In other respects, Northwestel can be viewed as essentially the same as other high cost of serving areas (HCSA).

117. At this point in time, within-company subsidies will be less practical than an industry wide subsidy regime, due to competitive issues. It may make sense to have a single regime that would be applicable for all HCSA’s.

8. What changes, if any, should be made to the obligation to serve and the basic service objective?

9. Should broadband Internet service be defined as a basic telecommunications 50We note the AAC proposal of of 25 bps by 2020.

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service? What other services, if any, should be defined as basic telecommunications services?

118. It is important to recognize that even in the midst of a telecommunications revolution there are a number of consumers who remain deeply committed to POTS for a number of reasons including but not limited to affordability and preference. As the industry changes, it is important to ensure that no consumer is left behind. It also is important to ensure that the obligation to serve is maintained while we transition towards a digital economy for remote communities.

119. In examining the existing policies related to the obligation to serve, the basic service objective, the use of the NCF and the role of price cap regulation, it is necessary to recognize that services meeting the existing definition of the basic service objective do not, in and of themselves, allow Canadians to participate meaningfully in the digital economy. Recognizing that broadband access is an essential element of basic telecommunications services, it may be appropriate to simply add that element to the basic service objective.

120. An alternative approach would be to develop an alternate definition of basic service based on digital bandwidth that would support the deployment of the digital equivalent of **** Old Telephone Service (POTS) while at the same time ensuring that every Canadian in able to participate in the digital economy to the full extent of their ability and interest.

121. The availability of affordable telecommunications services should mean that any Canadian that has difficulty adapting to new technologies is able to utilize voice over Internet Protocol (VOIP) service that is equivalent to POTS. At the same time, the same broadband connection would be capable of being used for all existing and future internet-based services.

122. The transition to a fully digital world would require the adoption of an expanded definition of the basic service objective that includes the relevant characteristics of digital services: capacity, high speed and low latency. However, in the context of rural and remote communities, it is also important to recognize that capacity standards need to be established not only on the basis of individual services (e.g., an ADSL connection), but also on the basis of the aggregate capacity of the link from the community to the outside world.

30

10. What changes, if any, should be made to the existing local service subsidy regime? What resulting changes, if any, would be required to the existing regulatory frameworks (e.g. price cap regimes)?

123. The existing definition of basic telecommunications services underpins the local service subsidy regime, which uses the National Contribution Fund (NCF) to subsidize the provision of basic residential local service, including video relay service (VRS) in high-cost serving areas (HCSAs). As a consequence, the funding mechanism supports only the incumbent local exchange carriers (ILECs).51

124. The subsidy regime needs to be expanded to accelerate the deployment of wideband service and provide affordable access to the telecommunications services that rural and remote communities require to participate meaningfully in the digital economy.

125. Limiting price cap regulation to the retail telecommunications services of ILECs is also rooted in a reality that was valid in the past but inadequate for the future. The affordability of broadband is equally important within rural and remote communities.

126. The rationale for the current limited subsidy regime is outdated. Looking to the future, the regime should evolve in parallel with the evolution of the digital telecommunications services that are becoming increasing integral to the daily lives of Canadians in HCSAs as they are for Canadians living in less remote and in major urban areas.

51 It is arguable that the existing regime reinforces continued reliance on historic technologies rather than being used as an incentive for innovation in transitioning HCSAs to technologies that enable Canadians in rural and remote areas to participate fully in the digital economy of the future.

31

11. What changes, if any, should be made to the contribution collection mechanism?

Your response should address, with supporting rationale, which TSPs should be required to contribute to the NCF, which revenues should be contribution-eligible and which revenues, if any, should be excluded from the calculation of contribution-eligible revenues.

FOR SUBMISSION

127. MKO is not in a position to comment upon this question at this point in time. It will review the submissions and evidence of other parties.

32

12. Should some or all services that are considered to be basic telecommunications services be subsidized? Explain, with supporting details, which services should be subsidized and under what circumstances.

128. The subsidy regime needs to be expanded to accelerate the deployment of wideband service and provide affordable access to the telecommunications services that rural and remote communities require to participate meaningfully in the digital economy.

13. If there is a need to establish a new funding mechanism to support the provision of modern telecommunications services, describe how this mechanism would operate.

Your response should address the mechanism described in Telecom Regulatory Policy 2013-711 for transport services and/or any other mechanism necessary to support modern telecommunications services across Canada. Your response should also address, but not necessarily be limited to, the following questions:

a) What types of infrastructure and/or services should be funded?

b) In which regions of Canada should funding be provided?

c)Which service providers should be eligible to receive funding, and how should eligibility for funding be determined (e.g. only one service provider per area, all service providers that meet certain conditions, wireless service providers, or service providers that win a competitive bidding process)?

d)How should the amount of funding be determined (e.g. based on costs to provide service or a competitive bidding process)?

e) What is the appropriate mechanism for distributing funding? For example, should this funding be (i) paid to the service provider based on revenues and costs, or (ii) awarded based on a competitive bidding process?

f) Should any infrastructure that is funded be available on a wholesale basis and, if so, under what terms and conditions?

g)Should the Commission set a maximum retail rate for any telecommunications service that is subsidized?

h)Should this mechanism replace the existing residential local wireline service subsidy? If so, explain how the existing subsidy should be eliminated, including details on any transition period. In addition, explain whether the small ILECs and/or Northwestel should be subject to any special considerations or modifications for this transition period.

129. To satisfy the requirement that all Canadians have access to affordable basic wideband telecommunications services, it is clear that rates for broadband service in 33

http://www.crtc.gc.ca/eng/archive/2013/2013-711.htm

markets with limited or no competition will have to be regulated. For example, basic wideband service that is VOIP capable could be defined and the price constraints currently imposed by the price cap regime could be applied to the equivalent digital service.

130. Using that price as a reference point for the cost-to-bandwidth relationship, price caps for other broadband services with higher capacity could then be established for markets in which the price cap regime applies.

131. To support the transition to fully digital telecommunications services, it might also be appropriate to implement a competitive bidding process for providing service to each existing HCSA in Canada.

132. A process of inviting bids to serve each HCSA subject to carefully defined performance standards related to capacity, high speed and low latency could be initiated. The service provider that requires the lowest subsidy for the right to provide service at the established price and service levels would be granted a multi-year license as the exclusive service provider in that community.

133. Enforcement of the standards will be a critical element of this innovation. In the event that the service provider fails to meet the contractual service standards, the license would be revoked and a new auction would be initiated.

134. This approach could be used to gradually introduce high standards of digital service that would be comparable in all characteristics, including price, to the telecommunications services that are available in non-HCSAs.

135. While there will be some HCSAs where competitive service providers will be able to provide new digital service at a cost that is below the subsidies provided by the existing subsidy regime not all locations will attract bids on that basis.

136. As “headroom” is established through the transition of the most attractive HCSAs to digital service, the NCF money saved can be reallocated to attract service providers into the less attractive HCSAs by increasing the cap on the bids. Ultimately, the higher value of universal broadband service will justify an increase in the available subsidy when necessary.52

Conclusion – An Appearance at the Public Hearing is Necessary 137. Pursuant to s. 26 of the CRTC Rules of Procedure, the MKO wishes to be considered as an intervenor in the proceeding. It designates Ms **** Fenske of the Public Interest Law Centre as its representative. Ms Fenske's address is 200 - 393 52 The MKO appreciates the input of Mr. John **** of Elenchus in developing its preliminary comments.

34

Portage Avenue, Winnipeg, MB *** ***. Her email address is: ******@***.com.

The MKO reserves the right to seek the leave of the CRTC to add further parties to its intervention.

138. MKO wishes to appear at the public hearing whether that appearance is made in Gatineau, Quebec or the regional office in Winnipeg. Given the significant barriers faced by high cost to serve MKO communities and its unique perspective, MKO believes it is important that a distinct Indigenous voice from a province with distinct challenges would be of assistance tot he Panel's deliberations.

**** Williams
Director
Public Interest Law Centre
*********End of Document*********
35
mailto:******@***.com

Initial comments of the Manitoba Keewatinowi Okimakinak Inc. in the review of basic telecommunications services PN 2015-134-1

**** Williams
Public Interest Law Centre
of Legal Aid Manitoba
200 - 393 Portage Avenue
Winnipeg, MB *** ***

Re: Intervention of the Manitoba Keewatinowi Okimakinak Inc. in the CRTC review of basic telecommunications services (2015-134) Overview

Part 1 – Introduction of MKO – Preliminary Conversations with Manitobans and Literature Review Who is the MKO?

What is the Public Interest Law Centre?
How has the MKO prepared its preliminary comments?

What have we learned from our initial conversations with Manitobans?20 What are the key themes from our literature review?

Common themes with the Affordable Access Coalition
Constitutional and Statutory Context

The Commission’s role regarding access to basic telecommunications services FOR SUBMISSION

Conclusion – An Appearance at the Public Hearing is Necessary

Intervention: Manitoba Keewatinowi Okimakinak (Intervenor 264)

Document Name: 2015-134.223988.2394496.Intervention(1fbls01!).pdf
Initial comments of the Manitoba Keewatinowi
Okimakinak Inc. in the review of basic
telecommunications services
PN 2015-134-1
**** Williams
Public Interest Law Centre
of Legal Aid Manitoba
200 - 393 Portage Avenue
Winnipeg, MB *** ***
1

Re: Intervention of the Manitoba Keewatinowi Okimakinak Inc. in the CRTC review of basic telecommunications services (2015-134)

1. The Public Interest Law Centre is pleased to provide the preliminary comments of the Manitoba Keewatinowi Okimakinak Inc. (MKO) relating to the review of basic telecommunications services.1

Overview

2. In Part 1 of its comments, the MKO provides an introduction to its organization as well as initial observations on issues raised by this review. In Part 2, it provides a preliminary response to the questions posed by the CRTC in Appendix B to CRTC 2015-134.

Common themes with the Affordable Access Coalition

3. Based on preliminary discussions with counsel for the Affordable Access Coalition (AAC), a number of common themes have emerged. MKO endorses the conclusions of the AAC that:

• Broadband has become an essential telecommunications service• There is a digital divide. With regard to broadband, unacceptably high access and socio-economic barriers persist

• Market forces and targeted government funding have not solved the problem • This hearing presents an important opportunity to address barriers to access and to affordability

1 Pursuant to s. 26 of the CRTC Rules of Procedure, the MKO wishes to be considered as an intervenor in the proceeding.

It designates Ms **** Fenske of the Public Interest Law Centre as its representative. Ms Fenske's address is 200 - 393 Portage Avenue, Winnipeg, MB *** ***. Her email address is: ******@***.com. The MKO reserves the right to seek the leave of the CRTC to add further parties to its intervention.

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mailto:******@***.com
Addressing the digital divide

4. Considerable work needs to be done by the MKO before its final position is developed. However, based on initial conversations with selected Manitobans and a literature review, it offers a number of preliminary observations.

5. The purpose of the CRTC consultation is to determine appropriate policies for ensuring that all Canadians have affordable access to the telecommunications services they require to participate meaningfully in the digital economy. To achieve this goal, it will be important to establish policies that provide a smooth transition from the existing regime that treats wireline voice service as the central element of basic telephone service to the digital telecommunications world of the future.

6. In making this transition, it is critical that no consumer be left behind and that affordable access to wireline voice service is maintained for consumers seeking this option.

7. However, in the context of high cost serving areas, there is a risk that excessive focus on the preservation of technologies that do not accommodate meaningful participation in the digital economy risk may impede progress toward universal access to the full range of digital services.2

8. The existing definition of basic telecommunications services underpins the local service subsidy regime, which uses the National Contribution Fund (NCF) to subsidize the provision of basic residential local service, including video relay service (VRS) in high-cost serving areas (HCSAs). As a consequence, the funding mechanism supports only the incumbent local exchange carriers (ILECs).3

9. The subsidy regime needs to be expanded to accelerate the deployment of wideband service and provide affordable access to the telecommunications services that rural and remote communities require to participate meaningfully in the digital economy.

10. Limiting price cap regulation to the retail telecommunications services of ILECs is also rooted in a reality that was valid in the past but inadequate for the future. The affordability of broadband is equally important within rural and remote communities.

11. The rationale for the current limited subsidy regime is outdated. Looking to the future, the regime should evolve in parallel with the evolution of the digital telecommunications services that are becoming increasing integral to the daily lives of 2 Some observers might argue that touchtone wireline service is no longer central to the obligation to serve and the related basic service objective and is already redundant in regions of the country where alternative technologies have been fully deployed.

3 It is arguable that the existing regime reinforces continued reliance on historic technologies rather than being used as an incentive for innovation in transitioning HCSAs to technologies that enable Canadians in rural and remote areas to participate fully in the digital economy of the future.

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Canadians in HCSAs just as they are for Canadians living in major urban areas.

12. If anything, the reliance on new technologies is greater in rural and remote areas since it is digital services that can surmount the disadvantages of rural and remote living and facilitate improved access to health, educational and social services as well as economic opportunity.

13. In reviewing the existing policies related to the obligation to serve, the basic service objective, the use of the NCF and the role of price cap regulation, it is necessary to recognize that services meeting the existing definition of the basic service objective do not, in and of themselves, allow Canadians to participate meaningfully in the digital economy. Recognizing that broadband access is an essential element of basic telecommunications services, it may be appropriate to simply add that element to the definition of basic service objective.

14. Alternatively, a definition of basic service based on digital bandwidth would support the deployment of the digital equivalent of **** Old Telephone Service (POTS) while at the same time ensuring that every Canadian in able to participate in the digital economy to the full extent of their ability and interest.

15. The availability of affordable telecommunications services should mean that any Canadian that has difficulty adapting to new technologies is able to utilize voice over Internet Protocol (VOIP) service that is equivalent to POTS. At the same time, the same broadband connection would be capable of being used for all existing and future internet-based services.

16. The transition to a fully digital world would require the adoption of an expanded definition of the basic service objective that includes the relevant characteristics of digital services: capacity, high speed and low latency. However, in the context of rural and remote communities, it is also important to recognize that capacity standards need to be established not only on the basis of individual services (e.g., an ADSL connection), but also on the basis of the aggregate capacity of the link from the community to the outside world.

17. For reasons detailed in the responses to the specific questions posed by the CRTC in its notice (Part 2), the volume of traffic generated on a per connection basis may be inconsistent with the bandwidth that is sufficient in non-HCSAs where employment rates and incomes tend to be higher.

18. To satisfy the requirement that all Canadians have access to affordable basic wideband telecommunications services, it is clear that rates for broadband service in markets with limited or no competition will have to be regulated. For example, basic wideband service that is VOIP capable could be defined and the price constraints currently imposed by the price cap regime could be applied to the equivalent digital 4

service.

19. Using that price as a reference point for the cost-to-bandwidth relationship, price caps for other broadband services with higher capacity could then be established for markets in which the price cap regime applies.

20. To support the transition to fully digital telecommunications services, it might also be appropriate to implement a competitive bidding process for providing service to each existing HCSA in Canada.

21. A process of inviting bids to serve each HCSA subject to carefully defined performance standards related to capacity, high speed and low latency could be initiated. The service provider that requires the lowest subsidy for the right to provide service at the established price and service levels, would be granted a multi-year license as the exclusive service provider in that community.

22. Enforcement of the standards will be a critical element of this innovation. In the event that the service provider fails to meet the contractual service standards, the license would be revoked and a new auction would be initiated.

23. This approach could be used to gradually introduce high standards of digital service that would be comparable in all characteristics, including price, to the telecommunications services that are available in non-HCSAs.

24. While there will be some HCSAs where competitive service providers will be able to provide new digital service at a cost that is below the subsidies provided by the existing subsidy regime not all locations will attract bids on that basis.

25. As “headroom” is established through the transition of the most attractive HCSAs to digital service, the NCF money saved can be reallocated to attract service providers into the less attractive HCSAs by increasing the cap on the bids. Ultimately, the higher value of universal broadband service will justify an increase in the available subsidy when necessary.4

4 The MKO appreciates the input of Mr. John **** of Elenchus in developing its preliminary comments.

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Part 1 – Introduction of MKO – Preliminary Conversations with Manitobans and Literature Review

Who is the MKO?

26. Incorporated in 1981, MKO represents the 30 northern most First Nations in Manitoba5 and 65,000 treaty First Nation citizens. MKO is a non-profit, political advocacy organization that provides a collective voice on issues of inherent Treaty, Aboriginal and human rights for its citizens.6 Its citizens speak a variety of languages including Oji-Cree, Dene, Cree and Ojibway.

27. Geographically the MKO region covers approximately three quarters of the surface area of Manitoba. Forty-nine percent of the population of Northern Manitoba is aboriginal.7

28. As recognized by the CRTC in Decision 2014-267, MKO communities in the G Band of High Cost Serving areas are among the most expensive to serve in all of Canada.8 As detailed in Map 1, MKO communities also account for a significant proportion of the communities in which C-model community aggregator infrastructure is in place. Manitoba communities account for 20 of the 89 communities and more than 3,000 households of the roughly 18,000 Canadian households receiving Internet Service through this model.9

29. The MKO has participated in a number of CRTC Telecom proceedings including proceedings related to High Cost Serving Areas,10 Local Service pricing options,11 MTS Service Improvement Plans12 and the use of deferral account funds to expand 5 Signatories of treaties number 4, 5, 6, and 10.

6 MKO receives its mandate by resolution of the MKO Chiefs in General Assembly. The **** Chief, elected for a three-year term, serves as the principal spokesperson. A regionally representative Executive Council of Chiefs provides ongoing direction between General Assemblies.

7 ****, Anja, **** Fiser, **** Brender, and **** Dowdall. Building a Resilient and Prosperous ****: Centre for the **** Five-Year Compendium Report. Ottawa: The Conference Board of Canada, 2015., p. 9. In Manitoba, over 15 per cent of the population is Aboriginal. The Aboriginal population is very young (median age 28 years) compared with the non-Aboriginal population (median of 41 years), p. 10.

8 See Table 1 of Telecom Decision 2014-627 in which the CRTC directed a monthly subsidy per residential NAS to the HCSA Band G in Manitoba of $60.48 as compared to the next highest province of Quebec receiving a subsidy of $43.58 in HCSA Band G. It is recognized that HCSAs in the territory served by Northwestel also receive very significant subsidies.

9 Satellite Inquiry, para 134. See also Satellite Inquiry, Key Findings, Chapter 4.

10 PN 97-42.
11 PNs 95-49 and 95-56.
12 CRTC Decisions 2003-68 and 2002-63.
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broadband services.13

30. The CRTC has found that the MKO is representative of a class of subscribers, First Nations people living in Manitoba,14 with an interest in the outcome of its proceedings.15 MKO is a regular participant in hearings before the Manitoba Public Utilities Board on matters relating to Manitoba Hydro.

Map 1

The Canadian Radio-Television and Telecommunications Commission, Satellite Inquiry Report (2014) at 29.

13 CRTC Decision 2008-1.
14 Telecom Costs Order CRTC 2002-3, para 22.

15 See for example, Telecom Costs Order CRTC 2007-11, para 9. Please also see Telecom Costs Order CRTC 96-21 and Telecom Costs Order CRTC 99-11.

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What is the Public Interest Law Centre?

31. The Public Interest Law Centre (PILC) was established in 1982 with the objective of representing groups and individuals on matters relating to issues of public interest including consumer and environmental issues.

32. PILC has represented MKO in all prior proceedings before the CRTC. Staff at the Centre frequently appears before tribunals such as the Manitoba Public Utilities Board.16

How has the MKO prepared its preliminary comments?

33. MKO presents the perspective of its citizens who live in all parts of Manitoba but are disproportionately represented in Northern and remote communities. In developing its preliminary comments, MKO has undertaken17:

• an initial conversation with MKO staff, selected First Nation citizens, consumer representatives, a staff person from an organization representing the Metis people and a representative from a food bank (“initial conversations with Manitobans”)• discussions with legal counsel to the Affordable Access Coalition (AAC) with a view to minimizing duplication, identifying common themes and specifying areas of distinct focus, and

• a preliminary review of relevant CRTC decisions, grey literature and peer reviewed literature with a particular focus on issues relevant to Indigenous people, remote communities and newcomers (the literature review)34. The comments of MKO are preliminary based on its initial conversations and literature review.18 It is committed to listening carefully to others in this proceeding prior to developing its final recommendations.

16 Including matters relating to the regulation of Manitoba Hydro, Manitoba Public Insurance and government cheque cashers and payday lenders. PILC staff frequently appear before the Manitoba Clean Environment Commission. They have or are representing First Nations, Elders and Traditional Knowledge holders in a number of regulatory and judicial proceedings. They are currently appearing before the National Energy Board on matters relating to Enbridge Line 3.

17 MKO appreciates the extensive efforts of CAC Manitoba in organizing and facilitating current discussions.

18 While MKO is greatly appreciative of the insight provided by Mr. John **** of Elenchus, the preliminary comments in this document were developed under the direction and control of MKO.

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35. MKO regularly employ feedback tools to gather insight from its citizens, other ratepayers and from organizations representing the perspectives of community groups, government agencies and business. For the purposes of its pending February 1, 2016 intervention, MKO intends to consider the results of future community surveys as well as “focus group like” conversations with consumers including low income consumers and newcomers.19 It reserves the right to amend its comments based on future learnings.

What have we learned from our initial conversations with Manitobans?20Manitobans seek affordable, reliable and modern connections to family, essential services and opportunity

36. In our initial conversations, Manitobans highlighted the importance of basic telecommunications services including the Internet, wireless and wired services as tools to:

• feel safe21
• connect with family
• access essential health services22
• improve their education
• participate in the marketplace
• seek employment, and
• entertain themselves and family

37. In the context of First Nation people living on reserve, it was noted that there is a significant movement from reserve to urban communities coupled with the need for First Nation residents to leave their communities for educational opportunities and essential health care.

38. This has prompted an increased reliance on social networking tools such as Facebook to remain affordably connected to family. Many First Nation citizens also are required to make regular micro-logistical communications just to manage the sheer volume of movement from and to their communities.

19 They also will seek additional information and analysis from Mr. ****.

20 Participants in the discussion were advised that while their comments might be shared their identify would not be revealed. Comments were typed and not taped and represent best efforts to accurately reflect the conversations.

21 “The cell phone is very important for my son for safety reasons. Critical sometimes. Its important for a parent to always have that link.”

22 ie. Tele health in remote communities
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39. Telecommunications were seen as a vital element of social inclusion with at least two persons pointing out that for low income persons including homeless person, a pre-paid cell phone might be their primary way to connect to society and the only form of safety.23

40. The importance of basic telecommunications services as a means of social inclusion also was highlighted by those with experience with newcomers who seek to maintain ties with families who may live in disparate parts of Canada and the world.

The nature of basic telecommunications services is changing due to technology, choice and to market barriers

41. Our conversations with Manitobans highlighted the rapidly evolving nature of their views of telecommunication services. From the perspective of one person experienced with working with Indigenous people:

“Demand” has to be restated; people feel like they've had a body part removed without their phone; people cannot function without this level of connectivity;

People do not want to wait anymore, they want instantly available tele-communication connectivity wherever you are at all times in the cheapest way; if the monopoly will not give it, they'll find it another way.2442. The same person highlighted increased social pressure to communicate in First Nation communities with people feeling obliged to respond and wanting to respond to “everything”. A number of persons suggested that the basic services world has shifted with Internet being the new centre. For some Manitoba First Nations citizens:

Facebook is popular everywhere. It is “the” feature.

43. Others noted that cell phones with voice detects have “opened up the world” for many clients with literacy challenges.

44. While conceding the reality of a rapidly changing marketplace, a number of 23 “There are limited links to family and friends as it is and they don't have a land line. Cell phone is the only way they might have to reach out.” “Smart phones are very important for people to stay socially connected. A lot of the people we were experiencing said their only way to connect was by phone. If that meant they had to sleep at a shelter, that was ok.”24 The person identified a number of ways in which First Nation communities are adopting creative approaches to provide access to service.

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participants suggested that barriers to accessing land lines such as credit checks, damage deposits and costs were other factors contributing to the shift to Internet access and smart phones.

Mixed levels of allegiance to traditional wired services

45. We heard a mixture of comments regarding the issue of whether wired service should remain an element of the basic service offering.

46. It was suggested that “people in the city are dropping their land lines because of cost” and that many young Indigenous people on reserve do not care how their service is delivered. The perception was that they did not have any particular brand loyalty and would use “whatever works”.

47. By contrast, others suggested that “if we are giving up land line we are less secure and private” noting that you can “give up the land line but at what cost? Are you using a “pay as you go phone” for your primary phone?”25 It also was suggested that older people on reserve tend to have significant loyalty to traditional services despite their distrust of the quality of service.

Material inequities in access to affordable, modern basic telecommunication services48. The Manitobans we spoke with identified inequities in access to affordable, modern services. Many comments focused on bandwidth constraints and reliability challenges leading to an inequity between service between the urbanized south and remote and rural communities. Similar inequities were identified among the MKO communities with the suggestion that there are “islands of connectivity” despite most communities having significant connectivity and reliability challenges.26 49. Financial barriers to land lines were also noted for low income persons and newcomers:

**** distance ends up being expensive. Pre-pay phones run out which is concerning. Credit checks are often done when applying for phones or internet.

25 Another person noted: “A lot of people use pay as you go – problem when you get put on hold for a long period of time.

Then you need to rely on land lines.”

26 It was observed that when the system “goes down” that certain service providers such as the RCMP and Nursing Station have emergency backup satellite phones that leave them able to connect with the outside world even if persons within the community cannot reach them.

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Newcomers – your credit history doesn't come with you. Your score will be low or you may not have a credit history at all. If you don't have money to put down a big deposit, you may need to go with pre-pay. This is an issue.

The reliance on market forces and government funding has led to piecemeal access to basic telecommunication services for certain communities

50. In terms of access to critical services such as broadband and smartphones for First Nations people living on reserve, the point was made that:

Consumer demand is outstripping market supply and the regulatory response51. It was suggested that:

it is hard for the regulator to respond to market-driven change when there is no market

52. From the perspective of one observer, “an ad hoc” response to market failure was leading to “piecemeal access” to essential telecommunications services in remote and rural communities. Two participants identified a dichotomy between service gaps and government insistence upon using the Internet:

They seem to be aggressive with people using the Internet. Almost like you're not a part of society if you don't use the Internet.

What are the key themes from our literature review?

53. Our literature review identified similar themes to our conversations with Manitobans with a focus on inclusion, opportunity and the need to overcome barriers.

No one should be left behind

54. A number of commentators have highlighted the risk that certain consumers might be left behind by the push to a digital society:

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Barth and Veit (2011) highlight the significant paradox that exists between massive efforts to digitize many government and public sector services without sufficient attention directed towards ensuring that internet access and use does not lag behind. Thus, it is those individuals who do not have internet access as well as those who engage in a limited number of activities online who are unable to fully participate in a digital society and take full advantage of resources, information, and social contacts.27 (emphasis added)Broadband as an essential element of basic telecommunications services55. Whether the move to broadband is characterized as a revolution or an evolution, there is general recognition that it an essential tool for social and economic inclusion for all Canadians including First Nations:

Recently, broadband has evolved from being a luxury to an essential type of infrastructure for business development, banking, communication, health care, education, tourism and entertainment. Access to the internet at broadband speeds has now become a necessary tool for engagement in the modern economy and culture.28 (emphasis added)

If designed to meet the needs of First Nations, a digital economy and Aboriginal connectivity can act as a powerful source of jobs and growth and help create stronger First Nations communities. 29

56. In a US context, the importance of broadband as a mechanism for inclusion of low income persons also has been noted:

Broadband access is increasingly a requirement of socio-economic inclusion, not an outcome of it—and residents of low-income communities know this.

**** is only one factor shaping the fragile equilibrium of home broadband adoption, and price pressures go beyond the obvious challenge of high monthly fees. Hardware costs, hidden fees, billing transparency, quality of 27 **** Haight, Anabel ****-Haase & **** A **** (2014) Revisiting the digital divide in Canada: the impact of demographic factors on access to the internet, level of online activity, and social networking site usage, Information, Communication & Society, 17:4, 503-519, DOI: 10.1080/1369118X.2014.891633, p. 515.

28 BROADBAND - AN EFFECTIVE TOOL FOR RURAL DEVELOPMENT, Government of Alberta, p. 229 Whiteduck, J. (2010). Building the First Nation e-community. In J. P. ****, J. ****, D. ****, & P. **** (Eds.), Aboriginal policy research VI: Learning, technology and traditions (pp. 95-103). Toronto: **** Educational Publishing

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service, and availability are major issues for low-income communities.30Broadband connectivity is essential to First Nation's Health, Education and Community Development

57. First Nation leaders have recognized the importance of broadband connectivity as a way to achieve better health and educational outcomes and community development:31

• Health Care – Broadband connectivity can support better access to health care and better health outcomes for people in remote or isolated communities, better management of patients with chronic conditions and reduced health related travel expenses.

• Education - Access to online learning tools and programs increases learning opportunities and improves outcomes for students and adult learners. It also supports teacher retention and training through access to professional development and networking for teachers from within their communities.

• Economic Development – Connectivity enables access to Internet based business tools, which is essential for business retention and development. It also provides access to global markets.

• Administrative Management – Broadband connectivity enables access to modern business tools, to web based government information and processes necessary for access to funding, for community operations, for natural resource management and land claims.

Broadband connectivity is essential for First Nation's families58. While broadband access makes good economic and social policy sense for First Nation communities, the ability to connect with family is of equally critical value.

Results from an “on-line” qualitative survey of First Nation women highlight the importance of the Internet as a means to connect with their families as well as to preserve their culture and to enhance their health and education:3230 Dharma Dailey, **** Byrne, **** Powell, Joe Karaganis and Jaewon ****, BROADBAND ADOPTION IN LOW-INCOME COMMUNITIES, A Social Science Research Council Report, Version, 1,1, **** 2010.

31 The Chiefs of Ontario, First Nations in Ontario Strategic Broadband Connectivity Business ****, **** 2013.

32 ****, ****, Kakekaspan & O’Donnell, How Women in Remote and Rural First Nation Communities are Using14

Until the advent of the Internet and broadband technology, maintaining closerelationships with friends and family members who have had to leave thecommunities for these or other reasons have posed challenges. Now, communitymembers can stay connected with each other across distances via video calls, instant text messages, and other means facilitated by broadband. Community members can in many instances also stay in their home communities while receiving health and wellness treatments, and engaging in educational opportunities.33 (emphasis added)

The digital divide remains - connectivity and affordability barriers remain for First Nations people

59. For much of the past two decades, commentators and First Nations citizens have expressed the concern that a digital divide between First Nations and other communites would only exacerbate existing patterns of economic underdevelopment, cultural marginalization and social exclusion. Writing in 2001, Bredin commented:

Geographic or social isolation, high costs, and lack of infrastructure contribute to a "digital divide" between First Nations peoples and other Canadians. Designed for profitable urban markets, digital networks and content that might address Native needs for education and information have not yet been fully extended to remote communities.34

60. Well over a decade after Bredin's comments, the qualitative “on-line” survey of First Nations women suggests there are ongoing inequities flowing from connectivity and affordability barriers:

Information and Communication Technologies, Journal of Rural and Community Development 8, 2 (2013) 79–97 (ICT) ISSN: 1712-8277 © Journal of Rural and Community Development, www.jrcd.cap, 80, 82,83 and 86. See also page 92.

Women are using the internet enthusiastically in their daily lives, communicating with people in their First Nations and other First Nations on a regular basis via the internet, and are using it to help preserve their culture in meaningful ways.

Many women are also using broadband-based health services, are interested in how this service can be useful to their community, and are thinking critically about it (e.g., in terms of privacy).

33 ****, ****, Kakekaspan & O’Donnell, How Women in Remote and Rural First Nation Communities are UsingInformation and Communication Technologies, Journal of Rural and Community Development 8, 2 (2013) 79–97 (ICT) ISSN: 1712-8277 © Journal of Rural and Community Development, www.jrcd.ca p. 80. The authors note that “... in many communities, limited access to health and educational services and opportunities means that many First Nations youth and individuals who need certain medical procedures are often required to leave their communities to have access to schools and medical facilities in urban centres.”

34 **** Bredin, BRIDGING CANADA'S DIGITAL DIVIDE: FIRST NATIONS' ACCESS TO NEW INFORMATION TECHNOLOGIES, The Canadian Journal of Native Studies XXI, 2{2001}:191-215, p. 191.

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http://www.jrcd.ca/
http://www.jrcd.cap/

Despite the vigorous use of ICT, the demand for better broadband and reasonably priced broadband was clearly identified: this would allow First Nation women users to operate at the same level as someone in a town or city.35As one woman wrote:

When you depend on technology in order to provide services for thecommunity and the Internet is always down then it is frustrating. Right now I am doing this survey on my emergency dial up because the Internet is up and down every 5 minutes. If not that it is so slow it boots you off because it takes too long to turn pages. Same for ordering or doing banking....36 (emphasis added)The digital divide and infrastructure deficit exacerbate existing inequities in social, health and economic development

61. While they are far from the only culprits in an complex social and cultural dynamic, the digital divide and infrastructure deficit exacerbate existing First Nation inequities in social, health and economic development.

62. As noted by the Auditor General, First Nations people face unique challenges in obtaining essential health services.37 They do not enjoy the same quality of service as other Canadians including other residents living in similar geographic locations.38 63. A recent report by the Conference Board of Canada appears to draw a link between poor infrastructure and health inequities in Northern Aboriginal communities:

35 ****, ****, Kakekaspan & O’Donnell Journal of Rural and Community Development 8, 2 (2013) 79–97, p. 93.

36 ****, ****, Kakekaspan & O’Donnell, How Women in Remote and Rural First Nation Communities are Using Information and Communication Technologies, Journal of Rural and Community Development 8, 2 (2013) 79–97 (ICT) ISSN: 1712-8277 © Journal of Rural and Community Development, www.jrcd.ca p. 86. In descending order, 81% of women indicated that “better or faster internet” was a high priority.

37 “. . . First Nations individuals living in remote communities face unique challenges in obtaining essential health services.

They rely on the federal government’s support to access health services within their communities, and on federally supported transportation benefits to access health services outside their communities.” Reports of the Auditor General of Canada, Access to Health Services for Remote First Nations Communities, REPORT 4, **** 2015, para 4.6. The report notes that “according to Health Canada, the life expectancy of the First Nations population increased between 1980 and 2010; however, it was about eight years shorter than the life expectancy of other Canadians in 2010.

Furthermore, the health status of the First Nations population remained considerably poorer than that of the rest of the Canadian population,” para 4.4.

38 “We also found that Health Canada had not implemented its objective of ensuring that First Nations individuals living in remote communities have comparable access to clinical and client care services as other provincial residents living in similar geographic locations.” Reports of the Auditor General of Canada, Access to Health Services for Remote First Nations Communities, REPORT 4, **** 2015, para 4.93.

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http://www.jrcd.ca/

When geography is coupled with poor infrastructure, health care is not easily accessible for most. Add in well-documented evidence of unhealthy socio-economic conditions—including poverty, cost of living, and housing—and it should come as no surprise that the state of health in the **** is poor, particularly among Aboriginal populations.

The Conference Board’s 2014 assessment of health outcomes in the territories saw them rank below all Canadian provinces and peer countries. As well, three Canadian provinces with Northern regions (Manitoba, Saskatchewan, and Newfoundland and Labrador) get D grades on the overall health report card.39Telecommunications infrastructure investments can be a critical element of social inclusion and economic opportunity

64. The Conference Board of Canada has identified telecommunications infrastructure as a “critical enabler of both economic opportunity and social cohesion”:

Canada’s Northern communities require critical connectivity infrastructure that is reliable, scalable, and supportive of locally affordable services. Though the state of telecommunications infrastructure varies widely across Canada’s ****, many remote Northern communities continue to be vulnerable to “bottlenecks” and service disruptions. It is not easy or cheap to connect remote communities, and no single type of telecommunications investment is most appropriate for all Northern regions.40 (emphasis added)

In a survey conducted by GE Canada, which involved more than 350 respondents, including Northern business and community leaders, infrastructure was ranked by 70 per cent of those surveyed as “the single most important criteria [sic]” for attracting investment and facilitating business development in remote communities.

(emphasis added)

The kinds of infrastructure most correlated with increased productivity and growth are transportation, energy, and telecommunications. . . The link between natural resource 39 ****, Anja, **** Fiser, **** Brender, and **** Dowdall. Building a Resilient and Prosperous ****: Centre for the **** Five-Year Compendium Report. Ottawa: The Conference Board of Canada, 2015, p. 16. The Conference Board of Canada has noted that “In regions such as Nunavut and Nunavik, the state of technology over the past decade has hampered attempts to deploy information communications technologies for applications such as distance education and e health”, p. 15. It is strongly arguable that these same challenges impact a number of MKO First Nations.‐40 ****, Anja, **** Fiser, **** Brender, and **** Dowdall. Building a Resilient and Prosperous ****: Centre for the **** Five-Year Compendium Report. Ottawa: The Conference Board of Canada, 2015, p. 45.

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development and transportation, energy, and telecommunications infrastructure is particularly important for regional governments, Aboriginal businesses, and strategically located communities in the ****.41

The digital divide extends beyond First Nation communities65. The Satellite Inquiry observes that “approximately 1.2 million households do not have access to broadband Internet access at the Commission’s 5/1 target.”42 Consistent with our conversations with selected Manitoba consumers, a 2014 study based on the 2010 Canadian Internet Use Survey suggests that the digital divide is not limited to remote First Nation Communities:

The present study relies on the 2010 Canadian Internet Use Survey to investigate differences in people’s access to the internet and level of online activity. The study not only revisits the digital divide in the Canadian context . . . The findings demonstrate that access to the internet reflects existing inequalities in society with income, education, rural/urban, immigration status, and age all affecting adoption patterns.4366. The finding show “large discrepancies” in Internet access by income, education, rural/urban location and age.44 The authors note that:

A surprising finding to emerge from this study is that recent immigrants to Canada are significantly less likely to have internet access; however, among those online they have a higher level of online activity than earlier immigrants and Canadian born residents.45 (emphasis added)41 ****, Anja, **** Fiser, **** Brender, and **** Dowdall. Building a Resilient and Prosperous ****: Centre for the **** Five-Year Compendium Report. Ottawa: The Conference Board of Canada, 2015, p. 42/43.

42 Satellite Inquiry, para 134. See also Satellite Inquiry, Key Findings, Chapter 4. The target is 5 Mbps (download speed) and 1 Mbps (upload speed). These communities are also covered by Xplornet for direct-to-home satellite Internet service. Seven of these communities have access to broadband Internet service at speeds that meet the 5/1 Mbps target speeds. The 7 communities are from Manitoba.

43 **** Haight, Anabel ****-Haase & **** A **** (2014) Revisiting the digital divide in Canada: the impact of demographic factors on access to the internet, level of online activity, and social networking site usage, Information, Communication & Society, 17:4, 503-519, DOI: 10.1080/1369118X.2014.891633, p. 503. The authors observe that “More recent immigrants to Canada have lower rates of internet access; however, recent immigrants who are online have significantly higher levels of online activity than Canadian born residents and earlier immigrants.”44 **** Haight, Anabel ****-Haase & **** A **** (2014) Revisiting the digital divide in Canada: the impact of demographic factors on access to the internet, level of online activity, and social networking site usage, Information, Communication & Society, 17:4, 503-519, DOI: 10.1080/1369118X.2014.891633, p. 51145 **** Haight, Anabel ****-Haase & **** A **** (2014) Revisiting the digital divide in Canada: the impact of demographic factors on access to the internet, level of online activity, and social networking site usage, Information, Communication & Society, 17:4, 503-519, DOI: 10.1080/1369118X.2014.891633, p. 515.

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67. In the author's view, the fact that 20% of Canadians continue to remain unconnected has serious implications and requires strategic policy interventions.46 Part 2 – Preliminary Comments on the Commission's QuestionsCommon themes with the Affordable Access Coalition

68. Based on preliminary conversations to date with legal counsel for the Affordable Access Coalition (AAC), a number of common themes have emerged. MKO endorses the conclusions of the AAC that:

• Broadband has become an essential telecommunications service. It is essential to individuals of all ages, to households, to businesses, and to Canada’s competitive advantage

• The digital divide exists. Access and socio-economic barriers persist• Market forces and targeted government funding have not solved the problem.

• This hearing presents an important opportunity to address barriers to access and to affordability

Constitutional and Statutory Context

69. The conclusions of MKO on the importance of committing to broadband access as a basic service objective is reinforced by its review of the Constitutional and statutory context. By virtue of the Constitution Act, 1982, the Government of Canada and the Provincial Governments are committed to:

• promoting equal opportunities for the well being of Canadians• furthering economic development to reduce disparities in opportunities• providing essential public services of a reasonable quality to all Canadians.4770. These constitutional commitments dictate a statutory affirmation of the objectives 46 **** Haight, Anabel ****-Haase & **** A **** (2014) Revisiting the digital divide in Canada: the impact of demographic factors on access to the internet, level of online activity, and social networking site usage, Information, Communication & Society, 17:4, 503-519, DOI: 10.1080/1369118X.2014.891633, p. 514/515.

47 Section 36 (1) of The Constitution Act, 1982, being Schedule B to the Canada Act 1982 (UK), 1982, c 11 19

http://www.statutelaw.gov.uk/documents/1982/11/ukpga
under the Telecommunications Act:48

(a) to facilitate the orderly development throughout Canada of a telecommunications system that serves to safeguard, enrich and strengthen the social and economic fabric of Canada and its regions;

(b) to render reliable and affordable telecommunications services of high quality accessible to Canadians in both urban and rural areas in all regions of Canada;

(h) to respond to the economic and social requirements of users of telecommunications services;

71. The Telecommunications Act also highlights the need:

(f) to foster increased reliance on market forces for the provision of telecommunications services and to ensure that regulation, where required, is efficient and effective;

Preliminary response of the MKO to the Commission's questions regarding Canadians’ evolving needs for telecommunications services

72. The preliminary views of the MKO are best summarized in the Overview appearing at the beginning of this document. The responses below should be read along with the Overview.

1. Canadians are using telecommunications services to fulfill many social, economic, and cultural needs in today’s digital economy.

a) Explain how telecommunications services are used to meet these needs. For example, uses may include e-commerce (i.e. the online purchase and trade of products or services), e-banking and/or telephone banking, e-health or telehealth services, telework, and distance education. Which of these uses of telecommunications services are the most important to ensure that Canadians meaningfully participate in the digital economy?

b) Explain which telecommunications services are most important to support these needs and uses. What characteristics (e.g. capacity, mobility, high speed, and low latency) should these telecommunications services have?

c) Identify and explain the barriers that limit or prevent Canadians from meaningfully 48 Telecommunications Act ( 1993, c. 38)

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participating in the digital economy (e.g. availability, quality, price, digital literacy, and concerns related to privacy and security). Identify which segments of the Canadian population are experiencing such barriers.

d) Identify and explain any enablers that allow Canadians to meaningfully participate in the digital economy (e.g. connected devices and applications).

e) As Canada’s digital economy continues to grow and evolve during the next 5 to 10 years, which telecommunications services are Canadians expected to need to participate meaningfully? Specify how your responses to parts a) through d) above would change based on your answer.

Response to questions:
1 (a)

73. In the preliminary view of the MKO, the uses of telecommunications services and the needs of Canadians to participate in the digital economy cannot be usefully defined in terms of a list of e-commerce, e-social and e-cultural uses. Any list that is created is likely to be out-of-date by the time it is finalized due to the rate of innovation of e-services.

74. It is far more useful to define the needs of Canadians in terms of bandwidth. A bandwidth based definition has several important features:

• Bandwidth identifies what is required to meet the full spectrum of user requirements since it can be defined as the total bandwidth requirements of Canadians, individually and in aggregate

• A bandwidth definition avoids any assessment of the value or social merit of particular uses, which is important since the value of particular uses will be very different in different circumstances. Facebook may be seen as frivolous by some but may in fact be the primary means of keeping families members connected.

For example, family members in First Nations communities can become geographically dispersed and social networking has become the primary, and most affordable, means of connecting, despite that challenges of accessing these services (we are advised that traditional phone service are often even less available due to traffic capacity limits)

• Bandwidth trends are much more likely to be predictable than specific uses• Bandwidth requirements can be defined in terms that relate to the adequacy of 21

facilities. The overall usage of facilities can be monitored to determine the extent of capacity problems due to high usage

1 (b)

75. The relative “importance” of different services is extremely difficult to establish in a way that would be appropriate for policy purposes. Canadians are very diverse and would have widely different priorities depending on their circumstances.

76. It may seem obvious that TeleHealth should have a higher priority than Skype calls among family members. But within a family that is living with chronic mental of physical life-threatening challenges, being able to connect reliably at any time may be far more important than most telehealth conversations.

77. Minimum standards for the characteristics of telecommunications services that apply on a community by community and service-by-service basis will be far more meaningful. Essentially, capacity should be sufficient to ensure that actual upload and download speeds are above the level defined as basic service most of the time with low latency.

1 (c)

78. The barriers that limit or prevent Canadians from meaningfully participating in the digital economy vary significantly among Canadians. It is important to distinguish barriers that are related to the telecommunications services that are available from those that not technology/facilities related.

79. Remote First Nations communities face challenges that are distinct from those faced by most other Canadians. Many of these communities are located in regions of the country that are high cost of service areas for traditional telephone service. As a result, they continue to be underserved in that all trunks are busy, which blocks additional calls, far more frequently than in other regions. This problem has been aggravated with increased use of e-services. When circuits are used for Internet connections as well as voice calls, the overloading increases.

80. A number of communities have been forced to find alternate solutions to their communications requirements. It is the practice in certain First Nations for the Band Office to provide unsecured WiFi access to the Internet over a dedicated facility. Since this cannot be provided on a community-wide basis, there are “pools of “WiFi” in 22

selected locations such as around the Band Office, schools and other public areas.

81. Individual users may find that dialup access is often unavailable and always costly, so they instead rely on the “free” WiFi connections that can be found in selected locations in the community. Unfortunately, the consequence of widespread reliance on this option is that immediate access is not available on demand (e.g., connecting from home in the event of an emergency may not be possible) and the access that is available is very slow.

82. Essentially, the key barrier is the limited bandwidth and limited coverage of WiFi service that is typical in these communities.49

1 (d)

83. The advent of cheap smart phones and pools of WiFi have been important enablers of access to e-services. However, the limited coverage and heavy use of limited shared bandwidth results in a low service quality. When a single high-speed connection is being relied on by a large proportion of families and individuals in a community, the available service is inadequate.

84. An important implication of this observation is that defining standards for a high speed service that is suitable for a typical household in a major urban centre is not appropriate for a remote community where many people within the community are sharing a single high speed connection.

85. The situation faced in these areas is equivalent to the entire neighbourhood in a city having to rely on a single ****’s location to meet all of their telecommunications needs.

1 (e)

86. Bandwidth requirements will keep expanding both because of new uses and increasing digital literacy and because needs that have been met with POTS in the past are migrating to digital service. As First Nations users discover that a Skype call can be made instead of an old fashioned phone call, they may tend to choose the digital option, even when the quality is poor and calls frequently fail. Digital quality suffers with congestion, but at least calls are not totally blocked because all circuits are busy.

2. The Commission’s current target speeds for broadband Internet access service are a 49 (e.g., availability, quality, price, digital literacy, and concerns related to privacy and security).

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minimum of 5 Mbps download and 1 Mbps upload, based on uses that consumers should reasonably expect to make of the Internet. Are these target speeds sufficient to meet the minimum needs of Canadians today? If not, what should the new targets be and what time frame would be reasonable to achieve these new targets?

87. Our understanding is that these targets are based on the requirements of typical individual users during what might be referred to as single internet user peak period requirements.

88. The preliminary view of MKO is that these standards do not reflect the reality of use in remote communities, or in other areas where there is a high ratio of users-to-connections to access service.

89. In a typical moderate-to-high income area of a city, the ratio of households-to-connections is approaching the ratio of persons per household since most households will have their own high speed internet service connection, usually either cable or ADSL. In areas where affordability is a problem, the average number of users per connection may tend to increase both because average household size tends to be larger and because more households share connections.

90. In the most extreme cases, such as remote communities where unemployment rates can exceed 50%, many users of Internet service do not have their own connections. First Nations citizens and the MKO representative interviewed suggest that while a number of households have internet-capable hardware (smartphones, tablet devices such as iPads, and computers), a relatively small proportion of households have their own Internet connections.

91. In a number of communities, many internet users access the internet through public WiFi connections provided by the Band Office, schools or community centres.

As a consequence, the volume of internet traffic is much higher per internet connection than would be typical where the ratio of households or users per connection is lower.

92. In addition, it is our perception that in low income communities fewer households have landline telephone service or cell phone service due to affordability issues. In remote communities, all options may not even be available, or the only options available are expensive (satellite service).

93. Even where cellular service is available, low-income households are more likely to rely on pay-as-you go plans since they are the households/individuals that are more likely not to have credit ratings that will enable them to be offered plans without 24

deposit requirements that they cannot afford.

94. Since pay-as-you-go plans are the most expensive on a per minute basis, it is households/individuals in low-income areas, including remote communities, that may be more likely to rely heavily on open-access WiFi service. One consequence of this reality is that the consumers may be more likely to rely more heavily on open-access WiFi as a substitute for landline and cellular voice calls than they are in locations where households face fewer affordability challenges in making their purchase decisions.

95. Based on its understanding of this social reality, it is the preliminary view of MKO that the number of users per connection in low-income and remote communities may tend to be higher. As a result, the required bandwidth to maintain acceptable internet service quality standards may be greater. If the bandwidth available in connecting a remote community with high user per connection to the internet is similar to the available bandwidth in higher income, lower use per connection areas, the broadband connections will be far more congested.

96. To maintain reasonable service levels in remote communities, it may be necessary to maintain comparatively high bandwidth per connection.

The Commission’s role regarding access to basic telecommunications services3. Which services should be considered by the Commission as basic telecommunications services necessary for Canadians to be able to meaningfully participate in the digital economy? Explain why.

a) Explain whether the underlying technology (e.g. cable, digital subscriber line, fibre, fixed wireless, mobile wireless, and satellite technology) should be a factor in defining whether a telecommunications service should be considered a basic service.

b) Identify, with supporting rationale, the terms, conditions, and service characteristics under which basic telecommunications services should be provided. Should any obligations be placed on the provider(s) of these services? If so, what obligations and on which service provider(s)?

c) What should be the prices for basic telecommunications services and how should these prices be determined? Provide rationale to support your answer.

3 (a)
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97. In the preliminary view of our clients, it is only the characteristics of the service being provided that is important in defining basic telecommunication service. Each service provider that is responsible for meeting minimum standards for basic service should be permitted to do so using the technology that meets the standards at minimum cost. In general, the least cost technology will be the technology that is in place, provided that it is capable of providing all aspects of basic service, including internet access with acceptable bandwidth.

98. In some locations, for example in remote communities, existing infrastructure and technologies may not be adequate to provide the functionality need to provide basic telecommunications service, including Internet access for the entire community. Where subsidies are appropriate, alternative technologies should be considered so that the increased capacity can be provided at least cost. In some circumstances the least-cost high bandwidth solution may make the existing infrastructure redundant. In such cases, the existing technology and owner may be able to offer competitive unsubsidized services using the existing technology.

3 (b) (c)

99. Some observers might suggest that **** Old Telephone Service (POTS) no longer provides a service that is not replaceable by digital services. In particular, VOIP service can be provided as a simple alternative for customers that do not want anything other than basic voice service, provided that Internet access is available and bandwidth meets the requirements of basic telecommunications service.

100. All licensed providers of telecommunications services should be obliged to include in their service options basic telecommunications services, as defined by the CRTC at a standard published price.

101. Any community (geographic area) that is served by only one licensed telecommunications service provider should be entitled to initiate a competitive process for the right to be the monopoly provider of service to that community.

4. Can market forces and government funding be relied on to ensure that all Canadians have access to basic telecommunications services? What are the roles of the private sector and the various levels of government (federal, provincial, territorial, and municipal) in ensuring that investment in telecommunications infrastructure results in the availability of modern telecommunications services to all Canadians?

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102. Our client's preliminary view is that market forces and government funding have not proved adequate to address both affordability and adequate bandwidth infrastructure issues. It appears there is little prospect of an easing of constraints on government funding.

103. Our client expects the CRTC will have to achieve its telecommunications objectives through a combination of market forces, telecommunications policy and industry-specific funding mechanisms. The National Subsidy Mechanism and Contribution Regime will have to be continued although consideration should be given to changing what is funded in order to align the subsidy mechanism with current telecommunications requirements.

104. A critical aspect of “ensuring that investment in telecommunications infrastructure results in the availability of modern telecommunications services to all Canadians” is the provision of adequate bandwidth to all segments of the network. In particular, the quality of digital service (capacity, mobility, high speed and latency) depends not only on the technical capacity of individual connections but also on the upstream connections to common backbone infrastructure that accommodates the aggregated use of all downstream users.

105. For example, representatives of remote communities observe that while the existing infrastructure may be sufficient in these communities to allow all users to get online, this is possible only because many users are able to share a single Internet connection through each WiFi router that is connected to the Internet.

106. They suggest however that due to limited capacity connecting the community to the main internet backbone, the total volume of digital traffic overloads the system which results in very slow Internet service. This problem is aggravated by the reality that most websites are designed for mainstream users; it is assumed that users have high speed connections.

107. Connecting to a website, including critical websites such as TeleHealth, involves the transmission of large volumes of data for every web page accessed. Due to the small number of connections from a remote community to the outside world, the aggregate bandwidth required can make wait times for each web page to load impracticably long.

108. Quality of service standards should include measures of latency that provide an indicator of the time it takes during periods of heavy use for the transmission of a standardized quantity of data.

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109. Any service provider operating in a non-competitive market should be required to meet the defined standard under normal heavy use conditions (i.e., during busy periods such as early evenings).

110. At the present time, some remote communities report that the periods of heavy congestion include most hours other than usual low-use hours (middle of the night).

The problem is serious enough that some users adjust their lifestyles so that they can shift their internet use to hours when most people are asleep and therefore offline.

5. What should be the Commission’s role in ensuring the availability of basic telecommunications services to all Canadians? What action, if any, should the Commission take where Canadians do not have access to telecommunications services that are considered to be basic services?

111. The question posed raises both policy and legal opinions. Our client has not developed a legal position at this point in time and the development of its policy position is ongoing.

112. We are advised that some remote communities have contracted with service providers to provide Internet service for the community. They have opted for competitive Internet service providers because they have been unable to obtain a standard of backbone internet service that meets the needs of the community from the ILEC that they are dependent on. They have been challenged, however, to ensure that performance standards are met.

113. In order to ensure that these communities receive telecommunications services that function at a level that meets mandated standards, enforcement mechanisms are required that ensure that any licensed service provider meets those standards.

114. Given the limited choice, remote communities are likely to have great difficulty enforcing contractual standards on a timely basis through normal legal processes. It is therefore desirable to have the CRTC oversee the commitments in non-competitive markets.

6. In Telecom Regulatory Policy 2011-291, the Commission stated that it would closely monitor developments in the industry regarding the achievement of its broadband Internet target speeds to determine whether regulatory intervention may be needed.

What action, if any, should the Commission take in cases where its target speeds will not be achieved by the end of 2015?

28

115. MKO is of the view that regulatory intervention is required to bridge the digital divide. One element of the intervention should include an expansion of the subsidy regime to accelerate the deployment of wideband service and provide affordable access to the telecommunications services that rural and remote communities require to participate meaningfully in the digital economy. A defined timeframe in which the target is expected to be met may be advisable.50

7. In Telecom Regulatory Policy 2013-711, the Commission stated its intention to establish a mechanism, as required, in Northwestel’s operating territory to support the provision of modern telecommunications services. Such a mechanism would fund capital infrastructure investment in transport facilities (e.g. fibre, microwave, and satellite), as well as the cost of maintaining and enhancing these facilities. The Commission considered that this mechanism should complement, and not replace, other investments from the private sector and governments, including public-private partnerships.

a) Explain, with supporting rationale, whether there is a need for the Commission to establish such a mechanism in Northwestel’s operating territory. As well, explain whether there is a need for such a mechanism in other regions of Canada.

b) What impact would the establishment of such a mechanism have on private sector investment and government programs to fund the provision of modern telecommunications services?

116. Northwestel has historically received special treatment because its entire service area is essentially a high cost service area. As a consequence, internal cross subsidies similar to the other former monopolies have faced special challenges. In other respects, Northwestel can be viewed as essentially the same as other high cost of serving areas (HCSA).

117. At this point in time, within-company subsidies will be less practical than an industry wide subsidy regime, due to competitive issues. It may make sense to have a single regime that would be applicable for all HCSA’s.

8. What changes, if any, should be made to the obligation to serve and the basic service objective?

9. Should broadband Internet service be defined as a basic telecommunications 50We note the AAC proposal of of 25 bps by 2020.

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service? What other services, if any, should be defined as basic telecommunications services?

118. It is important to recognize that even in the midst of a telecommunications revolution there are a number of consumers who remain deeply committed to POTS for a number of reasons including but not limited to affordability and preference. As the industry changes, it is important to ensure that no consumer is left behind. It also is important to ensure that the obligation to serve is maintained while we transition towards a digital economy for remote communities.

119. In examining the existing policies related to the obligation to serve, the basic service objective, the use of the NCF and the role of price cap regulation, it is necessary to recognize that services meeting the existing definition of the basic service objective do not, in and of themselves, allow Canadians to participate meaningfully in the digital economy. Recognizing that broadband access is an essential element of basic telecommunications services, it may be appropriate to simply add that element to the basic service objective.

120. An alternative approach would be to develop an alternate definition of basic service based on digital bandwidth that would support the deployment of the digital equivalent of **** Old Telephone Service (POTS) while at the same time ensuring that every Canadian in able to participate in the digital economy to the full extent of their ability and interest.

121. The availability of affordable telecommunications services should mean that any Canadian that has difficulty adapting to new technologies is able to utilize voice over Internet Protocol (VOIP) service that is equivalent to POTS. At the same time, the same broadband connection would be capable of being used for all existing and future internet-based services.

122. The transition to a fully digital world would require the adoption of an expanded definition of the basic service objective that includes the relevant characteristics of digital services: capacity, high speed and low latency. However, in the context of rural and remote communities, it is also important to recognize that capacity standards need to be established not only on the basis of individual services (e.g., an ADSL connection), but also on the basis of the aggregate capacity of the link from the community to the outside world.

30

10. What changes, if any, should be made to the existing local service subsidy regime? What resulting changes, if any, would be required to the existing regulatory frameworks (e.g. price cap regimes)?

123. The existing definition of basic telecommunications services underpins the local service subsidy regime, which uses the National Contribution Fund (NCF) to subsidize the provision of basic residential local service, including video relay service (VRS) in high-cost serving areas (HCSAs). As a consequence, the funding mechanism supports only the incumbent local exchange carriers (ILECs).51

124. The subsidy regime needs to be expanded to accelerate the deployment of wideband service and provide affordable access to the telecommunications services that rural and remote communities require to participate meaningfully in the digital economy.

125. Limiting price cap regulation to the retail telecommunications services of ILECs is also rooted in a reality that was valid in the past but inadequate for the future. The affordability of broadband is equally important within rural and remote communities.

126. The rationale for the current limited subsidy regime is outdated. Looking to the future, the regime should evolve in parallel with the evolution of the digital telecommunications services that are becoming increasing integral to the daily lives of Canadians in HCSAs as they are for Canadians living in less remote and in major urban areas.

51 It is arguable that the existing regime reinforces continued reliance on historic technologies rather than being used as an incentive for innovation in transitioning HCSAs to technologies that enable Canadians in rural and remote areas to participate fully in the digital economy of the future.

31

11. What changes, if any, should be made to the contribution collection mechanism?

Your response should address, with supporting rationale, which TSPs should be required to contribute to the NCF, which revenues should be contribution-eligible and which revenues, if any, should be excluded from the calculation of contribution-eligible revenues.

FOR SUBMISSION

127. MKO is not in a position to comment upon this question at this point in time. It will review the submissions and evidence of other parties.

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12. Should some or all services that are considered to be basic telecommunications services be subsidized? Explain, with supporting details, which services should be subsidized and under what circumstances.

128. The subsidy regime needs to be expanded to accelerate the deployment of wideband service and provide affordable access to the telecommunications services that rural and remote communities require to participate meaningfully in the digital economy.

13. If there is a need to establish a new funding mechanism to support the provision of modern telecommunications services, describe how this mechanism would operate.

Your response should address the mechanism described in Telecom Regulatory Policy 2013-711 for transport services and/or any other mechanism necessary to support modern telecommunications services across Canada. Your response should also address, but not necessarily be limited to, the following questions:

a) What types of infrastructure and/or services should be funded?

b) In which regions of Canada should funding be provided?

c)Which service providers should be eligible to receive funding, and how should eligibility for funding be determined (e.g. only one service provider per area, all service providers that meet certain conditions, wireless service providers, or service providers that win a competitive bidding process)?

d)How should the amount of funding be determined (e.g. based on costs to provide service or a competitive bidding process)?

e) What is the appropriate mechanism for distributing funding? For example, should this funding be (i) paid to the service provider based on revenues and costs, or (ii) awarded based on a competitive bidding process?

f) Should any infrastructure that is funded be available on a wholesale basis and, if so, under what terms and conditions?

g)Should the Commission set a maximum retail rate for any telecommunications service that is subsidized?

h)Should this mechanism replace the existing residential local wireline service subsidy? If so, explain how the existing subsidy should be eliminated, including details on any transition period. In addition, explain whether the small ILECs and/or Northwestel should be subject to any special considerations or modifications for this transition period.

129. To satisfy the requirement that all Canadians have access to affordable basic wideband telecommunications services, it is clear that rates for broadband service in 33

http://www.crtc.gc.ca/eng/archive/2013/2013-711.htm

markets with limited or no competition will have to be regulated. For example, basic wideband service that is VOIP capable could be defined and the price constraints currently imposed by the price cap regime could be applied to the equivalent digital service.

130. Using that price as a reference point for the cost-to-bandwidth relationship, price caps for other broadband services with higher capacity could then be established for markets in which the price cap regime applies.

131. To support the transition to fully digital telecommunications services, it might also be appropriate to implement a competitive bidding process for providing service to each existing HCSA in Canada.

132. A process of inviting bids to serve each HCSA subject to carefully defined performance standards related to capacity, high speed and low latency could be initiated. The service provider that requires the lowest subsidy for the right to provide service at the established price and service levels would be granted a multi-year license as the exclusive service provider in that community.

133. Enforcement of the standards will be a critical element of this innovation. In the event that the service provider fails to meet the contractual service standards, the license would be revoked and a new auction would be initiated.

134. This approach could be used to gradually introduce high standards of digital service that would be comparable in all characteristics, including price, to the telecommunications services that are available in non-HCSAs.

135. While there will be some HCSAs where competitive service providers will be able to provide new digital service at a cost that is below the subsidies provided by the existing subsidy regime not all locations will attract bids on that basis.

136. As “headroom” is established through the transition of the most attractive HCSAs to digital service, the NCF money saved can be reallocated to attract service providers into the less attractive HCSAs by increasing the cap on the bids. Ultimately, the higher value of universal broadband service will justify an increase in the available subsidy when necessary.52

Conclusion – An Appearance at the Public Hearing is Necessary 137. Pursuant to s. 26 of the CRTC Rules of Procedure, the MKO wishes to be considered as an intervenor in the proceeding. It designates Ms **** Fenske of the Public Interest Law Centre as its representative. Ms Fenske's address is 200 - 393 52 The MKO appreciates the input of Mr. John **** of Elenchus in developing its preliminary comments.

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Portage Avenue, Winnipeg, MB *** ***. Her email address is: ******@***.com.

The MKO reserves the right to seek the leave of the CRTC to add further parties to its intervention.

138. MKO wishes to appear at the public hearing whether that appearance is made in Gatineau, Quebec or the regional office in Winnipeg. Given the significant barriers faced by high cost to serve MKO communities and its unique perspective, MKO believes it is important that a distinct Indigenous voice from a province with distinct challenges would be of assistance tot he Panel's deliberations.

**** Williams
Director
Public Interest Law Centre
*********End of Document*********
35
mailto:******@***.com

Initial comments of the Manitoba Keewatinowi Okimakinak Inc. in the review of basic telecommunications services PN 2015-134-1

**** Williams
Public Interest Law Centre
of Legal Aid Manitoba
200 - 393 Portage Avenue
Winnipeg, MB *** ***

Re: Intervention of the Manitoba Keewatinowi Okimakinak Inc. in the CRTC review of basic telecommunications services (2015-134) Overview

Part 1 – Introduction of MKO – Preliminary Conversations with Manitobans and Literature Review Who is the MKO?

What is the Public Interest Law Centre?
How has the MKO prepared its preliminary comments?

What have we learned from our initial conversations with Manitobans?20 What are the key themes from our literature review?

Common themes with the Affordable Access Coalition
Constitutional and Statutory Context

The Commission’s role regarding access to basic telecommunications services FOR SUBMISSION

Conclusion – An Appearance at the Public Hearing is Necessary