Final Submission : First Mile Connectivity Consortium (Intervenor 298)

Document Name: 2015-134.224010.2613255.Final Submission (1k0#f01!).pdf
FMCC – Final Comments May 25, 2016

1. The FMCC is seeking means to ensure access to reliable and affordable broadband in northern Indigenous communities, with engagement of residents of these communities in the provision of services. Importantly, our member organizations provide and support the delivery of broadband-enabled public services such as online education and telehealth, as well as entertainment services for household consumers.

2. The FMCC is an incorporated independent not-for-profit national association. Our members are First Nations Internet service providers – what we call “community/regional intermediary organizations”.1 Our associate members are university and private sector researchers and others interested in Indigenous and community communications and telecommunication services for the public good. Our work focuses on innovative solutions to digital infrastructure and services with and in rural and remote regions and communities across Canada.

3. In this final written submission, we propose criteria for a National Broadband Strategy for Canada, clarify key points from our earlier interventions, and comment on statements and undertakings by other intervenors.

Toward a National Broadband Strategy

4. As noted by Chairman ****, these hearings are a chance to get things right through an open, public consultation process to shape broadband development in Canada. Working in partnership with other federal agencies, the Commission can shape a policy and regulatory framework that supports the aspirations of communities and regions as well as industry.

5. The lack of a national broadband plan has left Canada with no overall framework or common set of goals to guide government initiatives. We endorse the CRTC’s proposal to take up this challenge, and recognize the Commission’s unique expertise and its role under the Telecommunications Act. Many OECD countries, including Canada, have already agreed upon incorporating several areas of government policy in national broadband policies (NBPs), as developed in the 2004 Council Recommendation on Broadband and the 2008 Declaration of the Seoul Ministerial for the Future of the Internet Economy.2 Specifically, the OECD notes that NBPs link to policy areas including: crime and justice;

economy and finance; education and training; environment; health; industry; regional and rural development; science, technology & innovation; and transport. In Canada, any NBP will therefore necessarily have to involve the federal agencies responsible for these sectors, and other key stakeholders.3

1 Note: we referred to these as “community intermediary organizations” in our earlier testimony, because of their origins and strong connections to northern communities -- which include not only settlements but groups of Indigenous peoples. However, the term “community” was confusing, and so we have included the term “regional” in this submission.

2 OECD. National Broadband Plans. Directorate for Science, Technology and Industry Committee for Information, Computer and Communications Policy, Working Party on Communication Infrastructures and Services Policy Report JT03303792. **** 15, 2011.

3 We note that the preparation of the U.S. national broadband plan led by the Federal Communications Commission (FCC) included 36 public workshops, 31 public notices, and nine public hearings. Federal Communications Commission. Connecting America: The National Broadband Plan. Washington, DC, 2011. The plan emphasizes the need for adoption as well as infrastructure.

FMCC – Final Comments May 25, 2016

6. A National Broadband Strategy for Canada should be driven by partnerships that include the regional community-based providers that FMCC refers to as intermediary organizations, overseen by effective regulation, and guided by a multi-stakeholder advisory council that is coordinated by the CRTC and involves representatives from Northern, Indigenous and outlying areas of the country.

Broadband for all

7. Affordable and reliable broadband should be available to all Canadians, including those in Indigenous and remote communities.

8. We encourage the Commission to ensure that Indigenous and remote communities are included in all requirements and implementation strategies for a national broadband policy.

To this point, we note that in 2001, the National Broadband Task Force report4 prioritized the importance of connecting all First Nation, Inuit, rural and remote communities through affordable access to services. As the report notes:

“The priority of the broadband deployment strategy should be to link all First Nation, Inuit, rural and remote communities to national broadband networks using appropriate technology. Further, access to broadband connectivity in First Nation, Inuit, rural and remote communities should be available at a price reasonably comparable to that for more densely populated areas” (p.5).

9. We also point out that broadband is important for the delivery of education, health care, social and other public services, other government services, and private sector services ranging from banking to small business, tourism, transportation, and resource activities.

A Moving Target

10. FMCC and other intervenors have noted that requirements for high speed connectivity are evolving rapidly. Any specific targets must include parameters necessary for online activities currently conducted by individuals, families, and institutions today, but must be regularly updated to meet changing requirements.5 For example, cloud-based applications and streaming of content (for education and training as well as entertainment) are resulting in more bandwidth and more uploading capability than were envisioned a few years ago.

11. We expect that new and changing technologies and applications will continue to impact connectivity requirements across the whole community, as well as within individual households. We therefore believe any benchmarks should be reviewed every three years.

Access: Availability, Affordability, Digital Literacy

12. Adoption and effective use must be key goals of the policy. In our earlier testimony we emphasized that access to broadband requires availability, affordability, and the necessary skills to effectively use broadband technologies and services. Thus a national broadband strategy must include:

4 Industry Canada. The New National Dream: Networking the Nation for Broadband Access: Report of the National Broadband Task Force. Ottawa, 2001. Available at: 5 For example, the U.S. Telecommunications Act of 1996 referred to “advanced services”. While some criticized its use of that term, it offered the flexibility required to encompass changing services and bandwidth requirements over the following decades.

FMCC – Final Comments May 25, 2016

• Availability of broadband facilities to all Canadian communities and organizations;

• Pricing that is affordable for all, including low income residents, non-profit organizations, small businesses, and remote and rural communities;

• Digital literacy: skills to put these technologies and services to effective use.

Opportunities for Providers

13. A national broadband policy should include strategies to include multiple providers:

• Competition should be encouraged if a business case for multiple providers is feasible.

• Subsidies and other mechanisms designed to expand or upgrade infrastructure should be open to all providers that can demonstrate the necessary technical and business skills, including Indigenous regional community providers.

• Backbone or transport infrastructure constructed with public subsidies should be required to be open access, so that any provider can obtain access at wholesale rates.

Engagement of Stakeholders

14. We agree with several interveners that the Commission can play a key role as a coordinating agency for a National Broadband Strategy. We also agree with the suggestion that the Commission should establish a multi-stakeholder advisory council to oversee implementation, and that this council should bring together government, industry, consumers and non-governmental organizations, including Indigenous organizations and their representatives, as well as members of the academic community. For years, our FMCC members have advocated for the need to include Indigenous peoples in decision-making about broadband development taking place in their territories and communities.6 Recognition of and Engagement with Indigenous Peoples

15. We commend the Commission for its efforts to acknowledge and support Indigenous peoples and communities, including recognizing the traditional territories on which its deliberations take place, traveling to northern communities to conduct in-person public hearings involving residents of these regions,7 and extending access to video- and teleconferencing options during hearings. This approach is critical to implementing a National Broadband Strategy to enable all Canadians to participate in the digital economy.

16. It has been 20 years since the release of the final report of the Royal Commission on Aboriginal Peoples. Among other recommendations, the report focused on the need for policies to recognize Indigenous peoples as distinct peoples driving their own self-determination initiatives.8 Today, many of these recommendations have yet to be implemented. The current situation of Indigenous communities in Canada was highlighted in the recent report by **** Anaya, the United Nations Special Rapporteur on the Rights of 6 See Report of the National Broadband Task Force (2001); and comments submitted to Industry Canada’s 2010 ‘Digital Economy 150’ consultation (2010). This includes two papers submitted by FMCC members: “Ensuring Aboriginal Involvement in Canada's National Digital Strategy” ( and “Aboriginal Connectivity Strategy” (

7 As in CRTC 2012-669, Review of Northwestel Inc.’s Regulatory Framework, Modernization Plan, and related matters, which included hearings held in Inuvik and Whitehorse.

8 See: Highlights from the Report of the Royal Commission on Aboriginal Peoples, People to People, Nation to Nation. Available at: FMCC – Final Comments May 25, 2016


Indigenous Peoples. His report documented ongoing challenges include housing shortages, high cost of transportation, food costs, maintenance and operation of community facilities.9 17. Indigenous communities, including those located in northern, remote and rural regions of the country, continue to face many economic and social challenges. News reports illustrate how people living in communities like Attawapiskat and Natuashish face the same disparities in services and infrastructures that they did 20 years ago. The situation in some of these regions is so dire that Indigenous leaders are calling for a state of health and public health emergency.10 During these hearings, interveners from these regions have raised these issues. In FMCC’s testimony, **** Carpenter, manager of K-Net, referred to the health emergency in Attiwapiskat. Also, Manitoba Keewatinowi Okimakinak Inc. stated that:

“Increasing social isolation and economic exclusion has profound effects in communities that are already experiencing high rates of poverty, unemployment, and high indicators for poor health” (Transcript, **** 15, 2016, lines 6804-6805).

18. Yet as former **** Minister **** Martin recently noted, these conditions remain invisible to most Canadians, particularly those living in urban and southern regions of the country.11 The evidence submitted to these hearings by Indigenous intervenors has clearly demonstrated the interconnections between economic, social, cultural, and political challenges and the availability of affordable, adequate telecommunications infrastructures and services.

19. Most Indigenous communities require unique programs and services to properly operate, maintain, sustain, and upgrade the infrastructures required to support their residents. At the same time, as discussed in numerous submissions to the Commission, digital infrastructure costs are much higher in northern and remote communities than in other regions of the country. Various intervenors noted that many of these people are struggling to pay the high costs of accessing and using digital technologies – though research also illustrates they are eager adopters of digital technologies if they are affordable, reliable and meet their needs.

20. The evidence on the record of these hearings also points to the important role that Indigenous peoples are playing in addressing connectivity challenges. As pointed out in the RCAP report, by generations of Indigenous leaders, and in the many stories and research findings illustrating Indigenous successes from across the country, solutions are coming from the communities themselves. Throughout these hearings, and in past interventions before the CRTC and elsewhere, members of the FMCC and many other Indigenous organizations have demonstrated success stories of digital innovation emerging in regions of ‘market failure’. Despite challenges of geography and cost, members of Indigenous communities have innovated to build, operate and maintain broadband infrastructure and services. We pointed out many examples in our past interventions - these community stories are available on the First Mile website (

21. Too often, these efforts have been constrained rather than supported by policy and regulatory frameworks that are designed to support private-sector business cases in regions where such opportunities simply do not exist. Private sector-driven innovation has proven 9 Anaya, J. (2014). Report of the special rapporteur on the rights of Indigenous peoples, **** Anaya, on the situation of Indigenous peoples in Canada. United Nations, Human Rights Council, 27th session, May. New ****: United Nations. Available at: 10 See: 11 See:

FMCC – Final Comments May 25, 2016

successful across approximately 5% of Canada’s territory, where billion-dollar investments are connecting whole cities to fibre-to-the-home infrastructure, serving 95% of Canada’s urban and southern populations. But this approach simply does not work across the remaining 95% of the country. Fifteen years out from the completion of the National Broadband Task Force, remote and rural communities have yet to receive access to the standards of service proposed at that time. At the same time standards and technologies continue to evolve, leaving many communities across this region of Canada underserved.

22. Now is the time for reform – and action. Several recent actions taken by the Government of Canada point to a new approach to partnering with Indigenous peoples. Earlier this month, the Government officially adopted the United Nations Declaration on the Rights of Indigenous Peoples (UNDRIP).12 This endorsement came from Canada as a full supporter of the declaration - without qualification. Minister **** stated that: “We intend nothing less than to adopt and implement the declaration in accordance with the Canadian Constitution”.13

23. These hearings clearly illustrated the essential role that telecommunications infrastructures and services play in supporting the principles of the UNDRIP. In today’s digital society, broadband is a key requirement for access to public services and economic development - in particular in rural, remote and Northern Indigenous communities. It is through the ownership and control of the development and ongoing operations of these infrastructures and services that members of these communities and the self-governing institutions they have set up can shape these tools to support their own needs and requirements, rather than the needs and requirements envisioned by far-off government or corporate offices.

24. A National Broadband Strategy must also recognize the calls to action issued by the Truth and Reconciliation Commission of Canada (TRC) with endorsement. Concerning telecommunications, we highlight in particular 92, on “Business and Reconciliation”:

“92. We call upon the corporate sector in Canada to adopt the United Nations Declaration on the Rights of Indigenous Peoples as a reconciliation framework and to apply its principles, norms, and standards to corporate policy and core operational activities involving Indigenous peoples and their lands and resources. This would include, but not be limited to, the following:

i. Commit to meaningful consultation, building respectful relationships, and obtaining the free, prior, and informed consent of Indigenous peoples before proceeding with economic development projects.

ii. Ensure that Aboriginal peoples have equitable access to jobs, training, and education opportunities in the corporate sector, and that Aboriginal communities gain long-term sustainable benefits from economic development projects (Emphasis added).14

25. We also urge the telecommunications industry to lead in acting on these recommendations, in the spirit of corporate social responsibility and reconciliation. The call to action provides a framework these companies can use to partner with Indigenous communities to develop and 12 See: 13 See: 14 See:, p.9.

FMCC – Final Comments May 25, 2016

operate telecommunications systems that enable them to achieve their economic and community development goals.

26. Finally, we refer to the Guiding Principles, Definitions and Recommendations of the National Broadband Task Force (2001). FMCC Treasurer, **** Beaton, was a member of that Task Force in his role as the Coordinator of K-Net Services, Keewaytinook Okimakanak. As an early draft of a National Broadband Strategy for Canada, that report made several points specific to people living in Indigenous communities. Its guiding principles noted that:

“Our main order of business was to identify communities that are unlikely to obtain broadband access as a result of market forces alone by 2004, and to recommend strategies involving collaborative action among all stakeholders to ensure that businesses and residents in these communities have an opportunity to participate in, and benefit from, the broadband revolution.

To carry out this task, we found that we had to cast our net more widely and begin our work by developing a shared vision and a common understanding of what broadband is and why it is important for all Canadians, particularly for those living in First Nation, Inuit, rural and remote Communities” (p.1).

27. The following sections of our submission refer to our specific positions on various issues raised in the Basic Service Objective consultation (CRTC 2015-134).

Broadband as a Basic Service
Basic Service Criteria

28. During these hearings, we stated that the Basic Service definition should be expanded to include broadband. In our interventions, research and public outreach activities, FMCC members have documented and published more than 80 community stories and case studies illustrating the effective use and development of innovative digital applications that require broadband connections. People living in remote and Indigenous communities have consistently demonstrated their rapid adoption and uptake of digital technologies by using all bandwidth as soon as it becomes available. At the same time, bandwidth demands are continually increasing due to the demands of new technologies and uses. For example, the myriad devices associated with the “Internet of things” will only become more prevalent.

29. Further, the potential user base in remote communities is rapidly increasing due to population growth. Indigenous people are the youngest and fastest growing segment of the Canadian population, but face severe housing shortages. FMCC members and other interveners including KRG and NBDC have identified large households with multiple users per household, and there is clear recognition of demand for bandwidth because of multiple users relying on a shared connection.

30. Due to these converging trends, bandwidth ceilings and targets must be adjustable as demands and technologies evolve, and any specified speed should be considered a moving target subject to regular review. We agree with several interveners that the definition of Basic Service must also move beyond speed to include other Quality of Service (QoS) metrics. Specifically, it must:

• Be a moving target (recognize demand and innovation);
FMCC – Final Comments May 25, 2016

• Recognize upload (production) as well as download (consumption) activities to stimulate economic and community development;

• Consider a broad array of QoS metrics beyond download speeds;

• Include a community-based performance monitoring regime to supplement data provided through the Commission’s SamKnows initiative and by industry;

• Be capable of supporting mobile and fixed networks across entire remote and rural communities in place of household metrics;

• Recognize the different characteristics of user environments, such as the high number of people in northern households who share bandwidth; and

• Conceptualize needs beyond household/residential services to include the whole community approach to establishing minimum bandwidth requirements that include community-based organizations such as public service providers and businesses, in particular in remote and rural communities.

31. In contemplating this issue, we encourage the Commission to consider a perceptual shift from the economics of scarcity to the economics of abundance in the digital economy. A 2015 OECD report notes that when a resource such as bandwidth is scarce, participants in the marketplace expend energy trying to optimize use of that resource, whether through technical measures or business decisions. This effort ensures that more users enjoy a reasonable quality experience. However, it also involves trade-offs. For example, network operators can respond to bandwidth constraints with data caps or usage-based pricing, which create economic incentives for users to limit consumption - solutions that tend to depress potential demand and innovation (p.18). Many interveners described this situation in the ****.15

32. In contrast, when a resource such as bandwidth is abundant, new services and approaches emerge. Once adequate base infrastructure and capacity is in place, innovation is enabled.

According to the OECD report, the economy of abundance encourages entrepreneurs and innovative companies to try out new ideas, without facing constraints and limits. This approach reflects the position expressed in the 2001 National Broadband Task Force Report, in which the authors defined broadband as “a high-capacity, two-way link between an end user and access network suppliers capable of supporting full-motion, interactive video applications (p.2). The authors focused on a dynamic definition tied to activities identified as important to users, rather than a fixed definition generated by service providers:

“[W]hat is considered fast today may be considered slow in six months’ or one year’s time...Given these considerations, we concluded that it would not be useful to define broadband in terms of information transmission rates. We decided instead that it would be more useful to define broadband in terms of what it can do for Canadians” (p.1).

33. The Commission has repeatedly attempted to distinguish between user “needs” and “wants”. We think this approach is unrealistic. We think that a better approach is to first identify the key applications that Canadians need, and then determine technical standards required. While we agree with interveners who noted the problems of imposing such distinctions on users, our testimony focuses on uses such as for economic and community development, rather than entertainment uses such as unlimited video downloading and online gaming. For example:

15 For an example of this situation in Nunavut, see: FMCC – Final Comments May 25, 2016


• Indigenous organizations such as IsumaTV upload training and Indigenous language materials to local community servers.16

• Students and teachers are expected to access educational videos in school or for assignments using smartboards and other high bandwidth devices.

• Businesses and organizations need to access applications “in the cloud”, and families need to download software including security updates on their devices.

• Residents in remote communities use video-calling applications like Skype to stay in touch with family members in distant locations.

• Essential e-health applications require high definition, two-way symmetrical bandwidth to connect patients with medical professionals and information. Many other applications require this level of service, including governance, education and other services.

• Organizations and entrepreneurs use Skype and other conferencing applications to participate in meetings and to manage regional activities.

• New online translation tools are making it possible for first language speakers to converse with others, if adequate bandwidth is available.

34. Some intervenors referred to “the homework gap” experienced by students who do not have access to the Internet to complete and submit their assignments. In remote communities, students face an additional “distance education gap”. Without access to broadband, students (whether young or adult learners) cannot take online courses or participate in continuing education webinars. In our research for ISED, teachers in Iskut, a First Nations community in northern B.C., said that they could not stream or download educational videos in school, and both teachers and health workers said there was not enough bandwidth to participate in training webinars or teleconferences.17

35. To respond to those intervenors who state the a 5 Mbps down / 1 Mbps up connection is adequate, we note that the U.S. Federal Communications Commission (FCC)’s recently adopted Broadband Lifeline program requires a “standard based on what a substantial majority of consumers receive (currently 10 Mbps down / 1 Mbps up).” The FCC also sets a minimum monthly fixed broadband usage allowance standard, starting at 150 GB, to be updated thereafter.

36. As noted above, we think that a better approach is to first identify the key applications that Canadians need, and then determine technical standards required. A core baseline application is two-way symmetrical high-definition video for videoconferencing to link remote communities and for regional governance, telehealth, education and other services 37. With regards to technical standards, a multi-faceted approach to determining Quality of Service (QOS) is critically important in isolated communities. Therefore, such standards should include bandwidth, latency, jitter, and reasonable data usage allocations. They should also include minimal outage times. As MKO stated in its oral testimony:

“[S]ome individuals were waiting three months for a simple installation, or dealing with service outages for six weeks at a time. That’s not six hours or six days, but six weeks.

And during this kind of six-week delay, First Nation governments and businesses had to return to manual processes and employees were not able to take the holidays that they were otherwise entitled to” (MKO testimony, **** 15, para 6797).

16 See:

17 See: FMCC – Final Comments May 25, 2016


38. We reiterate that any set of standards will necessarily be a “moving target,” and must therefore be reviewed regularly, such as every three years.

Community Requirements for Broadband

39. We endorse the CRTC's efforts to look beyond household usage in its consideration of Basic Services. We provided detailed evidence about the importance of Internet access and broadband for Indigenous communities - not just individual households, but also local services and organizations and businesses. We note that most models used to understand digital technology adoption focus on individual and household adoption and ignore wider social and community processes. But existing research literature suggests that there is a link between the use of digital technologies in Indigenous communities, social capital, and community economic development. For example, two recent studies – an FMCC study completed for Innovation, Science and Economic Development Canada (ISED) and a study in rural southwest Alaska – highlight how broadband is used by Indigenous governments and non-profit organizations as well as businesses including retail, fisheries, and tourism.18 40. To stress this need to consider community as well as household needs, we use the “whole community” analytical framework. We introduced this framework during our presentation to the CRTC hearings and documented it in our report to ISED. In the ‘whole community’ approach, illustrated in the diagram below, there are three interconnected levels of factors that shape digital technology adoption:

• Community members / household factors
• Community services and community-organization-level factors

• Local and transport infrastructure supporting individual and community adoption 41. This “whole community” approach aims to ensure that adequate fibre infrastructure is put in place to support the immediate and future needs of regions and communities across Canada. Basic Service must ensure that residents of rural and remote communities have the same access to the essential public and commercial services available to urban Canadians. We have noted that online access to these services is more important to rural and remote community members because they lack the availability and range of ‘brick and mortar’ or ‘offline’ services (healthcare, education, banking, retail, etc.) found in urban areas.

A host of interveners from remote and Northern regions described how members of these communities require sufficient capacity, speed, and low latency to provide and access services including online banking, e-health, telemedicine, e-commerce, distance education, e-justice, e-security, remote water and facility monitoring, and e-government.

18 See ****, **** E. et al. “After Broadband. A Study of Organizational Use of Broadband in Southwest Alaska.” Available at FMCC – Final Comments May 25, 2016


42. In this context the FMCC recommends that the Commission ensure communities receive a minimum amount of bandwidth to support local and regional infrastructure needs and priorities. Through the “whole community” approach, local leaders and administrators can engage in strategic planning regarding how bandwidth can be paid for, distributed and managed in each community. This approach to bandwidth allocation enables local residents to make decisions on how infrastructure and bandwidth is made available to deliver essential services such as e-health, e-learning and so on.

43. When Bell Canada was constructing the regional fibre network project to connect remote First Nations across Northwestern Ontario, their business case included plans for 1GB of bandwidth for each First Nation – with the understanding that the communities would purchase additional bandwidth as required, when resources to do so became available.

44. The specific the level of bandwidth required in this approach must be determined based on several variables including population and demand. However, FMCC recommends that plans for every remote and rural community include a minimum of 500MB of bandwidth capacity, with larger communities (over 1,000 people) provided a minimum 1GB of capacity.


45. As NBDC pointed out: “The end goal of access is use” (Transcript **** 11, para 2131).

Affordability is a barrier to use across Canada - and especially in the **** where incomes are low and living expenses are high. Our primary focus in these hearings is on supporting the long-term community and economic development opportunities of the Indigenous residents of rural, remote and Northern communities. Residents and workers in these regions – including entrepreneurs and professionals – should not be prevented from providing business and services because of high-cost broadband or low data caps.

46. We reject the comments by some industry representatives that ‘everything costs more in the ****’, and so high telecommunications prices should not be a policy concern. As Commissioner **** stated during the hearings:

FMCC – Final Comments May 25, 2016

“I thought that some people might find that position a little blunt and perhaps even uncharitable. And just in the context of Canada's longstanding tradition … we do transfer payments to make sure that people have similar access to basic standards of healthcare and education, for instance. And some people in the **** might look at that and say, well, why wouldn’t the same philosophy apply to connectivity” (Transcript, **** 27, paras-18054-18055).

47. Determining policy regarding affordability requires consideration of both the cost of services (including installation and activation fees, monthly charges and usage charges) and the ability of community members to pay for them. Data caps can significantly increase the cost of usage and make access unaffordable for users who need broadband to access websites and cloud services and for online education – not simply for streaming entertainment.

48. We noted in our initial intervention that northern community members face an affordability gap for telecommunications services. Research in rural Alaska, where remote villages are very similar to Indigenous communities in the Canadian ****, found that affordability is a significant barrier to adoption. Like their counterparts in the Canadian ****, many Alaska Natives have only seasonal incomes or are not employed, and their cost of living is high. A 2012 study in southwest Alaska found that while there was general enthusiasm about broadband, the primary concern among the households who were not sure if they would sign up for broadband when it became available was cost – and specifically, monthly subscription and data overages or other charges. In 2015, researchers interviewed representatives of non-profits, government agencies and businesses in Southwest Alaska that were now using broadband. Without exception, they said that broadband was very important for their work, but they could not take full advantage of it because of the high pricing, including usage caps. We heard similar examples about barriers to access in our ISED-funded study of Digital Technology Adoption in Northern and Remote Indigenous Communities in Canada.19

49. As noted in our earlier submissions, to measure a track geographic inequalities in service pricing and affordability faced by residents of rural, remote and northern regions, we are currently developing a broadband affordability mapping methodology.

50. Given these factors, we agree in principle with the proposals made by interveners such as AAC and Open Media, who suggest that subsidies for low-income citizens can help address the affordability challenge. We note that the EKOS study sponsored by the Commission found that Canadians were willing to support affordable broadband access across the country. Professor **** Winseck noted that total federal subsidies for broadband for the past five years have been about $2 per person – compared with $33 per person for the CBC (Transcript **** 11, para 1510). Further, we note that the Canadian Federation of Municipalities stated:

“What we say at the FCM is that we’re in it together, that we are a nation that is attempting to improve the quality of life of everyone in Canada. Part of that equation is paying to ensure that everyone has access to succeed.” (Transcript **** 15, para 6657) 19 See: FMCC – Final Comments May 25, 2016


51. As noted above, the FCC in the U.S. has recently approved a broadband Lifeline subsidy for low income residents. Importantly, this Lifeline subsidy is portable; it can be used with any provider that meets program criteria.20

52. Several intervenors in the BSO hearing questioned how eligibility for a low income subsidy could be established in Canada. The FCC relies on evidence that consumers have qualified for other federal income assistance programs (unemployment, tribal, Medicaid, disability assistance, etc.). We believe that such a model could be used in Canada, including in Indigenous communities, where Indigenous broadband providers would be eligible to receive the subsidy to provide service to low income residents.

53. Along with these consumer subsidy proposals, we think the affordability problem in northern and isolated regions could be addressed by providing operating subsidies for Northern community-based providers, so they do not have to pass on excessively high service costs to their customers. We think that a fund such as the Northern Infrastructure and Services Fund (NISF - described below) that provides operating support and is permanent and open to community technology organizations, is the best way to assist organizations like our members to provide high quality and affordable telecommunications for Northern residents.

We also think it could be a mechanism to support economic development in these regions.

54. In short, we are not opposed to subsidies for low income broadband users - as long as northern and remote regions are included and funding for such subsidies would not be at the expense of funds for upgrading and maintaining northern networks, as we propose for the NISF (details below). We note that special outreach efforts will be needed to ensure that low income households in northern communities can access these subsidies. For example, Band councils or other local governments could certify eligible residents for such subsidies.

Community Ownership and Control of Broadband Infrastructure and Services 55. Broadband plays a key role in supporting long-term regional, community, and economic development - including through the new employment opportunities created through the ownership, management and operations of infrastructure and services. The Canadian Telecommunications Policy Review Panel report (2006)21 noted that community networks and other community-based organizations provide both technological and social infrastructures for digital technology access, adoption and use. In this context, the outcome of these hearings have implications beyond access to telecommunications services for consumers – they will also shape the ability of innovators living in rural, remote and Northern regions to contribute to the digital economy as the providers of these services.

56. The Assembly of First Nations supports the development of an e-community approach to developing Indigenous broadband networks. K-Net, a member of FMCC, whose manager, **** Carpenter, testified on our panel, exemplifies an e-community model. K-Net partners with locally owned and operated broadband providers to set up and manage community networks to distribute local bandwidth. In their testimony, KRG also pointed out a concrete example of this process:

20 Federal Communications Commission. FCC MODERNIZES LIFELINE PROGRAM FOR THE DIGITAL AGE: New Rules **** Help Make Broadband More Affordable for Low-Income Americans WASHINGTON, **** 31, 2016.

21 Industry Canada. Telecommunications Policy Review Panel Final Report. 2006. Available at:$FILE/tprp-final-report-2006.pdf FMCC – Final Comments May 25, 2016


“By owning and controlling their own telecommunications infrastructure, the people of Nunavik are able to make decisions that consider their own goals and priorities. As an example, we have established a mechanism with Nunavik organizations whereby we are informed in advance of any planned activities in small communities. This allows us to reconfigure capacity on our network in order to ensure that a large meeting planned in a small community will not have a negative impact on the broadband infrastructure.

Contrast this with the events that occurred in **** 2015 in Nunatsiavuit, or our neighbours in Labrador, where the non-Aboriginally owned broadband provider decided unilaterally to reduce broadband speeds to all consumers” (transcript **** 11, para 378 and 379).

57. Whiteduck (2010)22 used the following image to describe the community broadband network and the complex network supporting the community:

58. In our initial intervention to CRTC 2015-134, we introduced the concept of broadband-focused regional community intermediary organizations that are developing and providing technology support services to their constituent populations. In our response to an Undertaking on this topic, we stressed that the term regional community intermediary organization is not a concept but rather a definition used to describe various existing organizations currently operating across Canada. Some of these technology-focused organizations have been providing services for decades. For example, K-Net was founded in 1994, during the early years of the Internet. K-Net’s services, which employ the whole community framework discussed above, now reaches over 80 communities across Ontario and in other provinces. It partners with First Nations, government programs, telecom transport providers and other groups to facilitate the largest Indigenous network across Canada, and probably the world. The following network diagram shows the reach of K-Net:

22 See “Building the First Nations e-Community”, available at: FMCC – Final Comments May 25, 2016


59. The FMCC was established by several of these First Nations regional community intermediary organizations (see: The eight current members of the FMCC (listed from West to ****) are:

• First Nations Technology Council (B.C.)

• First Nations Technical Services Advisory Group Inc. (Alberta) • Assembly of Manitoba Chiefs

• First Nations Health and Social Secretariat of Manitoba
• Keewaytinook Okimakanak K-Net Services (Ontario)
• Western **** Bay Telecom Network (Northeastern Ontario)
• First Nations Education Council (Quebec)
• Atlantic Canada’s First Nations Help Desk (Atlantic region)

60. Over the years these regional community intermediary organizations have played prominent roles in both advocating for and administering ICT infrastructures and services on behalf of their Indigenous member communities. These organizations represent and are governed by groups of local communities, allowing residents to access services and benefit from economies of scale otherwise unavailable. They use ICTs to deliver public services and economic development opportunities to the residents of these communities. Acting as mediators between local, place-based communities and external entities like government funders or corporations, regional community intermediary organizations engage in both social and technical activities associated with the effective use of digital technologies:

operating complex networks and applications while asserting self-determined development goals. Their activities also include attempts to reform the policy and regulatory frameworks to address persistent digital divides in the Canadian north.

61. Regional community intermediary organizations include a range of institutions, including First Nation Councils such as Keewaytinook Okimakanak (which established K-Net), Regional Governments such as the Kativik Regional Government (KRG), and non-profit advocacy groups set up by residents of northern and remote regions of Canada, such as the FMCC – Final Comments May 25, 2016


Nunavut Broadband Development Corporation. These organizations perform a range of functions to their constituency of Indigenous communities across Canada, including broadband deployment, operations and maintenance, purchasing, IT support and training, legal and advocacy support, and so on.

62. In our undertaking in response to the Commission’s request, we provided a more in-depth example of the First Nations Education Council (FNEC), a regional community intermediary organization in Quebec. FNEC manages relationships between First Nations communities, telecommunications companies (including Telebec, TELUS and Bell), and another regional community intermediary organization, K-Net. FNEC aggregates member First Nations communities into a common market and manages a contract on their behalf, brokering partnerships between government funders such as INAC or Health Canada and service providers. In cases where individual First Nations choose to manage connectivity contracts themselves, FNEC supports them by connecting them with funding resources from government departments. FNEC also provides other services to member communities, including data management, training, help desk support, access to a videoconferencing bridge and network, and strategic planning, advocacy and research support.

63. Regional community intermediary organizations such as FNEC work directly with their member communities. Their board of directors is often composed of local community leaders and/or community members. In sum:

• They are community-owned, and so do not have obligations to make a profit for external shareholders.

• Because they are owned and controlled by communities, they have to be responsive to the needs of residents, support local priorities, and take direction from residents.

• They provide shared capacity and expertise in planning, fundraising and coordinating regional infrastructure and applications.

• Since they are based in the communities and regions where they operate, they can respond promptly to service issues.

• They tend to hire local people who are less expensive than employees of major service providers. The local employees do not have to fly to expensive-to-reach communities for installation and repairs.

• They often innovate to adapt equipment or services to local conditions.

64. In our initial intervention to these Hearings, we also described the different support activities provided by these regional community intermediary organizations as including:

• Setting up and operating industry standard broadband infrastructure.

• Supporting the delivery of online applications.

• Aggregating customers or ‘anchor tenants’ for community networks, such as public and community services like online education and e-health providers.

• Providing training in digital literacy to establish a skilled public service in every First Nation.

• Developing local skilled employment through jobs such as cable plant technicians and videoconferencing coordinators, or as administrators and technicians of community networks.

• Supporting partnerships between community networks and other public and private sector entities.

FMCC – Final Comments May 25, 2016

• Enabling community networks to achieve economies of scale in the purchasing of hardware, software and bandwidth (including satellite bandwidth and/or mobile spectrum).

• Providing strategic planning and business support for community networks.

The Role of Digital Literacy in Supporting Community-based Broadband Initiatives 65. Community members living in remote and Northern regions of Canada require the appropriate digital literacies to make effective use of telecommunications services and facilities. Many intervenors commented on the need for digital literacy. Our position is that the definition of 'digital literacy' must extend beyond an individual's ability to use a computer, software like Microsoft Office, or social media. It must also include digital literacies that support the planning, management and maintenance of telecommunications infrastructure and services. Given their isolated locations – and the lack of on-site technical specialists to operate and maintain facilities and services – remote community members should be supported to build capacity in the digital literacies needed for these tasks. In our opinion, this broader conception of digital literacy falls under the Commission’s mandate.

66. Our approach to digital literacies includes the ability to conduct local Internet performance monitoring tests – a key issue given the Commission's interest in ensuring that robust data is available on the quality of services in these regions. This involves monitoring activities that can complement the Commission’s existing efforts in this area through initiatives such as SamKnows. For example, we are presently working with Northern communities and their regional organizations to pilot a First Mile approach to Internet measurement using tools developed by by the Canadian Internet Registration Authority (CIRA). This project aims to involve members of these communities in ongoing Internet performance measurement activities. It highlights the important role that digital literacy can play in monitoring and enforcing basic service obligations.

67. Researchers affiliated with the FMCC are working on several projects to help individuals and organizations to conduct ICT planning initiatives and monitor broadband quality and usage, which is another component of our approach to digital literacy. In northern Ontario, community members are invited to use the eCommunity Facebook group to share ideas on how they are using technology in their communities, to share ideas, stay connected to other people and plan together for the future of community-owned networks. Community members are encouraged to post discussions about technology and other services – including cell phones, Internet and anything else that happens online. K-NET staff provide support by sharing network updates and opportunities.

68. Several other intervenors supported the need for this kind of technical training. For example, SSi Micro commented that: “Northerners have the technical capability to maintain and manage and support the network, but we need to train them” (Testimony **** 12, para 2474). SSi Micro pointed out that training two local people would save on flying in local technicians, and that the $40,000 it estimated would be needed to support four providers could be used to provide these local jobs (Transcript **** 12, paras 2515, 2516). ECN stated that in northern Quebec it has trained technicians, and 33 graduates have found work in IT in the Cree communities (Testimony **** 22, para 13570).

FMCC – Final Comments May 25, 2016

Proposal for the Northern Infrastructure and Services Fund (NISF) The Need for a Fund

69. Some intervenors in this consultation, and in the Northwestel hearing (CRTC 2012-669), argued that federal government programs should suffice to fund any unmet requirements for northern broadband. We disagree.

70. The FMCC has recently released a report on past and existing broadband funding initiatives provided by federal government departments and funding agencies.23 This review clearly illustrates the complex nature of funding for broadband infrastructure and services in rural, remote and northern communities. Our research determined that limited funding exists for broadband infrastructure, ongoing operating expenses, connectivity/bandwidth, public access, education/training, and research.

71. The existing Federal programs are important, and have provided major benefits for many unserved and underserved communities. However, they are not sufficient in scope, scale or sustainability. While we welcome new federal funding, our experience has been that the majority of federal funding is a one-time allocation for capital infrastructure. There is also a need for ongoing funding for sustainability: to maintain and upgrade these networks and train people to manage them. Also, in the past there has been little continuity to government funding, so providers do not know when funding will be available and over what time period, and what criteria will apply. Funding is also spread across a range of federal departments and programs, which makes it very difficult for our members to track the different deadlines, application requirements and funding opportunities.

72. Broadband funding programs are also periodic and inconsistent. Many end abruptly – sometimes in spite of positive evaluations from government funders, as was the case with the Community Access Program. The uncertainty of accessibility to these funding initiatives makes it difficult for community-based organizations to engage in strategic planning, and threatens the long-term sustainability of their services and infrastructures.

73. Our initial analysis of broadband funding programs has also identified a lack of coordinated funding opportunities for community-based organizations. Public programs often fund incumbent telecommunications providers directly to upgrade their infrastructure, rather than seeking competitive bids or partnerships with community providers. The result can be negative outcomes in terms of costs of projects and failure to achieve service goals. For example, in northwestern Ontario, when the incumbent provider experienced project cost overruns, five remote communities scheduled to receive a fibre connection were left off the network and removed from the project. Further, incumbent wholesale prices for 100 mbps to serve an entire remote community were more than 20 times the current retail price for 100 mbps service to a residential customer in a small city such as Fredericton, NB.

74. The existing Federal programs are important, and have provided major benefits for many unserved and underserved communities. However, they are not sufficient in scope, scale or sustainability. Requirements for private sector contributions could be replaced with recognition of in-kind contributions based on the revenue generated from the sale of the services proposed and from local contributions of lands, facilities, resources and 23 See: FMCC – Final Comments May 25, 2016


administration. The approach that we propose through the NISF could complement these existing funding initiatives and set a positive example for future programs.

75. In its Notice of Consultation, the Commission stated that it would:

“examine whether a mechanism is required in Northwestel’s operating territory to support the provision of modern telecommunications services by funding capital infrastructure investment in transport facilities as well as the cost of maintaining and enhancing these facilities. The Commission will also examine whether such a mechanism should be considered for other rural and remote areas in Canada”.

76. In our initial submission to these proceedings, we proposed the creation of the NISF to address this issue. The NISF consists of both capital (infrastructure) support and ongoing operational support. As noted above we recognize that some infrastructure support could come from various government programs, and not just the CRTC. However, to date these programs have been typically short term and unpredictable, and tend to prioritize capital investment over ongoing operations and maintenance costs. In the long term, the best way to ensure the efficient use of scarce resources is to provide ongoing support to initial investments.

77. Specifically, the FMCC suggests that the following activities should be eligible for funding support from the NISF:

• Capital costs: Procurement and installation of infrastructure required for deployment of broadband services in unserved and under-served remote and isolated communities to meet minimum connectivity levels based on the whole community approach.

• Operations and Maintenance costs: Operating costs of these facilities that exceed revenues from affordably priced services. There is also a need to upgrade the equipment as new digital technologies are required and as infrastructure ages.

• Providing training in digital literacy: To enable users in remote and isolated communities to participate in and contribute to the digital economy. This training includes developing local skilled employment through acquiring technical skills such as network management and operations and community-based Internet performance measurement.

This can result in jobs such as cable plant technicians and videoconferencing coordinators, or as administrators and technicians of community networks.

• Providing strategic planning, research and business support for community networks: For example, aggregating demand to achieve economies of scale in the purchasing of hardware, software and bandwidth (including satellite bandwidth and/or mobile spectrum), aggregating customers or ‘anchor tenants’ for community networks (such as public and community services like online education and e-health providers), and establishing partnerships between community networks and other public and private sector entities.

Eligibility for NISF Support

78. NISF support would not be limited to incumbent providers – it would be open to regional community intermediary organizations and community service providers. This is to enable these organizations to build, manage and operate their own network infrastructure and services through a stable, sustainable source of funding dedicated to these purposes.

FMCC – Final Comments May 25, 2016

79. The NISF is an open, portable subsidy that prioritizes northern regions. The regions eligible for NISF funding would include the northern territories of Yukon, Northwest Territories and Nunavut as well as the northern parts of the provinces and the regions of Nunavik and Nunatsiavut, which include remote communities similar to those in the territories. In our response to Undertakings from the Commission, we clarified that although our emphasis for the NISF is on northern Indigenous communities, we are proposing an inclusive definition for eligibility. We realize that there are some northern non-Indigenous and mixed communities that are also isolated and could be eligible for funding through the NISF. We have heard from the Commission and several interveners, as well as from FMCC member organizations and researchers, that regions outside of the **** face similar challenges to access to affordable, adequate infrastructure and services.

80. Therefore, rather than focusing on distinctions between treaty and non-treaty regions, the FMCC’s priorities for the NISF are the unserved and under-served communities and regions that exist across the country. This geographic focus includes communities in northern parts of provinces without year-round road access as well as other isolated communities. We realize there are other locations that are distant from regional centres, such as Obedjiwan, whose IT Coordinator Marc Awashish testified for FMCC at the hearing, and which is 300 km northwest of Roberval, Quebec -- more than half the distance by gravel road.

81. The 2001 National Broadband Task Force report provided a methodology to help determine investment models for under-served and unserved regions. The Task Force combined data on unserved communities provided by telecommunications and cable companies with data from Statistics Canada on the characteristics of these communities, which classifies census subdivisions by their proximity to metropolitan centres (specifying whether a community is, for example, ‘outlying’, ‘far outlying’ or ‘remote’).

82. In our research for ISED, we similarly used a definition of prescribed northern and intermediate zones as defined by the Canadian Revenue Agency and shown on the map below.

FMCC – Final Comments May 25, 2016

83. Coverage maps issued by Telecommunications Service Providers (TSPs) are one important source of data on whether a community is served, underserved or unserved. So is data collected through initiatives such as the CRTC’s SamKnows project. However, these maps and associated data should be verified by community-based organizations and local residents. The Canadian Internet Registration Authority (CIRA) provides a tool and process for this activity.24 Other sources describing coverage are referenced throughout our document and are included in our report to ISED.25

84. Priority access to the NISF should be given to community and regional organizations based in the ****, either as stand-alone providers or in partnership with other entities. In such cases, the northern organization would be required to be the majority partner in any NISF-funded initiative. In some cases, the fund may be accessed by existing providers, but in others, particularly areas that are unserved or underserved, the funds should be made available on a priority basis to local or community intermediaries where they exist. In the case of partnerships, the northern organization should be the majority partner.

Source and Costs of NISF Subsidy

85. We think that a revised high cost subsidy that could be available to any qualified provider could address the problem of high operating costs from the providers’ perspective and high prices from the users’ perspective. The necessary costs should be calculated using a ‘bottom up’ approach that first determines the requirements of providers (as expressed, for example, in project proposals and/or feasibility studies) and then generates estimated costs based on this information.

86. Concerning sources of funding, we believe that a small percentage of revenues for all telecommunications services in Canada should be made available for this purpose. All revenues of all telecommunications services (including Internet and mobile) should be subject to the overall subsidy regime – with a key exception. The Commission should maintain the exemption for telecommunications providers with revenues under $10 million.

This figure of $10 million should be adjusted for higher cost of service delivery and infrastructure in the ****.

87. We do not anticipate general government tax revenues being allocated to the NISF.

However, as noted above, any funding for broadband infrastructure and services by federal agencies should be coordinated with the NISF.

88. Concerning cost estimates for the NISF, the Commission has been given some estimates in these proceedings by Telecommunications Service Providers (TSPs). ISED would also have data from programs it has administered. However, we also note the difficulty in providing reliable estimates because of several factors:

• Many variables affect the costs of construction in these regions, including delivery, labour, materials, and other costs.

• The years that the estimates we provide below vary. Therefore, so do associated dollar values and costs for various items (transport, labour, equipment, materials, etc.).

24 See the Intervention and Presentation made by Dr. **** McKelvey.

25 See Appendix 2 of the report that is available online at:

FMCC – Final Comments May 25, 2016

• The projects noted below all incorporate different elements in their project cost calculations, rather than a standardized approach to determine costs. Therefore, it is impossible to tell from the numbers presented below what specific aspects of a fibre build are included in the estimate.

89. Recognizing these limitations, rather than attempting to estimate a specific figures based on a ‘one-size-fits-all’ solution, we propose that the Commission instead focus on establishing an administrative mechanism involving government, industry and members of affected regions and communities. This group could collectively identify infrastructure (and other funding) needs in the regions, and then monitor and review funded the implementation of projects on an ongoing and transparent basis. In developing this administrative mechanism, we suggest that the Commission consider similar programs in place in other jurisdictions (such as the FCC’s funding programs in the U.S.) as well as historic funding data. Below, we provide several examples of these estimates.

90. First, the 2001 National Broadband Task Force report began the process of this costing exercise by including several broad estimates determined by the various telecom industry representatives included on the committee. The report states the following estimates (in 2001 dollars) to implement its action plan:

• Transport to unserved communities: $1.3 billion to $1.9 billion • Connecting public institutions: $500 million to $600 million • Connecting businesses and residences: $900 million to $2 billion • Funding for community champions: $50 million to $70 million

91. In the intervening 15 years, the estimated $4 billion dollar requirements for transport and connections provided by the telecom industry have probably been realized through a mix of both public and private funds. However, as has been demonstrated repeatedly in the course of these BSO Hearings, the lack of adequate connections serving remote and rural communities remain a challenge. One key reason stated by several intervenors in these is that the incumbent telecom providers are continually investing first in core infrastructure and only later in upgrades to support additional builds at the “last mile”. The results of this approach in rural and remote communities speak for themselves. FMCC is advocating that the CRTC and our proposed NISF program adopt an alternative “first mile” approach to telecom infrastructure development. The “first mile” approach makes public funding and decision-making powers available to communities and/or their regional community intermediary organizations, so that in such projects their infrastructure requirements are addressed first instead of last.

92. Below, we provide estimates for capital costs for transport infrastructure based on the experience of FMCC members KNET and the Western **** Bay Telecommunications Network, and also projections of capital costs from KRG and NBDC. These costs are all on the public record. However, as noted above, we stress that it is very challenging to come up with an accurate estimate given the variables. The table below illustrates estimated costs:

Project Name Region # Communities Cost per KM Total Cost
NAN build by Bell NW Ontario 22 $30,000 to $40,000 $81 M
FMCC – Final Comments May 25, 2016
22/30 Western **** Bay 3 $70,00026 $4.9 M

Nunavik Fibre Optic Feasibility Study (2013)27 Nunavik 14 $34,000 $87.4 M Nunavut Fibre Optic Feasibility Study28 Nunavut 24 $70,00029 to $97,000 $750 M to $1,050 M Administration and Governance of the NISF

93. Any new funding mechanism – including the proposed formula for the NISF – must be subject to methodological due diligence (in terms of its development) and stringent transparency requirements so that providers (both those paying into the fund, and those drawing upon it), as well as ordinary citizens, can be sure that the funds are used fairly and efficiently. Implementation will require further specification of these terms.

94. We envision the Fund as an independent organization licensed by the Commission and governed by a Board of Directors, including representatives with strong ties to rural, remote and northern regions. The Board of the NISF would consist of representatives appointed by the Commission. NISF Directors would have no direct financial ties to entities applying to the Fund. Program officials require experience in working with small, remote and rural communities in local development and addressing local and regional needs and priorities.

Culturally appropriate experience, especially with Indigenous communities, will be an important consideration for the operations and management of the fund.

95. The process used by the CRTC to select representatives to this NISF Board should:

• be open, transparent and public;

• ensure balanced representation of cultural populations and geographic regions across the **** (including remote regions of the provinces);

• be based on nomination, including self-nomination;

• be large enough to ensure that directors are representative of the diverse communities and entities involved; and

• include representatives from private, public and civil society organizations with ties to rural, remote and northern regions and/or communities.

96. To address these issues we propose that the NISF adopt a transparent process that clearly demonstrates how capital and operational funds from the NISF will be spent to support and improve telecommunications infrastructures and services in remote and northern regions, and includes clear performance benchmarks and reporting requirements. There is a need for accountability and oversight in funding regimes, and we see regional community intermediary organizations playing a key role in this activity. The selection of funded projects should be based on published criteria including sound technical and financial plans, 26 WJBTN built the fibre from Kashechewan to Attawapiskat - a distance of 70 km along the **** Bay coast. WJBTN built fibre in each community, including poles, electronics towers, etc. The fibre network was constructed along with the electrical grid system, resulting in additional costs.

27 See Appendix A - Cost Estimate, p23. Full study available at:

28 See:

29 Based on 10,782 km of fibre, from Nunavut 2012 Fibre Optic Feasibility Study.

FMCC – Final Comments May 25, 2016

engagement of communities to be served in project planning and implementation, and commitment to hiring and training community residents.

97. Evaluation of proposals should be carried out by a committee whose members have no ties to the applicants. The membership of the licensed body managing the fund would consist of representatives from both the public and private telecom industry, including community and regional representation. This process should be conducted in an open and transparent manner. An example of this approach is the Community Radio Fund of Canada.30 98. The licensed body would be responsible for project selection, oversight, and ensuring accountability. Funded projects would be required to provide progress reports, meet implementation deadlines and remain within budget. Expenditures would be subject to audit.

The licensed body would have the right to request the CRTC to fine or otherwise sanction organizations that do not meet required targets or do not otherwise fulfill their obligations.

99. Regular and standardized reporting should be made to the CRTC, which in turn should make the information publicly available in an easily accessible format on its website.

Comparison with NCF and Deferral Fund

100. The proposed NISF governance model contrasts with the structure of the Canadian Telecommunications Contribution Consortium (CTCC) that administers the NCF. In the CTCC, nine of the 11 board members are from Ontario, with one each from Saskatchewan and Nova Scotia. None are from the ****. Further, most are current or former employees of major telecommunications services providers. In addition, the existing criteria and selection process for the NCF board members do not appear to be transparent or publicly disclosed.

101. The NCF has not been effective for the ****. We and several other interveners have pointed out ongoing poor reliability, inadequate bandwidth, and high prices for connectivity in remote regions. At present the NCF is open only to incumbents: any fund for transport networks should be open to all providers and not restricted to the incumbents. The NISF provides supports for the Indigenous regional community intermediary organizations represented in the FMCC. The board of the NCF consists of southern Canadian representatives from the communications industry. It does not include any representatives from northern regions or community-based technology organizations. Nine of the CTCC’s 11 board members are from Ontario, with one each from Saskatchewan and Nova Scotia.

None are from the ****. In addition, most board members are current or former employees of major telecommunications services providers. In addition, the criteria and selection process for board members are not transparent.

102. The NISF also seeks to address some perceived shortcomings of the Deferral Account Fund. In February 2016 the CRTC announced that over 280 communities served by Bell, TELUS, MTS got access to broadband through this fund. The recent Deferral Fund expenditures have definitely helped to extend broadband, but it is not an ongoing program.

Also, the original funding is tied to the incumbents, and is not accessible to other providers.

Finally, the Deferral Fund has no provision for ongoing maintenance and upgrades; it is restricted to capital (infrastructure) builds.

Harmonizing the NISF with Other Proposals for a Broadband Subsidy 30 See:

FMCC – Final Comments May 25, 2016

103. We recognize that other interveners have proposed some variation of a broadband subsidy to support the extension of infrastructure and services into rural and remote regions.

Our proposed NISF has several features in common with some of these proposals, which we outline below.

104. The ACC’s proposal for a transport fund (the ‘Broadband Deployment Funding Mechanism’ or BDFM), is capped at $190 million per year. This cap is based on an assumption of how much funding could be available, and an allocation between low income subsidies and infrastructure subsidies. The NISF approach has two major differences:

• We include subsidies where necessary for ongoing operational - not just capital costs.

Therefore, our proposal includes additional funding to support operations and maintenance, training (digital literacy for local network management and community-based Internet Performance Monitoring), research and strategic planning. The rationale to include these activities is to encourage sustainability and economic development among service providers in these regions, support required upgrades, and keep services affordable. Therefore, the NISF includes these added costs.

• The ACC proposes a cap on the BDFM based on assumptions of available funding and allocations of this “pot” between income subsidies and infrastructure subsidies. Instead, we propose that when determining funding for the NISF, the Commission should set policy objectives and then determine the resources required to pay for them. This ‘bottom up’ approach is more in line with the expressed needs of residents of northern communities, as described above in our discussion of the ‘whole community’ approach.

105. We agree with AAC that any new broadband fund should be open to all qualified providers. We also agree that paging and Internet revenues should be included in Contribution Eligible Revenues (CERs) for any new funds. AAC estimates a funding amount of $315 million per year, based on comparisons with similar funds in the U.S. and Australia.

It then reduces the amount to $300 million to accommodate appropriations for its proposed low income fund.

106. We think $315 million should be considered a low-end estimate. The Commission needs to examine costs “from the bottom up,” to address the total requirement for capital and operating costs, not by adopting an arbitrary number based on funds in other countries.

Also, we believe that broadband deployment funding should not be dependent on a single pot of money shared with low income subsidies.

107. We note that the Yukon Government’s positions are similar to those of FMCC. Yukon states that: “The subsidy mechanism for broadband support should be community-based, targeted to needs identified with community input, and transparent” (Transcript **** 11, para 111). This position supports the FMCC “whole community” approach to allocating minimum bandwidth requirements based on factors like population, cost, and infrastructure.

108. We also point to similarities between the NISF proposal and a statement made by KRG.

In its oral testimony, KRG stated: “… we feel the Commission should put a priority on supporting locally-owned internet service providers, especially in Aboriginal areas” (Transcript **** 11, para 380).

FMCC – Final Comments May 25, 2016

109. MKO’s proposal has several points of commonality with the NISF. MKO states that “a necessary component of any BDFM is supporting opportunities for development and growth of First Nations and Aboriginal businesses. This can be done through the implementation of a Procurement Strategy for Aboriginal Businesses or a PSAB-like policy.”31 110. Later, MKO adds: “…with a designated preference towards First Nations businesses or First Nations ventures then you would -- that would be a part of the criteria that you would be assessing bids on the basis of. Those would be some important principles to take into consideration” (Transcript **** 15, paras 6820, 6888).

111. The Canadian Association of Municipalities states:

“… the Commission should adopt a comprehensive and long-term funding mechanism for basic broadband access and the existing arrangement for basic telecommunications services is a good starting point. This mechanism could work alongside the current mix of targeted government programs and public/private partnerships.

We also suggest the Commission develop a specific strategy for Canada's **** that sets out a sustained funding commitment for developing communications networks as well as a regulatory environment that fosters competition in this area” (Transcript **** 15, para 6550 and 6551).

112. Some industry interveners also make points that harmonize with the NISF proposal. For example, Shaw, a major commercial provider of broadband facilities and services, states:

“…when we looked at the opportunities from this hearing to close those gaps and the scope of the issue around transport, we see the potential for a combination of the federal funding and some supplemental compliment to that through an industry funded CRTC overseen subsidy mechanism. So I think the short answer to your question is we would support a CRTC initiative to expand the scope of funding to address the transport issue (Transcript **** 26, paras. 17585 and 17586).

113. To summarize our NISF proposal, the distinguishing characteristics and core components are:

• Focus on northern/remote regions (including northern parts of the provinces as well as the northern territories);

• Focus on community providers, particularly Indigenous regional community intermediary organizations;

• A governance structure that includes representatives from these regions and communities;

• A funding mechanism that provides ongoing operating support where needed, and not simply one-time infrastructure funding;

• Inclusion of funding for digital literacy and training local residents in IT skills needed by providers and other organizations; and

• Inclusion of funding for monitoring of service quality in remote/isolated communities.

3131 Procurement Strategy for Aboriginal Business. See FMCC – Final Comments May 25, 2016


114. Concerning the process used to develop a broadband fund such as the NISF, we think that the CRTC has two broad options to consider:

• It can mandate some form of broadband fund, based on recommendations from FMCC and other intervenors; or

• It can convene a special inquiry or other appropriate mechanism to engage all interested parties in drafting a broadband funding mechanism that will meet identified needs, including those of residents of northern, Indigenous and remote communities. If this is the option chosen by the Commission, we would welcome the opportunity to participate in this process.

Institutionalizing the CRTC’s Role in Indigenous Telecommunication Policy and Regulation

115. We believe that the CRTC can play an important role in institutionalizing Indigenous participation in telecommunications policy and regulation. As noted earlier, for years our FMCC members have advocated for the need to include Indigenous peoples in decision-making about the broadband development requirements and activities taking place in their territories and communities. This Hearing has raised numerous issues about services to Indigenous populations across Northern regions of Canada - from the high Arctic to the northern regions of provinces.

116. We believe that the CRTC should establish an internal Office within the Commission with expertise on Indigenous and northern issues. This Office could advise the Commission on Indigenous and northern issues, conduct outreach to Indigenous organizations, and take the lead in establishing a coordinating mechanism for federal Indigenous and communications programs and policies.

117. We refer to the specific example of the U.S. Federal Communications Commission (FCC), which has established an Office of Native Affairs and Policy (ONAP) ( and a National Native American Broadband Task Force. ONAP has provided outreach to Native and Tribal organizations, and has acted as a resource on Indigenous issues within the FCC. ONAP is mandated to work with federally-recognized Tribal governments and Native organizations through regulatory action, consumer information, and community outreach. The FCC also now requires that carriers receiving support to serve tribal lands must engage with tribes. Specifically, they must show how they have met with tribes to discuss service requirements and any problems or issues.

Applying a “one size fits none” policy, ONAP makes any decisions, including funding decisions, on a case-by-case basis, and an internal Office to fulfill a similar role.

118. We recommend that the CRTC establish an office or bureau for northern and Indigenous affairs. This office could also serve as the single point of contact for Arctic broadband policy, as recommended by NBDC (Transcript **** 11, para 1987).

Subsidies: The U.S. Experience

119. We believe that the U.S. experience in subsidies for rural and Indigenous broadband and services to remote communities is relevant for Canada. Contrary to what has been stated by some industry consultants in these proceedings, U.S. universal service programs have been highly beneficial for remote and Indigenous regions of that country. Our expert FMCC – Final Comments May 25, 2016


witness, Professor **** Hudson, testified in the BSO hearing and in Whitehorse about the benefits to Indigenous Alaska communities from these programs. In the 15 years from 1998 to 2013, Alaska received a total of almost $3 billion from these funds, or 3 percent of the total awarded, despite having only 0.23 percent of the U.S. population. Over that period, Alaska schools and libraries received more than $295 million to subsidize broadband access for students and their communities.32 We cite these as examples of a promising approach.

High Cost Subsidies

120. The Federal Communications Commission (FCC) on **** 30, 2016, announced changes in the High Cost Fund component of the Connect America Fund that apply to some carriers (those regulated as rate-of-return). These carriers may accept specific support for a term of 10 years in exchange for meeting defined build-out obligations. They may receive subsidies of up to a total of $200 per customer per month for customers in census areas where costs of service to end users are above $52.50 per month. They must provide an initial minimum usage allowance of 150 GB per month, which over time will increase based on the average usage of a majority of consumers. The flexible nature of this subsidy reflects consideration of ever-changing environments, demographics, technologies and applications.

121. This approach has many advantages: it provides 10 years of predictable funding; it requires specific actual speeds; it caps prices for users; and it sets a relatively high user allowance or data cap. We note that the price ceiling of $52.50 (although in US dollars) is similar to the affordability ceiling noted by K-Net and Obedjiwan, and which these two Indigenous organizations said resulted in losses to the providers that had to be covered from other community sources.

122. We note that in the U.S. reforming high cost support also a work in progress. Chairman **** states that the FCC plans to have specific recommendations for Alaska by the end of the second quarter of this year and for broadband deployment to America’s Tribal areas before the end of the year.

Subsidies for Community Institutions: Schools, Libraries, Rural Health Centers 123. The FCC’s Universal Service Funds (USF) are all ongoing operating subsidies designed to provide affordable services to rural and low income residents, schools and libraries, and rural health facilities. The U.S. Telecommunications Act of 1996 expanded the traditional definition of universal service -- voice service for households -- to include schools, libraries, and rural health care facilities, and to include “advanced services,” which today may be defined as broadband. In Canada, we note that Industry Canada operated the Community Access Program (CAP) up until 2012, which provided similar subsidies and support.

124. The universal service Schools and Libraries Program, commonly known as the E-rate, helps ensure that schools and libraries can obtain high-speed Internet access and telecommunications at affordable rates. Subsidies depend on the level of poverty and location, such as in a rural or remote area. The Rural Health Care Support Mechanism allows rural health care providers to pay rates for telecommunications services similar to those of their urban counterparts.

32 ****, **** E. Connecting Alaskans: Telecommunications in Alaska from Telegraph to Broadband. Fairbanks: University of Alaska ****, 2015.

FMCC – Final Comments May 25, 2016

125. These programs have been highly beneficial to remote Alaska communities in providing broadband for schools and libraries, and connectivity for village clinics. However, their value extends beyond these services because the schools and clinics have become “anchor tenants” for many communities, and because the predictable annual subsidy payments helped to make the business case to upgrade connectivity for the entire community.

Rural Infrastructure Funds

126. The FCC has also introduced several infrastructure or capital subsidy funds targeted to remote and Indigenous regions. It has allocated $100 million per year to a Remote Areas Fund. In addition, a special allocation under the Connect America Mobility Fund is scheduled to provide $50 million capital plus up to $100 million per year for tribal areas to support the build-out of current and next-generation mobile networks in areas where these networks are currently unavailable. In 2013, the FCC held a reverse auction for Phase I of the Tribal Mobility Fund, which distributed $50 million in one-time support for mobile service providers serving tribal lands lacking 3G or 4G service. Phase II of the Mobility Fund provides $500 million annually for ongoing support of mobile services, with up to $100 million of this amount designated annually and exclusively for support to Tribal lands.

127. We believe the FCC’s infrastructure funds and operating subsidy programs provide useful models for the CRTC to consider in developing infrastructure and operating subsidies for Indigenous and remote regions in Canada.

Technology Considerations
Optical Fibre: Infrastructure for the **** Term

128. In its oral testimony, Shaw commented at the hearing: “We don't think the strategy should pick a platform, we think it should pick an outcome” (Transcript **** 26, para 17498).

We concur with this reasoning. However, we believe that if the chosen outcome is to provide required capacity to support ongoing needs and aspirations for community and economic development in rural, remote and Northern regions of Canada, optical fibre is the most likely technology to provide the best long term solution.

129. The number one reason to invest in fibre is because it is “future proof” – investment is needed, so make it once and do it right. Fibre cable is now cheaper to purchase and install than traditional copper or coax cable. It is also lighter, and the equipment for completing the installations and maintenance is affordable and transportable. Fibre cable is much more durable for long-term maintenance purposes. It is also much less weight for transporting to remote regions, including to fly-in communities.

130. For example, the KNET-NAN-Bell fibre network construction business case in northern Ontario demonstrated the cost-effectiveness of fibre over microwave and satellite in delivering the transport solution in that remote part of Canada. In northern Quebec, ECN states that it manages and maintains more than 1,900 KM of fibre-optic cable (Undertaking Filed May 4, 2016). Also, concerning remote northern Quebec, KRG has stated that it intends to build an undersea fibre optic network to all Nunavik communities by the time the five-year satellite capacity lease with SES expires (KRG, Undertaking Filed **** 25, 2016).

131. KNET technicians and the remote First Nations in northwestern Ontario now own and maintain their local fibre connections. The existing coax cable networks in these FMCC – Final Comments May 25, 2016


communities are being upgraded using fibre connections to improve performance and capacity. Since people in these communities had established the required technical and organizational capacity to operate and maintain their networks, they remain involved.

132. We also refer the Commission to a 2015 report from the OECD titled The Development of Fixed Broadband Networks.33 This report provides evidence of the need for fibre optic fixed broadband networks - which, as the report notes, are only increasing in importance.

The report lists the following reasons why fibre is the best underlying technology:

• It is future-proof – its carrying capacity is virtually unlimited. For example, researchers have demonstrated speeds exceeding 100 terabits (the equivalent of 100 000 000 megabits) per second over hundreds of kilometres (p.8).

• It supports other distribution forms, such as wireless broadband. “If anything, the growth of wireless data accentuates the need to focus on fixed network deployment and enhancement. Most Internet traffic still runs over wired connections. Worldwide, according to Cisco, mobile data traffic was 2% of total IP traffic in 2012, and will be 9% of the total by 2017” (p.11).

• It is largely distance-insensitive, while the performance of copper loop systems depends on the length of the loop.

• It is relatively inexpensive to upgrade and has low operational expenses.

• It can be symmetric, while alternative architectures, especially on cable networks, offer relatively limited upstream capacity.34

133. Demand for mobile broadband is also growing dramatically. The growth of mobile data actually increases demand for fixed networks. As the OECD report points out:

“Mobile connections only travel over the air for a short distance, after which they are carried on high-capacity wired connections. The growth of Wi-Fi and other mechanisms for offloading cellular traffic will place greater demands on wired networks” (p.5).

Satellite Considerations

134. However, we realize that there are some very isolated communities, especially in the far ****, where fiber connectivity may not be feasible in the immediate future. For those communities, and others still dependent on satellite, sufficient technical capacity should be provided to meet the CRTC’s bandwidth targets, and prices should not exceed those in terrestrially-served communities. But this must be considered an interim step leading to the end goal of the fibre infrastructure that every community requires.

135. The way that satellite bandwidth is delivered to these communities has implications for development aspirations. We have pointed out in earlier testimony the advantages of the community aggregator model for satellite deployment, which provides a single point-of-presence to a community and allows for local-level ‘first mile’ distribution of connectivity. It is important to determine a required minimum level of bandwidth capable of supporting all the broadband applications required using the whole community framework. Some other interveners noted the benefits of such a model. For example, in its oral testimony, Telesat states:

33 See: 34 OECD. The Development of Fixed Broadband Networks. ****, 2015.

FMCC – Final Comments May 25, 2016

“… satellite capacity is transmitted to an earth station located in a community and terrestrial local distribution facilities are used to connect to individual households, businesses and government buildings. This model is used to provide service in communities like Iqaluit, and others as small as Old Crow with only 100 households. It is economically efficient, reliable and scalable” (Testimony **** 13, para 4338).

136. During these Hearings, we have heard from several industry representatives that a decentralized residential consumer model for broadband delivery - such as that delivered by satellite to individual households - will address the Basic Service objectives. We disagree.

Instead, we are proposing the whole community approach to addressing broadband requirements in remote and rural communities.

137. As illustrated by numerous interveners from remote and northern regions, and from the Commission’s own research (as seen in the Satellite Inquiry and the recent EKOS surveys), decentralized, satellite-based delivery services to individual households are not adequate for consumers, especially those in remote and rural communities. We refer to testimony from several interveners describing low quality of service, inability to support private networking and symmetrical bandwidth, high costs, restrictive data caps, and long wait times for installation and repairs as some of the ongoing problems with such solutions. In their oral testimony, KRG pointed out:

“[Y]ou cannot have a distributed or active directory infrastructure across a high latency network because it doesn’t work. And in spite of the fact that latency can be mitigated for certain applications, once you get into kind of a more corporate level it’s very, very difficult to operate on high latency” (Transcript **** 11, para 536).

138. Individual entrepreneurs stated in their testimony that Xplornet (which provides services through the decentralized model described above), could not be used for a VPN, or for Skype:

“When I received confirmation that I could participate in these hearings, I was told I could present my submission by Skype. The irony wasn’t lost on me. In fact, I cannot reliably use Skype because of frequent interruptions and lost connections on account of the Xplornet service that I have, largely due to the latency no doubt” (Transcript **** 25, para 150280).

139. These kinds of decentralized satellite delivery approaches have received a significant amount of public funding over the years to address digital divides in the ****. However, we cannot be sure of the full extent of that funding because the specifics of that amount - as requested by the Commission in a formal Undertaking - were withheld from the public record due to a designation of the information by the funding recipient as ‘confidential’. We believe that the disclosure of public funds from Canadian taxpayers is a matter of public interest and therefore should be made public and on the record of these hearings. We also note that when requested by the Commission to disclose public funds received by FMCC members in an undertaking, we released that information in our response to CRTC Undertakings, as did several other organizations providing services into the ****.


Final Submission : First Mile Connectivity Consortium (Intervenor 298)

Document Name: 2015-134.224010.2613256.Final Submission (1k0#g01!).html

**** Ms. May-Cuconato,In accordance with the process established by the Telecom Notice of Consultation CRTC 2015-134 dated 9 **** 2015 (as amended), the First Mile Connectivity Consortium (FMCC) files the attached Final Comments. The FMCC is seeking means to ensure access to reliable and affordable broadband in northern Indigenous communities, with engagement of residents of these communities in the provision of services. Importantly, our member organizations support broadband-enabled public services such as online education and telehealth, as well as entertainment services for household consumers. Sincerely,Rob McMahonFirst Mile Connectivity ******@***.com

Final Submission : First Mile Connectivity Consortium (Intervenor 298)

Document Name: 2015-134.224010.2613254.Final Submission (1k0##01!).pdf

First Mile Connectivity Consortium Rob ****, Coordinator

PO Box 104
Fredericton, NB *** ***
Telephone toll free:
1-*-***-***-**** extension 4522
May 25, 2016
Submitted Electronically
Ms. **** May-Cuconato
Secretary General
Canadian Radio-television and
Telecommunications Commission
Ottawa, ON *** ***

RE: Telecom Notice of Consultation CRTC 2015-134 Review of basic telecommunications services — Final Comments from the First Mile Connectivity Consortium (“FMCC”) **** Ms. May-Cuconato,

In accordance with the process established by the Telecom Notice of Consultation CRTC 2015-134 dated 9 **** 2015 (as amended), the First Mile Connectivity Consortium (FMCC) files the attached Final Comments.

The FMCC is seeking means to ensure access to reliable and affordable broadband in northern Indigenous communities, with engagement of residents of these communities in the provision of services. Importantly, our member organizations support broadband-enabled public services such as online education and telehealth, as well as entertainment services for household consumers.

Rob ****

First Mile Connectivity Consortium ******@***.com