Intervention: Province of BC

Document Name: 2015-134.223986.2394492.Intervention(1fbl_01!).pdf
Ministry of Technology, Innovation
and Citizens’ Services
Office of the
Chief Information ****
Province of British Columbia
Mailing Address:
Box 9412 Stn Prov Govt
**** BC *** ***
Location:
4000 **** Place
Telephone: *-***-***-****
Facsimile: *-***-***-****
Email : ******@***.com
Ref: 102862
July 14, 2015
Mr. John Travesty
Secretary General
Canadian Radio-television and
Telecommunications Commission
Ottawa ON *** ***
**** Mr. Traversy:
Re: Telecom Notice of Consultation 2015-134

The Province of British Columbia is pleased to provide the attached comments to the Canadian Radio-television and Telecommunications Commission in response to TNC 2015-134. Our comments have been prepared and are presented by the Office of the Chief Information **** (OCIO) within the Ministry of Technology, Innovation and Citizens’ Services (MTICS).

MTICS performs a dynamic role in government to support the development of an innovative and robust technology industry; to promote the commercialization of technology across B.C.’s key economic sectors; to improve accessible and responsive services and information to citizens; to provide the enabling infrastructure for ministries to transform how government works on a day-to-day basis and to maximize the value and efficiency of services provided by the private sector.

Within the ministry, the OCIO is government’s chief IM/IT strategist; the Provincial OCIO plays a leadership role in promoting and guiding the management of information as a strategic business asset and recognizes technology infrastructure as a foundational component of a strong economy and for transforming service to citizens. The Provincial OCIO collaborates with federal, provincial, local and municipal governments; community organizations; First Nations organizations, and the private sector in support of government’s objectives. One important objective is to stimulate the extension of advanced broadband services to citizens living in rural and remote locations of B.C.

We agree with the Commission’s view that telecommunications plays an important role in the lives of Canadians and enables them to participate in the evolving digital economy. We thank the Commission for the opportunity to make our views known and look forward to the outcome of this proceeding.

Sincerely,
Bette-Jo ****
Associate Deputy Minister and
Government Chief Information ****
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Submission of the Office of the Chief Information **** of British Columbia Telecom Notice of Consultation CRC 2015-134,

Review of basic telecommunications services
Executive Summary

E.S. 1 The issue of extending broadband connectivity throughout Canada has been extensively analysed and discussed by the National Broadband Task Force, the Telecom Policy Review Panel and British Columbia’s Premier’s Technology Council. In each instance, those panels of noted experts concluded that it was imperative that Canadian’s have ubiquitous access to broadband Internet services in order to enjoy all of the benefits that broadband Internet based economies have to offer.

E.S. 2 Private enterprises in British Columbia have expended hundreds of millions of dollars to improve their networks to provide world class network infrastructure supporting modern telecommunications services, particularly in densely populated areas. As well, the Government of British Columbia has collaborated with TELUS, other telecommunications service providers (TSPs) and numerous small Internet service providers (“ISPs”), and has expended tens of millions of dollars to expand broadband Internet services throughout British Columbia.

E.S. 3 Despite the efforts of the Government of British Columbia, and episodic federal incentive programs, there are still access gaps in the provision of modern telecommunications services, including broadband, that need to be addressed if citizens are to enjoy all of the benefits that a digital based economy has to offer.

E.S. 4 Having over a decade of direct experience in trying to close British Columbia’s digital divide, and having worked very closely with British Columbia’s incumbent TSP, other TSPs and ISPs, British Columbia has learned a number of valuable lessons that, if addressed, may contribute to the sustainable provision of affordable broadband services throughout Canada.

E.S. 5 In this submission, British Columbia submits that the Commission’s current target of 5 megabits per second download and 1 megabits per second upload (“5/1Mbps”) is an appropriate current standard that should form part of the basic service obligation (the “BSO”) of incumbent local exchange carriers (“ILECs”) in regulated and forborne operating areas for reasons that will be explained in this submission. This is a moving target that will have to be revisited from time to time to support future modern telecommunications service requirements.

E.S. 6 British Columbia submits that in those areas of Canada that do not have access to modern telecommunications services, as defined by the Commission, including broadband Internet access services, and are not likely to receive such services from private enterprise or through public/private collaborations, that the federal government should create a 2

sustainable fund that can be drawn upon to extend modern telecommunications services into the “gap areas”1.

E.S. 7 British Columbia submits that episodic federal funding, while helpful, does not adequately support sustainable, ubiquitous modern telecommunications for gap areas. Accordingly, British Columbia submits that federal government should be requested to create a special fund (the “National Internet Access Fund” or “NIA Fund”) to be administered in accordance with specified guidelines. A potential source of funding for the NIA Fund may come from some of the proceeds of future spectrum auctions.

E.S. 8 Where ILECs do not provide modern telecommunications services to address gap areas and there are other service providers (“alternate ISPs”) that might be interested/able to do so, such service providers should be able to draw upon the NIA Fund to cover their cost of providing modern telecommunications services in gap areas. Such service providers should also be entitled to realize a reasonable return on their investment in much the same manner as ILECs that have access to the National Contribution Fund (“NCF”).

E.S. 9 Where alternate ISPs endeavor to provide modern telecommunications services into regulated and forborne territories, such service providers should also be able to access the NCF, even though they are not contributors to the NCF, as this would be a practical way to improve broadband connectivity in such locations and stimulate marketplace competition.

E.S.10 It is further respectfully submitted that Industry Canada may want to set aside a portion of spectrum from future spectrum auctions for use by alternate ISPs that provide modern telecommunications services in gap areas. This spectrum could be made available to such service providers at no or minimal cost and subject to reasonable conditions such as “use it or lose it”.

E.S.11 In TRP 2011-291, the Commission commented on the importance of setting a target broadband access speed for 2015. Recognizing that access speed requirements will continue to increase over time, as consumer requirements change and as applications multiply and require higher speeds, British Columbia respectfully submits that with the extensive information that will be presented to the Commission during the course of this proceeding that the Commission should craft a “Canadian Broadband Roadmap” to provide guidelines to the industry as to possible future target speeds and implementation dates. While it is recognized that such a roadmap may only forecast future target speeds, such a roadmap would be of great assistance to industry in general and Canada’s TSPs in particular as they plan and develop their future networks.

E.S.12 Many prominent Canadians have commented on the importance of providing broadband connectivity to all Canadians. Section 7 of the Telecommunications Act speaks of the national telecommunications objectives of “enriching the social fabric of Canada”, providing “reliable and affordable telecommunications services of high quality accessible 1 British Columbia uses the term “gap area” to mean a locale that does not have a government presence such as a library, school or health care facility but has a population cluster.

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to Canadians in both urban and rural areas in all regions of Canada”, “[encouraging] innovation in the provision of telecommunications services” and “[responding] to the economic and social requirements of users of telecommunications services”. With all of the evidence, submissions and public presentations that will be presented to the Commission during the course of this proceeding, British Columbia respectfully submits that the Commission should be able to devise a regulatory solution to the vexing problem of permanently closing Canada’s digital divide.

E.S.13 British Columbia respectfully submits that the creation of a Canadian Broadband Roadmap; revisions to the NCF to allow non-contributors to draw from that fund in certain cases; the creation of a NIA Fund; the possible reserve of spectrum for use by service providers interested in providing modern telecommunications services to unserved, underserved and gap areas would all contribute to the closure of Canada’s digital divide.

E.S. 14 However, British Columbia also respectfully submits that the provision of modern telecommunications services throughout Canada also requires collaboration between federal, provincial, territorial and Canada’s First Nations representatives. While British Columbia and some provinces have assigned, the task of addressing modern telecommunications issues to their administration, the federal government has not assigned the responsibility for collaborating with the provinces, territories and First Nations on the fundamentally important task of devising a strategy to address the provision of modern telecommunications services as envisioned in s. 7 of the Telecommunications Act to any particular department. Such collaboration could also be used to align federal/provincial/territorial modern telecommunications initiatives (funding and strategies), share best practices, resources and information.

E.S.15 In summary, British Columbia respectfully submits that while an innovative regulatory framework is part of the solution, collaboration is an equally important component to the vexing problem of creating a sustainable solution to Canada’s digital divide. This proceeding can be used, in part, to articulate just such a solution.

Introduction

1. The Government of British Columbia is pleased to provide comments to the Canadian Radio-television and Telecommunications Commission (the “Commission”) in response to Telecom Notice of Consultation 2015-134 (“TNoC 2015-134”), review of basic telecommunication services (“BSO”).

2. The Ministry of Technology, Innovation and Citizens’ Services (“MTICS”) of the Government of British Columbia is responsible for supporting the development of an innovative and robust technology industry; promoting the commercialization of technology across BC’s key economic sectors; improving accessible and responsive services and information to citizens; providing the enabling infrastructure for ministries to transform how government works on a day-to-day basis; and maximizing the value and efficiency of services provided by the private sector to government.

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3. Within the MTICS, the Office of the Chief Information **** (“OCIO”) is government’s chief IM/IT strategist. The OCIO plays a leadership role in promoting and guiding the management of information as a strategic business asset and recognizes technology infrastructure as a foundational component of a strong economy and for transforming service to citizens. The OCIO also collaborates with federal, provincial, local and municipal governments, community organizations, First Nations organizations and the private sector in support of government’s objectives.

4. Within the OCIO, Network BC (“NWBC”) was initially created as a project office within government and has been responsible for a number of important government initiatives including the development of telecom policies and strategies (including the presentation of several regulatory submissions to the Commission) for the advancement of British Columbia’s e-government, e-health, e-education and broadband Internet expansion initiatives. NWBC continues to work closely with local ISPs by assisting them in their efforts to extend broadband Internet services throughout British Columbia. Given the Government of British Columbia’s extensive efforts to bridge its digital divide since 2001, the NWBC has a clear understanding of the geographic and financial challenges facing ISPs that have played an ongoing and critical role in enabling our citizens to participate in the digital economy.

Background Information to Canada’s Information Superhighway 5. The issue of the importance of the Internet to Canadians, now characterized by the federal government as the importance of enabling Canadians to participate in the digital economy, has been previously investigated, studied and commented upon by the Minister of Industry, the Telecommunications Policy Review Panel, British Columbia’s Premier’s Technology Council and, the Commission itself on past occasions.

6. It will be remembered that in 2001 the Minister of Industry struck the National Broadband Task Force (the “NBTF”) that researched and released a report entitled “The New National Dream: Networking the Nation for Broadband Access” 2. (the “National Dream Report”)

7. In its report, the NBTF said that:

We believe, as a matter of urgency, that all Canadians should have access to broadband network services so that they can live and prosper in any part of the land and have access to high levels of education, health, cultural and economic opportunities.3 (underscore added) 8. The NBTF, and later the Telecom Policy Review Panel (“TPRP”), both said that the only way to provide Canadians with access to broadband services would have been to have 2 http://publications.gc.ca/collections/Collection/C2-575-2001E.pdf (National Task Force Report) 3 National Dream Report, “Overarching Principle”

http://publications.gc.ca/collections/Collection/C2-575-2001E.pdf5

created a national network to which all Canadians would have had access. The TPRP referred to this as the “Ubiquitous Canadian Access Network” or UCAN.

9. While one might have not agreed with the UCAN concept, the TPRP’s following observation remains valid today:

The challenge of achieving ubiquitous access to telecommunications networks is ongoing and evolves anew with each new generation of technology. In the 1990s, connecting all Canadian schools through dial-up modem was an innovative and pioneering objective, but today this objective is no longer sufficient. Current broadband networks represent a quantum advance over traditional telephone networks. However, they are only the latest stage in the evolution of telecommunications networks. They will be surpassed as the capacity of networks continues to evolve in response to demand for new services and applications. The fivefold increase in broadband speed that took place between 2000 and 2005 is the beginning of the broadband story, not the end. As broadband and other technologies evolve, our continuing challenge will be to ensure that modern telecommunications technologies become available to all Canadians within a reasonable period of time.4 (underscore added)

10. In Question 2 of Appendix B to TNoC 2015-134 the Commission posed the question “Are these targets [5/1Mbps] sufficient to meet the minimum needs of Canadians today?” With all due respect, the issue is not whether the current speed target is minimally sufficient to meet current requirements but rather, “the continuing challenge to ensure that modern telecommunications technologies become available to all Canadians within a reasonable period of time”. One should not limit one’s view to only today’s requirements. Rather, one should build a foundation (regulatory, structural and financial in this case) to meet current and future requirements on a sustainable basis.

British Columbia’s efforts to close its digital divide

11. In 2001 British Columbia’s Campbell government appointed a “Premier’s Technology Council” (the “PTC”) that was directed to advise the Premier on a number of technology related issues. As indicated to the Commission in NWBC’s Deferral Account Submission (May 2004) at that time of 366 British Columbia communities 215 communities had broadband access while 151 did not. The PTC defined a “community” as a location where there was a library, public school or health facility.5 At that time, broadband access was considered to be 1.5Mbps for residential and 10Mbps for businesses.

12. In its Deferral Account Submission NWBC estimated the then cost of closing British Columbia’s existing digital divide in certain specified communities would exceed $100 million.6 While some parties may have been critical of the Commission for directing that a significant part of ILEC Deferral Account funds be used to extend broadband 4 TPRP Final Report, 8-4

5 NWBC Deferral Account Submission, May 21, 2004, para. 2.1 6 NWBC Submission, Part 3.0

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connectivity, the Government of BC and TELUS worked very closely to use TELUS’ Deferral Account funds to extend broadband coverage throughout British Columbia.

Through the Deferral Account, TELUS expended some $100 million to upgrade its facilities to extend broadband connectivity in British Columbia. While allocation and use of the TELUS’ Deferral Account was a good example of targeted spending and public/private sector collaboration/cooperation resulting in truly beneficial outcomes, there were limits as to the permitted use of TELUS’ Deferral Account fund.

13. Over the past decade the Government of British Columbia has continued in its efforts to increase the number of internet access points of presence (“POPs”) throughout the province. The following is a list of initiatives that British Columbia has undertaken to improve broadband connectivity.

• Government negotiated a Connecting Communities Agreement with TELUS whereby TELUS invested over $100 million to extend broadband POPs to 119 communities and provide discounted network backhaul access services to small, regional ISPs.

• Subsequently, government negotiated telecommunications service agreements with TELUS whereby TELUS agreed, amongst other things, to extend its cellular network by over 1,700 kilometres on primary and secondary highways. TELUS also agreed to provide higher speed, discounted network backhaul access services to British Columbia’s small, regional ISPs.

• British Columbia applied for and was granted satellite spectrum under the NSI 1 program and has expended over $1 million dollars in operating costs for the use of that spectrum. That spectrum has been used to extend broadband services to remote communities of British Columbia.

• Over the past decade, British Columbia has initiated and/or sponsored a number of financial grant programs to assist ISPs in the provision of local and last mile services including:

o A significant financial contribution to Gwaii Tel Society for a microwave connection between the mainland and Haida Gwaii.

o A number of grant programs totaling to an estimated $10 million in funding assistance to small ISPs to improve their provision of broadband Internet services throughout British Columbia.

o British Columbia worked closely with Health Canada and Aboriginal Affairs and Northern Connectivity in expending over $30 million to address First Nations connectivity issues.

o The province granted the All Nations Trust Company (ANTCO) $40.8 million that also includes $17.5 million from Health Canada. These funds are being used to connect 203 First Nations communities in B.C.

Aboriginal Affairs and Northern Development Canada also provided $14.2 million to ANTCO to help connect First Nations communities. The total amount of federal/provincial investments to date provided to help connect First Nations communities is $55 million.

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o In 2014, British Columbia allocated $2 million to launch the BC Broadband Satellite Initiative to address connectivity to remote areas where no other terrestrial options exist.

14. In addition to other capital expenditures required to improve and expand its network in British Columbia, TELUS has expended hundreds of millions of dollars over the past 10 years in collaboration and cooperation with government to improve broadband access across British Columbia.

15. TELUS, Shaw, Bell, Rogers and others have also expended hundreds of millions of dollars to improve and upgrade their networks across Canada for the provision of modern telecommunications services and yet the digital divide persists.

What have British Columbia’s investments into broadband Internet access achieved?

16. In British Columbia, the provincial government has taken a lead role in attempting to close the digital divide.

o Through concerted efforts, the government’s negotiations with TELUS resulted in the execution of a number of agreements that have addressed some of British Columbia’s connectivity challenges;

o Government has worked with TELUS to strategically expend TELUS’ deferral account funds as directed by the Commission in TRP 2008-1;

o Government has invested considerable effort (including the creation of a specific program office that is responsible for devising telecom strategies and optimizing the acquisition of telecom services) and has provided grants to small ISPs to extend their broadband coverage. Government has also assisted small ISPs in their efforts to secure federal funding from various federal programs.

17. However, there are still a number of broadband access gaps in British Columbia where consumers either have no access to broadband Internet services (the “gap areas”), or where service speeds fall below the 5/1Mbps target set by the Commission.

18. While the 5/1Mbps target is typically met in urban areas, meeting that target is far more challenging in the remote areas of British Columbia. In fact, it is estimated that approximately 7% of British Columbia’s citizens reside in gap areas that have no access to broadband.

19. British Columbia continues in its efforts to develop strategies and liaise with others, such as representatives and organizations from First Nations, the Commission, Aboriginal Affairs and Northern Development Canada (AANDC), Industry Canada and Health Canada to find ways to address British Columbia’s digital divide issues. What is missing are federal government representatives that are specifically charged with the responsibility of finding solutions to Canada’s digital divide.

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Responses to Appendix B Questions

1(a) Canadians are using telecommunications services to fulfill many social, economic, and cultural needs in today’s digital economy. a) Explain how telecommunications services are used to meet these needs. For example, uses may include e-commerce (i.e. the online purchase and trade of products or services), e-banking and/or telephone banking, e-health or tele-health services, tele-work, and distance education. Which of these uses of telecommunications services are the most important to ensure that Canadians meaningfully participate in the digital economy?

20. British Columbia submits that there are few aspects, if any, of our daily lives that do not rely on some form of telecommunications services, modern or otherwise, and that it is impossible to suggest that one telecom service mode is more or less important than another. If one has an e-commerce business, then e-health might not be all that important.

If one requires reliable, high capacity broadband access for on-line education activities, then e-banking might not be all that important. It is all a matter of perspective as to what one requires to meaningfully participate in the digital economy. What really matters is that quality, high capacity, low latency bandwidth needs to be ubiquitously available to serve and support the requirements of all Canadians, individually and collectively, as and when they so require. This is part of the underlying imperative that is so very carefully articulated in section 7 of the Telecommunications Act.

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

21. Importance depends on user requirements. If one relies on mobile wireless services, then one expects that those services will be available seamlessly and everywhere, not just in some locations. Dropped calls are particularly annoying! This is important for both safety and convenience.

22. If one is trying to conduct a VOIP or similar video-conference call, then high-speed, low latency attributes are important otherwise the user cannot benefit from the advantages that technology has to offer and that are available elsewhere in the world. Or, if a health care professional is attempting to perform a health related service, such as remote heart monitoring via a secured internet connection or some other form of health care service, latency could have negative consequences.

23. Modern telecommunications services rely on high broadband capacity to quickly deliver content. Accordingly, something considerably more than “adequate” speed is essential. It is not a matter of choosing one attribute over another. Rather, all of the referenced infrastructure attributes are essential to support the provision of modern telecommunications services.

1(c) Identify and explain the barriers that limit or prevent Canadians from meaningfully participating in the digital economy (e.g. availability, quality, price, digital literacy, and 9

concerns related to privacy and security). Identify which segments of the Canadian population are experiencing such barriers.

24. In British Columbia, people living in gap areas are becoming increasingly distanced from the digital experience. They cannot receive and enjoy the benefits of online entertainment that urban residents have come to expect and enjoy due to the unavailability of broadband Internet access; they do not enjoy Commission targeted Internet speeds in some locations;

and home-based education is limited due to lack of affordable connectivity. As e-health services become more pervasive, gap area citizens still have to travel for some of their health care related services because they do not have the required Internet services to support e-health applications. Indeed, setting higher target speeds does not help people living in gap areas – it only serves to further distance such citizens from the digital experience.

25. British Columbia further respectfully submits that even if our gap residents had access to broadband Internet services, some of those residents may not have the requisite digital literacy skills to enjoy the benefits that a digital economy has to offer. This is something that could be addressed through the school system and at home if affordable and reliable broadband access was more pervasive.

26. Canada benefits from having strong, small communities. Not having access to the digital economy is just one more factor that drives residents from small communities to communities where better services are available. Rural citizens, having had access to dial-up Internet, are now left wanting while urbanites benefit from rapidly increasing broadband speeds and service competition while some rural citizens only have access to 1.5Mbps or slower access speeds. As well, it appears that availability and affordability concerns also apply to mobile wireless data services. This reality does not align with the federal government’s goal of improving broadband connectivity throughout Canada.

27. In summary the barriers are (1) telecommunications service disparities between urban and many rural and gap communities; (2) instances of digital illiteracy; (3) inadequate broadband access in some rural areas; (4) no broadband access in gap areas; and (5) the high cost of alternate (satellite and mobile wireless) broadband Internet services to rural and remote communities.

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

28. The devices that enable Canadians to participate in the digital economy include wireless devices, wearables, RFI enabled pill dispensers (that monitor and report use of prescribed medicines), **** TV’s, data enabled watches and cameras, monitoring devices (be they health, in-home security, kitchen appliances, etc.) and the plethora of devices that have yet to be devised but will be created in the near future.

29. Another application that is starting to appear is “virtual reality”. For example, virtual reality is being used to “virtually experience” things such as “climbing **** Everest” or, 10

more recently, the treatment of war veterans that are experiencing post-traumatic stress disorders. One can only imagine how virtual reality might be used for health care, science, education and entertainment purposes in the future. However, strong, robust and reliable broadband Internet service is the very foundation upon which all other enablers must rest. The best application or device in the world is of very little use without a network to support the same.

30. A strategy that would advance the ability of Canadians to meaningfully participate in the digital economy would be Canada-wide collaboration between the federal government, the provinces, territories and First Nations. A more formalized information sharing approach would contribute to the sharing of ideas, identification and development of best practices and improved outcomes for all Canadians.

31. Finally the Commission itself is a critical enabler by framing the important questions regarding Canadian broadband Internet access requirements; the creation of a flexible yet prescriptive framework to advance the provision of broadband connectivity throughout Canada; addressing issues related to sustainable funding to provide broadband Internet access into the gap areas; and charting a Canadian Broadband Roadmap that all service providers will be able look to for guidance as they develop their respective access networks.

32. It is almost impossible to predict what services Canadians will require 5 to 10 years from now because technology changes so rapidly. What might be trendy today might not even be in use 5 years from now. Remember PCS2? Introduced but never put into use. The desk-top computer? All but gone. Data centres? **** the cloud replace those or redefine user requirements? What is happening to traditional Over the Air programming? **** online content replace Over the Air and what implications does this have regarding the use of broadcasting and telecommunications to promote and foster Canada’s national identity?

Who can really predict what the next “must have” application or disruptive but ultimately important technology will be in 5, much less 10 years from now? We hope that the Commission will invite industry leaders to present their thoughts on this important question to the Commission as part of this proceeding.

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

33. Perhaps all that can be said is that Canadians require a robust, scalable, affordable and ubiquitously accessible network that is capable of supporting the rapid, reliable and safe transmission of data. At the heart of the issue is ubiquitous availability, capacity, reliability and network security.

2 - The Commission’s current target speeds for broadband Internet access service are a minimum of 5 Mbps download and 1 Mbps upload, based on uses that consumers should reasonably expect to make of the Internet. Are these target speeds sufficient to meet the 11

minimum needs of Canadians today? If not, what should the new targets be and what time frame would be reasonable to achieve these new targets?

34. In TRP 2011-291, the Commission observed that required broadband speeds at reasonable rates would be required to meet changing requirements. The Commission summarized the issue as follows:

The Commission notes that the ubiquity and speed of broadband Internet access at reasonable rates is becoming more important for Canadians in the achievement of a number of social, economic, and cultural objectives. Canadians will change their patterns of viewing and interacting with digital media as they increasingly consume and produce directly through the Internet. Their requirements for broadband speeds will grow, just as their requirements for the processing capacity of their computers have grown. What was an acceptable speed in one year will be regarded as slow a few years later. The Commission expects that Internet service providers will keep pace with these requirements. The Commission considers that the freedom to use communications media at reasonable rates will be a primary concern for all Canadians in the years ahead.7 (underscore added) 35. The Commission concluded that:

To accommodate such uses, the Commission considers that the appropriate target speeds for broadband Internet services are a minimum of 5Mbps download and 1Mbps upload. The Commission notes that, while many Canadians in urban areas already have access to broadband Internet services at or above these target speeds, such speeds are not currently available to most Canadians in rural and remote areas.8 (underscore added)

36. British Columbia submits that the Commission has already answered its own question.

“What is acceptable in one year will be considered slow in a few years.” Accordingly, British Columbia respectfully submits that the Commission develop a vision or “Canadian Broadband Roadmap” to ensure that service providers have a clear understanding of what speeds may be required in the next 5 to 10 years.

37. It is also respectfully submitted that setting target speeds may only be part of the solution.

That is, fibre based networks need to be constructed throughout Canada, including into the gap areas, if current and future target speeds, high throughput and low latency requirements are to be sustainably met.

Why should the Commission consider developing a Canadian Broadband Roadmap?

38. It is respectfully submitted that with the insights, submissions and evidence provided to the Commission through this proceeding, the Commission will have the clearest, latest and most independent view of the digital experience requirements and expectations of 7 TPR 2011-291, para. 71

8 TPR 2011-291, para. 76
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Canadians now and into the future; the adequacy and future sufficiency of various target speeds; technology and future application requirements; Canadian service requirements and expectations, including who will be best able to provide such services; respective roles; etc. With this considerable information in the hands of the Commission, a Canadian Broadband Roadmap would go a long way to expressing future target speeds, roles, responsibilities and Canadian requirements.

3 - Which services should be considered by the Commission as basic telecommunications services necessary for Canadians to be able to meaningfully participate in the digital economy? Explain why.

Regulated service areas – dial up internet services

39. In regulated service areas, where the ILEC has the obligation to serve, British Columbia submits that the absence of alternate ISPs is prima facie evidence that reliance on market forces to provide modern telecommunications services may not be a workable strategy.

40. In such cases, until an alternate service provider appears and the ILEC is able to make a case for forbearance, British Columbia respectfully submits that the ILEC should be obliged to meet the Commission’s 5/1Mbps target speed at affordable rates.

41. To offset any additional cost of providing 5/1Mbps Internet access service, the ILEC should be able to call upon the NCF for subsidized funding as might be approved by the Commission.

42. The circumstances where the ILEC should be required to provide 5/1Mbps Internet access should be where: (1) market forces have not resulted in the provision of 5/1Mbps services by an alternate ISP; and (2) targeted government funding has not attracted alternate ISPs to provide such 5/1Mbps services.

43. Indeed, the Commission previously concluded that there would be some cases where incumbent local carriers would likely be in the best position to provide basic services to some areas of Canada. In particular, the Commission stated the following:

56. The Commission considers, however, that a bidding process would make administration more complex, and would unduly slow the implementation of basic service in certain high-cost areas. Given the small number of Canadians without access to telephone service, the Commission is of the view that establishing a new bidding mechanism to provide basic service is not warranted.

In the Commission's view, incumbent local carriers, with their widespread infrastructures, will likely be the only providers of service to these areas in the foreseeable future. (underscore added)

57. Given the relatively small number of Canadians in scattered locations that do not have access to service that meets the basic service objective, the Commission finds that the most appropriate approach in high-cost areas is for incumbent local 13

carriers to provide service over a reasonable time period. The Commission is of the view that extending service to those now unserved is generally the responsibility of the incumbent local carrier providing service in that territory.

44. British Columbia respectfully submits that the logic that the Commission applied to the provision of basic services is equally applicable to the issues of providing 5/1 Internet service access. That is, the incumbents are still in the best position to provide basic services in “scattered locations that do not have access to service that meets the basic service objective”, Further, based on British Columbia’s experience in trying to close the digital divide, that reality remains today and is not likely to change any time soon. The “foreseeable future” has yet to come, though it is an issue that the Commission should consider revisiting some years from now.

45. It is further respectfully submitted that if an ISP were to present itself in a regulated serving territory and if the ILEC is able to demonstrate to the Commission’s satisfaction that the ILEC has actually lost 50% of its customers to the alternate ISP (as opposed to 25% as prescribed in Telecom Decision 2006-15) then the Commission could always issue a forbearance order and allow that market to freely operate. The reason for the change to 50% from 25% is as follows: the alternate ISP should have sufficient opportunity to provide and develop its services with the aim of establishing a competitive market.

Forborne service areas – still requires ILEC provided broadband Internet access 46. According to TRP 2011-291, ILECs will be relieved of their obligation to provide basic services where the ILEC is granted a forbearance order. What is not clear from TRP 2011-291, is whether relieving the ILEC of that service obligation also relieves the ILEC from providing dial-up Internet services, as the Commission seems to have focussed on voice services.9

47. If it were the Commission’s intention to continue requiring ILECs to provide dial-up services in forborne service areas, it is British Columbia’s respectful submission that such obligatory services should be replaced with the Commission’s new target of 5/1Mbps by the end of 2015.

48. Alternatively, if it were the Commission’s intention to eliminate the obligation to provide dial-up Internet access services within forborne service areas where the ILEC demonstrates to the Commission’s satisfaction that the forbearance threshold has been met, this could lead to the unintended outcome that some consumers in that territory would either be left without Internet access or might only have access to higher cost wireless data or satellite services.

49. Accordingly, British Columbia respectfully submits that ILECs should be obligated to provide 5/1Mbps Internet access services within forborne serving areas until the ILEC can 9 TRP 2011-291, para. 48, 49

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establish to the Commission’s satisfaction that a competitor is actively operating within that serving area; is providing reasonably priced 5/1Mbps services; and that the ILEC has actually lost 50% of its Internet customers to an alternate ISP.

50. When determining whether or not a competitor is “actively operating within a serving area”, the Commission may want to assess the attributes of the competitor’s offering including service level obligations/agreements; network integrity/security; and all costs to the consumer on a “like for like” basis.

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

51. If what the Commission is asking is whether mere ownership of cable, digital subscriber line, fibre, fixed wireless, mobile wireless and/or satellite technology should determine whether or not the owner should also have the obligation to provide specified basic services, British Columbia submits that facility ownership may not be the appropriate regulatory tool. Rather, the obligation to serve stems from the fact that ILECs, as historical monopoly service providers, have consequential obligations to provide basic telecommunications services in fulfilment of their regulatory obligations. The obligation to serve has only ever been the obligation of the monopoly service provider and has not been associated with the underlying infrastructure.

52. Alternatively, if what the Commission is asking is whether infrastructure ownership should be considered by the Commission in determining whether or not the owner should also have the obligation to provide basic services, British Columbia respectfully submits that such a requirement would undermine previous Commission decisions, particularly as related to non-dominant carriers and other facility based carriers.

53. For additional clarity, mere ownership of the underlying infrastructure should not be a consideration in determining the obligation to serve.

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

54. British Columbia agrees with the Commission’s description of the BSO as expressed in TRP 2011-291 with the exception that British Columbia respectfully submits that the commission should consider having ILECs provide 5/1Mbps Internet services (as opposed to dial-up services) as part of the BSO until the ILEC can establish to the Commission’s satisfaction that an alternate ISP has actually secured at least 50% of the ILEC customers within a particular operating area. The concern here is that relieving the ILEC from the BSO on the basis of meeting the voice threshold could leave the remaining citizens, particularly in peripheral areas, having no Internet services other than satellite or wireless data, both of which may not meet the Commission’s affordability targets. A situation 15

where consumers only have the option of one type of service seems to be inconsistent with the overriding principle of consumer choice and marketplace competition.

55. For further clarity, the Commission should consider replacing the dial-up Internet BSO by the 5/1Mbps target in regulated and forborne areas at affordable rates where alternate ISPs have not secured at least 50% of the ILECs customers.

56. While targeted government subsidies might motivate alternate ISPs to offer their services in certain unserved and underserved areas, the Commission should consider having the ILEC provide BSO broadband services at a future date in the event that the alternate ISP fails to provide comparable services.

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

57. In forborne areas, it appears that broadband service providers set their prices competitively; therefore, prices are determined by the marketplace.

58. Should the Commission decide that 5/1Mbps services form part of the BSO, then in such cases, those services should be provided to consumers at affordable rates, as prescribed by the Commission.

59. It is respectfully submitted that s. 7(b) of the Telecommunications Act directs that all telecommunications services should be “affordable” and “available in both urban and rural areas”. To create a regulatory regime that would result in the creation of a two or multi-tier access/cost regime would not be consistent with s. 7(b). There needs to be symmetry.

It may be that in some places it will take time for rivalrous marketplace competition to emerge. Until then, regulatory directives and funding subsidies will be needed to provide universal and affordable services.

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

Market forces and government funding

60. In a properly functioning marketplace, multiple service providers compete with each other for the customer. They do so by investing in and upgrading their service offerings, marketing, building their brand, bundling their service offerings, etc. They use their skills, expertise and market intelligence to promote and sell their services to existing and prospective customers. In such cases, British Columbia submits that government funding to stimulate competition in already competitive marketplaces is not required.

16

61. The question is not “can” but “should” government funds be relied upon to ensure that Canadians have access to modern telecommunications services and, if so, in what cases?

Role of the federal government to fund broadband expansion 62. In TRP 2011-291, on considering the complexities and requirements related to providing Canadians with access to broadband Internet services, the Commission set a broadband Internet target of 5/1Mbps by the end of 2015. The Commission also noted that “service gaps remain in rural and remote areas for broadband Internet access”10.

63. In cases where such gaps exist, British Columbia respectfully submits that the federal government should continue to provide the funding required ensuring that the Telecommunications Act objectives are sustainably financed where provinces, local governments and/or private/public collaborations cannot close the service gaps. British Columbia suggests that one approach might be for the federal government to create a sustainable NIA Fund and to set-aside a certain amount of spectrum capacity for use by alternate ISPs at no cost to them.

Role of the provinces
64. By way of example, British Columbia:

• created a designated office (NWBC) within the OCIO that has been mandated to develop and execute strategies to extend broadband connectivity throughout British Columbia;

• collaborated with TELUS in respect to the use of TELUS deferral account funds to extend broadband connectivity in British Columbia;

• negotiated a number of agreements with TELUS to extend broadband access to 119 unserved and underserved communities;

• negotiated with TELUS discounted backhaul and ISP access to Points of Presence throughout British Columbia;

• has worked closely with a number of small ISPs providing them both grants and strategic assistance in their connectivity endeavors;

• has expended tens of millions of dollars to extend broadband Internet to unserved and underserved areas of British Columbia resulting in approximately 93% broadband coverage;

• has often consulted with the Commission and is working with Industry Canada to develop strategies to improve broadband connectivity throughout British Columbia.

• has worked with First Nations to address connectivity gaps in First Nations communities.

65. Despite all of these concerted efforts, 7% of British Columbia’s population is still either unserved or underserved by broadband Internet services. British Columbia knows this is 10 TRP 2011-291, para. 55

17

the case because it has expended time, effort and financial resources over the past decade assisting small ISPs that provide services to unserved and underserved areas. Other provinces and territories have developed their own connectivity strategies and should individually address this issue. While there may be one national objective, there will be many ways to achieve that objective along with a number of provincial and territorial variations.

The private sector

66. It is respectfully submitted that the role of the private sector (i.e. ILECs, non-dominant carriers, other facility based carriers, businesses, small ISPs, etc.) in closing Canada’s digital divide depends on the nature of the connectivity challenge in each province and territory. What works for British Columbia may not necessarily work in other Provinces or Territories for any number of reasons including geography, climatic conditions, presence of service providers, government ownership of the service provider, etc. So, it might not be advisable to try to create a “one-size fits all” regulatory solution. In British Columbia, government has collaborated with TELUS to address some of government’s requirements and imperatives and TELUS has made changes to its network to address some of those requirements and expectations. However, even with such cooperation and extensive collaboration with TELUS, third parties and other service providers, a number of service gaps still exist that cannot be closed through such concerted efforts and collaboration.

Municipalities

67. British Columbia is advised that the Union of British Columbia Municipalities will be filing a submission with the Commission and therefore defers to its comments on this issue.

First Nations

68. British Columbia is advised that the ANTCO – a wholly owned First Nations organization) will be filing a submission with the Commission and therefore defers to its comments on this issue.

Reliance on federal funding to “close the gaps”

69. While the federal government has made significant contributions to closing Canada’s digital divide over the years, the problem is that such funding has been episodic.

According to the TPRP, the federal government allocated approximately $600 million in the decade up to 2005. $225 million was allocated through the Connecting Canadians fund in 2008 (not all of which was actually awarded) and $300 million was announced in 2014 for the Digital Canada 150 program.

70. British Columbia respectfully submits that while programs such as BRAND, the Connecting Canadians and Digital Canada 150 programs have most likely been welcomed 18

by ISPs, the episodic nature of such programs has made it challenging for ISPs between programs, particularly as technology races forward and ongoing investments are required.

71. British Columbia respectfully submits that to address such reinvestment and sustainability issues, the federal government may consider creating a NIA fund to ensure that all Canadians have access to a world class, scalable broadband Internet infrastructure system.

Further, it is respectfully submitted that bandwidth from future spectrum auctions may also be set aside for use by non-ILEC service providers, at no charge or cost to them, subject to “use it or lose it” stipulations. In other words, both funding and “in specie” spectrum allocation may be used to address the issue of program sustainability.

72. An adequately funded NIA Fund, accessible to existing or new ISPs, would ensure that such ISPs would have access to the capital required to construct and upgrade their infrastructure as and when required and, perhaps, stimulate local competition thus, at some future point in time, enabling ILECs to apply for forbearance orders. Further, a NIA Fund would be sustainable as opposed to being episodic in nature.

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

73. The starting point is section 7 of the Telecommunications Act. In answering this question, British Columbia submits that the following objectives are particularly germane.

7. It is hereby affirmed that telecommunications performs an essential role in the maintenance of Canada’s identity and sovereignty and that the Canadian telecommunications policy has as its objectives

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

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

(c) to enhance the efficiency and competitiveness, at the national and international levels, of Canadian telecommunications;

(d) ...
(e) ...

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

(g) to stimulate research and development in Canada in the field of telecommunications and to encourage innovation in the provision of telecommunications services;

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

19
(i) ...

74. In fulfilling its role as Canada’s telecom regulator, British Columbia respectfully submits that the Commission is obligated to develop regulatory strategies that fulfill the Telecommunications Act objectives and the Policy Direction.

75. By devising and recommending the adoption of a Canadian Broadband Roadmap the Commission would be fulfilling its mandate to “facilitate the orderly development throughout Canada of a telecommunications system that serves to safeguard, enrich and strengthen the social and economic fabric of Canada”. The Roadmap could be used to point the way to the orderly development of a strong Canadian telecommunications system.

76. Where market forces do not adequately fulfill these national telecom objectives within the meaning of s. 7(f), the Commission is obliged to devise an “innovative” approach to the provision of modern telecommunications services in order to “respond to the economic and social requirements of users of telecommunications services”. British Columbia respectfully submits that the existence of Internet access gaps and regulated areas clearly indicates that there are no, or are only limited prospects for market forces to prevail in such areas. This reality calls for a regulatory strategy to addressing the problem of creating a ubiquitously accessible modern telecommunications industry in Canada.

77. In British Columbia’s respectful view, the following suggestions could be considered:

• the Commission to compose a Canadian Broadband Roadmap as described herein;

• where alternate ISPs are unable to meet the Commission’s prescribed target speeds, the Commission should work with those entities to understand the root cause of the problem and devise creative solutions to the same;

• alternate ISPs to have access to the NCF even though they do not contribute to the same;

• the Commission to encourage the federal government to create a NIA Fund and possibly set-aside bandwidth from future spectrum auctions for use by alternate ISPs; and

• federal/provincial/territorial and First Nations to be encouraged to collaborate with each other to address modern telecommunications challenges and create a specific office for that task.

78. In British Columbia’s respectful view, should all of this be done, the Commission would fulfil a fundamental section 7 objective being the “orderly development throughout Canada of a telecommunications system that serves to safeguard, enrich and strengthen the social and economic fabric of Canada and its regions”.

6 - In Telecom Regulatory Policy 2011-291, the Commission stated that it would closely monitor developments in the industry regarding the achievement of its broadband Internet target speeds to determine whether regulatory intervention may be needed. What action, if 20

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

79. TNoC 2015-134 will not close until May 2016 and it could take upwards of a year for the Commission to assess the evidence and issue its decision - which takes us to late 2016 or perhaps early 2017. Accordingly, British Columbia respectfully submits that the Commission should devise a Canadian Broadband Roadmap that suggests prospective target speeds and dates that reflect expected consumer requirements over the next decade.

80. Creating a Canadian Broadband Roadmap will be made easier for the Commission since it will have, through the course of this proceeding, a clear understanding of current consumer requirements/expectations (Question 1); consumer requirements over the next 5 to 10 years (Question 1(e)); the adequacy of the 5/1Mbps target (Question 2); and consumer future expectations (Question 5).

81. British Columbia respectfully submits that the Commission needs to also review the coverage maps that have been filed as part of the Digital Canada 150 program as that information will provide to the Commission a concise, up to date summary of Canada’s broadband coverage and gap areas out to 2017.

82. Finally, it is respectfully submitted that while the Commission needs to continue to monitor industry progress in meeting future targets, the Commission may consider devising strategies to assist those services providers (such as small ISPs) that are experiencing difficulties in meeting future target speeds and service requirements.

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

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

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

83. British Columbia did not participate in the proceeding leading to TRP 2013-711 and does not feel that it has sufficiently informed insights to suggest whether the Commission should or should not develop a mechanism to support the provision of modern telecommunications services in the Northwestel operating territory. However, having government health care and other services in the Northwestel operating territory, British 21

Columbia can advise that enhancement to Northwestel’s service offerings would have a beneficial impact on the delivery of government services within that territory.

84. British Columbia also notes that data communication costs in the Northwestel operating territory appear to be significantly higher than the data costs paid by government elsewhere in British Columbia. .

85. Overall, British Columbia respectfully submits that a funding mechanism could have a positive and beneficial impact on citizens within British Columbia’s portion of the Northwestel operating territory as the introduction of modern telecommunications services could lead to improved citizen access to all government services; be they federal, provincial or municipal, including e-commerce, e-health outcomes and e-government services generally.

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

86. British Columbia respectfully submits that the BSO should be modified to have ILECs provide modern telecommunications services, including 5/1Mbps Internet services, in regulated territories and in forborne territories for reasons previously expressed.

9 - Should broadband Internet service be defined as a basic telecommunications service?

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

87. For all of the reasons already expressed, British Columbia is of the view that 5/1Mbps Internet service should replace dial-up services as part of the BSO. British Columbia also notes that the Commission has already ruled that wireless services can be used by incumbents as a substitute for primary exchange services. While British Columbia agrees with that approach, such wireless services should remain affordable to consumers.

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

88. Should 5/1Mbps Internet services be included into the BSO, British Columbia respectfully submits that the local subsidy regime might have to be revisited if operating revenues, after recovery of allowable capital expenses from the NCF, do not result in appropriate returns to the ILEC. Since pricing must be affordable, any deficit should be reimbursable.

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

89. British Columbia’s small ISPs do not meet the NCF $10 million threshold yet they play a vital role in providing broadband connectivity in British Columbia. **** ISPs are entrepreneurial and are generally self-financed. They have risen to the challenge of 22

providing broadband Internet services in locations that have not attracted major service providers.

90. British Columbia respectfully submits that non-contributors to the NCF should be able to access the NCF for projects that improve access to modern telecommunications, including meeting the 5/1Mbps and future target speeds. NCF applications should be scrutinized pursuant to a modified application processes so that the process does not become more complicated than reasonably required.

91. British Columbia recognizes that allowing NCF non-contributors to secure funding from the NCF might seem unfair, but forcing this sector to remain self-reliant while at the same time increasing broadband targets would likely further extend, not bridge Canada’s digital divide in underserved and gap areas of Canada.

92. For contributors to the NCF that provide modern telecommunications services in regulated and forborne territories, it would be reasonable, and perhaps advisable, to exclude from their assessable revenues all revenues emanating from broadband services.

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

93. For reasons already expressed herein, British Columbia submits that 5/1Mbps services should replace dial-up services in the BSO. Should the Commission include 5/1Mbps services as part of the BSO, then the extraordinary cost of providing those services should also be eligible for funding in order to ensure that consumers have access to affordable, modern telecommunications services where no alternate, comparable service providers are evident. Where marketplace competition is not evident or unlikely to emerge, this would probably be the only option to meet the s. 7 Telecommunications Act objectives.

13 – If there is a need to establish a new funding mechanism to support the provision of modern telecommunications services, describe how this mechanism would operate. Your response should address the mechanism described in Telecom Regulatory Policy 2013-711 for transport services and/or any other mechanism necessary to support modern telecommunications services across Canada.

94. While British Columbia understands the logic of attempting to create a uniform regulatory approach to sustain modern telecommunications services in Canada, British Columbia respectfully submits that using TRP 2013-711 as the appropriate regulatory framework might not be the right approach in respect to the subject matter of this proceeding. That is, the complexities of addressing issues related to Northwestel’s vast serving area resulting to TRP 2013-711 do not address the issues related to providing unserved and underserved areas with broadband connectivity.

95. Insofar as Northwestel is concerned, British Columbia remains concerned about the high cost of services in comparison to other parts of the province. Any ensuing framework should strive to reduce costs to the greatest possible extent.

23

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

96. Since the imperative articulated in s. 7 of the Telecommunications Act is that telecommunications services should be available to all Canadians, both rural and urban, at affordable costs, and since the NBTF and the TPRP have both emphasized the critical importance of providing such services, ubiquitously, throughout Canada, it is respectfully submitted that all infrastructure and associated services required to provide modern telecommunications services should be funded in the manner discussed earlier in this submission.

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

97. It is respectfully submitted that funding should be provided in all locations where market forces do not adequately provide the modern telecommunications that Canadians require to participate in the digital economy. That is, s. 7(b) of the Telecommunications Act speaks in terms of ubiquity, not exclusivity.

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

98. As previously discussed, British Columbia respectfully submits that ILECs that provide modern telecommunications services in areas where they have a BSO (including 5/1Mbps) should remain eligible for funding. Further, in areas where competitors endeavor to provide modern telecommunications services in regulated and forborne territories, such alternate service providers should also be eligible for funding from both the NCF, even though they are not NCF contributors, and from the NIA Fund.

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

99. British Columbia respectfully submits that a competitive bidding process might work in areas of Canada where competition exists but is probably not an appropriate strategy where there is limited or no competitive presence. Indeed, the Commission considered the propriety of competitive bidding processes in Telecom Decision 99-16 and concluded that such an approach was probably not appropriate. British Columbia respectfully submits that the Commission’s logic then remains applicable today.

100. In considering funding applications, the Commission should endeavor to use a modified or “light-handed” approach to scrutinizing funding applications so that the process does not become unduly burdensome on small ISPs. An approach similar to the one used in the recent Digital Canada 150 program might be best as that process is well known to potential applicants and appears to have been applied reasonably, expeditiously and with good results.

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

24

101. British Columbia respectfully submits that both the NCF and a NIA Fund are required.

The NIA Fund could be federally funded partially and possibly through a portion of future spectrum auctions.

102. As to funding small ISPs, it is British Columbia’s view that their entrepreneurial efforts should be encouraged. While it is possible that there could be multiple parties interested in providing modern telecommunications services to some areas of Canada, British Columbia’s experience has been that, typically, only one service provider tends to express an interest in providing broadband Internet services. In some locations there are no prospective service providers at all thus resulting in a potentially unbridgeable gap.

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

103. This is a difficult issue to address because it assumes that the mere existence of new infrastructure will immediately encourage other service providers to enter into that marketplace. As that may or may not be the case, British Columbia submits that the Commission need only include in its decision a stipulation that this issue may be revisited in the future if circumstances warrant reconsideration of this issue.

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

104. Since the Telecommunications Act and Commission decisions have spoken in terms of “affordability”, it might be appropriate for the Commission to establish maximum retail rates or price cap where no competition exists.

13 (h) Should this subsidy replace the existing residential wireline service subsidy?

105. British Columbia offers no opinion on this issue.

106. British Columbia does not wish to appear at the public hearing.

******* End of Document******
102862 FIN CIO_Ltr_J Travesty CRTC 2015-134 BC
102862 TNoC *-***-***-**** 07 14 BC

Intervention: Province of British Columbia (Intervenor 249)

Document Name: 2015-134.223986.2394492.Intervention(1fbl_01!).pdf
Ministry of Technology, Innovation
and Citizens’ Services
Office of the
Chief Information ****
Province of British Columbia
Mailing Address:
Box 9412 Stn Prov Govt
**** BC *** ***
Location:
4000 **** Place
Telephone: *-***-***-****
Facsimile: *-***-***-****
Email : ******@***.com
Ref: 102862
July 14, 2015
Mr. John Travesty
Secretary General
Canadian Radio-television and
Telecommunications Commission
Ottawa ON *** ***
**** Mr. Traversy:
Re: Telecom Notice of Consultation 2015-134

The Province of British Columbia is pleased to provide the attached comments to the Canadian Radio-television and Telecommunications Commission in response to TNC 2015-134. Our comments have been prepared and are presented by the Office of the Chief Information **** (OCIO) within the Ministry of Technology, Innovation and Citizens’ Services (MTICS).

MTICS performs a dynamic role in government to support the development of an innovative and robust technology industry; to promote the commercialization of technology across B.C.’s key economic sectors; to improve accessible and responsive services and information to citizens; to provide the enabling infrastructure for ministries to transform how government works on a day-to-day basis and to maximize the value and efficiency of services provided by the private sector.

Within the ministry, the OCIO is government’s chief IM/IT strategist; the Provincial OCIO plays a leadership role in promoting and guiding the management of information as a strategic business asset and recognizes technology infrastructure as a foundational component of a strong economy and for transforming service to citizens. The Provincial OCIO collaborates with federal, provincial, local and municipal governments; community organizations; First Nations organizations, and the private sector in support of government’s objectives. One important objective is to stimulate the extension of advanced broadband services to citizens living in rural and remote locations of B.C.

We agree with the Commission’s view that telecommunications plays an important role in the lives of Canadians and enables them to participate in the evolving digital economy. We thank the Commission for the opportunity to make our views known and look forward to the outcome of this proceeding.

Sincerely,
Bette-Jo ****
Associate Deputy Minister and
Government Chief Information ****
1

Submission of the Office of the Chief Information **** of British Columbia Telecom Notice of Consultation CRC 2015-134,

Review of basic telecommunications services
Executive Summary

E.S. 1 The issue of extending broadband connectivity throughout Canada has been extensively analysed and discussed by the National Broadband Task Force, the Telecom Policy Review Panel and British Columbia’s Premier’s Technology Council. In each instance, those panels of noted experts concluded that it was imperative that Canadian’s have ubiquitous access to broadband Internet services in order to enjoy all of the benefits that broadband Internet based economies have to offer.

E.S. 2 Private enterprises in British Columbia have expended hundreds of millions of dollars to improve their networks to provide world class network infrastructure supporting modern telecommunications services, particularly in densely populated areas. As well, the Government of British Columbia has collaborated with TELUS, other telecommunications service providers (TSPs) and numerous small Internet service providers (“ISPs”), and has expended tens of millions of dollars to expand broadband Internet services throughout British Columbia.

E.S. 3 Despite the efforts of the Government of British Columbia, and episodic federal incentive programs, there are still access gaps in the provision of modern telecommunications services, including broadband, that need to be addressed if citizens are to enjoy all of the benefits that a digital based economy has to offer.

E.S. 4 Having over a decade of direct experience in trying to close British Columbia’s digital divide, and having worked very closely with British Columbia’s incumbent TSP, other TSPs and ISPs, British Columbia has learned a number of valuable lessons that, if addressed, may contribute to the sustainable provision of affordable broadband services throughout Canada.

E.S. 5 In this submission, British Columbia submits that the Commission’s current target of 5 megabits per second download and 1 megabits per second upload (“5/1Mbps”) is an appropriate current standard that should form part of the basic service obligation (the “BSO”) of incumbent local exchange carriers (“ILECs”) in regulated and forborne operating areas for reasons that will be explained in this submission. This is a moving target that will have to be revisited from time to time to support future modern telecommunications service requirements.

E.S. 6 British Columbia submits that in those areas of Canada that do not have access to modern telecommunications services, as defined by the Commission, including broadband Internet access services, and are not likely to receive such services from private enterprise or through public/private collaborations, that the federal government should create a 2

sustainable fund that can be drawn upon to extend modern telecommunications services into the “gap areas”1.

E.S. 7 British Columbia submits that episodic federal funding, while helpful, does not adequately support sustainable, ubiquitous modern telecommunications for gap areas. Accordingly, British Columbia submits that federal government should be requested to create a special fund (the “National Internet Access Fund” or “NIA Fund”) to be administered in accordance with specified guidelines. A potential source of funding for the NIA Fund may come from some of the proceeds of future spectrum auctions.

E.S. 8 Where ILECs do not provide modern telecommunications services to address gap areas and there are other service providers (“alternate ISPs”) that might be interested/able to do so, such service providers should be able to draw upon the NIA Fund to cover their cost of providing modern telecommunications services in gap areas. Such service providers should also be entitled to realize a reasonable return on their investment in much the same manner as ILECs that have access to the National Contribution Fund (“NCF”).

E.S. 9 Where alternate ISPs endeavor to provide modern telecommunications services into regulated and forborne territories, such service providers should also be able to access the NCF, even though they are not contributors to the NCF, as this would be a practical way to improve broadband connectivity in such locations and stimulate marketplace competition.

E.S.10 It is further respectfully submitted that Industry Canada may want to set aside a portion of spectrum from future spectrum auctions for use by alternate ISPs that provide modern telecommunications services in gap areas. This spectrum could be made available to such service providers at no or minimal cost and subject to reasonable conditions such as “use it or lose it”.

E.S.11 In TRP 2011-291, the Commission commented on the importance of setting a target broadband access speed for 2015. Recognizing that access speed requirements will continue to increase over time, as consumer requirements change and as applications multiply and require higher speeds, British Columbia respectfully submits that with the extensive information that will be presented to the Commission during the course of this proceeding that the Commission should craft a “Canadian Broadband Roadmap” to provide guidelines to the industry as to possible future target speeds and implementation dates. While it is recognized that such a roadmap may only forecast future target speeds, such a roadmap would be of great assistance to industry in general and Canada’s TSPs in particular as they plan and develop their future networks.

E.S.12 Many prominent Canadians have commented on the importance of providing broadband connectivity to all Canadians. Section 7 of the Telecommunications Act speaks of the national telecommunications objectives of “enriching the social fabric of Canada”, providing “reliable and affordable telecommunications services of high quality accessible 1 British Columbia uses the term “gap area” to mean a locale that does not have a government presence such as a library, school or health care facility but has a population cluster.

3

to Canadians in both urban and rural areas in all regions of Canada”, “[encouraging] innovation in the provision of telecommunications services” and “[responding] to the economic and social requirements of users of telecommunications services”. With all of the evidence, submissions and public presentations that will be presented to the Commission during the course of this proceeding, British Columbia respectfully submits that the Commission should be able to devise a regulatory solution to the vexing problem of permanently closing Canada’s digital divide.

E.S.13 British Columbia respectfully submits that the creation of a Canadian Broadband Roadmap; revisions to the NCF to allow non-contributors to draw from that fund in certain cases; the creation of a NIA Fund; the possible reserve of spectrum for use by service providers interested in providing modern telecommunications services to unserved, underserved and gap areas would all contribute to the closure of Canada’s digital divide.

E.S. 14 However, British Columbia also respectfully submits that the provision of modern telecommunications services throughout Canada also requires collaboration between federal, provincial, territorial and Canada’s First Nations representatives. While British Columbia and some provinces have assigned, the task of addressing modern telecommunications issues to their administration, the federal government has not assigned the responsibility for collaborating with the provinces, territories and First Nations on the fundamentally important task of devising a strategy to address the provision of modern telecommunications services as envisioned in s. 7 of the Telecommunications Act to any particular department. Such collaboration could also be used to align federal/provincial/territorial modern telecommunications initiatives (funding and strategies), share best practices, resources and information.

E.S.15 In summary, British Columbia respectfully submits that while an innovative regulatory framework is part of the solution, collaboration is an equally important component to the vexing problem of creating a sustainable solution to Canada’s digital divide. This proceeding can be used, in part, to articulate just such a solution.

Introduction

1. The Government of British Columbia is pleased to provide comments to the Canadian Radio-television and Telecommunications Commission (the “Commission”) in response to Telecom Notice of Consultation 2015-134 (“TNoC 2015-134”), review of basic telecommunication services (“BSO”).

2. The Ministry of Technology, Innovation and Citizens’ Services (“MTICS”) of the Government of British Columbia is responsible for supporting the development of an innovative and robust technology industry; promoting the commercialization of technology across BC’s key economic sectors; improving accessible and responsive services and information to citizens; providing the enabling infrastructure for ministries to transform how government works on a day-to-day basis; and maximizing the value and efficiency of services provided by the private sector to government.

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3. Within the MTICS, the Office of the Chief Information **** (“OCIO”) is government’s chief IM/IT strategist. The OCIO plays a leadership role in promoting and guiding the management of information as a strategic business asset and recognizes technology infrastructure as a foundational component of a strong economy and for transforming service to citizens. The OCIO also collaborates with federal, provincial, local and municipal governments, community organizations, First Nations organizations and the private sector in support of government’s objectives.

4. Within the OCIO, Network BC (“NWBC”) was initially created as a project office within government and has been responsible for a number of important government initiatives including the development of telecom policies and strategies (including the presentation of several regulatory submissions to the Commission) for the advancement of British Columbia’s e-government, e-health, e-education and broadband Internet expansion initiatives. NWBC continues to work closely with local ISPs by assisting them in their efforts to extend broadband Internet services throughout British Columbia. Given the Government of British Columbia’s extensive efforts to bridge its digital divide since 2001, the NWBC has a clear understanding of the geographic and financial challenges facing ISPs that have played an ongoing and critical role in enabling our citizens to participate in the digital economy.

Background Information to Canada’s Information Superhighway 5. The issue of the importance of the Internet to Canadians, now characterized by the federal government as the importance of enabling Canadians to participate in the digital economy, has been previously investigated, studied and commented upon by the Minister of Industry, the Telecommunications Policy Review Panel, British Columbia’s Premier’s Technology Council and, the Commission itself on past occasions.

6. It will be remembered that in 2001 the Minister of Industry struck the National Broadband Task Force (the “NBTF”) that researched and released a report entitled “The New National Dream: Networking the Nation for Broadband Access” 2. (the “National Dream Report”)

7. In its report, the NBTF said that:

We believe, as a matter of urgency, that all Canadians should have access to broadband network services so that they can live and prosper in any part of the land and have access to high levels of education, health, cultural and economic opportunities.3 (underscore added) 8. The NBTF, and later the Telecom Policy Review Panel (“TPRP”), both said that the only way to provide Canadians with access to broadband services would have been to have 2 http://publications.gc.ca/collections/Collection/C2-575-2001E.pdf (National Task Force Report) 3 National Dream Report, “Overarching Principle”

http://publications.gc.ca/collections/Collection/C2-575-2001E.pdf5

created a national network to which all Canadians would have had access. The TPRP referred to this as the “Ubiquitous Canadian Access Network” or UCAN.

9. While one might have not agreed with the UCAN concept, the TPRP’s following observation remains valid today:

The challenge of achieving ubiquitous access to telecommunications networks is ongoing and evolves anew with each new generation of technology. In the 1990s, connecting all Canadian schools through dial-up modem was an innovative and pioneering objective, but today this objective is no longer sufficient. Current broadband networks represent a quantum advance over traditional telephone networks. However, they are only the latest stage in the evolution of telecommunications networks. They will be surpassed as the capacity of networks continues to evolve in response to demand for new services and applications. The fivefold increase in broadband speed that took place between 2000 and 2005 is the beginning of the broadband story, not the end. As broadband and other technologies evolve, our continuing challenge will be to ensure that modern telecommunications technologies become available to all Canadians within a reasonable period of time.4 (underscore added)

10. In Question 2 of Appendix B to TNoC 2015-134 the Commission posed the question “Are these targets [5/1Mbps] sufficient to meet the minimum needs of Canadians today?” With all due respect, the issue is not whether the current speed target is minimally sufficient to meet current requirements but rather, “the continuing challenge to ensure that modern telecommunications technologies become available to all Canadians within a reasonable period of time”. One should not limit one’s view to only today’s requirements. Rather, one should build a foundation (regulatory, structural and financial in this case) to meet current and future requirements on a sustainable basis.

British Columbia’s efforts to close its digital divide

11. In 2001 British Columbia’s Campbell government appointed a “Premier’s Technology Council” (the “PTC”) that was directed to advise the Premier on a number of technology related issues. As indicated to the Commission in NWBC’s Deferral Account Submission (May 2004) at that time of 366 British Columbia communities 215 communities had broadband access while 151 did not. The PTC defined a “community” as a location where there was a library, public school or health facility.5 At that time, broadband access was considered to be 1.5Mbps for residential and 10Mbps for businesses.

12. In its Deferral Account Submission NWBC estimated the then cost of closing British Columbia’s existing digital divide in certain specified communities would exceed $100 million.6 While some parties may have been critical of the Commission for directing that a significant part of ILEC Deferral Account funds be used to extend broadband 4 TPRP Final Report, 8-4

5 NWBC Deferral Account Submission, May 21, 2004, para. 2.1 6 NWBC Submission, Part 3.0

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connectivity, the Government of BC and TELUS worked very closely to use TELUS’ Deferral Account funds to extend broadband coverage throughout British Columbia.

Through the Deferral Account, TELUS expended some $100 million to upgrade its facilities to extend broadband connectivity in British Columbia. While allocation and use of the TELUS’ Deferral Account was a good example of targeted spending and public/private sector collaboration/cooperation resulting in truly beneficial outcomes, there were limits as to the permitted use of TELUS’ Deferral Account fund.

13. Over the past decade the Government of British Columbia has continued in its efforts to increase the number of internet access points of presence (“POPs”) throughout the province. The following is a list of initiatives that British Columbia has undertaken to improve broadband connectivity.

• Government negotiated a Connecting Communities Agreement with TELUS whereby TELUS invested over $100 million to extend broadband POPs to 119 communities and provide discounted network backhaul access services to small, regional ISPs.

• Subsequently, government negotiated telecommunications service agreements with TELUS whereby TELUS agreed, amongst other things, to extend its cellular network by over 1,700 kilometres on primary and secondary highways. TELUS also agreed to provide higher speed, discounted network backhaul access services to British Columbia’s small, regional ISPs.

• British Columbia applied for and was granted satellite spectrum under the NSI 1 program and has expended over $1 million dollars in operating costs for the use of that spectrum. That spectrum has been used to extend broadband services to remote communities of British Columbia.

• Over the past decade, British Columbia has initiated and/or sponsored a number of financial grant programs to assist ISPs in the provision of local and last mile services including:

o A significant financial contribution to Gwaii Tel Society for a microwave connection between the mainland and Haida Gwaii.

o A number of grant programs totaling to an estimated $10 million in funding assistance to small ISPs to improve their provision of broadband Internet services throughout British Columbia.

o British Columbia worked closely with Health Canada and Aboriginal Affairs and Northern Connectivity in expending over $30 million to address First Nations connectivity issues.

o The province granted the All Nations Trust Company (ANTCO) $40.8 million that also includes $17.5 million from Health Canada. These funds are being used to connect 203 First Nations communities in B.C.

Aboriginal Affairs and Northern Development Canada also provided $14.2 million to ANTCO to help connect First Nations communities. The total amount of federal/provincial investments to date provided to help connect First Nations communities is $55 million.

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o In 2014, British Columbia allocated $2 million to launch the BC Broadband Satellite Initiative to address connectivity to remote areas where no other terrestrial options exist.

14. In addition to other capital expenditures required to improve and expand its network in British Columbia, TELUS has expended hundreds of millions of dollars over the past 10 years in collaboration and cooperation with government to improve broadband access across British Columbia.

15. TELUS, Shaw, Bell, Rogers and others have also expended hundreds of millions of dollars to improve and upgrade their networks across Canada for the provision of modern telecommunications services and yet the digital divide persists.

What have British Columbia’s investments into broadband Internet access achieved?

16. In British Columbia, the provincial government has taken a lead role in attempting to close the digital divide.

o Through concerted efforts, the government’s negotiations with TELUS resulted in the execution of a number of agreements that have addressed some of British Columbia’s connectivity challenges;

o Government has worked with TELUS to strategically expend TELUS’ deferral account funds as directed by the Commission in TRP 2008-1;

o Government has invested considerable effort (including the creation of a specific program office that is responsible for devising telecom strategies and optimizing the acquisition of telecom services) and has provided grants to small ISPs to extend their broadband coverage. Government has also assisted small ISPs in their efforts to secure federal funding from various federal programs.

17. However, there are still a number of broadband access gaps in British Columbia where consumers either have no access to broadband Internet services (the “gap areas”), or where service speeds fall below the 5/1Mbps target set by the Commission.

18. While the 5/1Mbps target is typically met in urban areas, meeting that target is far more challenging in the remote areas of British Columbia. In fact, it is estimated that approximately 7% of British Columbia’s citizens reside in gap areas that have no access to broadband.

19. British Columbia continues in its efforts to develop strategies and liaise with others, such as representatives and organizations from First Nations, the Commission, Aboriginal Affairs and Northern Development Canada (AANDC), Industry Canada and Health Canada to find ways to address British Columbia’s digital divide issues. What is missing are federal government representatives that are specifically charged with the responsibility of finding solutions to Canada’s digital divide.

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Responses to Appendix B Questions

1(a) Canadians are using telecommunications services to fulfill many social, economic, and cultural needs in today’s digital economy. a) Explain how telecommunications services are used to meet these needs. For example, uses may include e-commerce (i.e. the online purchase and trade of products or services), e-banking and/or telephone banking, e-health or tele-health services, tele-work, and distance education. Which of these uses of telecommunications services are the most important to ensure that Canadians meaningfully participate in the digital economy?

20. British Columbia submits that there are few aspects, if any, of our daily lives that do not rely on some form of telecommunications services, modern or otherwise, and that it is impossible to suggest that one telecom service mode is more or less important than another. If one has an e-commerce business, then e-health might not be all that important.

If one requires reliable, high capacity broadband access for on-line education activities, then e-banking might not be all that important. It is all a matter of perspective as to what one requires to meaningfully participate in the digital economy. What really matters is that quality, high capacity, low latency bandwidth needs to be ubiquitously available to serve and support the requirements of all Canadians, individually and collectively, as and when they so require. This is part of the underlying imperative that is so very carefully articulated in section 7 of the Telecommunications Act.

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

21. Importance depends on user requirements. If one relies on mobile wireless services, then one expects that those services will be available seamlessly and everywhere, not just in some locations. Dropped calls are particularly annoying! This is important for both safety and convenience.

22. If one is trying to conduct a VOIP or similar video-conference call, then high-speed, low latency attributes are important otherwise the user cannot benefit from the advantages that technology has to offer and that are available elsewhere in the world. Or, if a health care professional is attempting to perform a health related service, such as remote heart monitoring via a secured internet connection or some other form of health care service, latency could have negative consequences.

23. Modern telecommunications services rely on high broadband capacity to quickly deliver content. Accordingly, something considerably more than “adequate” speed is essential. It is not a matter of choosing one attribute over another. Rather, all of the referenced infrastructure attributes are essential to support the provision of modern telecommunications services.

1(c) Identify and explain the barriers that limit or prevent Canadians from meaningfully participating in the digital economy (e.g. availability, quality, price, digital literacy, and 9

concerns related to privacy and security). Identify which segments of the Canadian population are experiencing such barriers.

24. In British Columbia, people living in gap areas are becoming increasingly distanced from the digital experience. They cannot receive and enjoy the benefits of online entertainment that urban residents have come to expect and enjoy due to the unavailability of broadband Internet access; they do not enjoy Commission targeted Internet speeds in some locations;

and home-based education is limited due to lack of affordable connectivity. As e-health services become more pervasive, gap area citizens still have to travel for some of their health care related services because they do not have the required Internet services to support e-health applications. Indeed, setting higher target speeds does not help people living in gap areas – it only serves to further distance such citizens from the digital experience.

25. British Columbia further respectfully submits that even if our gap residents had access to broadband Internet services, some of those residents may not have the requisite digital literacy skills to enjoy the benefits that a digital economy has to offer. This is something that could be addressed through the school system and at home if affordable and reliable broadband access was more pervasive.

26. Canada benefits from having strong, small communities. Not having access to the digital economy is just one more factor that drives residents from small communities to communities where better services are available. Rural citizens, having had access to dial-up Internet, are now left wanting while urbanites benefit from rapidly increasing broadband speeds and service competition while some rural citizens only have access to 1.5Mbps or slower access speeds. As well, it appears that availability and affordability concerns also apply to mobile wireless data services. This reality does not align with the federal government’s goal of improving broadband connectivity throughout Canada.

27. In summary the barriers are (1) telecommunications service disparities between urban and many rural and gap communities; (2) instances of digital illiteracy; (3) inadequate broadband access in some rural areas; (4) no broadband access in gap areas; and (5) the high cost of alternate (satellite and mobile wireless) broadband Internet services to rural and remote communities.

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

28. The devices that enable Canadians to participate in the digital economy include wireless devices, wearables, RFI enabled pill dispensers (that monitor and report use of prescribed medicines), **** TV’s, data enabled watches and cameras, monitoring devices (be they health, in-home security, kitchen appliances, etc.) and the plethora of devices that have yet to be devised but will be created in the near future.

29. Another application that is starting to appear is “virtual reality”. For example, virtual reality is being used to “virtually experience” things such as “climbing **** Everest” or, 10

more recently, the treatment of war veterans that are experiencing post-traumatic stress disorders. One can only imagine how virtual reality might be used for health care, science, education and entertainment purposes in the future. However, strong, robust and reliable broadband Internet service is the very foundation upon which all other enablers must rest. The best application or device in the world is of very little use without a network to support the same.

30. A strategy that would advance the ability of Canadians to meaningfully participate in the digital economy would be Canada-wide collaboration between the federal government, the provinces, territories and First Nations. A more formalized information sharing approach would contribute to the sharing of ideas, identification and development of best practices and improved outcomes for all Canadians.

31. Finally the Commission itself is a critical enabler by framing the important questions regarding Canadian broadband Internet access requirements; the creation of a flexible yet prescriptive framework to advance the provision of broadband connectivity throughout Canada; addressing issues related to sustainable funding to provide broadband Internet access into the gap areas; and charting a Canadian Broadband Roadmap that all service providers will be able look to for guidance as they develop their respective access networks.

32. It is almost impossible to predict what services Canadians will require 5 to 10 years from now because technology changes so rapidly. What might be trendy today might not even be in use 5 years from now. Remember PCS2? Introduced but never put into use. The desk-top computer? All but gone. Data centres? **** the cloud replace those or redefine user requirements? What is happening to traditional Over the Air programming? **** online content replace Over the Air and what implications does this have regarding the use of broadcasting and telecommunications to promote and foster Canada’s national identity?

Who can really predict what the next “must have” application or disruptive but ultimately important technology will be in 5, much less 10 years from now? We hope that the Commission will invite industry leaders to present their thoughts on this important question to the Commission as part of this proceeding.

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

33. Perhaps all that can be said is that Canadians require a robust, scalable, affordable and ubiquitously accessible network that is capable of supporting the rapid, reliable and safe transmission of data. At the heart of the issue is ubiquitous availability, capacity, reliability and network security.

2 - The Commission’s current target speeds for broadband Internet access service are a minimum of 5 Mbps download and 1 Mbps upload, based on uses that consumers should reasonably expect to make of the Internet. Are these target speeds sufficient to meet the 11

minimum needs of Canadians today? If not, what should the new targets be and what time frame would be reasonable to achieve these new targets?

34. In TRP 2011-291, the Commission observed that required broadband speeds at reasonable rates would be required to meet changing requirements. The Commission summarized the issue as follows:

The Commission notes that the ubiquity and speed of broadband Internet access at reasonable rates is becoming more important for Canadians in the achievement of a number of social, economic, and cultural objectives. Canadians will change their patterns of viewing and interacting with digital media as they increasingly consume and produce directly through the Internet. Their requirements for broadband speeds will grow, just as their requirements for the processing capacity of their computers have grown. What was an acceptable speed in one year will be regarded as slow a few years later. The Commission expects that Internet service providers will keep pace with these requirements. The Commission considers that the freedom to use communications media at reasonable rates will be a primary concern for all Canadians in the years ahead.7 (underscore added) 35. The Commission concluded that:

To accommodate such uses, the Commission considers that the appropriate target speeds for broadband Internet services are a minimum of 5Mbps download and 1Mbps upload. The Commission notes that, while many Canadians in urban areas already have access to broadband Internet services at or above these target speeds, such speeds are not currently available to most Canadians in rural and remote areas.8 (underscore added)

36. British Columbia submits that the Commission has already answered its own question.

“What is acceptable in one year will be considered slow in a few years.” Accordingly, British Columbia respectfully submits that the Commission develop a vision or “Canadian Broadband Roadmap” to ensure that service providers have a clear understanding of what speeds may be required in the next 5 to 10 years.

37. It is also respectfully submitted that setting target speeds may only be part of the solution.

That is, fibre based networks need to be constructed throughout Canada, including into the gap areas, if current and future target speeds, high throughput and low latency requirements are to be sustainably met.

Why should the Commission consider developing a Canadian Broadband Roadmap?

38. It is respectfully submitted that with the insights, submissions and evidence provided to the Commission through this proceeding, the Commission will have the clearest, latest and most independent view of the digital experience requirements and expectations of 7 TPR 2011-291, para. 71

8 TPR 2011-291, para. 76
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Canadians now and into the future; the adequacy and future sufficiency of various target speeds; technology and future application requirements; Canadian service requirements and expectations, including who will be best able to provide such services; respective roles; etc. With this considerable information in the hands of the Commission, a Canadian Broadband Roadmap would go a long way to expressing future target speeds, roles, responsibilities and Canadian requirements.

3 - Which services should be considered by the Commission as basic telecommunications services necessary for Canadians to be able to meaningfully participate in the digital economy? Explain why.

Regulated service areas – dial up internet services

39. In regulated service areas, where the ILEC has the obligation to serve, British Columbia submits that the absence of alternate ISPs is prima facie evidence that reliance on market forces to provide modern telecommunications services may not be a workable strategy.

40. In such cases, until an alternate service provider appears and the ILEC is able to make a case for forbearance, British Columbia respectfully submits that the ILEC should be obliged to meet the Commission’s 5/1Mbps target speed at affordable rates.

41. To offset any additional cost of providing 5/1Mbps Internet access service, the ILEC should be able to call upon the NCF for subsidized funding as might be approved by the Commission.

42. The circumstances where the ILEC should be required to provide 5/1Mbps Internet access should be where: (1) market forces have not resulted in the provision of 5/1Mbps services by an alternate ISP; and (2) targeted government funding has not attracted alternate ISPs to provide such 5/1Mbps services.

43. Indeed, the Commission previously concluded that there would be some cases where incumbent local carriers would likely be in the best position to provide basic services to some areas of Canada. In particular, the Commission stated the following:

56. The Commission considers, however, that a bidding process would make administration more complex, and would unduly slow the implementation of basic service in certain high-cost areas. Given the small number of Canadians without access to telephone service, the Commission is of the view that establishing a new bidding mechanism to provide basic service is not warranted.

In the Commission's view, incumbent local carriers, with their widespread infrastructures, will likely be the only providers of service to these areas in the foreseeable future. (underscore added)

57. Given the relatively small number of Canadians in scattered locations that do not have access to service that meets the basic service objective, the Commission finds that the most appropriate approach in high-cost areas is for incumbent local 13

carriers to provide service over a reasonable time period. The Commission is of the view that extending service to those now unserved is generally the responsibility of the incumbent local carrier providing service in that territory.

44. British Columbia respectfully submits that the logic that the Commission applied to the provision of basic services is equally applicable to the issues of providing 5/1 Internet service access. That is, the incumbents are still in the best position to provide basic services in “scattered locations that do not have access to service that meets the basic service objective”, Further, based on British Columbia’s experience in trying to close the digital divide, that reality remains today and is not likely to change any time soon. The “foreseeable future” has yet to come, though it is an issue that the Commission should consider revisiting some years from now.

45. It is further respectfully submitted that if an ISP were to present itself in a regulated serving territory and if the ILEC is able to demonstrate to the Commission’s satisfaction that the ILEC has actually lost 50% of its customers to the alternate ISP (as opposed to 25% as prescribed in Telecom Decision 2006-15) then the Commission could always issue a forbearance order and allow that market to freely operate. The reason for the change to 50% from 25% is as follows: the alternate ISP should have sufficient opportunity to provide and develop its services with the aim of establishing a competitive market.

Forborne service areas – still requires ILEC provided broadband Internet access 46. According to TRP 2011-291, ILECs will be relieved of their obligation to provide basic services where the ILEC is granted a forbearance order. What is not clear from TRP 2011-291, is whether relieving the ILEC of that service obligation also relieves the ILEC from providing dial-up Internet services, as the Commission seems to have focussed on voice services.9

47. If it were the Commission’s intention to continue requiring ILECs to provide dial-up services in forborne service areas, it is British Columbia’s respectful submission that such obligatory services should be replaced with the Commission’s new target of 5/1Mbps by the end of 2015.

48. Alternatively, if it were the Commission’s intention to eliminate the obligation to provide dial-up Internet access services within forborne service areas where the ILEC demonstrates to the Commission’s satisfaction that the forbearance threshold has been met, this could lead to the unintended outcome that some consumers in that territory would either be left without Internet access or might only have access to higher cost wireless data or satellite services.

49. Accordingly, British Columbia respectfully submits that ILECs should be obligated to provide 5/1Mbps Internet access services within forborne serving areas until the ILEC can 9 TRP 2011-291, para. 48, 49

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establish to the Commission’s satisfaction that a competitor is actively operating within that serving area; is providing reasonably priced 5/1Mbps services; and that the ILEC has actually lost 50% of its Internet customers to an alternate ISP.

50. When determining whether or not a competitor is “actively operating within a serving area”, the Commission may want to assess the attributes of the competitor’s offering including service level obligations/agreements; network integrity/security; and all costs to the consumer on a “like for like” basis.

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

51. If what the Commission is asking is whether mere ownership of cable, digital subscriber line, fibre, fixed wireless, mobile wireless and/or satellite technology should determine whether or not the owner should also have the obligation to provide specified basic services, British Columbia submits that facility ownership may not be the appropriate regulatory tool. Rather, the obligation to serve stems from the fact that ILECs, as historical monopoly service providers, have consequential obligations to provide basic telecommunications services in fulfilment of their regulatory obligations. The obligation to serve has only ever been the obligation of the monopoly service provider and has not been associated with the underlying infrastructure.

52. Alternatively, if what the Commission is asking is whether infrastructure ownership should be considered by the Commission in determining whether or not the owner should also have the obligation to provide basic services, British Columbia respectfully submits that such a requirement would undermine previous Commission decisions, particularly as related to non-dominant carriers and other facility based carriers.

53. For additional clarity, mere ownership of the underlying infrastructure should not be a consideration in determining the obligation to serve.

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

54. British Columbia agrees with the Commission’s description of the BSO as expressed in TRP 2011-291 with the exception that British Columbia respectfully submits that the commission should consider having ILECs provide 5/1Mbps Internet services (as opposed to dial-up services) as part of the BSO until the ILEC can establish to the Commission’s satisfaction that an alternate ISP has actually secured at least 50% of the ILEC customers within a particular operating area. The concern here is that relieving the ILEC from the BSO on the basis of meeting the voice threshold could leave the remaining citizens, particularly in peripheral areas, having no Internet services other than satellite or wireless data, both of which may not meet the Commission’s affordability targets. A situation 15

where consumers only have the option of one type of service seems to be inconsistent with the overriding principle of consumer choice and marketplace competition.

55. For further clarity, the Commission should consider replacing the dial-up Internet BSO by the 5/1Mbps target in regulated and forborne areas at affordable rates where alternate ISPs have not secured at least 50% of the ILECs customers.

56. While targeted government subsidies might motivate alternate ISPs to offer their services in certain unserved and underserved areas, the Commission should consider having the ILEC provide BSO broadband services at a future date in the event that the alternate ISP fails to provide comparable services.

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

57. In forborne areas, it appears that broadband service providers set their prices competitively; therefore, prices are determined by the marketplace.

58. Should the Commission decide that 5/1Mbps services form part of the BSO, then in such cases, those services should be provided to consumers at affordable rates, as prescribed by the Commission.

59. It is respectfully submitted that s. 7(b) of the Telecommunications Act directs that all telecommunications services should be “affordable” and “available in both urban and rural areas”. To create a regulatory regime that would result in the creation of a two or multi-tier access/cost regime would not be consistent with s. 7(b). There needs to be symmetry.

It may be that in some places it will take time for rivalrous marketplace competition to emerge. Until then, regulatory directives and funding subsidies will be needed to provide universal and affordable services.

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

Market forces and government funding

60. In a properly functioning marketplace, multiple service providers compete with each other for the customer. They do so by investing in and upgrading their service offerings, marketing, building their brand, bundling their service offerings, etc. They use their skills, expertise and market intelligence to promote and sell their services to existing and prospective customers. In such cases, British Columbia submits that government funding to stimulate competition in already competitive marketplaces is not required.

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61. The question is not “can” but “should” government funds be relied upon to ensure that Canadians have access to modern telecommunications services and, if so, in what cases?

Role of the federal government to fund broadband expansion 62. In TRP 2011-291, on considering the complexities and requirements related to providing Canadians with access to broadband Internet services, the Commission set a broadband Internet target of 5/1Mbps by the end of 2015. The Commission also noted that “service gaps remain in rural and remote areas for broadband Internet access”10.

63. In cases where such gaps exist, British Columbia respectfully submits that the federal government should continue to provide the funding required ensuring that the Telecommunications Act objectives are sustainably financed where provinces, local governments and/or private/public collaborations cannot close the service gaps. British Columbia suggests that one approach might be for the federal government to create a sustainable NIA Fund and to set-aside a certain amount of spectrum capacity for use by alternate ISPs at no cost to them.

Role of the provinces
64. By way of example, British Columbia:

• created a designated office (NWBC) within the OCIO that has been mandated to develop and execute strategies to extend broadband connectivity throughout British Columbia;

• collaborated with TELUS in respect to the use of TELUS deferral account funds to extend broadband connectivity in British Columbia;

• negotiated a number of agreements with TELUS to extend broadband access to 119 unserved and underserved communities;

• negotiated with TELUS discounted backhaul and ISP access to Points of Presence throughout British Columbia;

• has worked closely with a number of small ISPs providing them both grants and strategic assistance in their connectivity endeavors;

• has expended tens of millions of dollars to extend broadband Internet to unserved and underserved areas of British Columbia resulting in approximately 93% broadband coverage;

• has often consulted with the Commission and is working with Industry Canada to develop strategies to improve broadband connectivity throughout British Columbia.

• has worked with First Nations to address connectivity gaps in First Nations communities.

65. Despite all of these concerted efforts, 7% of British Columbia’s population is still either unserved or underserved by broadband Internet services. British Columbia knows this is 10 TRP 2011-291, para. 55

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the case because it has expended time, effort and financial resources over the past decade assisting small ISPs that provide services to unserved and underserved areas. Other provinces and territories have developed their own connectivity strategies and should individually address this issue. While there may be one national objective, there will be many ways to achieve that objective along with a number of provincial and territorial variations.

The private sector

66. It is respectfully submitted that the role of the private sector (i.e. ILECs, non-dominant carriers, other facility based carriers, businesses, small ISPs, etc.) in closing Canada’s digital divide depends on the nature of the connectivity challenge in each province and territory. What works for British Columbia may not necessarily work in other Provinces or Territories for any number of reasons including geography, climatic conditions, presence of service providers, government ownership of the service provider, etc. So, it might not be advisable to try to create a “one-size fits all” regulatory solution. In British Columbia, government has collaborated with TELUS to address some of government’s requirements and imperatives and TELUS has made changes to its network to address some of those requirements and expectations. However, even with such cooperation and extensive collaboration with TELUS, third parties and other service providers, a number of service gaps still exist that cannot be closed through such concerted efforts and collaboration.

Municipalities

67. British Columbia is advised that the Union of British Columbia Municipalities will be filing a submission with the Commission and therefore defers to its comments on this issue.

First Nations

68. British Columbia is advised that the ANTCO – a wholly owned First Nations organization) will be filing a submission with the Commission and therefore defers to its comments on this issue.

Reliance on federal funding to “close the gaps”

69. While the federal government has made significant contributions to closing Canada’s digital divide over the years, the problem is that such funding has been episodic.

According to the TPRP, the federal government allocated approximately $600 million in the decade up to 2005. $225 million was allocated through the Connecting Canadians fund in 2008 (not all of which was actually awarded) and $300 million was announced in 2014 for the Digital Canada 150 program.

70. British Columbia respectfully submits that while programs such as BRAND, the Connecting Canadians and Digital Canada 150 programs have most likely been welcomed 18

by ISPs, the episodic nature of such programs has made it challenging for ISPs between programs, particularly as technology races forward and ongoing investments are required.

71. British Columbia respectfully submits that to address such reinvestment and sustainability issues, the federal government may consider creating a NIA fund to ensure that all Canadians have access to a world class, scalable broadband Internet infrastructure system.

Further, it is respectfully submitted that bandwidth from future spectrum auctions may also be set aside for use by non-ILEC service providers, at no charge or cost to them, subject to “use it or lose it” stipulations. In other words, both funding and “in specie” spectrum allocation may be used to address the issue of program sustainability.

72. An adequately funded NIA Fund, accessible to existing or new ISPs, would ensure that such ISPs would have access to the capital required to construct and upgrade their infrastructure as and when required and, perhaps, stimulate local competition thus, at some future point in time, enabling ILECs to apply for forbearance orders. Further, a NIA Fund would be sustainable as opposed to being episodic in nature.

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

73. The starting point is section 7 of the Telecommunications Act. In answering this question, British Columbia submits that the following objectives are particularly germane.

7. It is hereby affirmed that telecommunications performs an essential role in the maintenance of Canada’s identity and sovereignty and that the Canadian telecommunications policy has as its objectives

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

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

(c) to enhance the efficiency and competitiveness, at the national and international levels, of Canadian telecommunications;

(d) ...
(e) ...

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

(g) to stimulate research and development in Canada in the field of telecommunications and to encourage innovation in the provision of telecommunications services;

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

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(i) ...

74. In fulfilling its role as Canada’s telecom regulator, British Columbia respectfully submits that the Commission is obligated to develop regulatory strategies that fulfill the Telecommunications Act objectives and the Policy Direction.

75. By devising and recommending the adoption of a Canadian Broadband Roadmap the Commission would be fulfilling its mandate to “facilitate the orderly development throughout Canada of a telecommunications system that serves to safeguard, enrich and strengthen the social and economic fabric of Canada”. The Roadmap could be used to point the way to the orderly development of a strong Canadian telecommunications system.

76. Where market forces do not adequately fulfill these national telecom objectives within the meaning of s. 7(f), the Commission is obliged to devise an “innovative” approach to the provision of modern telecommunications services in order to “respond to the economic and social requirements of users of telecommunications services”. British Columbia respectfully submits that the existence of Internet access gaps and regulated areas clearly indicates that there are no, or are only limited prospects for market forces to prevail in such areas. This reality calls for a regulatory strategy to addressing the problem of creating a ubiquitously accessible modern telecommunications industry in Canada.

77. In British Columbia’s respectful view, the following suggestions could be considered:

• the Commission to compose a Canadian Broadband Roadmap as described herein;

• where alternate ISPs are unable to meet the Commission’s prescribed target speeds, the Commission should work with those entities to understand the root cause of the problem and devise creative solutions to the same;

• alternate ISPs to have access to the NCF even though they do not contribute to the same;

• the Commission to encourage the federal government to create a NIA Fund and possibly set-aside bandwidth from future spectrum auctions for use by alternate ISPs; and

• federal/provincial/territorial and First Nations to be encouraged to collaborate with each other to address modern telecommunications challenges and create a specific office for that task.

78. In British Columbia’s respectful view, should all of this be done, the Commission would fulfil a fundamental section 7 objective being the “orderly development throughout Canada of a telecommunications system that serves to safeguard, enrich and strengthen the social and economic fabric of Canada and its regions”.

6 - In Telecom Regulatory Policy 2011-291, the Commission stated that it would closely monitor developments in the industry regarding the achievement of its broadband Internet target speeds to determine whether regulatory intervention may be needed. What action, if 20

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

79. TNoC 2015-134 will not close until May 2016 and it could take upwards of a year for the Commission to assess the evidence and issue its decision - which takes us to late 2016 or perhaps early 2017. Accordingly, British Columbia respectfully submits that the Commission should devise a Canadian Broadband Roadmap that suggests prospective target speeds and dates that reflect expected consumer requirements over the next decade.

80. Creating a Canadian Broadband Roadmap will be made easier for the Commission since it will have, through the course of this proceeding, a clear understanding of current consumer requirements/expectations (Question 1); consumer requirements over the next 5 to 10 years (Question 1(e)); the adequacy of the 5/1Mbps target (Question 2); and consumer future expectations (Question 5).

81. British Columbia respectfully submits that the Commission needs to also review the coverage maps that have been filed as part of the Digital Canada 150 program as that information will provide to the Commission a concise, up to date summary of Canada’s broadband coverage and gap areas out to 2017.

82. Finally, it is respectfully submitted that while the Commission needs to continue to monitor industry progress in meeting future targets, the Commission may consider devising strategies to assist those services providers (such as small ISPs) that are experiencing difficulties in meeting future target speeds and service requirements.

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

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

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

83. British Columbia did not participate in the proceeding leading to TRP 2013-711 and does not feel that it has sufficiently informed insights to suggest whether the Commission should or should not develop a mechanism to support the provision of modern telecommunications services in the Northwestel operating territory. However, having government health care and other services in the Northwestel operating territory, British 21

Columbia can advise that enhancement to Northwestel’s service offerings would have a beneficial impact on the delivery of government services within that territory.

84. British Columbia also notes that data communication costs in the Northwestel operating territory appear to be significantly higher than the data costs paid by government elsewhere in British Columbia. .

85. Overall, British Columbia respectfully submits that a funding mechanism could have a positive and beneficial impact on citizens within British Columbia’s portion of the Northwestel operating territory as the introduction of modern telecommunications services could lead to improved citizen access to all government services; be they federal, provincial or municipal, including e-commerce, e-health outcomes and e-government services generally.

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

86. British Columbia respectfully submits that the BSO should be modified to have ILECs provide modern telecommunications services, including 5/1Mbps Internet services, in regulated territories and in forborne territories for reasons previously expressed.

9 - Should broadband Internet service be defined as a basic telecommunications service?

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

87. For all of the reasons already expressed, British Columbia is of the view that 5/1Mbps Internet service should replace dial-up services as part of the BSO. British Columbia also notes that the Commission has already ruled that wireless services can be used by incumbents as a substitute for primary exchange services. While British Columbia agrees with that approach, such wireless services should remain affordable to consumers.

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

88. Should 5/1Mbps Internet services be included into the BSO, British Columbia respectfully submits that the local subsidy regime might have to be revisited if operating revenues, after recovery of allowable capital expenses from the NCF, do not result in appropriate returns to the ILEC. Since pricing must be affordable, any deficit should be reimbursable.

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

89. British Columbia’s small ISPs do not meet the NCF $10 million threshold yet they play a vital role in providing broadband connectivity in British Columbia. **** ISPs are entrepreneurial and are generally self-financed. They have risen to the challenge of 22

providing broadband Internet services in locations that have not attracted major service providers.

90. British Columbia respectfully submits that non-contributors to the NCF should be able to access the NCF for projects that improve access to modern telecommunications, including meeting the 5/1Mbps and future target speeds. NCF applications should be scrutinized pursuant to a modified application processes so that the process does not become more complicated than reasonably required.

91. British Columbia recognizes that allowing NCF non-contributors to secure funding from the NCF might seem unfair, but forcing this sector to remain self-reliant while at the same time increasing broadband targets would likely further extend, not bridge Canada’s digital divide in underserved and gap areas of Canada.

92. For contributors to the NCF that provide modern telecommunications services in regulated and forborne territories, it would be reasonable, and perhaps advisable, to exclude from their assessable revenues all revenues emanating from broadband services.

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

93. For reasons already expressed herein, British Columbia submits that 5/1Mbps services should replace dial-up services in the BSO. Should the Commission include 5/1Mbps services as part of the BSO, then the extraordinary cost of providing those services should also be eligible for funding in order to ensure that consumers have access to affordable, modern telecommunications services where no alternate, comparable service providers are evident. Where marketplace competition is not evident or unlikely to emerge, this would probably be the only option to meet the s. 7 Telecommunications Act objectives.

13 – If there is a need to establish a new funding mechanism to support the provision of modern telecommunications services, describe how this mechanism would operate. Your response should address the mechanism described in Telecom Regulatory Policy 2013-711 for transport services and/or any other mechanism necessary to support modern telecommunications services across Canada.

94. While British Columbia understands the logic of attempting to create a uniform regulatory approach to sustain modern telecommunications services in Canada, British Columbia respectfully submits that using TRP 2013-711 as the appropriate regulatory framework might not be the right approach in respect to the subject matter of this proceeding. That is, the complexities of addressing issues related to Northwestel’s vast serving area resulting to TRP 2013-711 do not address the issues related to providing unserved and underserved areas with broadband connectivity.

95. Insofar as Northwestel is concerned, British Columbia remains concerned about the high cost of services in comparison to other parts of the province. Any ensuing framework should strive to reduce costs to the greatest possible extent.

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

96. Since the imperative articulated in s. 7 of the Telecommunications Act is that telecommunications services should be available to all Canadians, both rural and urban, at affordable costs, and since the NBTF and the TPRP have both emphasized the critical importance of providing such services, ubiquitously, throughout Canada, it is respectfully submitted that all infrastructure and associated services required to provide modern telecommunications services should be funded in the manner discussed earlier in this submission.

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

97. It is respectfully submitted that funding should be provided in all locations where market forces do not adequately provide the modern telecommunications that Canadians require to participate in the digital economy. That is, s. 7(b) of the Telecommunications Act speaks in terms of ubiquity, not exclusivity.

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

98. As previously discussed, British Columbia respectfully submits that ILECs that provide modern telecommunications services in areas where they have a BSO (including 5/1Mbps) should remain eligible for funding. Further, in areas where competitors endeavor to provide modern telecommunications services in regulated and forborne territories, such alternate service providers should also be eligible for funding from both the NCF, even though they are not NCF contributors, and from the NIA Fund.

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

99. British Columbia respectfully submits that a competitive bidding process might work in areas of Canada where competition exists but is probably not an appropriate strategy where there is limited or no competitive presence. Indeed, the Commission considered the propriety of competitive bidding processes in Telecom Decision 99-16 and concluded that such an approach was probably not appropriate. British Columbia respectfully submits that the Commission’s logic then remains applicable today.

100. In considering funding applications, the Commission should endeavor to use a modified or “light-handed” approach to scrutinizing funding applications so that the process does not become unduly burdensome on small ISPs. An approach similar to the one used in the recent Digital Canada 150 program might be best as that process is well known to potential applicants and appears to have been applied reasonably, expeditiously and with good results.

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

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101. British Columbia respectfully submits that both the NCF and a NIA Fund are required.

The NIA Fund could be federally funded partially and possibly through a portion of future spectrum auctions.

102. As to funding small ISPs, it is British Columbia’s view that their entrepreneurial efforts should be encouraged. While it is possible that there could be multiple parties interested in providing modern telecommunications services to some areas of Canada, British Columbia’s experience has been that, typically, only one service provider tends to express an interest in providing broadband Internet services. In some locations there are no prospective service providers at all thus resulting in a potentially unbridgeable gap.

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

103. This is a difficult issue to address because it assumes that the mere existence of new infrastructure will immediately encourage other service providers to enter into that marketplace. As that may or may not be the case, British Columbia submits that the Commission need only include in its decision a stipulation that this issue may be revisited in the future if circumstances warrant reconsideration of this issue.

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

104. Since the Telecommunications Act and Commission decisions have spoken in terms of “affordability”, it might be appropriate for the Commission to establish maximum retail rates or price cap where no competition exists.

13 (h) Should this subsidy replace the existing residential wireline service subsidy?

105. British Columbia offers no opinion on this issue.

106. British Columbia does not wish to appear at the public hearing.

******* End of Document******
102862 FIN CIO_Ltr_J Travesty CRTC 2015-134 BC
102862 TNoC *-***-***-**** 07 14 BC

Intervention: Province of BC

Document Name: 2015-134.223986.2394493.Intervention(1fblp01!).html

Copie envoyée au demandeur et à tout autre intimé si applicable / Copy sent to applicant and to any respondent if applicable: Non/No

Intervention: Province of British Columbia (Intervenor 249)

Document Name: 2015-134.223986.2394493.Intervention(1fblp01!).html

Copie envoyée au demandeur et à tout autre intimé si applicable / Copy sent to applicant and to any respondent if applicable: Non/No