My weekly Law Bytes column (Toronto Star version, homepage version) picks up on Toronto Hydro’s announcement last week of its plans to blanket the City of Toronto with wireless Internet access. I note that the announcement has sparked an important debate about the appropriate role for governments and public institutions in providing Internet connectivity, which comes on the heels of the CRTC’s recent decision to distribute $652 million to major telecommunications providers such as Bell and Telus to help defray the costs of implementing high-speed connectivity in rural Canadian communities.
These developments place the spotlight squarely on a critical question for new Conservative Industry Minister Maxime Bernier – what, if anything, should government do about Internet connectivity?
The starting position for a Conservative government might well be to argue that government has a very limited role to play here, concluding that this is strictly a marketplace issue and that the private sector has plenty of incentives to develop networks for consumer use.
Given the Web’s importance, I argue that government cannot adopt a hands-off approach, though it must recognize that its role differs in the urban and rural markets. In urban communities, most of which are serviced by a choice of two broadband options (cable or DSL), the focus ought to be on the competitive environment and the assurance that the entire community can afford access.
The governmental role in rural Canada ought to be a different one. In those communities, many of which lie on the outskirts of major cities such as Toronto or Ottawa, the concern revolves around connectivity, not competition, since there is often no broadband option available to local residents.
While its intent is laudable, the CRTC’s approach is an inappropriate way to solve the problem. Since the money comes directly from Canadian consumers, consumer groups rightly argue that it should be returned to those same consumers (each consumer would receive approximately $50).
The Commission’s decision has highlighted the need for governmental involvement, however, since the major Canadian ISPs informed the CRTC that without external support, there is no economic case for building high-speed networks in many rural Canadian communities.
The solution therefore lies not in simply handing over $652 million in economic assistance to the telecommunications providers, but rather for government to support local, community-owned networks that operate for the public benefit. While the telecommunications providers might be called upon to establish the services, publicly funded networks would remain in public hands, with the communities retaining the flexibility to offer reduced fees or alternate options.