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Secret Surveillance Puts Internet Governance System at Risk

One year ago, many Internet users were engaged in a contentious debate over the question of who should govern the Internet. The debate pitted the current model led by a United States based organization known as the Internet Corporation for Assigned Names and Numbers (supported by the U.S.) against a government-led, United Nations-style model under which countries such as China and Russia could assert greater control over Internet governance.

The differences between the two approaches were never as stark as some portrayed since the current model grants the U.S. considerable contractual power over ICANN, but the fear of greater foreign government control over the Internet led to strong political opposition to UN involvement.

While supporters of the current model ultimately prevailed at a UN conference in Dubai last December where most Western democracies, including Canada, strongly rejected major Internet governance reforms, the issue was fundamentally about trust. Given that all governments have become more vocal about Internet matters, the debate was never over whether government would be involved, but rather about who the global Internet community trusted to lead on governance matters.

My weekly technology law column (Toronto Star version, homepage version) argues that the Internet governance choice was a relatively easy one at the time, but in recent weeks the revelations about widespread U.S. secret surveillance of the Internet may cause many to rethink their views. Starting with the first disclosures in early June about the collection of phone metadata, the past two months have been marked by a dizzying array of reports that reveal a massive U.S. surveillance infrastructure that covers the globe and seeks access to virtually all Internet-based communications.

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August 2, 2013 4 comments Columns

Save the Date: The Canadian Copyright Pentalogy Conference on October 4, 2013

Earlier this year, the University of Ottawa Press published The Copyright Pentalogy: How the Supreme Court of Canada Shook the Foundations of Canadian Copyright Law, an effort by many of Canada’s leading copyright scholars to begin the process of examining the long-term implications of the copyright pentalogy. The book is […]

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August 2, 2013 Comments are Disabled News

Industry Minister James Moore’s Commitment to Wireless Competition, Resolution Style

Whereas the 2013 OECD Communications Outlook ranked Canada among the ten most expensive countries for wireless services in virtually every category;

Whereas the Wall Report commissioned by Industry Canada and the CRTC found that Canadian prices are on the high side in nearly every category of wireless service;

Whereas the Canadian Wireless Telecommunications Association has argued that consumers would be willing to pay more for wireless services and Telus has said that given our geography Canada should be the most expensive country for the wireless services in the OECD;

Whereas Canada has long been one of the only developed economy countries with significant restrictions on telecom foreign investment and has been characterized as the most restrictive in the OECD;

Whereas Bell has consistently opposed or sought to delay changes to the foreign investment rules;

Whereas the government announced a telecom policy last year that opened the door to greater foreign investment and rules designed to facilitate new entrants to the marketplace;

Whereas Telus described that policy as “thoughtful and balanced”;

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August 1, 2013 8 comments News

Telus Flip-Flopping Continues With Latest Lawsuit as Company Changes Its Tune Yet Again

Telus’ decision to file a lawsuit against the federal government over its spectrum transfer rules continues a trend of flip-flopping on policy issues at the company. What does Telus think of the government’s wireless policies?  Apparently it depends when you ask. For example, in March 2012, Telus said the following about the spectrum auction approach:

TELUS believes this is a thoughtful and balanced decision that meets the Government’s objectives of promoting consumer choice, supporting sustainable competition through investment in technology and further expanding broadband services in rural markets.

Sixteen months (and the possibility of a Verizon entry) later, CEO Darren Entwistle now says:

There’s going to be a bloodbath, because people are not going to give up on getting that block. So it’s going to be prohibitively expensive and suck a lot of money out of the industry – money that won’t go to infrastructure and technology, money that won’t go into rural coverage or support lower prices.

There is similar change of tune with the latest lawsuit.

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July 31, 2013 11 comments News

Why the Canadian Plan to Encourage Wireless Competition Is Consistent with Many Developed Countries

As the lobby onslaught from Bell, Telus, and Rogers bears some fruit – editorials from the Globe and Toronto Star calling for the government to reverse its position on a set-aside as well as support from the Canadian Council of Chief Executives and from a leading telecom union – it is worth considering whether the Canadian policy differs significantly from other developed economies. The Canadian policy boils down to the two issues: opening the door to telecom foreign investment after years of restrictions and creating a spectrum set-aside to ensure that new entrants (whether domestic or foreign) have a reasonable shot at winning sufficient spectrum to offer competitive wireless services in Canada.

While the big three argue for a “level playing field”, the reality is that Bell, Telus, and Rogers already enjoy enormous marketplace advantages. As I’ve previously discussed, these include restrictions on foreign ownership for broadcast distribution, extensive broadcast assets that Verizon could not touch, millions of subscribers locked into long term contracts, far more spectrum than Verizon would own, and shared networks that saves the companies millions of dollars. In the absence of a set-aside, the incentives for the big three would be to pay far above market price for the spectrum in order to keep competitors out of the market. In other words, Bell, Telus and Rogers will massively over-pay for the spectrum to keep out Verizon unless the government establishes a policy that precludes them from doing so.

The incumbent talking points might lead some to believe that the Canadian policy is dramatically different from other countries (Bell has been talking about how the U.S. would never grant equivalent access, while the Globe speculates  that perhaps the policy is “the result of a drafting error”). Yet a review of recent spectrum auctions in other OECD countries indicates that the twin policy of encouraging foreign investment plus establishing set-asides to facilitate competition is very common. The biggest difference between Canada and many other developed economies is that Canada is late to opening its telecom market and is therefore doing both at roughly the same time. In other countries, foreign investment restrictions in the telecom market were removed years ago.

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July 30, 2013 11 comments News