Canada's telcoms regulator declares internet an "essential service"

After decades of allowing anti-competitive mergers in the TV, radio, phone and internet sectors, Canada's telcoms regulator, the CRTC, has taken an important step to address the underperformance of Canada's monopolistic, bumbling phone companies and cable operators, declaring internet access to be an "essential service" and thus something that operators must offer in all territories in which they operate.

The CRTC has set an up/down target of 50Mbps/10Mbps for every Canadian, and will require ISPs to offer unlimited data packages; in return, it is offering the sector $750M in subsidies for rural rollouts.

However, the CRTC will not set prices for these services, which provides the sector with an obvious way to subvert the order, simply by pricing their services out of the range of the customers they do not wish to serve.

The Commission has also announced a suite of customer-friendly reforms, including a requirement to upgrade wireless infrastructure to LTE or better and clear notification about mobile data overages.

Industry has six months to act on these targets, and after that point, Canadians can ask the regulator to intervene to enforce its rules.

The CRTC estimates two million Canadian households, or roughly 18 per cent, don't have access to those speeds or data. The CRTC's goal is to reduce that to 10 per cent by 2021 and down to zero in the next 10 to 15 years.

To achieve that, the CRTC will require providers pay into a fund that's set to grow to $750 million over five years. The companies will be able to dip into that fund to help pay for the infrastructure needed to extend high-speed service to areas where it is not currently available.

The fund is similar to one that subsidized the expansion of local landline telephone service in years past. Providers used to pay 0.53 per cent of their revenues, excluding broadband, into that fund. Now they'll pay the same rate on all revenues, including broadband.

CRTC declares broadband internet access a basic service
[Matthew Kupfer/CBC]