I'm not a proud Canadian these days. It seems that everywhere I look I see some monopolist trying to wipe out free markets in Canada, and not enough government intervention to protect the market. There are individuals in the current cabinet who appear on the surface to share some ideas, but who are sending mixed messages. I also don't get the impression that there is enough support elsewhere in cabinet, with other parliamentarians and parties, or with the larger bureaucracy who should be working for us.
This week we saw quite a bit with the incumbent phone/cable companies trying to wipe out competition through the so-called "Usage Based Billing" fiasco at the CRTC for landline data communications, and through Public Mobile and TELUS trying to wipe out competitor WIND Mobile through the federal court.
If you follow the twitter feed for current Federal Industry Minister Tony Clement, you might think the government is firmly behind solving these problems.
Almost immediately after the federal court decision (See Globalive press release), Tony Clement said:
After seeing the reaction from the public about the Usage Based Billing decision at the CRTC, Tony Clement said:
While I was thankful for attention to the decision, it was unfortunate that much of the public reaction didn't relate to the CRTC decision. Customers of bundles with the phone/cable companies were complaining about UBB, but the recent decision didn't have anything to do with them. Even if the recent decision is overturned, ISPs will be allowed to charge their own customers for usage.
The question was whether the companies currently running the government-granted last-mile connections to our homes would be allowed to impose inappropriate fees on their competitors : especially fees like per-byte usage fees which have nothing to do with the specific last-mile connectivity service being discussed. On this issue, in the context of a discussion with the National editor of Maclean's magazine, Tony Clement wrote:
(For more on this issue, see my intervention before the CRTC which included a suggestion of structural separation between this last-mile natural monopoly and a competitive marketplace for services that could be built on top)
Here is the problem that I see. The decisions that Tony Clement has made thus far on these issues are temporary cabinet decisions, not long term legislative solutions where all the "i"'s are dotted and the "t"'s crossed.
When I signed up for WIND mobile I knew that if the government changed (there is an election coming soon) or someone less technically aware than Tony Clement took over as Minister of Industry Canada, that my mobile voice/data provider of choice would be allowed to fade away.
I signed up with TekSavvy specifically rejecting the incumbent phone/cable companies as options for my landline voice/data. Working in this industry I knew that the phone/cable companies were in a conflict of interest for providing proper Internet services, and that they would continue to abuse any legal, business or technological trickery they could get away with to wipe out competition.
For the same reasons I am also trying to replace my cable TV, but unfortunately the only current options for this type of content is from incumbent phone/cable companies (Rogers cable, Bell satellite, Shaw satellite). I'm stuck with paying money to companies I find offensive, not accessing the content I want, or being pushed like so many Canadians towards less legal alternatives.
These problems need legislative changes to make legal competition more stable. A cabinet directive saying to allow market forces to decide means nothing when there is so much disagreement as to what that means.
For land-line communication, the "last mile" to our homes is both a natural monopoly and an exception to property rights to allow these lines to be put above and below private and public property without asking permission of or making payments to the owners. Left in a policy vacuum, inadequate regulation allows the existing managers of this "last mile" to leverage that monopoly to wipe out competition in services built on top of those connection. In other words, we must have strong regulation of this "last mile" in order for market forces to exist at all.
We have a situation where Bell Canada has been allowed to own CTV (owned before, and will most likely be allowed to re-purchase again). This is a company that has never liked the Internet, and considers it competition to its phone service and its growing broadcast/content services.
I am a fan of Sanctuary, a science-fiction show out of Vancouver that is partly funded by and aired on Space. Space is owned by CTV, which is (will be) owned by Bell. What are the chances that the parent companies will allow Space as a channel or Sanctuary alone to be available for legal digital download for those of us who want to pay directly rather than watch through an incumbent BDU? If I could get Space directly over the Internet I would be able to drop down my cable package, putting those savings directly into purchasing more content from the creators. Phone and cable companies aren't going to allow companies they own to enable customers to skip them as intermediaries.
I suspect I'll eventually be left with the only viable legal option being to purchase the DVD's a year or more after the last episode of a season airs (2+ years after premier) . This leads me directly into how the passage of an inadequately amended Bill C-32 will mean my device shifting of that DVD content to work on the devices I own will be even more illegal than it is today given I'll continue to circumvent the TPM. Bill C-32 was tabled by Tony Clement, and contains a direct frontal attack on a competitive technology marketplace.
You can see why I'm nervous when temporary decisions by Tony Clement appear to support competition, but more permanent legislation which he tables attacks competition. This is mixed messages from one of the few people in parliament who on the surface seems to understand some of these issues.