ARCHIVED - Transcript, Hearing April 27, 2016

Volume: 13
Location: Gatineau, Quebec
Date: April 27, 2016
© Copyright Reserved

Attendees and Location

Held at:

Outaouais Room
Conference Centre
140 Promenade du Portage
Gatineau, Québec

Attendees:

• Chairman: Jean-Pierre Blais
  
• Members: Candice Molnar, Peter Menzies, Linda Vennard, Christopher MacDonald
  
• Legal Counsel: Emilia de Somma, Amy Hanley
  
• Secretary: Jade Roy
  
• Hearing Managers: John Macri, Christine Bailey, Sarah O’Brien
  

Transcript

Gatineau, Québec

--- Upon resuming on Wednesday, April 27, 2016 at 9:02 a.m.

17672 LE PRÉSIDENT: À l’ordre, s’il vous plait.

17673 Madame la Secrétaire.

17674 LA SECRÉTAIRE: Merci. Before we begin I would like to announce that -- like I announced yesterday, Concordia University Faculty of Engineering and Computer Science, ADISQ, On Screen Manitoba and the Canadian Media Producers Association advised us that they will not be appearing today.

17675 We will now start with the presentation of MRC de Témiscamingue, s’il vous plaît vous présenter et présentez vos collègues -- votre collègue, et vous avez 10 minutes pour votre présentation.

PRESENTATION

17676 M. WAROLIN: Merci, madame la -- mesdames les commissaires, Monsieur le commissaire, bonjour. Permettez-moi de me présenter, Arnaud Warolin, préfet de la MRC de Témiscamingue, et je vous présente mon collègue, monsieur Martin Roch, préfet de la MRC Abitibi.

17677 Nous tenons d’abord à vous remercier d’avoir accepté de nous entendre dans le cadre de la Commission, et nous espérons que ces audiences du CRTC permettront d’améliorer la desserte numérique dans les régions rurales du Canada.

17678 En préambule, les deux préfets ici présentes -- présents, représentent la région d’Abitibi-Témiscamingue, nous représentons donc cinq MRC. L’Abitibi-Témiscamingue est située à l’ouest du Québec à la frontière de l’Ontario, entre les régions du Nord et la rivière des Outaouais. C'est un vaste territoire de près de 57 000 kilomètres carrés, pour 147 000 de population, soit -- et nous avons une erreur sur notre mémoire -- environ deux habitants au kilomètre carré.

17679 Notre région est une région-ressource, une région jeune, une région en croissance au niveau économique, mais qui vit -- y a des difficultés sur le plan de sa démographie.

17680 Notre région, malgré ce qu’on peut en entendre, est peu ou mal desservie en termes d’internet haute vitesse et de téléphonie cellulaire.

17681 M. ROCH: Le territoire de l’Abitibi-Témiscamingue est isolé par un lien de population habitée. Le parc La Vérendrye qui est environ 200 kilomètres nous coupe de -- d’un lien continu d’habitation. Et le Nord, la forêt Boréale nous encadre avec toutes ses ressources, mais avec ses contraintes aussi.

17682 Donc ce contexte nous met dans une situation d’isolement pis peut-être de moins grand intérêt pour certaines entreprises à profitabilité établie. Le territoire, selon les statistiques, semble desservi par le réseau cellulaire autour de 77 à 80 pour cent, mais on s’aimerait s’entendre sur la desserte et la qualité.

17683 Là nous nous considérons que desservi à une barre de signal ou une demi-barre ou une barre et demie, c'est pas être desservi. Ça fait des situations que la communication est coupée, est pas continue. Un exemple très concret, à mon chalet au Lac Abitibi, on a un petit endroit sur la fenêtre que c'est indiqué, « Placez votre cellulaire ici si vous voulez avoir au moins une barre et demie. Sinon, vous devez sortir à l’extérieur, lever le bras pis attendre que le signal arrive. » Dans des contextes d’urgence ou dans des contextes de d’autres situations, c'est un peu problématique.

17684 Nous voulons aussi dénoncer la qualité du -- ben la qualité du signal et le prix, le prix des forfaits en région, et l'accessibilité à tous. On est en train de déployer un Canada à deux vitesses -- on est en train de déployer un Canada qui a des gens qui sont connectés, et les autres au numérique.

17685 Ça nous donne une situation que la mondialisation s’adresse aux gens qui ont accès à tous les services. Pour les autres, y ont accès à une ligne terrestre au meilleur, une ligne terrestre partagée, et même parfois juste les signaux de fumée sont suffisants. Nous considérons qu’on vit une certaine discrimination au niveau du numérique. Nous sommes en train de déployer un Canada avec deux vitesses.

17686 L’objectif du CRTC qu’on a relevé est résolu à veiller à ce que les Canadiens en tant que citoyens créateurs et consommateurs aient accès à un système de communication de classe mondiale qui encourage l’innovation et enrichit leur vie.

17687 Nous demandons que le Gouvernement fédéral légifère correctement, efficacement pour obliger les compagnies à offrir un service cellulaire sur tout le territoire habité. Nous considérons que le service cellulaire est devenu un service essentiel comme Radio-Canada, comme le déploiement des systèmes ferroviaires, comme le réseau routier qui a relié toutes les régions ensemble. Nous devons être inclusifs et partager à tous le même service qu’on considère essentiel aujourd'hui pour être dans le monde moderne.

17688 De plus, nous voudrions que cette intervention du gouvernement se fasse en concertation afin d’atteindre un système de communication complet, pas seulement quelques bribes de communication ou une partie du système de communication. Pour nous c'est essentiel que tous puissent recevoir également un système de qualité.

17689 Dans le déploiement de l’internet on nous vend des systèmes à une certaine vitesse, mais lorsque ces vitesses-là sont mesurées, c'est bien en deçà de ce qui est vendu sur la facture. On a des gens qui sont pris en otage avec un système téléphonique terrestre, puis si ils veulent participer à la modernité, doivent payer un système cellulaire en parallèle qui peuvent pas utiliser chez eux, mais qui peuvent utiliser lorsqu’on se déplace dans les grands centres ou dans les centres plus urbains ou quelque chose comme ça.

17690 Nous considérons plusieurs petits arguments qui permettent de dire que pour le déploiement du Canada dans sa totalité, nous devrions favoriser ce déploiement-là du service cellulaire et internet comme un service essentiel. Mais nous mettons l’accent sur le cellulaire, parce que avec le cellulaire vous pouvez facilement avoir accès à internet, mais le cellulaire lui représente des éléments précis.

17691 M. WAROLIN: Quelques arguments afin d’étayer les propos de mon collègue, monsieur Martin Roch. Pour des raisons de sécurité publique, pour nous c'est absolument extrêmement important d’avoir accès à ces systèmes de communication, considérant la très grande surface de nos territoires, et la répartition de ses populations.

17692 Dernièrement, pendant les fêtes de Noël, nous avons pu en voir écho dans le journal La Presse, des jeunes de la communauté algonquine de Eagle Village, se sont perdus à cinq kilomètres de la réserve, et donc dû attendre deux jours à côté de leur voiture que quelqu'un vienne les chercher. Nous considérons que ces éléments-là sont inacceptables aujourd'hui.

17693 Un autre cas, un agriculteur qui est tombé d’un tracteur à trois kilomètres de l’hôpital de Ville-Marie et qui a dû attendre plusieurs heures avant de pouvoir se faire secourir. Donc quand on parle de desserte, c'est une question de sécurité publique extrêmement importante sur les territoires.

17694 Pour des raisons d’attraction et de rétention, au cours des années les habitudes de vies ont changé. Et tant l’internet que le cellulaire font partie intégrante de nos vies.

17695 Comment attirer des nouvelles familles, des professionnels, des médecins, des architectes, des ingénieurs sans l’accès à ces services, devenus aujourd’hui essentiels. Sur les offres pour les maisons aujourd'hui écrit « desservi ou non desservi ». On ne peut pas absolument pas se développer en tant que région dans ces conditions-là.

17696 Pour des raisons de développement économique, mon collègue vous en a fait part, les entreprises d’aujourd'hui doivent avoir accès à des communications de qualité, tant pour leurs employés que pour leurs affaires. Alors dans nos régions -- et nous avons plusieurs lettres de compagnies qui ne peuvent pas venir s’installer chez nous, qui ne peuvent pas permettre le développement de nos territoires, faute d’accès à ces services-là.

17697 Il en est dans l’industrie, il en est dans l’agriculture aussi ou dans la foresterie, avec les nouveaux outils nous devons être considérés comme des citoyens à part entière.

17698 Pour des raisons d’accès au savoir et à la culture, quoi de plus important que l’éducation de nos enfants aujourd’hui pour faire des travaux scolaires, pour suivre des cursus.

17699 Pour continuer à se spécialiser il faut avoir accès à internet haute vitesse. Il faut avoir accès à la téléphonie cellulaire et actuellement nous sommes extrêmement limités; plusieurs municipalités n’ont pas accès.

17700 Donc ça c’est un élément extrêmement important et nous le voyons d’un terme aussi culturel, si on veut accéder au savoir du monde nous devons passer par ces moyens de communication.

17701 Pour des raisons de santé publique, nous l’avons dit, nous sommes un territoire très grand, avec des populations dispersées, avec plusieurs communautés amérindiennes.

17702 Aujourd’hui les techniques médicales, voir un médecin avec des systèmes de vidéoconférence, obtenir de l’information, nous devons aller vers là.

17703 Nous voyons les limitations des gouvernements actuels et nous devons pouvoir accéder à ces technologies, malheureusement nous ne pouvons le faire.

17704 Enfin pour la vie de tous les jours, nous le savons et nous le voyons de plus en plus, que ça soit pour des services bancaires, notons Desjardins qui offre -- qui ferme actuellement chez nous des points de service en disant les gens accèdent à l’internet pour faire leurs transactions.

17705 Donc si nous n’avons pas accès à internet ça veut dire que nous ne pouvons pas faire de transactions bancaires. Comprenez la difficulté de la situation. C’est la même chose avec les organisations, les permis.

17706 Il en est de même pour le CRTC. Nous avions reçu votre sondage, sondage qu’on doit remplir sur internet. Oui, il y avait une possibilité téléphonique, mais on s’entend que si on veut participer à ces efforts démocratiques-là on doit accéder à de l’internet et pas de l’internet basse-vitesse, de l’internet qui permet au moins de remplir le formulaire du CRTC sans si reprendre à trois fois.

17707 En conclusion, Mesdames et Messieurs les Commissaires, le Canada ne doit pas rater le virage du numérique.

17708 Dans la société du savoir qui se dessine actuellement, nous ne pouvons accepter d’avoir un Canada avec d’un côté des urbains ayant accès au système de communication et au monde et de l’autre des ruraux privés, exclus des moyens de communication modernes. C’est une question d’équité, d’égalité et d’inclusivité.

17709 C’est d’un vrai projet ambitieux dont nous avons besoin, afin de permettre à l’ensemble des citoyens du Canada de pouvoir vivre et se développer dans leur milieu de vie.

17710 Nous désirons exprimer avec ce mémoire notre désir de collaborer avec le CRTC. CRTC que nous pensons être la meilleure instance pour régler cette problématique dans son ensemble et pas en séparant la téléphonie cellulaire d’un bord et l’internet haute vitesse de l’autre.

17711 Aujourd’hui ces technologies-là sont intimement liées et nous croyons que vous êtes la meilleure organisation afin de nous aider dans cette tâche.

17712 Nous désirons aussi que le Gouvernement Fédéral s’implique dans ce projet, afin d’assurer au niveau législatif et au niveau financier une desserte internet haute vitesse et cellulaire adéquate pour l’ensemble des citoyens du Canada. Merci beaucoup.

17713 LE PRÉSIDENT: Merci beaucoup pour votre présence et votre participation à l’instance. C’est fort apprécié.

17714 Vous pouvez tenir pour acquis, pour les fins de notre discussion, que le Conseil comprend bien que la connectivité est vitale pour la vie économique, sociale, démocratique, culturelle, dans son ensemble. Donc là on est au-delà de ça. On essaie de trouver des solutions.

17715 Et en passant -- bien je le note ici, même Radio-Canada a fait l’erreur. Curieusement en français on est un Conseil, donc nous sommes des Conseillers et en anglais on est un Commission et nous sommes des commissionners, mais même à Radio-Canada on fait l’erreur, donc voilà.

17716 Si je comprends bien votre première priorité c’est plutôt le déploiement des services mobiles cellulaires? Est-ce que je vous comprends bien? Si vous aviez à mettre des priorités?

17717 M. WAROLIN: Oui, absolument, Monsieur le Commissaire, si on doit l’appeler ainsi.

--- (LAUGHTER)

17718 LE PRÉSIDENT: Conseiller, conseiller.

17719 M. WAROLIN: Monsieur le Conseiller. Le Conseiller.

17720 LE PRÉSIDENT: Voilà.

17721 M. WAROLIN: Monsieur le Conseiller, aujourd’hui -- et nous ne sommes pas des experts. Nous devons en tant que -- Monsieur Roch et moi-même nous sommes là pour le service de nos citoyens.

17722 LE PRÉSIDENT: Oui, mais c’est ce que vous entendez de la part de vos commettants que c’est plutôt le côté sans fil, cellulaire, mobile, qui est la première priorité si on avait que un certain montant de dollars, d’effort, de ressources à déployer ça serait surtout ça?

17723 M. WAROLIN: Oui, mais ce que on nous dit c’est que de toute façon si il y a un service de cellulaire disponible, inévitablement maintenant on a accès à l’internet.

17724 Donc oui c’est pour nous une priorité de cellulaire. Le cellulaire c’est une question de sécurité publique.

17725 C’est une question essentielle, la sécurité de nos citoyens, le fait de pouvoir communiquer en cas d’urgence c’est un élément majeur. On a des exemples. On pourrait vous donner des exemples toute la journée de l’importance d’avoir accès à ce cellulaire-là et en ayant assez nous pourrons accéder, même si ce n’est pas du très haute vitesse, au moins à de l’internet de base.

17726 LE PRÉSIDENT: Certains diront par contre que les appareils intelligents –- je ne sais pas si c’est les appareils qui sont intelligents ou plutôt les gens qui les utilisent, mais voilà, ont peut-être des limites technologiques d’une part, à offrir le genre de -- à l’heure actuelle des services à large bande auxquelles vous voulez avoir accès et en plus les coûts actuellement au Canada pour ces services-là sont plus élevés, mettons, que l’accès par d’autres moyens au service de large bande.

17727 Vous ne trouvez pas que c’est une préoccupation ou est-ce que comme d’autres vous envisagez que la technologie va faire en sorte, puis la concurrence va faire en sorte, que les prix vont baisser et que la technologie va être au rendez-vous même sur une plateforme mobile?

17728 M. ROCH: Vous nous demandez qu’est-ce qui serait l’idéal? L’idéal c’est d’avoir les deux réseaux bien déployés et de qualité.

17729 Nous voulons avoir -- ou minimalement la possibilité de communiquer rapidement et d’intervenir.

17730 Le partage des données-là, mon fils m’a montré ça sur mon téléphone, le partage des données avec les appareils intelligents effectivement ça l’apporte des forfaits autour de $100 pour un 3 gigs.

17731 Mais moi je voudrais vous dire que en Abitibi pour avoir une connexion de 70 gigs, par câble moins de 5 -- je connais -- mégabits, ça coûte $75-là, puis d’avoir un téléphone avec juste le droit de partager ça me coûte 60-65; 1 gig c’est 60-65.

17732 Effectivement c’est très cher. On est dans des forfaits peu accessibles. Chez-moi là si on est six au total, il y a à peu près $400 par mois de -- qui est payé en communication pour internet, le câble, les téléphones cellulaires, les éléments et encore un téléphone terrestre.

17733 C’est cet élément-là qu’on considère un peu problématique, que la concurrence ne s’établisse pas c’est des règles de marché, mais au moins d’avoir accès et d’avoir le libre choix d’y participer ou pas.

17734 À Clairval, le seul moyen d’avoir l’internet pour l’instant c’est par la connexion cellulaire. Je partage des données.

17735 Donc ça fait une gestion responsable, puis c’est bien pour nos enfants. Ça fait une gestion responsable de la présence sur le net ou d’utiliser le net pour l’essentiel et -- mais c’est le minimal. C’est l’information minimale qu’on devrait avoir.

17736 Nous aimerions d’avantage une belle couverture aussi efficace qu’ailleurs, mais minimalement c’est l’essence même qu’on aimerait être desservi.

17737 LE PRÉSIDENT: Vous avez fait référence dans votre présentation à des entretiens que vous avez eu avec -- ou des lettres que vous avez reçu des fournisseurs.

17738 Pouvez-vous nous parler plus d’avec qui et quels fournisseurs, puis qu’est-ce qu’ils vous ont dit?

17739 M. WAROLIN: Effectivement si on veut pouvoir se développer il faut avoir du développement économique.

17740 Quand on essaie d’attirer des entreprises, même si nous avons les ressources naturelles, si nous avons de la main d’œuvre, il faut avoir accès à ces technologies-là.

17741 Donc ces entreprises, puis on a plusieurs exemples, mon collègue vous en parlera, que ça soit en terme de -- en termes agricoles, en termes culturels, en termes -- au niveau forestier aussi ou minier, si nous devons -- nous n’avons pas accès à ces éléments de base, non seulement ça vient pénaliser l’entreprise -- hein on comprend très bien?

17742 C’est évident aujourd’hui beaucoup de ventes se font par internet. Les systèmes de gestion se font par internet, les systèmes boursiers, tout passe par un système internet ou par de la téléphonie cellulaire.

17743 Donc ces entreprises peuvent faire le choix -- et je rajouterais aussi l’élément de faire venir des cadres, de faire venir des spécialistes, si on dit -- si on disait moi ma famille vous allez venir dans un milieu, mais vous allez être privés de ces technologies-là, on vient quand même de se limiter énormément. Alors, il est évident que on se retrouve d’une certaine façon à une discrimination. Et l’entreprise préfère à ce moment-là s’installer dans un centre, dans un endroit où on a accès à cette téléphonie, et faire tout simplement le transport des matières premières pour les transformer, pas sur notre territoire, mais transformer ailleurs.

17744 Alors vous comprenez que l’impact est extrêmement négatif et c'est constamment, non seulement des entreprise qu’on veut attirer, mais les entreprises présentes qui aujourd'hui à l’ère du numérique vont malheureusement soit s’exclure de ces marchés faute d’accès, soit déménager pour pouvoir avoir de la croissance.

17745 Je laisserais la parole à Monsieur Roch qui vous donnera un exemple concret.

17746 M. ROCH: Un exemple concret, Tourbières Lambert. Tourbières Lambert qui est sur le territoire du Québec depuis 87 ans qui est situé dans le Bas-Saint-Laurent, au Saguenay-Lac-St-Jean, sur la Côte-Nord, ont un projet à Senneterre. À Senneterre y viennent créer 40 emplois, c'est des millions d’investissement, un million de masses salariales récurrentes annuellement, un million d'investissement dans la région, et deux millions pour la modernisation de l’usine.

17747 Si on prend la carte qu’on vous a laissée là de la desserte, l’usine est située à Senneterre, mais les sites d’extraction sont situés dans les zones complètement vides de service cellulaire. Lorsqu’y ont pris état de cette situation-là y ont dit, « Comment on va gérer la sécurité des travailleurs qui vont dans des sites -- là on est dans -- on est pas sur une route asphaltée là, on est dans des tourbières à l’intérieur du bois. »

17748 Donc y ont déjà envoyé une lettre, une demande de dire, « Comment on peut régler cette problématique-là? » Tout est possible, l'investissement privé peut tout palier, on peut utiliser le -- on peut utiliser n’importe quoi, mais c'est des technologies qui coûtent plus cher à l’exploitation pis qui nous rend non concurrentiels.

17749 Ces gens-là nous ont demandé, « Comment ça se fait que au -- minimalement dans les zones habitées y a même pas le service de cellulaire. » Donc ça met en péril une partie de leur projet de déploiement.

17750 Un autre projet important, Royal Nickel qui est situé -- le projet Dumont à Launay, est un projet qui a dû se déployer pendant trois ans de temps sans couverture cellulaire du tout. Puis par la suite, une tour est apparue sur le long du réseau, qui maintenant facilite énormément leur projet de déploiement de cette mine-là.

17751 Mais d’autres sites miniers -- on choisit pas où le minerai est comme on choisit pas où est-ce que -- on aimerait ben toutes les mettre proche là, pis dans un beau circuit déployé ---

17752 LE PRÉSIDENT: Ça coûterait encore plus cher ça, déplacer les ressources.

17753 M. ROCH: Mais j’aimerais voir le colosse qui déplace ces ressources-là.

17754 LE PRÉSIDENT: Oui.

17755 M. ROCH: C'est cet élément-là. Donc on a des situations -- on est une région ressource. Les ressources elles sont à l’endroit -- à Saint-Mathieu-d’Harricana l’usine d’Eau Vive Eska qui distribue l'eau -- mais pas la vôtre là, mais l’eau Eska, sont dans un secteur où est-ce qui avait pas de couverture cellulaire. Les interventions qu’on doit faire dans ce secteur-là, soit par -- eux y ont dû déployer pis investir pour régler leur problème, mais ça règle pas le problème de -- en dehors de l’usine elle-même.

17756 Donc c'est là qu’on voit que ces situations-là sont -- oui, ils sont captifs, mais lorsque les coûts pour pouvoir exploiter un site sont moins efficaces que dans d’autres régions ou dans d’autres secteurs, ça peut mettre en attente des projets en attendant ou en -- que soit les prix des métaux ou soit les coûts d’exploitation soient abordables. Donc c'est des exemples simples.

17757 Aujourd'hui on a un autre projet avec Olymel de déployer des maternités porcines dans le secteur Champneuf, Rochebeaucourt, La Morandière. Dans la carte là c'est très petit, mais -- bon, Olymel eux c'est cinq maternités, 10 emplois -- 50 emplois qui pourraient être créés dans une zone rurale. Mais encore là, la zone rurale non desservie par le cellulaire, non desservie.

17758 Eux, leur système d’épandage de fumier ça se fait injecter dans le sol à même le réservoir, pis c'est un -- c'est un système de référence là qui -- bon, on a même pas ça pour pouvoir les aider.

17759 Donc minimalement, qu’est-ce qu’on aimerait avoir? Ben, d’abord le cellulaire, mais évidemment une couverture internet adéquate aussi là.

17760 LE PRÉSIDENT: Oui. Avez-vous eu des discussions avec les compagnies de télécommunications?

17761 M. WAROLIN: Oui, absolument. C'est évident que on a déjà des services sur place. Alors alors les raisons sont toujours les mêmes, faible population, non-rentabilité des investissements. On sait que ces technologies évoluent à une grande vitesse aussi. Nous avons d’ailleurs des propres projets. Y a plusieurs projets qu’on a tenté de faire, le monde municipal en collaboration avec des associations, des organismes sur nos territoires, mais on se bat pas à armes égales.

17762 C'est pas normal que des citoyens, que des MRC, que des régions soient obligées de prendre de l’argent des citoyens, l’argent des taxes pour essayer de palier à ce qui se fait ailleurs à un coût payé par le privé.

17763 Donc on comprend bien qui a des enjeux. Nous ne voulons pas jeter la pierre à l’industrie ni au gouvernement, on veut collaborer avec eux, y a certainement des solutions. Si on est capable de capter et d’offrir des services en Afrique par exemple, ou en Asie, il nous semble un petit peu étrange ---

17764 LE PRÉSIDENT: M'hm.

17765 M. WAROLIN: --- que dans des régions pas si éloignées que ça, peut-être que pour les urbains elles le sont, mais nous avons fait la route hier et c'est tout de même -- cinq heures de route c'est quand même raisonnable, et nous ne comprenons pas comment on peut pas être plus innovants, plus ouverts, trouver des solutions qui fassent l’affaire.

17766 Le Gouvernement fédéral a investi au cours des années des millions dans différents projets de technologie, notamment chez nous le large bande, donc une fibre optique qui relie chacune des municipalités. Cette fibre optique là nous ne pouvons pas nous en servir, nous ne pouvons pas nous en servir. Elle ne sert que ---

17767 LE PRÉSIDENT: Pourquoi?

17768 M. WAROLIN: Pour des règles de -- des règles de concurrence, des règles aussi de sécurité notamment, si on parle avec les réseaux de la police ou des réseaux de la santé. Il y a des infrastructures, et pour des affaires aussi de contrats, contractuels notamment avec Télébec chez nous, ben on se retrouve avec une infrastructure qu’on a payé, mais qui ne permet pas de la diffuser à toutes -- à tous nos citoyens.

17769 Donc nous ne sommes pas des experts, je le répète, mais nous sommes persuadés que dans un pays comme le nôtre on peut trouver des solutions, pas forcément une solution, mais des solutions pour au moins améliorer la situation.

17770 Et on le sait, ça va tellement vite en termes de technologie, que peut-être que dans deux ans, trois ans, quatre ans, on va encore trouver des moyens de rendre enfin le service accessible partout. Mais si au moins les villages, les routes, hein, que ça soit pas continuellement coupé, ça c'est un élément important pour nous.

17771 Nous sommes aussi collés à nos voisins de l’Ontario, je pense que y aurait des maillages à faire pour qu’on puisse travailler ensemble, desservir de part et d’autres. On est dans un grand pays, mais y faut s’entraider.

17772 LE PRÉSIDENT: M'hm.

17773 M. WAROLIN: Donc nous on veut collaborer, on veut être impliqué dans les -- dans les décisions que vont prendre le CRTC et vont prendre le Gouvernement fédéral, car actuellement nous avons l’impression que toutes ces décisions-là sont faites sans consultation, et sans -- sans se rapprocher du terrain et des réels besoins des citoyens.

17774 LE PRÉSIDENT: Vous avez mentionné Télébec, est-ce que vous avez approché d’autres entreprises?

17775 M. WAROLIN: Oui, y a plusieurs télécommunicateurs, dont Rogers Communications, on a Vidéotron qui s’installe sur notre territoire. Tout le monde est en attente, hein.

17776 On se le cachera pas. Il faut avoir une stratégie d’ensemble. Aujourd’hui, tout nous porte à croire que ces deux éléments, cellulaire et internet, vont migrer ensemble et devenir un seul moyen moderne de communication. Donc il faut qu’il y ait une vision gouvernementale qui soit intégrée pour nous permettre de développer ça et que des régulations ou des règlementations ne viennent pas dire blanc d’un côté et puis gris ou noir de l’autre, et c’est ce qu’on vit actuellement.

17777 Alors il faut absolument intégrer tout ça. Nous sommes très contents de pouvoir passer ce message-là au gouvernement. Vous l’avez dit, dans les autres pays du G7, c’est intégré. Pourquoi pas au Canada?

17778 LE PRÉSIDENT: Si je comprends bien, implicitement dans votre réponse c’est que vous n’avez pas eu satisfaction du régulateur du spectre?

17779 M. WAROLIN: Non.

17780 LE PRÉSIDENT: D’autres sont intervenus, particulièrement des représentants comme vous, des municipalités, des organismes régionaux qui sont semblables au MRC. Notamment, je songe au groupe de l’est de l’Ontario qui sont venus me parler de leur façon d’approcher et puis essentiellement c’était un PPP où on voyait un peu d’argent du fédéral, jumelé avec le privé, évidemment les entreprises de télécommunications et les pouvoirs locaux, municipaux, de la région.

17781 Est-ce que vous trouvez que c’est un modèle intéressant que vous avez étudié ou non? Je sais que vous avez un regroupement dans votre région qui ont comparu chez nous un petit peu plus tôt, mais est-ce qu’au-delà d’un regroupement pour identifier les problèmes, est-ce que vous avez songé et est-ce que vous êtes favorable à des partenariats PPP pour assurer le déploiement?

17782 M. ROCH: On a déjà déposé un projet, l’ensemble du territoire, avec l’organisme sans but lucratif, le GIRAT, qui avait déposé une solution internet mobile -- cellulaire mobile, excusez-moi, pour l’ensemble du territoire avec un projet de 31 tours en partenariat avec un privé, le gouvernement fédéral, le gouvernement du provincial et une partie du municipal dans ce projet-là. Ce projet-là n’a pas été retenu.

17783 Mais lorsqu’on a commencé à se questionner fondamentalement, il y a un constat qu’on fait. Il y a beaucoup de joueurs qui interviennent dans le dossier, mais il y a aussi d’autres partenaires, exemple au Québec, Hydro-Québec qui a installé des compteurs intelligents partout. Ils ont besoin de faire une lecture de ces compteurs-là et ils installent des petites tours et puis ils font une espèce de réseau de communications mais comme à vase clos.

17784 Nous, on se questionne toujours pourquoi le gouvernement n’a pas -- il n’y a pas quelqu’un qui dit, « Voyons, on va arrêter de faire pousser un paquet de tours qui appartiennent à Pierre, Jean et Jacques et que chacun ait son exclusivité pour des questions de sécurité... » comme si c’était grave qu’on pourrait mettre deux appareils dans une même tour.

17785 On n’est pas des experts, mais le constat de la population c’est qu’on voit un paquet d’infrastructures s’installer. Tout ça coûte de l’argent. Est-ce que c’est efficient? C’est efficace. Ça rend service à celui qui en a besoin à ce moment précis là.

17786 Mais comme communauté, comme organisation théoriquement structurée, est-ce qu’il n’y aurait pas lieu que quelqu’un prenne en charge ce déploiement-là et puis qui dit -- qui puisse faire un constat clair : les besoins somme ça, comme ça, comme ça; les partenaires sont là et sont là. Faisons un cadre que tous doivent s’intégrer un en l’autre pour éviter de déployer des coûts énormes.

17787 On est au courant que là il y a une espèce de petit projet pour relier le parc pour cette problématique-là d’Hydro-Québec des compteurs intelligents. Mais encore là, c’est du vase clos. C’est sans autres partenariats que le besoin d’Hydro-Québec lui-même. On essaie de travailler, mais c’est assez hermétique. C’est un constat qu’on fait dans notre territoire.

17788 M. WAROLIN: Moi, je rajouterais, on a parlé -- donc on a déjà un système au niveau de la fibre optique, système d’Hydro-Québec, un système au niveau de la police, nouveau système au niveau des pompiers. On a des privés, que ce soit Télébec, des projets avec Bell, des projets internes, Communication-Témiscamingue qui a installé des tours aussi.

17789 Donc il faut une vision. Il faut une cohérence. Il faut une législation qui est intéressante et puis il faut une vision, parce que tout ça, ça évolue extrêmement vite. On fait un PPP aujourd’hui et puis dans deux ans ou trois ans, la technologie est dépassée. Il faut remettre de l’argent. Il faut retravailler des projets. Donc il faut vraiment non seulement -- nous, on n’est pas fermé à des solutions, mais il faut avoir vraiment une vision avec un standard, nous assurer qu’on va avoir une technologie qui va répondre aux besoins, qui va être capable d’évoluer dans le temps et pas qu’on laisse à chaque territoire l’odieux de choisir pour les citoyens et puis de faire des essais, des erreurs ou des réussites.

17790 Donc il faut absolument -- puis c’est le rôle du gouvernement fédéral et du CRTC là-dedans de nous accompagner, de nous aider. Je pense que ça serait extrêmement profitable pour l’ensemble du Canada, au lieu de faire des études, si on comptait, Monsieur Blais et Messieurs les commissaires, les conseillers -- je vais y arriver, les conseillers...

17791 LE PRÉSIDENT: Je suis désolé d’avoir même mentionné ça. Là, je vous rends tout nerveux.

17792 M. WAROLIN: Les conseillers.

17793 Si on avait compté toutes les études qu’on a faites sur l’ensemble du Canada pour étudier des possibilités des technologies, ça serait une honte. Alors que fondamentalement c’est les mêmes principes, les mêmes besoins qui s’appliquent, qu’on soit au Yukon, au Québec ou en Alberta.

17794 Donc il faut absolument avoir une vision, une stratégie. Ça s’est fait dans certains pays africains, alors pourquoi pas chez nous et pourquoi vouloir constamment réinventer la roue, réinventer les systèmes alors que ce qu’on demande c’est quand même relativement simple. Les technologies sont connues. Donc ayons un peu de vision. Ayons un peu d’ambition et faisons-le ce projet.

17795 On a été capable d’électrifier le monde rural. On a été capable de donner de la téléphonie. On est capable de desservir les gens avec des routes. Alors aujourd’hui, on est rendu à cette étape-là. Il faut desservir les citoyens du Canada avec un réseau fiable, avec une qualité qui est similaire, avec un coût qui permet l’accès à ces technologies.

17796 LE PRÉSIDENT: Et votre région est toute à fait prête de mettre l’épaule à la roue pour participer?

17797 M. WAROLIN: Absolument. Nous voulons collaborer. Nous ne sommes pas là des experts pour dire il faudrait faire ci ou ça, mais nous croyons que si on se met ensemble, si on regarde les projets de façon intelligente -- on a des projets chez nos voisins du nord-est de l’Ontario. On a des projets chez nous. Bien, forcément, aujourd’hui, les zones, elles voyagent. Il n’y pas de frontières. On est capable de travailler ça en commun et puis de desservir la population.

17798 Nous, on le rappelle. L’important, c’est pas telle ou telle entreprise ou tel ou tel organisme. C’est le service aux citoyens qui est le plus important et ce service-là, il est devenu essentiel.

17799 LE PRÉSIDENT: Est-ce que vous avez eu de l’expérience ou vous avez entendu parler les citoyens de votre région par rapport au service sans fil fixe et les services satellitaires comme solution technologique pour rencontrer vos besoins?

17800 M. ROCH: Service satellitaire, Hydro-Québec avait pensé à cet élément-là et j’imagine dans leur analyse ont considéré que les coûts de communications de quatre minutes par tour par jour amenait une facture. Ces éléments-là sont déployés. La Sûreté du Québec utilise des téléphones satellites, mais c’est pas -- c’est coûteux. C’est une solution efficace. Ça fonctionne, il n’y aucun problème, mais c’est coûteux. C’est déjà très coûteux aujourd’hui. Là, il faut espérer qu’en voulant se baser seulement sur ces genres de technologies-là pour déclarer que la zone est bien couverte, que ça va devenir accessible par les entreprises privées. Ils vont baisser leurs tarifs parce que plusieurs... Je vous laisse le choix de me réconforter sur cette approche-là.

17801 Mais actuellement, ce qu’on voit c’est que par manque de cohérence, plusieurs petits projets naissent avec des solutions temporaires ou alternatives et il y a beaucoup d’argent qui est déployé là-dedans.

17802 Xplornet, actuellement, dépose un projet de service internet sur l’ensemble du territoire et dit que par le satellite, la Zone Témiscamingue va être desservie minimalement à cette vitesse-là.

17803 Mais est-ce qu’il y a quelqu’un qui mesure le minimalement de la vitesse? Chez nous, vous pouvez vérifier dans la presse, Val d’Or, Amos, les gens se sont plaints en disant, « On nous vend des forfaits à telle vitesse, et c’est une échelle, là. Si on veut un peu plus vite, il faut payer plus cher. Si on veut un peu plus vite, il faut payer plus cher pour arriver avec des tarifs autour de 100 $ pour avoir une certaine performance. » Mais aller savoir où est le goulot d’étranglement, on n’est pas des spécialistes. Mais on n’a pas cette vitesse-là et puis on n’a pas...

17804 LE PRÉSIDENT: En fait, si vous regardez le détail de ces publicités-là normalement c’est « jusqu’à telle vitesse ». Donc eux ils font -- ils vont dire qu’ils ne font pas de la fausse publicité mais ---

17805 M. ROCH: Mais nous on entend les commentaires des citoyens que « jusqu’à cette vitesse-là » c’est peut-être pas suffisant, puis il faudrait peut-être qu’y’aille minimalement cette vitesse là jusqu’à celle-là.

17806 LE PRÉSIDENT: M’hm.

17807 M. ROCH: Parce que lorsqu’on descend en bas de un ou on est -- c’est quelque chose de -- tu sais de pouvoir compter qu’on -- les gens de l’Abitibi peuvent regarder En Direct ici sans que ça coupe, ou sans que ça se perde, ou que ça prenne -- que ça bloque, ça télécharge, ça télécharge, ça télécharge, ça bloque, ça télécharge ---

17808 Tu sais c’est sûr qu’on a peur qu’on devienne un Canada à deux vitesses; sans faire de jeux de mots. Ceux qui sont capable d’avoir un vrai service, puis les autres.

17809 LE PRÉSIDENT: M’hm.

17810 M. ROCH: Puis, tu sais, cet élément nous inquiète.

17811 Qu’on veulent participer -- on n’est pas là pour vous dire le satellitaire devrait être priorisé ou autre chose.

17812 On pense que le CRTC devrait être le cœur des recommandations ou la personne mieux informée neutre, qui ne vient pas nous vendre une technologie.

17813 On est -- on ne veut pas parler à le proposeur, installeur et le commerçant, qui va encaisser les revenus de ça.

17814 On aimerait être bien encadré pour qu’on aille un déploiement intelligent, efficient, à moindre coût. Efficace, à moindre coût et que le tout soit intégré partout pour pas qu’il y ait des problèmes de compréhension, si on veut là, dans les services.

17815 LE PRÉSIDENT: Ma dernière question ou mon dernier sujet que je voulais aborder avec vous, parce que vous avez déjà répondu implicitement à plusieurs de mes autres questions, c’est une question j’ai posé à d’autres politiciens qui sont -- qui ont comparus devant nous et c’est par rapport au -- à la volonté des gens, des citoyens de votre région, de payer.

17816 Dans le sens suivant, le -- en bout de ligne un déploiement de cette nature-là, évidemment il y a le secteur privé qui pourrait contribuer, mais il semble que il y a des endroits où économiquement il n’y a pas de plan d’affaire et donc il va falloir des subventions.

17817 Et que ces subventions viennent d’un régime règlementaire ça va avoir une incidence sur les taux d’abonnements.

17818 Ou si ça vient d’un programme gouvernemental, ça soit un gouvernement fédéral, provincial ou municipal, ça vient de la poche du contribuable, mais en bout de ligne il y’a rien qu’un portefeuille, qu’on porte notre chapeau de contribuable ou d’abonné.

17819 Je songe à l’annonce récente du Gouvernement fédéral sur le 500 million. Tous les contribuables contribuent à ce 500 million-là.

17820 Et je me demandais quelle était l’ouverture, à votre avis, comme représentant de ces -- élue de ces citoyens-là, de la disponibilité et de l’ouverture des gens de contribuer encore plus au déploiement des réseaux, évidemment dans votre région.

17821 C’est facile de vouloir payer pour recevoir, mais aussi pour l’ensemble du Canada.

17822 M. ROCH: Dans les secteurs que je vous ai parlé, La Morandière, Rochebaucourt, Champneuf, ce que Tourbières Lambert veulent s’installer, les gens m’interpellent. Me disent moi je suis prêt à payer un double, un triple, pour avoir accès à la téléphonie cellulaire.

17823 Je suis prêt -- les résolutions de ces conseils de villes là sont déjà passées. Ils veulent qu’on brasse la cage, qu’on fasse du démarchage pour inciter à régler la problématique et en être des partenaires financiers.

17824 Les partenaires financiers c’est évident qu’on ne veut pas se substituer. On ne veut pas devenir des subventionnaires de compagnies privées. C’est évident là.

17825 Mais on pense que il y a une responsabilité de l’ensemble des gouvernements et on s’inclue là-dedans, comme municipalité.

17826 Est-ce que ça serait de façon pondérée une partie à même la taxation municipale et une partie à la tarification plus élevée? Oui.

17827 Dans nos secteurs, moi les gens qui m’ont interpellé sont prêts. Ils comprennent la situation mais ils veulent avoir une solution, donc ils comprennent qu’il va avoir un impact financier --

17828 LE PRÉSIDENT: M’hm.

17829 M. ROCH: -- dans leur quotidien.

17830 Mais je vous invite à regarder la grille tarifaire qu’on paie déjà pour des services, somme toute, très, très, très rudimentaires.

17831 Ceux qui ne sont pas desservis, qui paient une ligne terrestre déjà à 75$ ou 70$, eux ils disent je vais en donner 100-120. Je vais en mettre plus, mais pour avoir accès et avoir un seul service, un seul appareil, un -- c’est ce qu’ils veulent.

17832 LE PRÉSIDENT: Oui, parce qu’en fait ils pourraient faire des choix pour éviter le dédoublement si, comme vous disiez tout à l’heure, leur service cellulaire, mobile, pouvait offrir la téléphonie partout?

17833 M. ROCH: Aujourd’hui ils n’ont pas le choix.

17834 LE PRÉSIDENT: Oui.

17835 M. ROCH: Aujourd’hui ils sont captifs de cette situation là. Ils sont prêts à avoir un choix et qu’on module la tarification, qu’on le présente, qu’on l’offre au moins, avant de dire ça ne sera pas rentable et on ne fait pas de projet.

17836 LE PRÉSIDENT: Vous voulez ajouter?

17837 M. WAROLIN: Oui. Je rajouterais, Monsieur le Conseiller, que --

--- (LAUGHTER)

17838 M. WAROLIN: -- on paie déjà. On paie déjà beaucoup. Beaucoup plus que les urbains.

17839 On l’a dit, on paie déjà pour notre ligne fixe, puisqu’on ne peut pas avoir seulement un cellulaire. On paie déjà pour l’internet. On paie déjà pour le câble.

17840 Par contre, il faut le regarder dans un ensemble. Nous les régions nous ne sommes pas un poids. Nous sommes aussi une richesse.

17841 Et les mines sur notre territoire, les forêts sur notre territoire, l’agriculture, contribuent à la richesse du Canada beaucoup plus en proportion du pays B que la population qu’on a.

17842 Alors ce n’est pas une dépense qu’on demande au gouvernement, mais un investissement. Investir dans le développement des régions c’est investir dans la richesse du Canada.

17843 Et quand on parle de discrimination, il faut aussi avoir une vision. Peut pas avoir des citoyens où on dit bien le privé est là, les réseaux sont là. C’est une région qui est plus ancienne, c’est une région qui est mieux desservie.

17844 Et de l’autre côté des communautés et des territoires qu’on balaye du revers de la main en disant c’est normal. C’est à eux de payer. C’est eux qui ont décidés de vivre ici.

17845 Pour moi c’est une question de société. C’est une question je la rappelle de vision. Si on a cette vision là nous on est prêt à collaborer. Mais pas n’importe comment, n’importe où.

17846 Si on nous demande d’investir dans des tours bien on aimerait avoir au moins notre mot à dire sur la technologie, sur la desserte, puis que si jamais il y a un problème avec le privé, rester au moins minimalement propriétaire de quelque chose.

17847 Ce n’est pas le cas aujourd’hui. Aujourd’hui on nous demande de payer, puis de se taire. Puis de dire ‘oui je suis content, merci beaucoup’. Ce n’est pas ça. Ce n’est pas ça la réalité.

17848 Donc oui je pense que notre -- nos municipalités, nos citoyens sont conscients que investir dans une tour de cellulaire, ou investir dans de la voierie, ou de l’aqueduc et de l’égout, aujourd’hui c’est aussi important d’avoir une tour et une desserte que d’avoir une route asphaltée.

17849 Donc on le comprend, mais on veut quand même que les gens réalisent que ces territoires ruraux là, ces territoires qui se développent, elles aussi elles ont certains besoins et on peut travailler -- hein il y a de la péréquation au Canada, bien c’est le même principe.

17850 Il faudrait qu’on ne demande pas à ces citoyens-là, ces très petites municipalités, de payer des frais qu’elles ne peuvent pas payer.

17851 Une tour de cellulaire ou un accès internet c’est des coûts qui sont importants. Donc trouvons une méthode, trouvons un moyen de nous rendre imputable dans les processus et nous on va collaborer, c’est évident. On est rendu là. C’est une question de survie de nos régions.

17852 LE PRÉSIDENT: C’est très bien. Merci vous -- je vais me tourner vers mes collègues. Oui, Monsieur Menzies?

17853 CONSEILLER MENZIES: Bonjour. Je suis désolé, mais je dois poser mes questions en anglais. Répondre ce que vous choisissez.

17854 I’m clear -- we heard with your -- your frustration is obvious, but I just want to clarify that you -- that emergency services, you mentioned police had fibre connectivity to your communities?

17855 And when you talk about interaction it’s -- I’m trying to understand how the Cree Nation who was here the other day was able to connect through a fibre line via Hydro Quebec that was running on theirs and you haven’t been able to get the same access in that sense.

17856 Have you -- I’m going to assume that Hydro Quebec has a fibre line running on its transmissions into your areas. Have you had any discussions with them about being able to connect through them?

17857 M. WAROLIN: Oui, alors vous avez tout à fait raison. D’ailleurs on a déjà eu ce type de relation avec Hydro Québec pour certains festivals, certains moments particuliers, dans –- en Abitibi parfois Hydro Québec nous permet d’accès sur une -- accéder d’une façon temporaire sur son système, mais ne veulent pas le faire de façon récurrente pour des raisons, ils nous disent, de sécurité de leur système.

17858 Pour ce qui est des Cris, il peut y avoir des ententes particulières. Notamment on sait que les Cris des ententes avec la Convention de la Baie James, ce qui n’est pas notre cas.

17859 Pour ce qui est de la police, la police a accès à certains réseaux, la santé aussi, ce qu’on demande c’est une cohérence. Mais oui on a -- on le travaille cet élément-là, mais on ne voit pas de vision. On voit pas de cohérence.

17860 Donc la police, d’un côté, n’a pas accès partout, mais quand même a accès à un certain système de communication, les pompiers, on l’a dit, Hydro Québec. Certains privés, eux aussi, peuvent avoir des systèmes. Et c’est pour ça qu’il faut absolument travailler ensemble, trouver les moyens en protégeant la sécurité.

17861 On comprend qu’il y a une question de sécurité, mais aujourd’hui à l’aire du numérique, on est persuadé qu’on est capable de faire ça.

17862 Mais tant qu’on n’est pas -- il n’y a pas une imposition, la volonté est pas là. La volonté n’est pas là. La volonté n’est pas là de collaborer avec les territoires, de collaborer avec les communautés.

17863 Nous on travaille avec les communautés. Nous c’est des Algonquins qu’on a sur notre territoire de façon majeure. On les dessert aussi avec -- on travaille ensemble.

17864 Donc nous la large-bande, la fibre optique dans le système qui a été payé par le gouvernement fédéral, on rentre dans chaque communauté. On rentre dans les bâtiments municipaux ou dans les bâtiments -- dans les écoles, dans les systèmes de santé.

17865 Là ce qu’on demande, c’est de pouvoir utiliser cette technologie pour la -- pour la déployer à l’ensemble de nos citoyens. Si au moins on avait le droit de faire ça, on règlerait une grande partie de nos problématiques.

17866 Comme je vous dis, on n’est pas des experts, mais de ce qu’on voit, de ce qui se fait ailleurs, de ce qui se fait notamment en Amérique latine ou ailleurs, on prend la fibre optique puis avec des petits routeurs on fait un réseau et au moins on permet de donner un accès.

17867 Alors il y a -- les technologies existent. Des moyens de communication existent. Maintenant ce qu’on n’a pas, c’est la volonté de le faire.

17868 Alors il faut travailler ensemble et je pense qu’on l’a dit, on le répète, si c’est possible avec les Cris, pourquoi ce n’est pas possible dans le reste du territoire ou dans le reste du Canada. C’est une bonne question.

17869 COMMISSIONER MENZIES: I can’t answer that question. Merci.

17870 LE PRÉSIDENT: On est bien loin de la période il y a 100 ans où on appuyait la colonisation puis l’occupation du territoire, mais c’est curieux qu’on a encore des enjeux qui se déclinent dans le même sens avec des nouvelles technologies.

17871 Mais je voulais vous remercier pour avoir participé et puis pour défendre avec passion, vigueur et intelligence votre désir et donc on vous a bien entendu. Merci. Bonne journée.

17872 M. WAROLIN: Merci infiniment.

17873 LE PRÉSIDENT: Madame la secrétaire.

17874 THE SECRETARY: I will now invite Bragg Communications to come to the presentation table.

17875 Please introduce yourself and your colleagues when you're ready, and you have 15 minutes for your presentation.

17876 MS. MacDONALD: Good morning, Chairman, Commissioners, Commission staff.

17877 My name is Natalie MacDonald. I'm VP, Regulatory for Eastlink.

17878 To my right is Lee Bragg, our CEO; and to my left is Marielle Wilson, our Regulatory Analyst.

17879 And Lee?

17880 MR. BRAGG: Thank you.

PRESENTATION

17881 MR. BRAGG: We appreciate the opportunity to be here today and to share with you our views on these important issues.

17882 At the outset, we wish to address the panel's remarks that the Chairman made on April 17^th. Our written submission describes at length Eastlink's experience as a rural-focused service provider and the efforts we have made to bring state of the art services to some of the smallest communities in the country. We invest 100 percent of our profits back into our business, which has allowed us to expand services to new areas and upgrade services in other areas.

17883 As a family-owned business from rural Nova Scotia, we take pride in ensuring that small rural communities can enjoy the advantages of the same, if not higher, quality services than some of the larger urban centers in Canada. We are more than familiar with the challenges of making the business case in smaller communities and we have taken them on time-over-time.

17884 But we also recognize that our regulator and governments have enabled or contributed to our success at certain key times. As a regulator, the Commission's role in encouraging facilities-based competition and setting the stage so we could do so under reasonable terms and conditions was critical.

17885 In 1999, we became the first cable company in Canada to provide competitive telephone service over our cable network under those policies, and we rely on such policies today for our wireless business, as we continue to invest into new communities.

17886 In our submission, we also described the value that governments can play through cooperative arrangements and funding support towards infrastructure builds, which in turn improves services for Canadians and bolsters the economy.

17887 In Eastlink's view, this proceeding was primarily about how to fill the broadband gaps for Canadians consistent with the policy objectives of the Act and to determine what basic broadband service should be. However, over the past couple of weeks, it became clear that there are also important issues regarding broadband adoption and poverty issues faced by some Canadians, who are barely able to make ends meet for food, shelter or clothing, let alone communications services. Indeed, where broadband fits within the broader poverty issues needs to be considered.

17888 These issues are certainly not simple and we don't think a solution to them can come from this one proceeding. We agree it may be appropriate to consider these issues as part of a national broadband strategy and the way forward likely needs coordination between the Commission and governments, along with input from other stakeholders.

17889 We reviewed the nine National Broadband Task Force principles referred to earlier last week and we generally agree that they are an appropriate starting point to developing a national strategy. The Commission's expertise in data collection and reporting, along with experience gained over the years, positions it well to initiate the first stages of such a strategy.

17890 While governments have and will continue to play a role in broadband deployment, they are also ultimately responsible for issues of digital literacy and the poverty issues faced by many Canadians. As industry, our expertise is in building networks and the provision of quality services. Our business focus in turn also helps to bolster the economy by providing communication services to individuals and to business.

17891 Where Eastlink and other industry members can provide value is through our experience and expertise, sharing opinions regarding the various funding models, information about our business and what works and what did not. We described some of our views on these issues in our submission.

17892 Through a collaborative effort, we can also learn the views of various governments, and other participants, about what worked and what did not. Sharing this information will help drive a clear, and more efficient approach to a broadband strategy with the goal to be sustainable in the long term.

17893 We will provide our views on some key issues, but first we think it is important to give some insight into our business.

17894 Eastlink provides services to over 1,800 communities across 7 provinces in Canada. Our two largest serving areas are Halifax, Nova Scotia and Sudbury, Ontario, with our next largest, Dartmouth, Nova Scotia and Delta, B.C., having subscriber levels below 20,000.

17895 Of the over 1,800 communities we serve, 72 percent of them have fewer than 100 customers. We have invested billions into our networks to interconnect hundreds of these communities with fibre and to extend broadband and other services to these areas. Communities such as Timmins, Cochrane and Kirkland Lake, Ontario; Cold Lake and Grand Prairie, Alberta; Cavendish, PEI; Peggy's Cove, Nova Scotia and Heart's Desire, Newfoundland.

17896 Among other business considerations, the fact that Eastlink is able to provide Internet, TV and phone services has been critical to support our significant network investments.

17897 Through competitive pressures, we have seen some changes to subscriber growth. Moreover, with more video streaming over the Internet we are experiencing a shift from TV subscribers to more reliance on the Internet. Yet even as Internet subscriber numbers remain relatively constant, usage is increasing so exponentially that in order to meet the demand of our current base of subscribers and to continue to improve services we must increase investments.

17898 Eastlink does not have the urban operator advantages that the larger communication companies in Canada have. We cannot rely on densely populated major urban centers to bring in the margins for our investment, and in rural areas our per-household costs to build are higher when one considers not only the distance but also increased costs for pole attachments and operational costs to serve remote areas.

17899 With fewer than 350,000 total internet subscribers, we are dwarfed by our direct telco competitor who has 3.4 million internet subscribers. We have been successful despite our rural footprint and low population density in the communities we serve.

17900 Our investment in capacity is directly related to the increased usage of the internet. Capacity has increased by 40 to 60 percent year over year and we expect this trend to continue. From this perspective of rural-focused companies like us, it is critical to keep investing in our networks if we want Canada’s broadband success to continue and to expand.

17901 Natalie?

17902 MS. MacDONALD: In this regard, we offer our views on the following issues.

17903 With regard to basic broadband service, we agree that a five/one megabits per second speed meets the basic needs of Canadians for now, although basic needs will likely require increased capacity in the future.

17904 With regard to aspirational goals, we agree that aspirational goals may help shape plans for broadband development. A 25 down three up megabits per second goal may be reasonable.

17905 With regard to data caps, in our experience, data caps have been necessary to manage our rural connect service and in other areas to manage the highest capacity users. Service providers need flexibility to implement caps in order to address increasing broadband usage and its replacement for other services by consumers. This may be even more important in the remote areas where capacity is restricted.

17906 With regard to quality of service, this is not an issue for the vast majority of Canada. Some standards may be appropriate in exchange for subsidies.

17907 With regard to the subsidy regime, we generally do not support a Commission mandated regime but, if necessary, in limited areas where the market or governments cannot bridge the gap subsidies should be carefully considered in order to keep them to a minimum. We generally support an auction approach.

17908 There are many approaches to how a subsidy would be directed and we have some views on a roadmap to getting there. Even after a regime is established, there should be a quick process for interveners before a build is finally approved to ensure new build plans have not developed over the intervening period.

17909 Other areas for consideration by the Commission; the Commission has an important role to play in other aspects of our industry that can also impact our ability to maintain or expand our broadband services. For example, in our experience, support structure rates have been a major cost factor in building to rural areas. Currently Eastlink pays $12.5 million per year for support structure attachments to telcos and hydro utilities, and this does not even include make-ready and other permitting charges. And we are now facing exponential increases to support structure rates by hydro, rate increases from $22.35 per pole per year to upward of possibly $70 or more per pole. The impact is in the millions for our company.

17910 While hydro is not within the CRTC’s jurisdiction, there are areas where the separate regulation allows for a shell game between hydro and telco, whereby licensees who are not joint users are paying more and sometimes to both parties.

17911 Another example for us is the impact of inequitable application of wholesale requirements. For example, the imbalance in the application of internet resale rules as between us and our largest competitor. Currently we must provide our highest speed services, up to 400 megabits per second, discounted by 25 percent off the lowest promotional rate, yet our direct competitor, who is over 10 times our size, must only provide wholesale access to its seven megabit service.

17912 With regard to broadband strategy, as we said earlier today, we support that it may be time for our regulator, governments and industry to work together to build a national broadband strategy. This will help reduce duplication of investment, assess the most appropriate way to direct funding and to consider the broader social issues also highlighted during this proceeding.

17913 While it may add some additional steps to final solutions, and hence time, we favour the right solution over the fastest solution. This does not mean we cannot continue while that is worked out. Updating the evergreen project of mapping is one example.

17914 We are pleased to answer any questions you have.

17915 THE CHAIRPERSON: Well thank you very much.

17916 And certainly, Mr. Bragg, we very much appreciate when CEO’s show up at important hearings, so we appreciate your presence.

17917 And I also want to congratulate you in supporting the role of very talented women in the regulatory proceeding. And I also note that your panel was set well ahead of the start of this oral hearing, so that’s even more an honour in your favour because I think it’s part of your company’s DNA. So thank you very much for that.

17918 Now, I’ll put you in the hands of the Vice-Chair Telecommunications to start us off and others will no doubt follow.

17919 Thank you.

17920 COMMISSIONER MENZIES: Morning. Thank you.

17921 I’m going to start with, as you noted in your presentation here that you’d kind of come in to this proceeding noting it was about filling the gap. And there’s sort of four areas here that appear to have -- appear, to me at least, to have been made evident here, and I want to see if you agree that ideas that pop out.

17922 One is service to the north; one is service to satellite dependent communities; filling the gap sort of I call them semi-rural pockets that don’t have adequate service or uneconomic and somehow they’re just at the edge of connectivity, and service to remote often First nations communities. Would you agree that those are the sort of areas where the previous decision for -- to go with market forces and targeted government funding that at least in those areas the market forces aren’t able to meet the connectivity needs?

17923 MR. BRAGG: I think generally those are four reasonable buckets, and I think, you know, obviously there’s some overlap in if you’re an individual customer you might be in sort of two places at once if you’re in the north and you’re in a satellite only, however you want to define it.

17924 But I do agree that market forces have not taken the facilities to some of those areas at this stage, but I think that’s part of the challenge is just the sheer magnitude of the economics to solve those issues, to get facilities into some of those areas it’s somewhat staggering to be honest.

17925 And, I mean, I know many have talked about, you know, whether it’s a satellite solution that should be improved, or a fixed wireless solution, or cellular as a solution, or direct wireline connection. I would agree with many that have been here so far that a wireline solution is the best long-term solution.

17926 It’s likely from an initial investment standpoint obviously the more expensive but also would require less upgrade in the long run, but it’s still -- I think it’s sort of the elephant in the room, it’s just the sheer economic issue.

17927 I mean, we looked at -- you know, Nova Scotia -- I mean, and that’s part of the challenge too. I mean, everybody has talked about what their needs are and/or wants and that there are obviously a lot of underserved areas. But I truly believe there -- you know, no matter what we do there are always going to be some areas that are not serviced as well as others.

17928 Because I just -- if you do the math -- and we’ve done some of the math for Nova Scotia, Nova Scotia is the second most densely populated province. We cover -- I think there’s roughly about 20,000 homes that are not serviced by a wireline solution. We’ve been -- had a partnership with the provincial government to build a fixed wireless solution to try to service those. We had a mandate of doing 1.5 megabits a second five years ago because that seemed to be determined as fitting the needs. Kind of by the time we were done it doesn’t fit the needs, the needs or wants. And I’m still confused on what’s a need and what’s a want.

17929 But -- so now we’re talking about should it be five, should it be 10, but it’s just pouring more and more money into it, and that was a $100 million project. It didn’t -- it still did not connect everybody.

17930 But we did the math on what it would take to build a wireline solution, we did the engineering, and we stopped -- for the 20,000 homes we stopped at 1,600 where we actually did the math and we took the most densely populated areas and we get up to $72,000 a home at the top end and it only got worse from there. It was $45 million to build 1,600 unserviced homes, still leaving 17 or 18,000 not done.

17931 So if we extrapolated that out, even if the density didn't get any worse than the 72,000, which I know it does, it's in the neighbourhood of a billion-and‑a‑half dollars just for Nova Scotia, the second most densely populated area.

17932 So when we look and consider the magnitude of the North -- and we operate in Northern Alberta and Northern Ontario, so we're very familiar with the amount of geography and how spread out these areas are -- like it's tens of billions of dollars to solve this issue. Plus we also know we couldn't afford to operate with the pole rate attachments and the operating cost to manage a network that is that sparsely done.

17933 We'd need a subsidy of about $1,500 -- it's about $1,000 a year per customer just for the poles, just to attach the poles, plus the additional operating costs to operate a network that's that big with so few customers attached -- we'd need about a $1,500 a year subsidy to keep the rate, the per month rate, the same for customers in the rest of the network.

17934 So if you extrapolate that out across the country, it's tens of billions of dollars to build it and maybe a billion or two a year to maintain it. And it's just -- it's a staggering amount of money.

17935 So I think that's -- I agree that those are the unserved areas, and I -- but I think we have to look at, well, what are the cost-effective things that can be done to increase service to certain pockets, whether it's...

17936 Like I do think we've had some success in some partnership with government, and others, and subsidies on the backbone issue. I can get my head around that. Once you get some fibre to a community sometimes you can let the market forces define the community, and we've seen success at that.

17937 Newfoundland is a good example where we partnered with the Newfoundland Government, and a couple of other carriers, to build a fibre backbone across Newfoundland itself ---

17938 COMMISSIONER MENZIES: I'm going to get into that a bit later.

17939 MR. BRAGG: Okay.

17940 COMMISSIONER MENZIES: Okay? So before we go right through, do you mind if I just stop you here ---

17941 MR. BRAGG: Oh, no, no, please.

17942 COMMISSIONER MENZIES: --- and ---

17943 MR. BRAGG: But this -- I mean, I ---

17944 COMMISSIONER MENZIES: I can tell you're passionate about it.

17945 MR. BRAGG: --- this is a big issue.

17946 COMMISSIONER MENZIES: Yeah, I know.

17947 Do you have -- I mean, when you came to those financial estimates. I mean, Bell was in here a week ago talking $1.7 billion for some of the issues we were talking about, and that's a lot of money, but it's not tens of billions, as you were saying.

17948 Would you ---

17949 MR. BRAGG: But that was just their area in the North.

17950 COMMISSIONER MENZIES: Yes, yes. You were talking about all across ---?

17951 MR. BRAGG: M'hm.

17952 COMMISSIONER MENZIES: Okay, we'll just leave that there for now. And I was going to ask you about National Digital Strategy and coordination of issues, and that, but you've answered all that in your oral presentation, so I'm not going to.

17953 But in terms of that filling the gap item, I just had one, and you may have addressed it a little bit previously here, but I wanted to read you a comment from one of our online, in terms of our online discussion coming in. And it was posted on April 25^th, which was Monday. I just know it's Day 14.

17954 Anyway, it's from John S. -- John, NS:

17955 "I live on a road with about 10 or 12 people over a 4 or 5 kilometre stretch. This road is off a secondary highway. There is high-speed service on the highway but both Bell and Eastlink say it's not worth their expense to bring service to us; it will not happen.

17956 We've offered to pay more, sign multi-year contracts, and even asked about cost sharing, if we can raise a reasonable amount. They won't budge. I understand they are in it to make money and I don't begrudge that; however, the money poured into programs, like broadband, wireless Internet, and 5 and 1 are misplaced and short-sighted.

17957 By the time companies get around to actually doing it, since there's little profit in it for them -- profit for them, they drag -- since there's little profit in it for them, they drag their feet. The target goal is already years and years behind -- years and years and years behind."

17958 So what do folks in industry -- how should we respond to people with an issue like that? I mean, they're near a highway, there's connectivity, and they phone companies -- and I'm not trying to pick on you, because I could pick this – any place across the country. How do we respond to those folks, because it must be -- they're not that far away?

17959 MR. BRAGG: I think they're not that far away on a mileage basis but they're a long way away from a dollar basis, and I think that tends to be the challenge. That people underestimate how much it costs to build.

17960 It's, you know, in the neighbourhood of $40,000 a kilometre to build a network, so when somebody tells me, well, but I have three or four neighbours and I'm only 5 kilometres away from your fibre run, well, there's a -- first a fixed cost to break into the fibre and then $40,000. So I'm at 200, maybe $250,000 to go connect them.

17961 And people, they say, oh, surely that can't be right. I mean, I get that a lot. And I say, well, I'm afraid it is right. And people offer, they say, but I'd pay $1,000 to get hooked up. I agree, but you won't pay $50,000 to get hooked up, and that's the issue.

17962 So I understand that I'm not necessarily answering your question on what do you say or how do you articulate that but, I mean, we have to articulate that to customers all the time, or potential customers, people who want service. And it's -- it just -- it's a lot of money. I mean, and I don't -- to be honest, I don't really know how you answer it, other than to say it's a lot of money.

17963 COMMISSIONER MENZIES: But I'm trying to understand that in terms of your opposition to a subsidy of -- I mean, you concede subsidy, and some is maybe necessary in some areas, but you're very cautious about it, and there's nothing wrong with being prudent. But that seems to me to be a situation where, as we made the point earlier, the market can't serve. It's not it doesn't want to, it just -- it's uneconomic, it doesn't work, it's not a burden that is appropriate for those conditions.

17964 So that would be the sort of situation you'd look at in terms of subsidy or funding or connectivity of some kind. So wouldn't that sort of situation be -- doesn't that illustrate the need for some form of subsidy regime or are there other solutions that we could look at? Because it seems to be -- it can't be you, it can't be the companies, and if it can't be government, what happens?

17965 MR. BRAGG: I mean, Natalie, you may want to add to this, but I don't think we said we're dead set against a subsidy, but I think it's ---

17966 COMMISSIONER MENZIES: No, you conceded that it's -- you know, there may be regions and that sort of stuff, but ---

17967 MR. BRAGG: Oh, no. I think -- but I think that's the -- I mean, I think that's part of the challenge is there may be a subsidy structure that with enough foresight will solve some issues in some places. But I think it's -- I think we all have to be prepared that it won't solve all the issues in all the places.

17968 And that's -- and even if we got half the homes that are underserved, unserved, you know, still that's better than where we are now, but it's -- you know, I think there are so many moving parts and how -- I just -- I have yet to really figure out what the right subsidy model is.

17969 And I think that's why it's -- it was -- it's hard for me to say, oh, I agree with the subsidy, because it's easy to say subsidy but how do you handle the ongoing upgrade requirements and/or the operational costs and not necessarily put an unfair burden on other customers. And if you did put that burden on other customers, how do you do it equally across all providers in say the lower cost area, if you're going to cross-subsidize. It's just -- it's ---

17970 MS. MacDONALD: And if I could just add on the subsidy topic, our cautionary message is really just about making sure that we put the right time and review into those target areas so that we can hopefully get it right long term where that's possible. So as Lee said, in the cases where maybe there is the opportunity for certain communities to benefit from a transport or a fibre build for a transport network. And if a company can be sustainable and build the access component without ongoing subsidies, that could be targeted as an area for success.

17971 Now, I agree that in some of these areas, as you described, where it appears there is no real solution, those areas need to be flagged for consideration for a solution through a regime that may involve subsidies, whether through government or through the subsidy regime from the Commission.

17972 But just getting back to the issue of what will the markets do, even in some of our areas that are seriously troubled in terms of the technology, so the rural connect area in Nova Scotia that we referred to, there are communities in that area that a few years ago we didn’t even think we would be able to build and upgrade our own plant over. And we’ve managed over the last year and a half to move into some of those areas where we could make a case. Not a great case, but a case to invest. And we’ve been able to build services to another close to 800 homes in those areas at an investment.

17973 But again, if you had asked us a few years ago if we could even do that, we probably wouldn’t have expected to be able to say yes. And we’re still focussing on those areas to see if there’s solutions, but they’re very troubled.

17974 And so I guess I’m just saying that market can still get to some of those difficult areas. And so our approach to a cautionary model for the subsidy is really let’s really be careful how we define what areas really need the subsidy. And then what areas -- of what’s left, let’s put them into two buckets.

17975 The bucket of there’s no other solution other than perhaps satellite, which that creates a clear route to what are we going to do, because if there’s no other solution that’s probably the answer, at least in the interim.

17976 And then the other bucket is communities with multiple characteristics that could benefit from multiple types of technologies. And we’re saying let’s look at those, and that might be the coordinated government approach with the Commission and industry stakeholders to say what would work? What are the costs? And that’s where we don’t necessarily say the lowest cost bid is necessarily the right answer if there’s a reasonable long-term sustainable solution that could be achieved with maybe a little bit more, but it isn’t the lowest cost.

17977 So we think that that’s sort of the model that -- at least some ideas toward a model that can slowly shorten the gap in terms of the services available and hopefully have some communities that are more sustainable.

17978 COMMISSIONER MENZIES: Right. And so one of the things that could be mentioned to John NS is have you phoned Xplornet.

17979 MS. MacDONALD: That’s right.

17980 COMMISSIONER MENZIES: Right.

17981 MS. MacDONALD: Yeah.

17982 COMMISSIONER MENZIES: So things which may be possible.

17983 Okay. I want to talk about the speed targets of five and one. Again, and it’s -- I mean, that’s an aspirational goal we set five years ago. And it was met or exceeded, and mostly exceeded pretty much everywhere, and it was met in many, many areas that people were skeptical that it would never be met. So it was broadly successful.

17984 But it seems to me that it doesn’t seem very ambitious to then go through this and go with a five and one, although most industry representatives have been doing it. And a little bit of that is the want and need. I understand that.

17985 But as we’ve gone through it, I just -- we’ll read you the list and some of this is -- I know there’s demand driven by online video and Netflix and that sort of stuff. But there’s also been a shift, you know, as more and more government services, more and more companies expect people to be accessible at home to maybe be able to do, you know, access a BPN network, all kinds of different things; right?

17986 So we’ve got things that five years ago weren’t, when we set an aspiration of five and one, weren’t nearly as intensive as they are now. The number of government services available online are online only. Job searches, I mean, you can only do that online; right? Access to news and current affairs even is becoming -- becomes more online as newspapers die and traditional TV news is declining. Education systems almost universally assign work that demands connectivity, sometimes with multiple -- well, frequent -- most of the time with multiple kids in the house, I think. So the needs have been expended.

17987 There’s a list here in -- looking at them later today. Anyway, I could go on, but you get my point in terms of all that stuff. So wouldn’t it make more sense to at least move to 10 and 1? Because, I mean, you talk to yourself about the demand growth and that sort of stuff. And I know some of it is, you know, whether I get HD or not. That was mentioned as an appropriate border line and that sort of stuff. But there are more needs now than there were five years ago in terms of fundamental needs.

17988 Would you agree? And then I’m giving you the opportunity to defend why five and one is still sufficient to meet those.

17989 MR. BRAGG: I think five and one arguably is sufficient today. Is 10 and 3 or 25 and 3 better? Yes. Again, it comes back to the economics involved to getting there.

17990 The -- I got scolded once before for using the phrase “overly honest”. But really, speed is not the hard part. Capacity’s the hard part. Often network providers use speed as a throttling mechanism to not chew up too much capacity on the network.

17991 So whether it’s 5, 10, 25, the big issue, does the network have enough capacity to meet the demands of all the customers attached to it?

17992 You know, there are some things, you do need a certain amount of speed to just accomplish, you know. So it’s -- if you pick 5, it’s going to need to be 10 3 to 5 years from now. If you pick 10, you buy yourself a little more time. But it’s going to be a moving target forever and ever and ever.

17993 MS. MacDONALD: And I think I would just add to that. I agree with what Lee just said. And, you know, that’s why I don’t -- I’m not sure if you would have in reading our written submission seen that -- the struggle there because we were talking about needs and then wants and saying we’re not satisfied providing a level of service that we’re providing on a fixed wireless network.

17994 But anyway, having said that, the five and one is the question needs today. But we absolutely acknowledge, and I’ve heard a number of other parties here say, when you’re looking at planning to build in underserved or unserved areas, it might be the most reasonable approach to build toward a higher. So a number of people have said 10/1 might be what you build. Maybe the 5/1 is how you target where do we go first? So obviously we need a plan and we need to look at those communities that are unserved and underserved.

17995 So communities that have a 5/1 if basic needs are being met. Communities that are unserved maybe are priority in terms of a targeted plan. The aspirational targets is where the 5/1s will get.

17996 And so it may be just a part of how do we build that plan. And the 5/1, those who have it today, those basic needs are being met, maybe not all wants. And let’s target the areas that are below that.

17997 COMMISSIONER MENZIES: Just in terms of capacity issues, it’s one of the issues that’s been raised fairly often is data cap management and that sort of stuff. And one of the accusations people make from time to time -- and you referred to it today in terms of capacity issues and that sort of stuff. And I understand that.

17998 But I wanted to give you the opportunity, not necessarily on your own behalf, but perhaps an industry view or maybe it happens elsewhere. People suggest that that may have been the original purpose of data caps was to -- was capacity management, but it has become for some a very positive revenue stream. And that that is one of the reasons why it’s maintained as it is. How would you respond to that?

17999 MR. BRAGG: I mean, I think you can do that and use it as a revenue generator if you want to. I mean, we know the majority of our customers do not go over our caps. It’s a network management technique that we use to try to protect ourselves from big, big users that sort of that would cost us more than the revenue they generate.

18000 It’s a -- you know, I mean, in our experience it’s definitely not an economic decision, other than it potentially delays capital that we have to put in the network to add more capacity. So you could argue there’s an economic benefit from that.

18001 But it’s -- I mean, from my perspective, it’s truly -- it’s a network management technique.

18002 COMMISSIONER MENZIES: And should -- do you think data caps should be part of a basic service objective definition?

18003 MR. BRAGG: I don’t -- I think it’s hard to determine. Everybody designs a network a little differently so they’re going to need to manage it differently. So if there’s a certain amount of capacity and you see a certain level of usage depending on the design of the type of network, you -- you know, I’m afraid I’m thinking of it from an engineering standpoint. But that’s how it’s done and why it’s done, from our perspective.

18004 So I mean, Nathalie, you might be able to ---

18005 MS. MacDONALD: I’d like to just go back a little step into what Lee was describing, because the issue of data caps for us is absolutely about network management, and I want to explain our logic in going there with the rural connect. Not the best example I understand because it’s not our favourite service to be offering, but it really highlights the challenge with caps and how we had to think about trying to deal with the traffic in that area. And then I’ll explain the distinction in our other areas that are well-served by internet.

18006 So in the areas where -- in our rural connect service areas obviously we described in detail the challenges that we had, because it’s a capacity limited system with a number of people relying on it and usage has increased so much over the last 10 years that we just simply cannot manage the capacity on that network and provide a service that we want to be providing to our customers there.

18007 The rate for that service -- it’s a 1.5 meg service -- we charge $46.95. That rate was established under a contract that was worked through in the mid-2000s and executed in 2007. And that contract required that we keep that rate, and it was based on the comparable rate that was offered in the urban centers, and we were not permitted to increase that rate during the entire term of the contract, notwithstanding that we’d gone over -- $20 million over the budget.

18008 So when the contract ended and we began to really experience usage problems, and it was starting to build over the years as people began to use the internet more, we were struggling with how to manage the capacity, and we didn’t think it was appropriate to increase the rates for everyone, we thought well this is a network management issue. So we established a data included usage and we had to do some work to try to figure out what to get to, and in doing so we said well this service was created in the mid -- basically the mid-2000s that’s when it was -- the idea was -- came about for the 1.5 meg service on a fixed wireless, and it was built for what at that time was expected to be used for, which was basic web browsing, email, online banking, very light video usage, if any, but not the kind of gaming and high-def streaming that we’re seeing today.

18009 So we looked at that and we said well let’s look at what the usage would be to try to arrive at a cap that we can try to manage the network because of the limitations, and we subtracted sort of from the usage what was the obvious high video streaming that wouldn’t have been the excess and got down to a cap of about -- sorry -- a usage that we expected was for necessities at about 12 gig -- not very high I know -- and then we upped it by another three gig to allow for some extra usage and we set a usage cap at 15.

18010 Now, we don’t call it a cap we call it included usage because we don’t just end it there. So then we said well we’ll charge an extra for anyone who uses over and that we’ll try to manage some of these excessive users so that our other users have a valid good experience or at least an improved experience, but we also didn’t keep charging for every gig. So we charged $2 extra per gig to a cap at 20. So again we didn’t keep charging over and above. So the highest a customer would pay in that area is $66.95 for the 1.5 service, and that would give them at that 20 cap unlimited usage after $20.

18011 So I just wanted to explain that, because even with that model it was challenging, because basically we had a number of users, all of those were below the included usage were at about a five gig a month usage, all of those that were under the $20 extra averaged about a 19 gig a month usage, and then the ones that were over were -- I’m talking we’ve got people that are at 300 gig a month and we’re trying to figure out how to deal with it because it’s really impacting the network for others. And so it seemed like the ones that were saying “Well we’re going to do whatever we want with the service and we’re going to pay the extra 20 and then it’s unlimited” those are the ones that use it quickly and continue to use it and those are the challenges.

18012 Now, that’s a very unique situation that we’re experiencing because the rest of our network is well built and it has the capacity to serve, but then the rest of our network has very high included usage and the vast majority of our customers aren’t exceeding that.

18013 The exception to that -- so we primarily try to sell multiple services, as we said, so our bundled customers well within the usage, no issue at all. The customers who are not bundling -- so they’ve chosen not to take a TV service -- the standalone internet customers, they’re using significant -- sorry -- significant usage but not necessarily above our caps because our caps are still pretty good, but they’re the ones that we’re seeing people go above the cap. So what they’re doing is they’re just replacing what we would say two services, maybe three if you count the VOIP, for the price in their minds of one service. So that’s just sort of the logic.

18014 So we would say that our approach to included usage and what everyone’s been referring to as caps for our well served areas is not about making money -- more money on the cap, otherwise we would have offered a shorter -- a lower included usage and charged more, and we’re not getting those extra charges for usage.

18015 COMMISSIONER MENZIES: I mean ---

18016 MS. MacDONALD: I hope that helps clarify the situation.

18017 COMMISSIONER MENZIES: No, I understand that. Should the issue of data caps be addressed in the basic service objective?

18018 MR. BRAGG: Yeah, I think it needs to be.

18019 COMMISSIONER MENZIES: That was the original question. I mean, bits don’t travel for free across the network. So if somebody’s going to use more -- I mean, it’s like anything, if they use more power they pay for it, if they’re on a water system and they use more water they pay for it. And I think in order to make sure there’s some fairness that, you know, if there’s big users on the network that are driving costs that may end up being borne by all the customers, you know, I think you should have to have a mechanism that allows the bigger users that are driving the costs to pay more.

18020 MS. MacDONALD: I think where we would be concerned ---

18021 COMMISSIONER MENZIES: Well, just let me -- what I’m trying to get at is the affordability issue for some people. It was brought forward to us that they need -- because they have multiple children in the house doing homework and that sort of stuff, especially for people who are challenged financially this becomes an issue if they go over their data cap trying to manage their finances and that.

18022 So what I was trying to get, should we set a standard that says people should get at least this many gigs, right, or -- that’s what I was trying to get at, to address those things. And maybe in your answer there you could also think -- I’m also curious to know about what do you do -- how do you help your customers manage their usage in terms of that so that they don’t get sort of a surprise?

18023 MS. MacDONALD: If I could start and then Lee can add anything if I’ve missed anything.

18024 So in terms of should the Commission set a standard at a minimum usage, our initial response would be we would be very concerned about setting a minimum if that minimum wasn’t -- there would be risks if it impeded our ability to properly manage our usage and our network especially in troubled areas or challenged areas.

18025 So in that respect we would say the market -- the service provider should have the flexibility to provide and establish reasonable usage. But we understand where the Commission would be concerned and that would be unreasonable, and so if the Commission were going in that direction we would say it really could be an impact on our business if that wasn’t set properly.

18026 Because if the cap is too high the cost of us to keep that network running for one service at a very generous cap could impede our ability to continue our investment. And I say that because of our strategy in building in rural areas and trying to sell multiple products we need to have some flexibility in pricing the standalone to cover it if people are choosing one service.

18027 COMMISSIONER MENZIES: And how do you manage your customers in terms of helping them manage their data cap?

18028 MS. MacDONALD: So we have a very well trained customer care team who is able to work through -- talk to our customers about the service options available But realistically it’s not become a huge challenge for us at this point or for our customers because we’ve got the rural connect area which has one service, one plan and one method for caps. We have online tools for people to go in and see where they are and to talk through that with our customer care reps. And in our other served areas the caps are so high that we’re really not seeing an issue there, although they have management tools as well to go in and look at their usage as well.

18029 COMMISSIONER MENZIES: Okay. And what’s the cheapest package -- the most affordable package that you offer?

18030 MR. BRAGG: Natalie, you have some of the details on that I think, don’t you?

18031 MS. MacDONALD: Yes.

18032 So we do have services across different service areas and some of them are, you know, and DSL areas as well. We would say our most affordable -- so if we take a given service area, and I think you've raised the issue of the Atlantic has come up and the Maritimes, and that's one of -- we're from Halifax.

18033 So if we look at the Halifax area, our most affordable service is when we provide a bundled service because it allows us to provide a value discount.

18034 COMMISSIONER MENZIES: Sure.

18035 MS. MacDONALD: The standalone ---

18036 COMMISSIONER MENZIES: The standalone ---

18037 MS. MacDONALD: --- service for our Internet, our broadband, we have a 50 meg service and the price in the Halifax area is around an $82 price point. There is no -- it's unlimited usage at that price point.

18038 We also have wireless services as well that are extremely competitive. We would say that any of our wireless options that are comparable to competitors are at a better value and a better rate. And so we have services there, starting at, I think, in the -- well, there's a page you go that starts at, you know, $25 and there's a $15 plan for people who just want text, and so we've got those services as well.

18039 COMMISSIONER MENZIES: That seems high, compared to some of the others we've heard. Is that an issue of regional costs or regional company costs? Because I believe your competitors' rates are, in Nova Scotia at least, very similar?

18040 MR. BRAGG: Yeah, I mean, I -- there's two factors. One is there's -- there is a significant amount of competition. So we have to balance ourselves to make sure we're not, you know, obviously, overpriced relative to our competitors, but the other big driving factor is just the rural nature of our networks.

18041 We cover a significant amount of geography with not very many people living in it, so our capital costs per customer are much higher than others that have more urban dominated markets. So that tends to drive the cost structure from an Eastlink standpoint.

18042 COMMISSIONER MENZIES: Before I forget, I have an undertaking request that you could please provide us -- this is a brief interlude in our conversation -- please provide us with copies of your Internet service agreements, contracts, and related terms and conditions.

18043 MS. MacDONALD: Sure, we'll do that.

18044 UNDERTAKING

18045 COMMISSIONER MENZIES: Okay, thank you.

18046 MR. BRAGG: I hate to interrupt, but on our cellular Internet product as well or only our sort of wireline or fixed ---?

18047 COMMISSIONER MENZIES: Only Internet.

18048 MR. BRAGG: Okay, well, we do sell some Internet only over our cellular network. We'll throw it in.

18049 COMMISSIONER MENZIES: You know -- yes. I mean, send too much rather than too less.

18050 MR. BRAGG: Sure.

18051 COMMISSIONER MENZIES: I'm sure people will...

18052 I just want to go back. When you were talking about -- in your original submission, last July, you made reference to the Far North, and I want you to clarify a bit in this context because it could be critiqued this way; all right.

18053 So you make reference to why people in the Far North should not have broadband -- addressing the issue of should they have broadband access at comparable rates because -- and I think you say, because everything costs more there. Food costs more, everything.

18054 And I thought that some people might find that position a little blunt and perhaps even uncharitable. And just in the context of Canada's longstanding tradition of -- I mean, we've -- we do transfer payments to make sure that people have similar access to basic standards of healthcare and education, for instance.

18055 And some people in the North might look at that and say, well, why wouldn't the same philosophy apply to connectivity; right. I mean, they concede in most polls that they're going to have to pay more, but ---

18056 MS. MacDONALD: And ---

18057 COMMISSIONER MENZIES: --- why wouldn't they ---?

18058 MS. MacDONALD: So I think I'd like to clarify that as well, because we certainly wouldn't -- from our perspective, when we looked at those decisions, there seemed to be a reference to the Far North requiring rates in line with rates in Southern Canada for the same services. And we would recognize that in some higher cost areas, comparable may mean a little more, but identical to a very competitive market, in a more lower cost to build market we don't necessarily think that's the right way to establish the price.

18059 And if that wasn't clear, that would be really what we were getting at. We need to be aware that there are higher costs in some of these areas and so there needs to be, obviously, reasonalbe, in light of the situation as well, but comparable but not exactly the same.

18060 COMMISSIONER MENZIES: Okay, thanks for clarifying.

18061 While on the North, I just have one more question on that, because I thought you might have -- be a little helpful in terms of this because you have experience with submarine fibre cabling and I believe you interconnected with -- at some point with TELE Greenland port there. So -- and they have a fibre line, you know, from Greenland -- you know -- from Greenland to Newfoundland, but for the record, but also they connect to Europe through Iceland.

18062 And when I was reading up on it, because I was trying to get my head around how much it would cost to connect Nunavut, it was like somebody spent $150 million and they managed to run submarine cables. That was the price I read in the -- reading the St. John's newspaper, anyway, to connect to Greenland by fibre, and to both Iceland and Newfoundland.

18063 How much do you think, with your experience with that, it might cost to connect a fibre -- submarine fibre line to -- I mean, just your best guess?

18064 MR. BRAGG: From where to where?

18065 COMMISSIONER MENZIES: Well, is -- would it be possible to connect to that submarine line between the TELE Greenland from Iqaluit?

18066 MR. BRAGG: I mean, anything's possible, but to pull it up and put a branching unit in, I don't know how much -- what the fibre count is on that cable off the top of my head. So I don't know whether that makes sense to do.

18067 I just -- I don't know. You'd have to go to your -- where is the nearest point where you can get access to a good fibre connection and build it so it's distance and -- I don't know, 150 million. I mean, I don't know how far it is from -- well, I know where Nunavut is but I don't know where we're going on the other side. So I think that's...

18068 I mean, the environment's tricky. You're going to have significant repair issues. Our fibre between -- we have sort of double -- we have redundancy and then we partner with another carrier. So we end up with sort of three routes from Nova Scotia to Newfoundland, and it gets cut a couple of times a year and we have to repair it.

18069 So you know -- and so to go to the Far North undersea is a challenge that if there's ice cover you're not going to be able to fix it until the ice goes, so that's not a pleasant undertaking. You know, again, anything's possible, but that's -- so you might be able to build it with a reasonable amount of money but you might not be able to look after it.

18070 COMMISSIONER MENZIES: And the reasonable amount of money for the build would be?

18071 MR. BRAGG: If we were going from, I don't know, Nuuk in Greenland is how far to Nunavut? I'm just trying to picture a map. Eight hundred (800) miles, 1,000 miles?

18072 COMMISSIONER MENZIES: Yeah, it's about that. It's about a two‑hour, hour-and‑a‑half flight.

18073 MR. BRAGG: So yeah, likely, yeah, 150 -- I only know this because we just did some pricing to Bermuda from Halifax and it's about the same distance, give or take a little. So 150 million.

18074 COMMISSIONER MENZIES: Okay, I was just trying to get that. And it's always fun to have Bermuda and Greenland in the same conversation.

--- (LAUGHTER)

18075 MR. BRAGG: It doesn't happen very often.

18076 COMMISSIONER MENZIES: Now, thank you for that.

18077 What I want to -- I want to talk really now about your experience that you outlined today and in your written submission regarding funds to build. You contrasted the -- your experience with the one in Nova Scotia, which you've talked about a bit, and it was sort of familiar with the one that, to keep it simple, did not work, and the one in Newfoundland that you think is better.

18078 And I'm thinking in the context, because we've talked a little bit today about transport, and Shaw said yesterday if you're going to fund something, transport, and that's come up more, and that's seems to be one of the other emerging themes in terms of that.

18079 So if funds are to be created to build out access, how should they be -- what should they focus on and how should they be structured, from your experience?

18080 MR. BRAGG: I think transport makes the most sense. Now, part of that is because we know it's worked in a few indications. I gave the Newfoundland example but I also think we've taken advantage of the SuperNet fibre that’s managed by Axia now in Alberta. That really worked. And what it allowed to do is it took away the barrier of that -- you know, use an example a little bit earlier of, you know, a cluster of home that are -- well we’re only 10 kilometres away from the Eastlink fibre and there’s 15 or 20 homes, well it’s the 10 kilometres that’s the issue.

18081 If you get enough density within a small community the market can build that. So if you can get over that transport or that connectivity to the community hurdle, which a subsidized transport network can do, I think then you end up with a more manageable subsidy scheme because you’re -- there’s less issue around ongoing subsidy requirements.

18082 Because a buried or an aerial plant of fibre tends to not need as much ongoing maintenance, ongoing cost issue, and it gets into that community then, you know, there might be lots of people that might be able to afford to build out and operate in a non-subsidy model on a per customer basis to build that.

18083 So I think there is still lots of examples of communities in Canada where that can really work well, and you get the best bang for the buck, it’s the less contentious, the easiest to manage, easiest for people to get their heads around.

18084 MS. MacDONALD: And I agree. And that’s sort of what we were thinking when we think about a coordinated effort and working with the government and the Commission is let’s figure out what the right priorities are to how to direct that money.

18085 And we would say if you can create a sustainable business from a service provider who won’t need to rely on subsidies -- and there may be very specific characteristics of those communities that are able to do that, but let’s look at those and see what we can do so that we can do away with the subsidy question in the future and then we just have a smaller group of communities to figure out.

18086 COMMISSIONER MENZIES: But do you think that the current announcements -- I mean, the federal government made announcements for $500 million for its Canada Connect plan, and there was money there as well for a different stream for First Nations connectivity and that. If you were in charge of that, how would you structure that in terms of again, would you shift it to a focus on transport?

18087 MR. BRAGG: I think it should be focused on transport. I mean, does that consume at all? I don’t know. There’s a likelihood. But I think it still may be sort of a bid process where if you take a community that’s un-serviced and say, you know, if there was -- you know, talk to the carriers in the region, say who’s -- how much do you need to connect that, I mean, that’s one way to do it. It could be more of a -- you know, I mean, not to be too crazy, the government could build it. I mean, because it’s -- you know, it’s kind of a benign thing, the fibre network, and then just let anybody on to it.

18088 COMMISSIONER MENZIES: It is a transportation corridor. So you’d -- one of the suggestions then would be that government just go ahead and build it, the transport network?

18089 MR. BRAGG: Yeah, and then allow access to whoever wants to provide service in that community.

18090 COMMISSIONER MENZIES: Right. Then it would be an open network like the SuperNet ---

18091 MR. BRAGG: Sure.

18092 COMMISSIONER MENZIES: --- in terms of management like that.

18093 MR. BRAGG: I mean, that’s one way to do it. You know, another is you could just, you know, ask people how much would you need, and if Bell wanted $10 million to connect some little community, and Eastlink wanted seven well you’d give it to Eastlink. I mean, that’s sort of the -- more of an auction.

18094 COMMISSIONER MENZIES: Reverse auction.

18095 MR. BRAGG: Yeah. Like there are -- you know, I think the concept of focusing on transport first is the right concept. I’m sure there are, you know, lots of different mechanical structures we could go through to figure it out.

18096 COMMISSIONER MENZIES: Okay. Thank you. Those are my questions.

18097 THE CHAIRPERSON: Commissioner MacDonald?

18098 COMMISSIONER MacDONALD: Good morning.

18099 We’ve heard from a number of different intervenors that they have difficulty when they want to launch a local service provide last mile access in a community they have trouble either a) discovering what transport facilities, what fibre facilities are out there, or they have difficulty accessing them at a competitive rate.

18100 And I know obviously Eastlink has a carrier department. You deal with other carriers frequently. When you receive a request, how do you evaluate whether you’re able to support that request for transport facilities and how do you arrive at a price point that you’re willing to offer someone wanting to access those facilities?

18101 MS. MacDONALD: Okay. I thought you were going down a different direction there so I was preparing for a different question.

18102 MR. BRAGG: But you’re still going to answer this one.

18103 MS. MacDONALD: Well, you can take it on as well if you want to go there.

18104 But we do have a separate group that sells the wholesale services. And, in fact, you know, the topic came up throughout the week about availability of your network, and we consider that a line of business, and so we’ve got an aggressive sales team that’s interested in selling access to fibre routes, you know, across the country, and we have a website that maps that out. If you go onto Eastlink’s business site you’ll see the wholesale side of the business and the map showing what is available.

18105 And so my answer to what -- how do we go about making sure it’s competitive is we pay for transport across the country. We are very aggressive in trying to get the best and most reasonable prices, and we have some challenges at times of course. And our sales force is also aggressive in wanting to sell. And so I would say that, you know, we look at the market, look at the rates, look at the costs and willingly make it available to third parties that are looking for access.

18106 I would like to comment though, if I may -- I know the question wasn’t asked. But with regard to the issue of transport and the challenges where there’s only one provider -- and I won’t take too long. But we are primarily facilities-based and we try to build all of our own facilities but, as Lee said, we do rely on third parties for transport getting to some of those hard to reach areas and we do rely on it in a number of those hard to reach areas.

18107 In areas where there’s competition we’ve not had too much of a problem. And in the case of some of our northern Ontario systems, the benefit of having competitive routes that are reasonably priced because of competition is that it actually enabled us to justify our builds. And so we built 19 systems out north of North Bay covering Timmins, New Liskeard, Kirkland Lake, Kapuskasing because we were able to get a reasonable transport rate at a competitive rate, and that was through the Ontara(phonetic) Transport. There are concerns that we have in the limited areas where there’s only one provider and the rates are 10 to 20 times more in some cases.

18108 So I just wanted to get that on the record because it is relevant. And while we don’t rely on third parties as much there are other companies that do and so I just wanted to make that statement that there really is an issue where there is only one access to transport facility in a certain route.

18109 COMMISSIONER MacDONALD: So just a follow-up, because you’ve clearly done it, you’ve relied on other providers and leveraged the benefits of there being competition on some of those transport routes, would you like to speak to the Alberta SuperNet model?

18110 Axia was in a few days ago and spoke to us and they were very much of the belief that if you build it people will come. If you build the transport facilities if it’s set at a fair price point other providers will go and build out their last mile infrastructure, be it fibre-optics, be it fixed wireless, or what have you. So you’re very much, I would assume, of the opinion that that’s an accurate statement on their part.

18111 MR. BRAGG: Generally I think that’s right. I mean, it’s -- there has to be some “they” to come though. I mean, so it’s -- you know, Alberta structure was pretty good where they connected a lot of different communities. So there were some they’s that -- whether it’s ourselves, or Shaw, or TELUS, or whoever is servicing those, or multiple providers, will go after some of those communities and take advantage of that fibre backbone that was created.

18112 If you get into some very rural remote areas sometimes, you know, it might be a stretch if you decided to, you know, build fibre on that model to some really remote area there just might not be enough business or commercial activity to get that many people coming to it. So anyhow everything’s a bit of a balance from that standpoint.

18113 COMMISSIONER MacDONALD: Okay. Thank you.

18114 THE CHAIRPERSON: Just a few more questions. Do you track complaints in your various systems with respect to internet?

18115 MR. BRAGG: Yes.

18116 THE CHAIRPERSON: Would you be able to give us -- I know you have several systems, I’m not sure how you could do this, but the top three types of complaints you get from your customers across your systems?

18117 MS. MacDONALD: Yes, we can provide that.

18118 THE CHAIRPERSON: Okay. So you can do that as an undertaking.

18119 UNDERTAKING

18120 MR. BRAGG: Would you -- I think it would be important that we do it across the different types of networks we have to separate our fixed wireline versus our wireless, because I think that's ---

18121 THE CHAIRPERSON: Sure.

18122 MR. BRAGG: --- likely helpful.

18123 THE CHAIRPERSON: Yes, because I think we'll probably see a pattern there because ---

18124 MR. BRAGG: Yeah.

18125 THE CHAIRPERSON: --- the technology would have some sort of impact; right?

18126 MR. BRAGG: Yeah.

18127 MS. MacDONALD: I would just qualify that slightly, to the extent that we actually them, but ---

18128 THE CHAIRPERSON: Yeah.

18129 MS. MacDONALD: --- we will obviously attempt to do that as well.

18130 THE CHAIRPERSON: Right, right. So you know what we're looking for and it would be helpful, and we've asked others, and you are using different technology. So to the extent you can be helpful, we would appreciate it.

18131 Is -- in your view, are mobile wireless -- you were here during the previous presentation -- do you think mobile wireless is also now at the point of being essential or perceived as essential by Canadians in terms of their telecommunication needs?

18132 MR. BRAGG: I think if you ask those who don't have it, they're going to say yes. I mean, that's -- I was anticipating this question. I was thinking about it, because we operate in a sister business, some very rural farming operators that in the past, in my time, did not have cellular coverage. And I used to ask myself how on earth did we manage that before everybody had cellphones?

18133 But, you know, one of the things we did do is we put our own sort of private radio network in so we had communication because there wasn't a cellular network then. Now there is, and that's taken the place of it.

18134 So is it -- I mean, I think that's -- you know, what's essential? I mean, that's a really hard question to answer. I think it would be great if there were broader coverage, and you know, we're a cellular operator as well and we continue to build out our networks. But it's -- it comes back in my mind, it just comes back to a huge economic hurdle. And at what -- how valuable is it or how much are we willing to spend to solve that problem?

18135 THE CHAIRPERSON: Well, you might want to reflect on that as well in the next phases of comments because I think it is an issue that is, as well, squarely within this proceeding.

18136 I note your comments on page 4 of your presentation, and you said:

18137 "While hydro is not within the CRTC's jurisdiction there are areas where the separate regulation allows for a shell game between hydro and telco..."

18138 It reminded me that as a lawyer at the CRTC, many, many years ago, when I used to do telecom regulation, I -- we had a case, and I had written for the commissioner -- the Commission, the decision about the importance of infrastructure being similar to the infrastructure required back in the 19^th century to build out the railroad.

18139 I remember defending the case in front of the Federal Court of Appeal, successfully. Unfortunately, the Supreme Court had a different view of things, and we are where we are.

18140 But tell me more about separate regulations allowing for a shell game?

18141 MS. MacDONALD: So support structures are a huge challenge for us, as you can appreciate from what we've said. Because of the joint use -- the joint ownership models that the hydro utilities have with the telco's there are processes, when we seek to attach to a pole, that appear to be quite duplicative.

18142 So examples would be we can see make-ready costs that are as high as $4,000 per permit in some of our areas -- 2,000 for the telco, 2,000 for the utility. Because of the joint ownership, both are required to go out and do the work for the make-ready for various reasons.

18143 In the charges, when we get them, we're seeing discrepancies in the charges from one to the other or a duplication of the charges just in terms of the time it takes to travel -- and we're talking rural areas as well, and so we're constantly looking at that.

18144 And then on the ownership issue, we've run into some challenges with the actual number of poles owned by one party as compared to the other, and finding out at times that there was a transfer and we've been paying both parties for some of the same poles at times.

18145 And so I think the point of that is, I'm not suggesting when we say shell game that it's intentional, by any means, it's just that the nature of the relationship between the two, and the processes for us to attach, allow for a lot of error, perhaps duplication of costs and significant time just managing that.

18146 And oftentimes, because we're faced with a need to build and to get that permit approved, we're not in a position even to dispute it because if you dispute it you're not getting the permit. So most of the time, we're just eating that and saying, well, we have to move on, we have to keep building.

18147 And so we wrote that into the ---

18148 THE CHAIRPERSON: But you're eating but it gets passed on to the rates, does it not?

18149 MS. MacDONALD: Well, it's increasing our rate for sure, yeah. Increasing our costs.

18150 And we raised it because it's just one of those areas that I think really does require attention at some point in the future, especially as we're seeing exponential increases in hydro rates that look like they're coming and it's a real cost impact to us.

18151 THE CHAIRPERSON: Right.

18152 On page -- but do you think – just on that, do you think that the -- I mean, you mentioned hydro but it's electrical utilities that have plant, sometimes they're not hydro so ---

18153 MS. MacDONALD: That's right.

18154 THE CHAIRPERSON: --- let's be neutral.

18155 Would you think that they'd be willing to come to the table to ensure a coordinated deployment of broadband?

18156 Because they do have a plan that is important. There's also conduits. There's Crown corporations that run electrical utilities of provincial jurisdiction.

18157 I mean, others have called for more coordination because that's economically efficient, because you avoid making mistakes that -- and having to even rip up roads a second time. But it even is true for how we use poles for one purpose or some infrastructure for one purpose that could be used for another purpose.

18158 Do you think that realistically, utilities, provincially regulated utilities would come to a federal table?

18159 MR. BRAGG: No.

18160 THE CHAIRPERSON: Okay.

18161 MS. MacDONALD: We would like them to in terms of support structure rates, though.

18162 THE CHAIRPERSON: No, I appreciate that.

18163 MR. BRAGG: They determine it and they call it the communication space ---

18164 THE CHAIRPERSON: Right.

18165 MR. BRAGG: --- on the hydro poles. So I could argue you could make the case to take jurisdiction over that. I know, obviously, that's easier said than done.

18166 But they're, you know, they're not that -- and their job is, whether they're regulated by a Utility and Review Board or how, is to protect their own ratepayers. So ---

18167 THE CHAIRPERSON: Yeah.

18168 MR. BRAGG: --- it's difficult for them to just decide to be, you know, at risk of any cost on their standpoint to further anybody else's goals.

18169 THE CHAIRPERSON: Right, and in all due respect to the Supreme Court, I'm not convinced they got it right because of the impact on the country from a policy perspective, but as a lawyer, I have to be respectful of their judgements, and there we go.

18170 You mentioned on page 3, 10(c), you talk about -- and I'm quoting here:

18171 "...this may be even more important in...remote areas where capacity is restricted."

18172 And you had a conversation and answered some questions for the vice-chair on this in terms of managing, and I think your point is that you still need some sort of ability to manage the network and/or a framework. And we do have a framework when it's a capacity issue that exists, but I take your point.

18173 But I was wondering, could you expand -- are you making a point as well in terms of backhaul, or is it just access technology plan, or is it both when you talk about the particular challenge in remote areas?

18174 MR. BRAGG: A backhaul, a little bit, but it's less of an issue. It's typically the access side of the network that is where your capacity demands are, and more so on a satellite or cellular or fixed wireless because just the nature of the architecture of how it's built. It's one tower, one site; a fixed amount of spectrum that you can use to deliver bits to your customers.

18175 So that's where that shared architecture is more susceptible to, I'm going to say, overuse, but that's -- my point is a couple of big users chew up all the capacity on that network and you need to be able to manage around that.

18176 Now, if you were to set a certain standard, I think that would -- you know, I think it might be all right, but it would tend to just go in. If we were, I'm going to say, bidding inside a subsidy regime to build or upgrade an area and it needed to be at 10 and 1 speed and you wanted to have a 50 gigabyte a month data cap, well that just all goes into the math about, well, all right, well how big do I have to build this network to support that; and therefore, how much subsidy do I need.

18177 If it was 15 gig capacity per month, then you'd have to -- wouldn't need to spend as much money to build a network, so it just becomes an economic argument and it’s like the size of the network.

18178 THE CHAIRPERSON: Okay. Appreciate that. I believe those are our questions. So thank you very much for your participation and look forward to reading your written arguments in the further phases. So thank you very much.

18179 Why don’t we take a short break until -- yeah, we were trying to do all this before a lunch break too. So why don’t we take a shorter break until 11:25 and come back. Thanks.

--- Upon recessing at 11:12 a.m.

--- Upon resuming at 11:25 a.m.

18180 THE CHAIRPERSON: À l’ordre s’il vous plaît.

18181 Madame la Secrétaire.

18182 LA SECRÉTAIRE: Merci. We’ll now hear the presentation of Vaxination Informatique. S’il vous plaît vous présentez, et vous avez 10 minutes pour votre présentation.

PRESENTATION

18183 M. MEZEI: Bonjour, mon nom est Jean-François Mezei, Vaxination Informatique. Je vous remercie pour l’opportunité de participer à ce processus. Je vais présenter en anglais, mais je réponds aux questions dans les deux langues.

18184 In the late 1800s, the small rural community of Fort Brisebois was only accessible by the 5/1 transport of the day, namely, the canoe. There was no business case to build a railroad to it. The canoe got you there, but it took weeks and could only carry light cargo, yet the government saw the long-term strategic value in funding the railroad. Today, Fort Brisebois is better known as Calgary.

18185 Imagine if the two incumbents of the day, La Compagnie des 100 Associés and Hudson’s Bay Corporation, had convinced the government that the canoes were more than enough. Keeping the served status allows incumbents to protect their territory from new entrants without having to invest.

18186 If incumbents have no interest, then they should be sidelined and a focus moved to those who have an interest, namely, municipalities.

18187 Vint Cerf has said that over 90 percent of Internet applications have yet to be invented. The needis to empower all Canadians to createnew applications, content and services, not just consume them.

18188 The Commission cannot define basic Internet based on a fixed set of existing applications. Deciding which applications are need versus want would constitute undue discrimination against a declared want and against apps that have yet to be invented.

18189 What is done with packets is none of the Commission’s business. Its business is to ensure Canadians have access to a network that carries packets quickly and efficiently to support growth in the digital economy.

18190 Therefore, the needis to give all Canadians access to the Internet using the most modern technology applicable.

18191 Quickly, for telephone, until an area is considered served with broadband, telephone should remain an obligation to serve, including dialup, paper directories and the blue pages.

18192 And I have some comments about Bell raising its rates. I don’t think they should be allowed to because that’s a disincentive to invest in broadband. Keep the rates low so Bell can invest. Because once broadband is there, telephone’s forborne.

18193 For broadband there’s been different -- a whole slew of different programs that have funded different -- based on geographical definitions that were incompatible and that leaves a lot of holes. This has to change.

18194 What I recommend is the formation of basically NBN.ca. And I’m sure you can find a better name to that. It needs to draw an accurate and complete census of areas needing broadband deployments. And areas would be defined by municipal boundaries or First Nations and special cases for unorganized territories.

18195 The census results would be available online to any Canadian to check for the status of their town and complain if their home or town has not been identified.

18196 NBN.ca would combine funding from NCF, federal programs and others, such as EORN, and coordinate with provinces to fund deployment of broadband based on bids for each projects.

18197 It would also help each municipality to either find companies with expertise to build, or help the municipality build to deploy its own municipal broadband network. It would also coordinate the backhaul availability with each municipal project.

18198 It would also need to coordinate -- NBN would coordinate and champion spectrum availability. In other words, it would be the middle man to go Industry Canada to get the spectrum needed to do proper broadband in a town.

18199 Projects should be funded by public private partnerships. No free grants.

18200 NBA.ca [sic] would in charge of quality assurance to ensure the service is delivered as per standards. An ISP could buy back the PPP shares to become 100 percent owner. And those proceeds, NBN would then -- be available to NBN to fund more projects. Dividends would flow back to NBN.ca, which means an incumbent might have an advantage to buy back the shares.

18201 Winning bidders below certain size would get either 5 or 10 years’ guarantee that no incumbent would build. If the incumbent says we’re not interested and someone else comes in, they need that protection to be able to go to the bank and say lend me money. There’s no dangers from an incumbent.

18202 And a deployed system that falls below standards during the term loses any protection from a new entrant.

18203 Backhaul has been mentioned very often. It’s become fairly obvious. There is one metric I wish to add. Currently in the south we’re looking at about 1.2 gigabits a second of backhaul per 1,000 customers. This rises 32 percent per year according to a recent CRTC decision.

18204 And also, you have to look at population growth. And this allows you to project over 10 years what a bidder has to be able to provide in terms of backhaul. So you want to serve town X, you have -- that proposal has to have sufficient capacity in the backhaul for 10 years.

18205 You may need to rate regulate the backhaul because in cases where only the incumbent is served and the incumbent doesn’t win the bid to serve a town, the incumbent is not going to be very forthcoming in terms of offering lower rates.

18206 And again, this was brought up, convincing provincial governments to open up their own private networks for use.

18207 Satellites, well, they’re always behind the capacity curve and will always be more expensive. They really are the solution of last resort. The goal is to move as many people from satellite to wireline to free capacity for those who absolutely need satellite.

18208 Only a certain number of customers can be served by satellite without undue restrictions. Geographical standards, such as community size, distance from road, fibre trunk, et cetera, can be set to limit who has priority to access the satellite so the total number remains within the satellite’s limit. In other words, if you want to have reasonable gig limits, lower the number of people on the satellite so that those who use satellite get proper usage.

18209 If you lower the number of customers per satellite, it may become uneconomical for private enterprise and government may have to step in. Australia did as part of its NBN.

18210 In terms of Telesat, you might have a consideration to provide CBB level rates, in other words, a subsidy for the backhaul so that towns -- ISPs in

18211 Iqaluit and stuff can provide decent service at normal prices.

18212 For the last mile, there’s a -- I’ve listed a few scenarios. As the unserved, there’s a partially served by one ISP and partially served by two or more ISPs. And basically, this is where the obligation to serve comes in because you have to use your powers to say to those who are already present in the town to finish the job, to complete the full footprint of the municipality.

18213 Technologies should be able to serve everyone in a municipality, not just the core. So the full footprint. And everyone must be able to get the speed standard, the sync rate. No “up to” speeds. And doesn’t prevent an ISP from offering higher or lower speeds. But if I want 25/10, I should be able to get 25/10, even if 5/1 is still offered.

18214 There needs to be standards, and this was raised before, on oversubscription to make sure that we get decent service. This is particularly important for fixed wireless where they have limited amount of spectrum.

18215 And when you evaluate bids, you should evaluate a long-term strategy because if you deploy fixed wireless and it only lasts two years and you have to deploy FTP three years later, you’re wasting money with the first investment. So an eye to long term.

18216 Basically, the major goal, make sure whatever is deployed is future proof. There’s no point in deploying something you know is already outdated.

18217 Aspirational speed, I will be bold and I will say 100 megabits download and 100 megabits per second upload. And you will see why next page.

18218 Basically, this is incentive to choose today a technology that will evolve for at least 10 years. And proposals today who have a technology that can scale to that, get a boost in terms of bidding. In other words, they get ahead of someone who’s cheaper, because their technology will last longer than a short-term solution.

18219 My last -- targets now, a lot of people have done -- I’ve done this very differently. A lot of people have said technology neutral, I've gone the opposite -- the actual opposite, I’ve not put years, but I’ve put technologies.

18220 So basically, as of now, 8.1.1.1 eliminates ADSL1, and then it eliminates ADSL 2, and then it eliminates VDSL2, basically copper. And what's left are only technologies who can basically go forward in time. And also, this plan by having multiple steps, allows the ISPs to plan their investments.

18221 Now, to come to my favourite topic, wiring the North. I've looked at a number of towns, and there's quite a few -- most of them are coastal. And I’ve drawn a map very roughly of what is -- what's interesting in this is Canada’s topology allows for redundancy in fibre, because you can have different fibres that go up and join at the top. And there's the Arctic Fibre Project as well from Quintillion.

18222 Each community that’s served with fibre reduces the need for capacity on the satellites, so that leaves capacity available for others.

18223 A build would take many years to achieve, so it has to start now, because if we don’t start now satellite capacity will become totally underwhelmed in the future. So we need to start replacing satellite as much as possible to limit to only the places where it’s absolutely necessary.

18224 A rough calculation on the back of a napkin, Whapmagoostui to Iqaluit is about 2,000 kilometres in the water, and a number that I found on the internet, roughly $40,000 per kilometre, it comes out 80 million. Now this is just one -- one thing with no landings.

18225 Okay. And last, affordability. The Commission needs to declare that broadband is a basic access, basic service, before social services will even consider including it. So it’s not you waiting for social services, it’s social services waiting for you to declare it.

18226 Neither the Commission nor the telcos have access to information to determine whether a person qualifies for help or not. So that really -- your goal is to set the standard and let the social services provide the subsidies where needed.

18227 And another point too in closing, you also need to work to lower the cost of deployment. For instance, weaning yourself from satellites to reduce the actual costs so that the subsidies are less. So the more modern technology you use, the more efficient it is, the less it cost, the less of a subsidy you need. So that’s I think a role that CRTC can play in terms of affordability.

18228 And finally, for digital literacy, I would say that you can produce videos and distribute it to schools. MediaSmarts have had similar projects as well on that.

18229 And on this, I will await your questions -- happily await your questions.

18230 THE CHAIRPERSON: Thank you very much. So I’ll put you -- je vais vous mettre entre les mains de notre collègue, le conseiller MacDonald.

18231 COMMISSIONER MacDONALD: Good morning and thank you for being here from -- from Montreal today.

18232 I just want to start off -- I’ve sort of divided my questions into three themes: what do we need to achieve; how do we coordinate to make it happen; and then how do we pay for it.

18233 But I’d like to start off -- I noticed in your earlier submissions you had suggested different speed targets than -- than what you're presenting here. You mentioned 5, 15, 20, 30, 50 megs as potential targets, and now you're suggesting, you know, up to a full 100 up, 100 down. And I’m just wondering how you -- how you arrived at -- why you changed your thoughts and how you -- what your thought process was?

18234 MR. MEZEI: Good question. This process lasted over a year, and during that time seeing the submissions and seeing what's happening, and even seeing the incumbents appear, especially Bell and Telus, have evolved my opinion on these things. And the speed targets I initially put was essentially a wish sort of -- you know, because nobody can predict the future itself.

18235 And when you guys came out on the first day -- when the Chairman came out with the need versus want, it made me realize I need to find some sort of justification for these speeds. And the speeds that I presented in the previous were -- you can't really justify, it’s just, you know, a feeling, right. And where -- so what I’ve decided here is what we really need to do is to stop deploying technology that has -- that’s a dead-end. And you can’t really do this overnight, because there's a lot of ADSL1 out in the terrain, a lot of ADSL2 and some VDSL2 that doesn’t quite work. And you can't fix that overnight, especially when you have people who are not served.

18236 So what I -- the reason I put that graph up was basically saying, “Okay, the served status, you know, stop deploying today.” But if you're below that, you still become underserved. And you know, it’s only the second cycle where the 5/1 becomes unserved basically, totally, grossly insufficient. And so that’s why I did sort of that graduated approach, because it gives time to invest.

18237 And you know, Bell Canada in the interrogatories and even -- I think it was Telus, I'm not sure about Telus, who admitted basically they -- no, it was MTS who admitted they don’t do 1 megabit even though they get grants, their technology can't do it. And I'm the victim of this because I’m on FTTN and I can't do 1 megabit, I have 888 kilobits per second in a building that’s certified to do 25/10.

18238 And I can give you an example why 1 megabit isn't enough, for all the talk about these people, I did a Skype presentation to a bunch of university graduate students. And I prepared -- I’ve got an old SD camera, because I can't do HD with 1 megabit, so I've got an old SD camera -- and all tested and I start to speak and stuff, and at one point I switched to present a slide, and it failed. Why? Because my screen is HD, so when I switched to present the sky -- to present the slide, Skype switched to AD, at which point the 888 wasn’t enough.

18239 So, you know, you hear all this bragging, the technology and the applications evolve. It used to be you could specify in Skype maximum throughput, it’s gone, because Skype assumes everyone has modern broadband. And Canada’s stuck with not so modern.

18240 So that was sort of the impetus for me to draw these new speeds basically just above each technology, to make sure that they're not deployed anymore.

18241 COMMISSIONER MacDONALD: And with respect to the five or the 10-year roll-in average or roll-in speed targets, are you advocating that we set the new speed targets and give people the full term, the full 10 years to catch up or meet those targets? Or are you suggesting that they gradually increase year over year? So next year we require 10 down, 1 up, and the year after that 15 down, 2 up until ---

18242 MR. MEZEI: Well I ---

18243 COMMISSIONER MacDONALD: --- an end state of 100/100?

18244 MR. MEZEI: In my chart I put year A, B, C and D because this is something that you're going to have to decide. If -- if you look for instance, areas that need to be served by fixed wireless, there’s limitations in spectrum, there's limitations in physical deployment. They can't just fix this overnight, they have to be given time. So -- and that’s why I have this now.

18245 If there's a bid in a town, in a very distant community where none of the bidders come out with something that fix to serves, then there's a question that needs to be asked. Is less better than nothing, or should we actually find a solution that will work?

18246 And again, it’s a question of are you going to waste money on something that’s going to have to be reinvested in a few years or not?

18247 And so -- but if -- for instance if this year D were 15 years from now, then you’d expect in 15 years that technology such as DOCSIS and -- obviously FTTP can do this today, and fixed wireless would be able to reach the 100/100.

18248 And the other aspect of setting long-term goals is you allow the high-speeds to go their vendors and say, “I will need fixed wireless to do 100/100 in 15 years, change your equipment because this is what we need.” The same thing with the cable companies, they're currently limited in their upload by 42 megahertz repeaters in the coax, and this needs to be changed so they allow more upload capacity.

18249 And so by giving this, you know -- and I specifically waited until Year B to raise the upload to 10, knowing the cable companies will need to do this. Now, I've been told it's a simple change. You just open the box, change our card, but for cable companies nothing is simple.

18250 But this gives them a roadmap as to how to plan their plant upgrades for existing systems, but it's also a roadmap for any new system, saying you must now serve with these new speeds.

18251 COMMISSIONER MacDONALD: And with -- just because I want to make sure that I understand how you've laid this out. You've broken it out into underserved, unserved, and served with different speed targets.

18252 So are you suggesting that we would set different aspirational targets depending on where in the country we're actually talking about?

18253 MR. MEZEI: No, I -- the aspirational target is 100/100, and that's something we should strive to get. And someone who installs technology today that can do 100/100 is blessed, essentially. You know, they get privileged access or priority in terms of the bidding process.

18254 I think I may have forgotten to say this, but satellite needs to be treated separately because that will always be very specific to satellite. I would note, however, that even though Xplornet brags about 25/1, on the same satellite, the Viasat‑1, in the U.S. EXEDE offers 12/3, which in my opinion, is far more interesting than 25/1 because there is that upload.

18255 And that upload really isn't -- is something the incumbents have refused for years, despite demand from -- initially from geeks and now from everyone. Because you know, with the Cloud services, you take a picture and Apple wants to upload this to the iCloud right away, you know, and if you're at home, it's on your Wi‑Fi, which means you're wireline system.

18256 There's a whole bunch of stuff being developed today that expects upload. And people want to create videos, they want to publish their photos in high resolution, not just, you know, these tiny pictures. This is what's coming, and the incumbents have really not pushed their vendors to up those upload speeds. Now, DOCSIS 3.1 allows great upload speeds but they need to change those 42 megahertz things.

18257 And that's, really, why I want to -- I see your role as nudging technology. And if you look at 7(g) of the Telecom Act about innovation, this is where your role is. You need to push the big, old companies to innovate; otherwise, to use my vernacular, they'll want to stick with the canoe, the 5/1 canoe.

18258 COMMISSIONER MacDONALD: I'm looking at your -- the map that you provided, wire in the North.

18259 MR. MEZEI: Yeah.

18260 COMMISSIONER MacDONALD: And I'm going to venture out on a limb here and say I would be a very popular commissioner responsible for Nunavut if we were able to make this happen.

18261 But we just heard from Eastlink, and they provided some very high level figures. It would be about $100 million just to build fibre to Nunavut, to say nothing about building it around the territory. They also spoke about challenges that they face with undersea cables elsewhere in the country. You know, it's amazing how easy it is for a fisherman to drop an anchor on underwater cables and the extreme work that goes into repairing those connections.

18262 Do you think a plan like this would be feasible? And I know we're taking a longer-term view, we're not talking tomorrow here.

18263 MR. MEZEI: Look, there's never going to be a business case to do this. You're never going to get Bell, or Telus, or Eastlink, or anyone to have a business case to do this.

18264 Now, Quintela Networks, an American company, has already started to deploy in the western edge of Alaska. They want to do a cable between Japan and England over the Canadian Arctic, and in their plan, they want to connect some cities. And so that's one way to do this, and the fact that it hasn't been done yet probably means they're waiting for a business plan.

18265 So there needs to be a vision. In the same way there's no business plan for the railroad, and the government built it 1800s, 1890s, there needs to be a business plan on this.

18266 And you know, I'm reminded, I visited Resolute Bay a number of years ago and I learnt that Resolute Bay and Grise Fiord were artificial settlements. It was the Government of Canada who put -- who moved people up there to assert her sovereignty. And I think that all the people of Nunavut, and Northern Quebec, Labrador, and Northwest Territories, I think they deserve good broadband.

18267 Now, unless you're willing to subsidize satellite forever -- and I should note, Australia with their NBN 2.0, as opposed to the NBN 1.0, was restricted only to only those people who absolutely needed satellites. NBN 2.0 under the new government, a city as large as Launceston in Tasmania is not going to be served by satellite because Turnbull doesn't want to build fibre to the town.

18268 As a result, they've got so many people on satellite they've had to stop-sell, and they're building a third satellite that's going to be owned by the government, a third satellite to serve Australia because they don't want to deploy fibre anymore. So you have to look at that.

18269 If you want to serve these people with satellite make sure you have enough capacity, because those plans, with the 10 gig, or 15, or 20 gigs per month is indicative that there is no capacity on the satellite. It can't serve people properly.

18270 You know -- and so while I drew the map -- I had some fun yesterday because I was tired and I started to draw all the dots from all the towns and was trying to spell -- and Whapmagoostui I know because I met some people who went there. When I biked to Chisasibi, I knew about it because I crossed the road over LG‑1, you can cross and there's a sign.

18271 Whapmagoostui happens to be in Hudson's Bay, whereas Chisasibi is James Bay. And as a little trivia, there's a big difference because James Bay is very shallow; Hudson's Bay, it's deep. From an undersea cable point of view, deep is better. So Hudson's Bay is actually a bigger challenge than James Bay.

18272 Now, if you look at all the communities -- as a matter of fact, maybe I shouldn't have drawn the lines because what impressed me were the number of communities in there. And I went over on the Nunavut Government website and I found the list of all the communities and the population.

18273 Same thing from the Government of Quebec, the -- “marmot” pointed me to a document where they have all the Northern Kativik communities, there's a lot of people there. You know, they need to be served.

18274 And it's -- you know, it's obvious, a community of 30 people or a lodge in the middle of nowhere, that's going to be satellite. But a community of 1,200, do you really want satellite for that, you know.

18275 COMMISSIONER MacDONALD: I don't ---

18276 MR. MEZEI: And one last thing, to respond to your question. I drew all the lines but it's obvious this is going to be a -- if this happens, it's going to be progressive. So you might want to build to Iqaluit first, and that relieves you 2,300 homes or 7,000 people from the satellite, which is capacity others can use, and then you can move around this way bit by bit to serve more and more.

18277 COMMISSIONER MacDONALD: So on the topic of capacity, because technology is a wonderful thing and it advances very quickly. And we've heard from a number of different intervenors, new technology that appears to be -- it appeared to be just at the cusp of being able to take advantage of it.

18278 Be it Xplornet's new service -- new satellite services that will offer 25 down, 1 up. We heard from OneWeb a day or two ago, talking about lower satellites that are being deployed. We heard from another intervenor about high throughput satellites that are going to be deployed.

18279 Do you think that that's a more viable option to service rural and remote Canadians? Understanding people do want wired infrastructure, but with these technological advancements is that going to solve the problem?

18280 MR. MEZEI: Solve, no; help, yes. And as I said, satellite has a place. It is essential because there are communities -- areas where, you know, it just can't work. It -- you know, if you have 30 people in a community you can't really string fibre all the way there, unless there's community further up the road of 12,000 people, you know, then it works.

18281 But satellite has a room, but you have to, I think, look a bit at the spin that you've gotten from the incumbents and Xplornet on this. They claim the satellite is going to be 20 gigabits of capacity. Now is this 20 gigabits in the uplink or 20 gigabits in each of the combs, the beams to each towns?

18282 Because if it's 20 gigabits for the uplink, and the uplink serves the beam that serves Toronto, serves the beam that serve Nunavut, Northwest Territories, and maybe Northern Manitoba, then that's 20 gigabits for all of Canada, which means Nunavut only may get 5 gigabits because if they -- depending on how they allocate the stuff.

18283 So you have to take all those claims with a little grain of salt.

18284 Now, in the interrogatories, I asked Xplornet specifically about, for instance, fixed wireless and satellite technologies, and their response was, “Not relevant to this proceeding.”

18285 So unless they come to you with hard facts of this is exactly how much capacity is going to be available to high Arctic on the East, how much it’s going to be to the Arctic in the West, the Western Arctic, and how much it’s going to be in the Northwest Territories, and so on and so forth, can you really bank on this?

18286 And OneWeb is very interesting. What I heard, it was -- their capacity was 6 Gigabits that they’ve been given in terms of data throughput. But again, no mention of the uplink, and that’s -- the satellite that’s over Iqaluit has to talk to other satellites before it reaches the base station, and what’s the capacity…

18287 I mean there’s a whole lot of details you need to know before you can find out whether these future solutions will provide something you can bank on, you know.

18288 And the only thing we know that we can bank on right now is fibre. You know, but satellite definitely will be there. And the example, OneWeb has a very interesting advantage. Because their satellites are constantly moving, someone -- I know the town of Field was mentioned. Field is right on the northern edge of a mountain range, the Kicking Horse Pass. It does not have view of satellites in the South.

18289 But OneWeb satellites passing over will also move to the North. So they might have service from them.

18290 So they have service -- they have internet from another like wire.

18291 COMMISSIONER MacDONALD: Yes.

18292 MR. MEZEI: But I’m just using that one as an example.

18293 So there’s uses for satellites and they’re necessary but what you have to do is not declare satellite as the solution. It really is the last resort for those who really need it.

18294 And when you reduce the number of people who depend on it, then those who depend on it have enough capacity to have, let’s say, 200 gigs a month of usage, and they actually get advertised speeds because the satellite is not congested.

18295 COMMISSIONER MacDONALD: Thank you for that.

18296 With respect to coordinating efforts, you suggested the creation of a crown corporation NBN, and I’m just wondering your thoughts on how that should be structured. You draw in from other similar crown corporations that have been structured in other countries?

18297 MR. MEZEI: I looked at -- and a number of comments were raised already a bit in this proceeding in terms of the four-year cycles for elections.

18298 You need -- this is a long-term project to wire Canada and so it needs to be able to operate fairly independently. Now, the CRTC is an independent administrative tribunal, although you’ve admitted you touch sometimes, even though you’re arm’s-length, but you know you have that.

18299 But are you the right organization to actually run this? And I think you’d be the right organization to set the standards and set the procedures, the policy, but are you the right one to run this?

18300 And I don’t have a huge judgment on this, but I think that having a crown corporation, something that’s separate, allows it to operate more based on logic and business sense than on political sense. So you know it’s -- that’s one of my goals.

18301 The other aspect I looked at is I looked at the NBN in Australia, and a change of government wrecked it because essentially the new prime minister, while being in the opposition, argued against it. So once he got elected, he had to deliver on his promises. Essentially, that’s the big picture of what happened.

18302 And so that’s a danger of having something that’s tied too closely to the government.

18303 And I think that the recent budget and the lack of mention of broadband in the election campaign of the current governing party is an opportunity because maybe we’re working with a blank slate, and they are going to allow you to define. And I think that’s an opportunity here to work on that.

18304 COMMISSIONER MacDONALD: And how would this -- because there’s a number of different stakeholders involved in whatever the solution is going to be. How would this crown corporation, how would its mandate be separate from the CRTC, separate from Industry Canada?

18305 How will it harness and bring all of those different stakeholders to the table, be they the service providers, the provinces, what have you, in a collaborative way?

18306 MR. MEZEI: That’s a big challenge; isn’t it?

18307 But if you look at a number of municipalities that have appeared in front of you who complained at how difficult it is to deal with Industry Canada, you know, you look at a company the size of Bell, they have, you know, I keep joking they have 10,000 regulatory lawyers. They know how to deal with all these things, but a small municipality who wants to deploy their own network, they don’t.

18308 And that’s why I see NBN as being someone who will help deploy this, and it will actually do all the work of dealing with the government to get, you know, access to that 500 million, access to the funds from that, and NCF and the provinces as well. Because you know the provinces have -- because the Canadian government has lacked in leadership or has not been forthcoming early enough, provinces filled in the gaps and they strung their own fibres. And you’ve heard that fibre is not really available, even though it’s there.

18309 NBN might be the organization that goes to the provincial governments and say, “look, you know, we have people who are willing to use your fibre, and we have the solution to make it safe. We use different VLANs, we use different fibre strands or whatever but we can make it work.” Same thing with what’s been raised, dealing with hydros. Railways also, by the way, have fibre.

18310 So that could be the champion that does all the work of the red tape on behalf of the ISPs and also combining -- being able -- and I know there’s stacking rules but if you’re able to combine funding from different parties, then you come out with a solution to serve -- I call it Saint-Profond-des-Creux, it’s you know sort of a little village in Québec that doesn’t exist but it’s out in the boondocks.

18311 If you want to serve Saint-Profond-des-Creux, you need to find the backhaul and possibly, you know, get it from the government or possibly get it from someone else. You need to find an ISP or a builder who will actually install the stuff.

18312 So this NBN can be the resource that helps a municipality to get it done. And you know, the government seems to be more red-tapish in terms of, yes, you qualify; here’s your money; go away and leave us alone. Whereas NBN, especially if it’s a PPP, can be involved in helping move these things forward.

18313 The goal is really to give broadband to the home, you know, not broadband to the press release.

18314 And so that’s why I seek a crown corporation being more independent from government in being able to -- its job. And you can give it a very strong mandate to do the job.

18315 COMMISSIONER MacDONALD: And you sort of started to go down this road, so I’ll bring you back to it, and it’s with respect to the funding. I mean you mentioned P-3. So we’re talking about companies being involved; we’re talking about obviously governments being involved, and so forth.

18316 Do you have any thoughts on how much funding should come from what body? I mean we have $500 million announced in the recent federal budget to go towards broadband. There’s provincial initiatives underway as well. Service providers are investing. Some people have suggested a levy to be charged to internet rate payers to help fund builds.

18317 Where should we be drawing all of this money from and to what degree should it come from one pocket versus another?

18318 MR. MEZEI: I would say, as a citizen, draw from all of them because you’re going to need it, because 500 million is not going to be enough. And for instance, in the case of the North, whether you launch another satellite or stretch a string of fibre, this would have to be a totally separate project funded by the government.

18319 I don’t think that ISPs should be funding that because that’s really sort of a nation-building one.

18320 But closer in the South, you have the NCF right now for telephone. That could be shifted, and it’s been mentioned a number of times over, to help deploy broadband. You have the 500 million. Why not combine them?

18321 And so when Saint-Profond-des-Creux wants their broadband, instead of getting 20 million from the government only, it might draw only 5 million from the government, 5 million from the NCF, and maybe 10 million from the province.

18322 And I think the NBN company would be able to do these negotiations based on where that town is and a town in Ontario may have access to provincial funding that’s not available in another province and vice versa.

18323 So I don’t think you can have a cookie-cutter approach to this, and you need an organization that has the knowledge to be able to basically manipulate through all this government opportunities and government, you know, difficulties as well.

18324 So I can’t give you a specific, you know, 50 percent there, 50 percent there. It could be the province -- for instance, in the project the province is more than willing to offer its fibre as backhaul. So the province ends up solving the backhaul and the rest of the funding only affects the last mile. In other cases, you know, the 500 million from the federal might go to the backhaul as well.

18325 So I don’t think you can or should fix specific targets as to percentage of fundings.

18326 COMMISSIONER MacDONALD: Just one final question before I hand you back over to my colleagues. And maybe you can only answer this question as an individual Canadian. But we’ve seen studies, people when they’re surveyed are very supportive of rates being similar across the country; they’re very supportive of affordability measures; they’re very supportive of increased speeds and more reliable service, but people also rank their priorities and sometimes we don’t get a clear picture of that in some of the surveys that are done.

18327 So if it’s federal money that goes towards this it either means that that money doesn’t go towards something else, national defense, building schools, whatever, or it means taxes go up. If service providers are providing funding that means they’re not spending it somewhere else in their network, they’re not returning profits to their shareholders, or they’re increasing what they have to charge the end user.

18328 So on that scale of priorities, where does access to broadband fit?

18329 MR. MEZEI: If I look at the original call for the 134, notice of consultation, full participation in digital economy, one can argue that it’s a national strategy to deploy broadband in order to deploy the economy.

18330 As such, you could argue that it is a priority for the government, and I’d say here government, federal, provincial and municipal, to deploy broadband, because that’s how you grow your economy.

18331 And as a cyclist, I’ve gone through -- as a matter of fact, you’ve seen the mayor from Sainte-André a few days ago. I’ve seen that town lose their dépanneur. As a matter of fact, last year the Caisse populaire was for sale, the building. I’ve seen the same in Ontario, Glen Robertson near the Quebec border, and they lost their dépanneur, and now the bar is a dépanneur, but they’re for sale, because there’s no other businesses in town, they’ve all gone.

18332 I’ve seen this myself from a small footprint that I do on my bike over the years, and there needs to be action to provide economic growth in rural Canada. And right now there’s a big opportunity because with digital, with broadband, anyone in Canada could come out with the next Google. And, you know, if you build it they may come but if you don’t build it they will not come. So it’s a risk the government has to take.

18333 And I think it’s a priority, because if you look at the States -- if you look at the stock market in the States, the big companies they’re all digital companies. This is where the growth is happening, and if Canada doesn’t jump in then -- you know, you’re going to have Toronto, Montreal, and Vancouver, maybe Winnipeg and Calgary and the rest is going to be just farmers begging to have access so they can plug their modern farming equipment in.

18334 It’s a national need, and so I think the government -- and the 500 million is great. Australia, the NBN 1.0, they set out -- ambitious project -- 30 billion. Five hundred (500) million compared to 30 billion. So which economies in the world are going to succeed in a digital age? And this is a question the government needs to ask.

18335 And, you know, I’ve seen the jaw dropping speed -- speech -- sorry -- from the Chairman of last week, and my jaw did drop, and he framed the problem very well, we need a digital strategy. And if the government is convinced that the digital economy needs broadband to grow that would be step one. That’s a problem.

18336 I don’t know if that answers your question. I just ---

18337 COMMISSIONER MacDONALD: No, that’s very helpful. And you’ve cited building the railroad a couple of times today.

18338 MR. MEZEI: Yeah.

18339 COMMISSIONER MacDONALD: Another example would be building the TransCanada, which took about two decades to accomplish. So we may not be done yet but it does take some time to do these initiatives.

18340 MR. MEZEI: I would say this very quickly, admitting the need, or admitting the problem is a big step in solving the problem.

18341 COMMISSIONER MacDONALD: Thank you very much. Those are my questions.

18342 THE CHAIRPERSON: I never thought our policies would be a 12-step program but I guess ---

--- (LAUGHTER)

18343 THE CHAIRPERSON: --- you’ve opened that door.

18344 It’s also delightful to hear Quebec English spoken at our hearings, things like dépanneur instead of convenience stores but -- I understand autoroute is also widely used in English in Quebec. So it’s a delightful métissage.

18345 Just one question for you and it goes to page 3, and I guess it also builds on a question of language. You said that -- the fourth bullet there you say that Canadians have access to a network that carries packets quickly and efficiently. While you were putting down adverbs I’m surprised you didn’t add “neutrally”.

18346 MR. MEZEI: Well, I know there’s an ITMP hearing coming up. And yes, I probably edited the word out because I don’t want to get into, you know, two hearings at the same time. But essentially, yes. And, you know, I had 27 too in the text but I removed it because I figured it would be maybe a little too obvious.

18347 But essentially yes, the role of the internet is to deliver packets and it’s up to the users of the internet to use it and exchange information. And the type of information -- and this is the beauty of the internet, is nobody -- you don’t need to ask permission to send something to someone. Whatever that thing is, whether it’s video or a document, you don’t need permission. You don’t need permission to start a new application. And this is where innovation really thrives.

18348 And if you start to define what’s needed versus what’s want you get into dangerous territory. And that’s why when I saw the debate start with, you know, the incumbent saying that five/one is perfectly for email and stuff, email and stuff is not going to grow the economy.

--- (LAUGHTER)

18349 MR. MEZEI: Innovating and finding a new application is what’s going to grow the economy and to do that you need more than five/one.

18350 THE CHAIRPERSON: Thank you. Those are my questions. Wouldn’t want to ask -- say anything that would cause more jaws to drop and cause injury to you. So appreciate it. Thank you very much.

18351 MR. MEZEI: Thank you very much.

18352 LE PRÉSIDENT: Madame la secrétaire?

18353 THE SECRETARY: I would now ask Cybera to come to the presentation table.

18354 When you’re ready, please introduce yourself and your colleagues, and you have 10 minutes for your presentation.

PRESENTATION

18355 DR. CARRA: Thank you, Mr. Chairman, Vice-Chairman and Commissioners.

18356 THE CHAIRPERSON: Are you getting product placement from Apple at least revenues?

--- (LAUGHTER)

18357 DR. CARRA: I’ll turn it this way.

18358 THE CHAIRPERSON: It’s okay. It’s okay.

18359 DR. CARRA: I’ll begin by introducing our team. I’m Barb Carra, Vice-President Policy and Strategic Initiatives. Beside me is Robin Winsor, our President and CEO of Cybera. And finally we have Alyssa Moore, our Policy and Strategy Analyst.

18360 Over the past 20 years, Cybera has managed Alberta's advanced Research and Education Network. Our organization is strategically positioned as Alberta’s technology neutral expert agency for the purpose of driving innovation for the economic benefit of the province.

18361 One of Cybera's core roles is the expansion and operation of Alberta’s Research Education Network called CyberaNet. This is the dedicated network for unmetered, public-sector traffic used by Alberta’s schools, post-secondary institutions and business incubators.

18362 Over the past two years, we have expanded our network to connect more academic researchers, industries, incubators, and government-funded partners than ever before. We now have 78 member institutions and our network connects over 600,000 end users.

18363 We receive both provincial and federal funding to spearhead technology pilot projects that improve efficiencies and increase the competitiveness of Canadian institutions and businesses, but more and more our members are asking us for better, faster access to network and coordinated computing solutions. Broadband is being viewed as essential infrastructure and a driver of innovation, especially as the internet of things gives rise to new products, business models and new companies.

18364 Based on our technology neutral, unbiased expertise, we are regularly consulted by academic institutions, local and provincial governments, and economic development authorities to help guide and advocate for critical technology infrastructure investments.

18365 The conversation is shifting though. All across Alberta, small towns and larger municipalities are calling for connectivity to operate more efficiently, launch innovation opportunities, minimize the digital divide, and simply bring access to citizens who are underserved. They’re asking for direction and they’re asking for leadership

18366 As such, the importance of this review cannot be understated. It represents a critical turning point for Canada's digital economy and communications landscape.

18367 So I’m going to pass it over to my colleague, Alyssa Moore, will now provide a synopsis of our written submission.

18368 MS. MOORE: In our written submissions we state that broadband should be considered a basic telecommunications service, and should be affordable and accessible to all Canadians.

18369 To ensure that Canada is able to take the lead in tomorrow's marketplace of ideas and services, regulation is required to build and support our digital infrastructure. The reality is at that the present and in the future of communications in Canada is and will be conducted via an Internet connection.

18370 Currently, not all Canadians have the affordable broadband connections required to use common Internet-enabled services and resources at a satisfactory level. It is a question of both price and availability.

18371 The interventions made by private citizens directly on the notice of consultation, indirectly through various public interest groups, and the compelling presentations made by ACORN earlier in the hearing, reflect Canadians’ frustration with their inability to meaningfully participate in the digital economy.

18372 This is especially true for Canadians living in rural and remote regions where barriers include poor availability due to lack of access infrastructure, poor quality due to lack of bandwidth and capacity, and poor pricing due to lack of competition or geographic remoteness.

18373 When you ask the average Canadian what a reasonable data cap is or what speed they think is necessary to conduct basic activities online, few have the technical knowledge to pinpoint a number. They can, however, tell you when they are billed for exceeding their data caps with regular Internet usage or experience difficulty engaging with services involved in fulfilling common social and economic activities, including distance education, government services, teleconferencing, using cloud services, and uploading or downloading content.

18374 To ensure that Canada is competitive in the global digital economy, the Commission should set both ambitious aspirational targets and mandate a level of basic broadband service.

18375 In our written submissions we said, “All Canadians will need the capability to transmit gigabits per second of data and process terabytes of information.” While this scenario will not be the case tomorrow, we maintain that this is the future our communications infrastructure must be prepared to handle. New infrastructure builds must anticipate and accommodate future needs. This means scalability, flexibility, and shareability of networks.

18376 Early in the hearing Commissioner Menzies stated that it will be helpful for the Commission to think in terms of the “basic, the no less than” and “ideally as much as.”

18377 It is our position that at the minimum a subsidy eligible basic broadband service should aim to match the FCC's National Broadband Plan target of 25 megabits per second down and three up. Ideally, Canadians would have affordable access to a symmetric gigabit connection.

18378 Upload speeds must be taken into consideration because Canadians, and soon their numerous connected devices, are not only passive consumers of online content and services, but also active producers and participants. At the current 1 megabit per second standard, uploading a 10-minute iPhone video would take approximately 3 hours.

18379 Data caps are a real concern for many Canadians. The Commission heard from ACORN and multiple small municipalities that users are limiting or censoring their Internet use for fear of exceeding their data caps. Ideally, all connections would be uncapped.

18380 It is clear that market forces are not well suited to extend the infrastructure required to deliver a quality, affordable, basic service that is satisfactory for Canadians’ Internet usage needs in many areas of the country. It is the nature of for-profit service providers to seek out profitable population centres and to actively avoid regions where it does not make business sense to operate.

18381 This is understandable from a business perspective, but has resulted in a manifestation of the digital divide known as “the donut hole” or “timbit” problem where a service provider hollows out the profitable business centre of a town, but does not extend their services to the less profitable premises on the edge of town and beyond.

18382 Some interveners have submitted that it is the role of the government, rather than the CRTC, to fund the provision of broadband services where the market has failed. We agree that municipalities, provinces, territories, and the federal government have an important funding, granting, and planning role. For example, we support Bell's proposal to earmark a portion of federal spectrum auction revenues to finance broadband infrastructure deployment. However, the CRTC with its regulatory powers has the ability to take the lead by defining broadband as a basic service supported by a subsidy regime and signal to governments the importance of investment in broadband infrastructure.

18383 And my colleague, Robin Winsor, would now like to speak to the Chairman's recent remarks on strategies to address gaps in connectivity.

18384 MR. WINSOR: In addressing the Chairman’s question as to gaps in connectivity, Cybera takes a holistic approach.

18385 From the ground up, the layers of technology start with in-the-ground conduits carrying copper and fibre, to above ground services on utility poles, all the way up to the often underutilized fibre assets associated with optical groundwire on electrical transmission systems.

18386 Over the air connectivity starts at public Wi-Fi hotspots, fixed area wireless and cellular networks, all the way up to satellites 35,000 kilometres over the equator in geosynchronous orbit. Soon to be joined in this network of networks will be the low earth orbit satellites constantly flying by only a few hundred kilometres directly overhead.

18387 This last element will surely be a key element in the technological side of filling the gaps, assuming the business and regulatory models allow it to do so.

18388 It's worth noting that the cost of launching one of these new low earth orbit systems, while certainly high at several billion dollars, is less than what the Government of Canada has already recouped from spectrum options.

18389 But technology is not the only source of gaps in connectivity. Indeed, it may not be one at all if the new technologies discussed earlier by OneWeb come to fruition.

18390 The other elements are economics and expertise. Let's address those first and come back to technology later on.

18391 Often the technology is easy. It’s changing the tone from a model of scarcity to a model of abundance that is difficult.

18392 We have found that in many largely rural municipalities, elected officials need no convincing as to the value of broadband. The connectivity gap here is that they do not know how to get connected and are unlikely to be able to source the needed expertise locally. Without an economic incentive, the community will not be served by a TSP and so if it is to be served, it must arrange for both the expertise and the funds to connect itself. This is an area where the CRTC can help by making funds available through a subsidy program.

18393 By allowing public organizations, in addition to ILECs, to access the subsidy funds you can empower communities to take care of themselves. In some cases, this may be a town council, a library, a band council or other not-for-profit organization whose purpose is to serve the public interest.

18394 Suitably funded, and especially when combined with the levers of control afforded by decision making authority over land use and rights of way, these bodies will be able to arrange backhaul and oversee the installation of appropriate distribution infrastructure.

18395 CRTC cannot provide the expertise directly but you can empower a wider range of organizations through access to the subsidy. This may be the single most important step the Commission can take to close the gaps. Sometimes though there will be side effects.

18396 The goal of telecom policy ought to be the empowerment of Canadians through ubiquitous access, not the protection of Canadian telecom providers. If a regulatory structure significantly improves access for the population but in doing so displaces an established Canadian business, then that is the right thing to do. Protectionism at the cost of connectivity cannot be justified.

18397 This will come to the fore as global providers develop the technological reach to provide service into all parts of our country. While some companies, such as OneWeb, have said that they intend to work through TSPs as a wholesaler, what will the CRTC's stance be if SpaceX or another global provider were to provide service directly to every rural Canadian home?

18398 The Chairman has asked who is in the best position to implement these strategies.

18399 We would like to see the CRTC use its position of influence, if not its authority, to make all levels of government aware of the importance of broadband connectivity and to help change the lexicon. Too often we hear of government investment in infrastructure only to learn that the funds are going to bridges and roads.

18400 These create short-term employment, to be sure, but to truly build our 21st century digital economy, investment in infrastructure has to mean investment in digital networks.

18401 Leadership is needed. And while it ought to come from the government of the day, if it does not, then it should come from the CRTC.

18402 Clearly, the CRTC has a major role to play, but we would like to see a coordinated approach between the various regulatory bodies to ensure the best use of fibre capable facilities, such as pipelines and high voltage transmission systems.

18403 Can the CRTC work with provincial regulators to improve access to underutilized assets and to require the installation of fibre, or at least the conduit for later use in open access networks as a condition of public access -- or of access to public lands?

18404 Can the CRTC give guidance to cities and encourage them to work cooperatively with public interest groups trying to extend the infrastructure? While many municipalities, such as the City of Calgary, do indeed work cooperatively to build out municipal fibre for the public interest, many others still see it as a revenue opportunity and charge the same rate to schools and colleges as they do to for-profit telcos.

18405 This would be a step in the right direction towards a National Broadband Strategy that affords all Canadians affordable access to an ever expanding terrestrial, aerial and orbital network.

18406 Thank you for your time and we are happy to take questions.

18407 THE CHAIRPERSON: Thank you very much. I’m not sure if it was wise referring to bits, bites and Timbits just before the lunch break, but we’ll soldier on.

18408 The Vice-Chair will start us off.

18409 COMMISSIONER MENZIES: Thank you. Your written submission -- your oral submission was good too. Your written submission was -- I think I wrote it down -- very thorough, thoughtful, visionary and exhausting in the daunting challenge that it placed in front of us in terms of that. But I enjoyed it. And it did paint an image of the future. And it also inspired the thought, okay, so where do we begin in terms of that? Not that it hasn’t already begun. And thanks for your thoughts on the broadband strategy and coordinating.

18410 I have one question from that, which I should get out of the way. When you refer to the various regulatory bodies, in the previous conversation railways were brought up and now you mention pipelines, and last week we learned about hydro and -- or more about hydro, and that sort of stuff. Do you have a list or would you be willing to provide us with one of -- just of what you know of where fibre connectivity may be associated with different transportation and other corridors in the country?

18411 MR. WINSOR: We’d certainly be happy to work up the lists that we do have and provide those to the Commission.

18412 For example, we are currently working with utility providers in Alberta governed by the Alberta Utilities Commission through the Alberta Electric System Operators who have specified, for example, that all of the new high voltage transmission lines within the province carry a optical ground wire. So that is a 48 fibre bundle in the electrical protection at the top of the towers. Only two strands of which are actually required for their operation of the electrical system, leaving 46 as they use the entertaining term a “stranded asset.” We would like to get at those strands of the stranded asset and think it should be deployed in the public interest.

18413 So we’re in those discussions just now and we’d be happy to share that information with the Commission.

18414 COMMISSIONER MENZIES: Thank you. I think our undertaking date is May the 5^th, if you’ll take it as an undertaking.

18415 UNDERTAKING

18416 DR. CARRA: I would just ask that if we get a few extra days would be useful for us to put that information together.

18417 THE CHAIRPERSON: How many -- what’s a few extra days?

18418 DR. CARRA: If we could -- to the following Monday. Is that the 8^th? I don’t know. Sorry. 9^th?

18419 THE CHAIRPERSON: 9^th?

18420 DR. CARRA: Thank you.

18421 THE CHAIRPERSON: Okay. So the 9^th?

18422 DR. CARRA: If we could get until after the -- it’d be great.

18423 THE CHAIRPERSON: Sure.

18424 DR. CARRA: We have a board meeting that’s going to take up our time.

18425 THE CHAIRPERSON: I think since you’re late in the proceeding that seems fair.

18426 DR. CARRA: Thank you.

18427 COMMISSIONER MENZIES: Okay. I’m going to start with your outlining of the need for symmetrical download and upload speeds. We’ve discussed that a bit with industry and they find it very daunting and haven’t been able to put a price on it, but certainly referred to as extremely expensive.

18428 Can you point us to other jurisdictions where -- with similar infrastructure where symmetrical high speeds are available?

18429 MS. MOORE: So I don’t even think that I need to point towards another jurisdiction actually. We had Axia FibreNet in a few days ago in front of you and they are deploying symmetrical fibre services to rural communities in Alberta. So that’s definitely something that could be looked into. And I’m not sure if they put that on the record, but I’m aware that’s happening.

18430 COMMISSIONER MENZIES: Do you know what the speeds are?

18431 MS. MOORE: I am not aware, but it’s certainly information that would be available through Axia’s website, if I’m not mistaken. But I can undertake to try and find that out as well.

18432 COMMISSIONER MENZIES: That’s okay. I don’t want to give you another undertaking. It’s -- you just -- you provided the first breadcrumb and we’ll follow it ---

18433 MS. MOORE: But I believe it’s somewhere in the neighbourhood of 50/50, if I remember correctly.

18434 COMMISSIONER MENZIES: Okay.

18435 MS. MOORE: It’s not insignificant.

18436 COMMISSIONER MENZIES: Thank you. That’s very helpful.

18437 So you also referred to the Connecting Canadians target. I think -- I’m not -- it’s a chicken and egg. I think that emerged from our 2011 target. Yeah, anyway, and we’re moving forward with another target. Would you agree that it would be wise for some synchronicity in those targets in terms of that?

18438 DR. CARRA: I was just going to say I think, yeah, absolutely. I think it’s really important we see better coordination across all these initiatives that come out there. We often hear about opportunities through Digital 150 or the things that come out from the federal government, at least at the provincial level. And then when you chat with our provincial level folks, there’s a disconnect between understanding how that’s happening at that level, and then how to make use of that at the provincial level, and then even further down the stack with our municipal partners.

18439 So I think if there was a more holistic and coordinated approach around these different initiatives, including Connecting Canadians and ever -- whatever future strategies come out, it would be really useful.

18440 COMMISSIONER MENZIES: True. How do you interact with municipalities?

18441 DR. CARRA: We work really closely with the big cities. So City of Edmonton, City of Calgary on, you know, fibre initiatives within the cities, mostly to connect our public sector members. Finding out a, either how can we leverage the fibre they’re investing in their infrastructure as a not-for-profit user, but also, with the City of Edmonton we’ve actually been working on building an actual fibre and putting fibre in the ground as a partner with the City of Edmonton to connect some of the institutions that haven’t been able to make appropriate use of SuperNet or other sources in the environment to get better capacity at an affordable rate.

18442 We also work with the smaller municipalities on strategy around how do they improve their broadband capacity in their communities, looking at different models for moving forward and how can they get better access to the bigger centres for shared initiatives.

18443 COMMISSIONER MENZIES: Is there a lot -- that’s just reminded me of another thing. There’s municipal fibre everywhere too, right, that is used exclusively.

18444 MR. WINSOR: There’s a considerable amount of municipal fibre. At a meeting some time ago when we first looked at the City of Calgary’s municipal fibre map, I mistakenly thought I was looking at a street map of the city. It’s very dense. And City of Calgary has taken the attitude that this is to be deployed in the public interest. They are not trying to make money off it. They regard it very much as part of the City’s infrastructure, much as the roads and everything else. So they’re absolutely terrific partners in making sure that we can connect all the various parts of the city.

18445 Some other jurisdictions do treat that as something that they would like to recoup the cost on. But our argument tends to be you built it for your own purposes or you laid it at a time when you had the road dug up anyway. That makes it available and it’s just part of using the city’s infrastructure. Unless we’re about to go to toll roads everywhere and so on and charge for every bridge and tunnel, we shouldn’t do the same for municipal fibre.

18446 So guidance from CRTC that whenever public institutions dig up the ground that they put in the capabilities of the fibre. Because the fibre is not expensive. It’s in placing it that’s the problem.

18447 COMMISSIONER MENZIES: Does the City provide service providers access to its fibre network?

18448 MR. WINSOR: They do.

18449 COMMISSIONER MENZIES: Okay.

18450 MR. WINSOR: They ---

18451 DR. CARRA: I was just going to say the cities tend to operate under different business models though. And that’s an educational piece as much as it’s sometimes changing attitude toward how can we better improve those relationships.

18452 Honestly, the City of Calgary is very progressive in their business model and view opportunities as partnerships in terms of improving public sector connectivity. You know, some of the other cities haven’t quite come as far down that business model approach and still are more proprietary over the investment in the ground. And it’s a harder business model sometimes to crack.

18453 COMMISSIONER MENZIES: Okay. When we talk about a target of -- you talk about a target of 25. Is -- and you sort of talked about the Timbit or the donut hole -- sorry to bring that up before lunch again, but the -- isn’t there a risk that that just makes that divide larger? I mean, if you said 25, all of a sudden that the ISPs -- again, you’d just see -- you would likely just see a repetition of the previous economic pattern. And concern people might raise is that that's just going to grow that divide and result in more social tension and more depopulation of towns and municipalities and that regional districts that don't have that level of connectivity. Could you address that, how we would get around that, or mitigate?

18454 MR. WINSOR: I'm not sure that you can mitigate that consequence of setting reasonable targets and having people feel that they are disenfranchised when they don't get that service. The pressure, however, from the public to build will grow as the targets rise and as the imbalance becomes ever more apparent.

18455 Although it's not something that we really need to add a lot of pressure to just now. Rural users are already feeling greatly disadvantaged relative to the people who are either in the cities or in the middle of small towns, where quite often there is service. There is a big difference between the Timbit and the donut. Again, apologies.

18456 But raising the target should not be something that you hold back on just because it's going to make those who aren't getting what they should more dissatisfied. If anything, it'll help to add the weight of the public voice to saying we must build this, and as innovative new technologies come along that will add pressure to the providers to bring it in.

18457 COMMISSIONER MENZIES: Thank you.

18458 In your written submission, you suggest that we regulate in terms of the following: speed, competitive access, oversight, affordability, and latency.

18459 So first of all, what should be the latency standard we set should we choose to set one?

18460 MR. WINSOR: Less than or equal to 64 milliseconds.

18461 COMMISSIONER MENZIES: Sorry?

18462 MR. WINSOR: Less than or equal to 64 milliseconds.

18463 COMMISSIONER MENZIES: Sixty-four (64)? Thanks.

18464 And you also -- you mentioned in your updated and in your presentation here in terms of, I think you said ideally there would -- data caps would become a thing of the past, but I don't think they will real -- right away.

18465 So where would we start in terms of what you would consider to be a minimum capacity for a standard?

18466 MR. WINSOR: We firmly believe those data caps should go. We operate the Research and Education Network, which is not the Internet but still connects a great deal of researchers, universities. And there's a counterpart to Cybera in each of the provinces, some large, some small, but -- and then our federal counterpart's CANARIE. That Research and Education Network runs without camps because that's how you get people to use it most effectively.

18467 Because of the fact that our service levels are designed to give maximum use of the network, what we do when we do have to do any sort of metering at all -- and we've collected a lot of users together to form Internet buying groups, aggregating demand and moving it forward.

18468 So if a schoolboard wants a 50-megabit or 100-megabit service, we'll make sure that they get that, but we put no immediate prevention on bursts and we don't cap the actual amount moved. Because in our view, if we say that we're going to provide a 50-megabit or 100-megabit service, then you should always get a least 50 or 100 megabit. That would be the floor.

18469 And then if people want to burst to a gigabit, as long as they're not stepping on somebody else at that very moment, that's great because we'd like to fill the pipe. And when the pipe fills, we get a bigger pipe and we handle the economics from there.

18470 That leads to unfettered use of the resource. The last thing we want is somebody saying, well, I'm near my limit; I better not do this or that. That's absolutely anathema to the research mentality, and I believe the same is true of innovators wherever they may be. They're not necessarily on campus. They can be on farms, in homes, you name it. The camps need to go.

18471 COMMISSIONER MENZIES: Okay, but we've heard several intervenors, including most recently Mr. Bragg, mention that, I mean, they use that to manage their capacity, right. And certainly, they could increase the capacity because, I mean, if there are no -- we take them at their word on that, that if they're not managing their capacity people get a much less pleasurable experience with their Internet connection. And then they have to invest in the capacity and they have to recoup that investment and everyone's Internet bills go up, or they lay some people off, or something or other happens.

18472 So are you aware of that difficulty in that sense, and how you -- I mean, there's one thing is creating the system. The other thing is, I mean, as many have mentioned previously, the Telecom Act says it has to be affordable. So help me with that.

18473 MS. MOORE: So we're certainly aware of data caps as a method of management. However, it's an artificial limiter to impose upon end users.

18474 Bits are not a limited resource. There are other methods of managing capacity, other traffic management methods that do not encompass data caps. Because data caps disincentive use across the entire billing period, where what really is required to happen is disincentivizing use at peak periods where congestion is happening and capacity is being breached.

18475 So it's -- we just find that it's an incredibly artificial method of managing traffic and there are better ways to do it.

18476 COMMISSIONER MENZIES: Okay, thank you.

18477 In your submissions there, you noted that we regulate price in the Northwestel serving area, and you encouraged us to do more of that. But you also sort of insist that we regulate for competitor access, which we do, and I found that -- I was trying to square the two.

18478 Because if there is a competitive environment in terms of that, doesn't that regulate price? By giving -- I mean, if you have choice and you have competition, that should regulate the price, and at least from a self-serving point of view, people can blame price on their service provider and not on the CRTC. But more broadly, it just seems to be odd. That usually you would regulate price because of the lack of competitor -- competitive pressure.

18479 So how do you want us to do both across that?

18480 MR. WINSOR: If economic theory were to be believed, then once we've got sufficient competition you wouldn't need to regulate. But I think a big part of the challenge before the CRTC on an ongoing basis is getting real competition. We have not seen the limited number of large carriers effectively producing the competition that we would like to see.

18481 As an example, when we first looked at Internet pricing in Alberta, not even way up North, we saw that some post secondary's were paying 200 times the American rate. As soon as we aggregated that demand and setup a truly competitive system, where there was a large amount of demand and there was the opportunity for one carrier or another to displace the others from the various major universities and colleges, the price dropped by a factor of 10 overnight.

18482 That suggests that the competitive system was not working very well before.

18483 COMMISSIONER MENZIES: True, but it might suggest that by you taking the action you did the competitive system worked.

18484 MR. WINSOR: Yes, but it needed help ---

18485 COMMISSIONER MENZIES: Yeah.

18486 MR. WINSOR: --- and we hope that you will help it also.

18487 COMMISSIONER MENZIES: Okay, but ingenuity was involved. Okay, I understand where you're coming from.

18488 Explain why service-based competition is better than facility-based competition, which you make that point. But facilities-based competition has long been the policy of the Government of Canada. So why is it wrong?

18489 MR. WINSOR: We think this gets back to the questions, again, of scarcity and abundance. The capacity of fibre trunks is tremendous. On a single pair of fibres, you can run 88‑100 gigabit circuits. A bundle will typically have 144 fibres. So the ability once you can get access to a fibre trunk is tremendous.

18490 Now, history is filled with people who said nobody will ever need more than X. Bill Gates said nobody’s ever going to need more than 650 -- 640 kilobits of memory. The initial market for computers was three for the world.

18491 Those -- I don’t want to be one of the people saying nobody’s ever going to need more than this and be laughed at 10 years from now or maybe 5; things are changing faster. We have to build futureproof.

18492 But there is tremendous capacity on a fibre trunk and to have four or five of them deployed exactly in parallel with each other seems terribly wasteful in a country with sparse population and costs that are generally agreed to be too high.

18493 There’s fibre in various places that we’re not using, such as the optical ground wires. We have -- I have a photograph that I like to show people of myself standing next to five fibre trunks all in the same ditch outside a small town in Alberta.

18494 Clearly you don’t want to have all your eggs in one basket. There has to be redundancy and resiliency in the system, but duplicating infrastructure everywhere is problematic.

18495 It’s also problematic within the cities. If you look at City of Calgary they’re desperately trying to make sure that all the carriers don’t dig up the same road time, after time, after time, to put parallel resources in.

18496 And even though the city’s infrastructure is repaired to a required standard, you know that that roadway is going to crumble many, many years before it would otherwise if it had only been dug up once then we could at least have shared a conduit, if not the actual fibre.

18497 COMMISSIONER MENZIES: Okay, thank you.

18498 And maybe this segues into your quoting of Tim Woo in your submission. The view that it’s obvious in his view that broadband is a public utility.

18499 So how do you see that image as different from a largely private enterprise network regulated in the public interest by people like us?

18500 MR. WINSOR: Apparently not a popular one to answer.

--- (LAUGHTER)

18501 MR. WINSOR: The idea of public utility is, I think, basic and it comes through in all the statements that we see from you at the CRTC.

18502 It’s more and more how people think of access to broadband and whether it’s from a tightly regulated corporation that is following the rules in the public interest or whether it is actually built as a utility without a for-profit motive is somewhat immaterial, as long as the regulation and regulatory environment is strong.

18503 But we’ve certainly seen that it is not in the nature of corporations without strong regulation to behave in the public interest.

18504 They have their shareholders, they’re doing what they’re supposed to do, but this is too vital a resource to leave to simple competitive pressures from very large corporations and we’re strongly in favour of strong regulation.

18505 DR. CARRA: I would add to that just a little bit.

18506 In Alberta at least every time we go to a provincial meeting and we talk about the fibre opportunities in the province, we constantly have to re-educate to some extent to and make clear that there are these models in the ground for these reasons.

18507 But there are also these other approaches and resources that they think if these things come online then we don’t need fibre in the ground anymore.

18508 We sometimes get that question. Oh if you access satellites or satellites come online we’re not going to need the SuperNet anymore or we’re not going to need this.

18509 And painting that complete picture from ground all the way up we find that all these models have a role in the space creating that complete picture.

18510 So while the SuperNet might not go everywhere and you need wireless -- or you know the end points to connect to the communities and you need satellite to service the underserviced areas.

18511 They tend to not realize that there’s all these pieces that build the complete picture and they tend to just focus on one.

18512 And I think a big part of that is educating that all these different approaches have a role if they’re coordinated better and more properly.

18513 So from SuperNet to private sector, you know, fibre deployments to satellites coming online, they’re all going to build that system, including if we can access the transmission fibre or every time they put a pipeline in the ground let’s lay the conduit for more fibre. Why not?

18514 It’ll -- every pipeline that goes through every small community across this country can bring fibre to the small communities.

18515 Like those are opportunities that we’re not tapping into and I think would paint a better picture for Canada.

18516 COMMISSIONER MENZIES: That might be a sales pitch somebody uses for pipelines at some time.

--- (LAUGHTER)

18517 COMMISSIONER MENZIES: I don’t blame you. But I’m not that regulator. The -- sort of seguing onto again to looking at other jurisdictions, we often get examples -- and I will pick on you mildly here, to look at and I know that you’re sensitive to Canada’s geographical challenges.

18518 You used an example in paragraph 55 of investment and return on investment by the U.K. Government and I tend to react when I look at those -- and you can dispossess me of why -- of this impulse.

18519 I look at that and I understand that the entire United Kingdom fits into 40 percent of Alberta and it has 16 times as many people.

18520 And I -- you know, when we go through this and I look at that and I’m trying to say how is that supposed to make any sense to me; right?

18521 Where if somebody says why can’t we be like Singapore or Estonia or something. I mean Calgary is the size of Singapore; right?

18522 Point me to a model that I can relate to or use -- relate this model to me, if you would, please?

18523 MR. WINSOR: Pretty clearly the -- you’re absolutely correct about the U.K. being a very different situation.

18524 Although I would point out as a Scotsman, who’s been in Canada for 34 years, that Scotland’s about the same size as England and its only got one tenth of the population. So the ratios are about the same between Scotland in England as Canada and the States.

18525 But anyway, that little aside, we have Hadrian’s Wall to keep the English out.

18526 The analog that we tend to go to is Australia. Unfortunate as the previous presentation pointed out, that by going back and forth politically they haven’t built out their national broadband network in the way that they would have hoped to.

18527 But population density, the fact that a lot of it is concentrated along the coast, those are reasonable analogs to the Canadian situation.

18528 But we are unique. We have a massive geography. We have tiny population density compared to those other places.

18529 So yes we point out what’s happening in the U.K., we point out what’s happening in others, because Canadians will compare themselves to their friends in the U.K. or in the States, or in Australia.

18530 They speak more to the aspirations for connectivity then they do the absolute economics of Canada, which is after all quite special.

18531 COMMISSIONER MENZIES: Okay, thank you. Because I’m -- feel free to call me Magnus(Ph) if you want, but the ---

18532 MR. WINSOR: I have been tempted.

--- (LAUGHTER)

18533 COMMISSIONER MENZIES: The -- where it comes in is with the economics there. I mean the cost per capita and the return and that sort of stuff, but thank you for addressing it and being patient with me anyway.

18534 Now you speak fairly generally about subsidies and I just want to be clear where you’re talking about where you think subsidies should apply and whether you’re differentiating there between subsidies and some like -- some of -- and funding.

18535 And some of the discussions we’ve had recently have begun to focus more -- and more recently have focused more on the need to fund transport and I -- so are you talking subsidy and funds separately or all together?

18536 MS. MOORE: I think we’re talking separately. So when we -- when we say “subsidy” we mean an industry subsidy analogous to the national contribution fund.

18537 And when we say funding or granting, we are talking about provincial, or municipal, or territorial, federal government funding or granting.

18538 And so in Alberta the example has come up time and time again of the SuperNet, that is a transport, for the most, part that is funded in part by the Provincial Government, where a subsidy, I think, we’ve discussed would apply to more the last mile.

18539 If that can be coordinate certainly that is the goal here in terms of a national broadband plan, but there’s a place for all of these contribution mechanisms.

18540 COMMISSIONER MENZIES: Do you think that -- do you agree with others who may have heard today too that transport is the preferred target for funding?

18541 MS. MOORE: We’re going to say no, because again, there’s been lots said about the SuperNet, and there seems to be this rosy view that Alberta is covered and that there is nobody struggling in Alberta, and we’re this wonderful utopia with the SuperNet, but that’s not the case.

18542 Yes, we have the transport into the points of presence and the meet-me’s and the communities, but that, in many cases, does not -- or has not translated into service levels for the end users for the last mile. So there is certainly need for the last mile to be subsidized and funded as well.

18543 COMMISSIONER MENZIES: I’m slightly saddened to hear that Alberta is not utopia.

18544 But perhaps for the benefit of others ---

18545 MS. MOORE: It’s close.

18546 COMMISSIONER MENZIES: --- the -- I mean, the broadband map, the connectivity map that’s out certainly shows Alberta more geographically covered than any other jurisdiction, although I expect PEI probably looks pretty good if you could pick it out, but the -- no? Okay.

18547 MS. MOORE: Which is wonderful ---

18548 COMMISSIONER MENZIES: See, I shouldn’t make assumptions. But help -- for others, explain why that look at Alberta is not what they may assume it to be.

18549 MS. MOORE: So I think Dr. McNally from the University of Alberta spoke to the Van Horne Institute’s a little bit earlier in the hearing. And so Van Horne hosts a meeting a couple of times a year called the Digital Futures, and that’s where we pull together a bunch of community leaders, we’ve got reeves and mayors of small towns, and interested parties who really want to get community broadband or at least get their constituents served by TSPs because it’s not happening at least to sufficient service levels.

18550 So where we see in this broadband map all these hexagons are covered in Alberta and in many cases those are people who are only getting 1.5 megabit per second speeds from a wisp and in the best case scenario when the connects aren’t saturated by numerous end users. So a lot of those numbers are best case scenarios and don’t reflect the actual service levels obtained by people in their homes.

18551 COMMISSIONER MENZIES: Okay. I just have a couple more questions I think. But I think the larger one that comes together with this as we go through and sort of when you talk about -- you create a number of funding options you put out in front us and -- like the universal service fund in the States for instance.

18552 Now, a Canadian equivalent to that I think would be about $1.5 billion a year roughly. I think, they -- maybe a little less than that but roughly there. And I was trying to figure out the affordability of that and I was thinking 14 -- okay, 14 million households, 1.5 billion, that’s about $100 a year, right. So -- or a little more than that.

18553 And I was trying to figure that again how we come out of this when we’ve got all these affordability issues in front of us trying to explain at the end of the day to Canadians we’ve created this new fund, and we’re very visionary, and your internet bill is going to go up after taxes by $10 a month. I was going to ask where do you think they’d hold the parade for us but it was more like how do we manage that interface.

18554 I mean, how do we manage these -- and your ambitions are laudable and that sort of stuff, but we do have these other obligations in terms of that. So what are our options, suggesting -- I mean, apart from coordination and that sort of stuff. If you put yourself in our shoes for a minute and where do we begin to solve that problem?

18555 MR. WINSOR: I think one of the things that you’ve been hearing through the course of the hearings has been that Canadians care deeply about getting connected. And if you told everybody in the country that they were going to pay $10 more many in the city might not be terribly happy but I don’t think they would argue a lot in terms of the value they’re receiving.

18556 If in doing so, they could talk not only to their friends in the city but also that situation meant that they could also connect cleanly and affectively to all their cousins in the countryside as well, then I think that we would say that we had done a very, very good job and I would be happy to be out in the parade.

18557 The importance of this is it’s hard to underestimate just how important this is. The Chairman in his mid-hearing remarks pointed out that this is a chance to get it right. It matters. It matters a lot. It doesn’t just matter to those of us who are kind of the geeks that care more about the technology. It’s an everyday part of life. And don’t underestimate how much people care about getting that connectivity.

18558 So if the cost to build out and fix a lot of the connectivity problems that we have just now was one and a half billion that added certain amounts, what is the cost for an interchange in the city that costs hundreds of millions of dollars.

18559 I mean, when infrastructure is talked about by our new federal government, I keep on waiting for them to say “and this means large investment in digital infrastructure” but it tends to mean physical infrastructure. And sure, if some of that physical infrastructure is crumbling than that is somewhere where we have to spend money on public safety, but these networks are also public safety aspects.

18560 COMMISSIONER MENZIES: I’m reminded of the extension of the Dempster Highway to Tuktoyaktuk in terms of choices.

18561 Last thing is we have all of these issues in front of us that we’ve identified. How would we triage them? It’s not like we’re not capable of multi-tasking. But if this is an emergency room and all these problems have arrived in it, who gets to see the doctor first?

18562 MR. WINSOR: I suspect my colleague’s going to want jump in on this one as well. But I think one of the first places that you can do is empower community broadband.

18563 There’s so many small communities that we talk to in Alberta who are ready to do something to get better connectivity and simply cannot attract the attention of the incumbents at the levels that they want. They want to do community broadband. They don’t know how. They haven’t got the funds. They need help.

18564 Folks like Van Horne Institute who are trying to establish some sort of a playbook that says this is how you go about it are certainly helping but guidance from the CRTC, access to subsidies to help them build out and achieve community broadband is one of the things that I think that you can do first to stop the bleeding in that triage situation.

18565 I think you should be looking on the longer term very, very closely at what’s happening with the new technologies, especially the lower earth orbiting satellites. Obviously that’s a bit further out and the launches are only starting next year but it’s going to be a big part of the picture if you do this again a few years from now.

18566 So somewhere between those two, but it’s certainly starts with helping the community broadband efforts.

18567 COMMISSIONER MENZIES: Thank you very much. I enjoyed your intervention and your presentation.

18568 I’ll turn it back over to others now.

18569 THE CHAIRPERSON: Thank you.

18570 Commissioner Vennard?

18571 COMMISSIONER VENNARD: Hello. I enjoyed your presentation too, as well as your written submission.

18572 I just wanted to make a couple of comments that I think are really quite important and then pose a question to you.

18573 The first comment that I want to make is just with respect to the SuperNet. And the SuperNet never was designed to deliver connectivity to peoples’ homes it was a provincial initiative to deliver one point of presence to 424 rural and remote communities not to every home.

18574 So if the people are not getting -- and I know that there are all sorts of issues -- I’m the Commissioner for Alberta, so I know there are all sorts of issues with respect to getting every single person in every single community, but that never was something that the SuperNet itself and the province took on.

18575 So I think it really speaks to something that you wrote about all through your submission, and we’ve heard it before, certainly in -- as our hearings have progressed, and that’s the idea of the structural separation from the services.

18576 Now, there’s obviously got to be some structure to get out to a home too. But it also falls in that same kind of category there, so -- I did work on the SuperNet right from the beginning, right -- way back in 2000, and it was a project that was ahead of its time, and it failed on many levels and wildly succeeded on many other levels too. So I don’t think we can really classify it as something that was a resounding success, but neither was it a dismal failure, it's somewhere in the middle. And it's very, very right for lessons learned, because some elements of it I think worked really well, some less so.

18577 So having said that, I just wanted to sort of put that on there for the record that it, you know, I didn’t want that to be sort of the last word on SuperNet, that it -- that the people weren’t happy with it. One of the issues with it is the connectivity fees that actually get onto the SuperNet, which is something that we don’t regulate, and that’s something that has to be negotiated.

18578 In your written submission you identified many of these sort of areas, and as I say, there was a lot of lessons learned from the SuperNet, that’s for sure.

18579 Now I just want to pose a question to you, we’ve heard from Axia earlier on in the week, and they had the idea of the new basic infrastructure, which is basically to take future connectivity and sort of take it out of this -- this major playing field that everybody is kind of playing in right now, put is somewhere else for those people who wish to participate in it. So that was -- that was that idea. Then we know the SuperNet, we’ve heard about the SuperNet and I know all of you know a lot about it.

18580 And then on paragraph 25 of your written submission, you talk a bit about private and public partnerships. And I presume that would have something to do with the optical ground wire, perhaps the development and deployment of that within that communication space.

18581 So my question for you is given that there is three sort of basic things -- and I would have put in the Vaxination submission too, because it was -- it was really, really interesting but it’s not the Alberta context -- how -- what do you think were -- how would you cobble together something if you were going to say, design something for -- and use a different province, use Quebec, use Ontario, don’t use Alberta -- how would our situation -- what would you put together and suggest?

18582 MR. WINSOR: Thank you. And by the way, I agree, we certainly want -- we don’t want to paint the SuperNet as a -- as a failure per se, there's a lot of frustration that it’s not as good as it could be, but that’s not to say that it’s -- it’s not better than not having it at all.

18583 So now we’re building a SuperNet-like construct in another province or territory.

18584 COMMISSIONER VENNARD: M'hm.

18585 MR. WINSOR: One of the building principles behind the SuperNet was to use the trunk area, the base area network, where there already was fibre from carriers such as Bell or Telus, and then to put fibre extensions in to form the complete network in the extended area network.

18586 One of the shortcomings was that the Crown didn’t end up with any rights to that base area of fibre at the end of the contract. So come 2018, June of 2018, when those SuperNet contracts expire, there will be a lot of stranded little pieces if we don’t find another replacement for the base. And the province is currently issuing RFPs to replace that.

18587 Where there is fibre that’s been built with public dollars, we believe that that fibre should be accessible and part of building a public access network. And in many cases, that goes hand in hand with the electrical transmission system. I think it’s an asset that hasn’t been used.

18588 We’ve heard others talking about putting fibre on poles. I'm not talking about poles within the distribution system. We’re talking here about the actual fibre bundle in the transmission system. And at least in Alberta -- and I'm assuming the same in this fictional province that I’m not wiring up -- there is a transmission charge on every electrical customer’s bill for the transmission charge to build that out. With access to that to form your trunk lines, that actually gets you a long way to starting to build your new SuperNet.

18589 Additionally, because at least from Alberta, that was built out with the rebuild of a lot of the transmission system. With policy changes it’s possible to say that wherever we carry the electrical transmission and distribution system, we can carry fibre as we build, that's not going to happen tomorrow.

18590 Commissioner Menzies pointed about triaging this, it’s a long view, but all of that system does get built out and refreshed over time. And the cost to add the optical ground wire is relatively small compare to the cost of building other systems.

18591 So as I build out these other systems, would I do it as a public/private partnership? M'hm. I would certainly want to know that at the end of that PPP, the assets would revert to the Crown and we would have something at the end of the day, not something that vaporizes, because people do build dependency on these systems. They want to know that those schools, those hospitals and indeed those homes, are connected and will stay connected regardless.

18592 Effectively, SuperNet is now too big to fail and is a bit of a worry given the model that was put in place at the start, because we need it and this new fictional province will need it to.

18593 So using whatever’s there that's been paid for by the taxpayer, effectively any -- a patchwork, not a patchwork, a tapestry -- better than a patchwork -- that ties it all together is the way to go.

18594 Is that a start?

18595 COMMISSIONER VENNARD: Yeah. So in your mind -- I don’t know if you -- did you hear the presentation from Eastlink this morning?

18596 MR. WINSOR: I heard the last part of it.

18597 COMMISSIONER VENNARD: Yeah, and the estimate there -- it was just -- it was just an estimate that he was kind of throwing out, would be that it would cost billions and billions and billions of dollars to connect the country. And in your mind, would it be a fair thing to say that we should start to look at what's already there and utilize what's there before rolling out something that’s new ---

18598 MR. WINSOR: We should ---

18599 COMMISSIONER VENNARD: --- everywhere?

18600 MR. WINSOR: We should absolutely use whatever is there. Again, we feel that as long as the infrastructure has the resiliency and can be treated as critical infrastructure, which the electrical transmission system is, then that's a great place to start. But facilities-based competition, if it’s billions and billions for one to do it, it’s many more billions for all the others to do it right alongside, and it’s unnecessary.

18601 We also have as, you know, again I’ll come back to -- the satellite situation is changing rapidly ---

18602 COMMISSIONER VENNARD: M'hm.

18603 MR. WINSOR: --- and when it does, it will not be a fixed bill that we’ll deal with for 10 years. The solutions that are being put up there will only stay in orbit for one and a half to two years. They're sitting just above the space station, they're going to be coming down -- well not quite as fast as they're being launched, but it’s a constant refresh. So if a satellite has a couple years’ life, the one that goes up six months, a year later after the first one, will have better and better technology.

18604 So these are solutions that all put together in a strategy that says we’re going to have this for the short-term, this for the medium, this for the long, a national broadband strategy, will actually give us a much better picture at lower cost than just building it all and doing it again every 10 years.

18605 COMMISSIONER VENNARD: Yeah. So would it be fair to say that a guiding principle for us of a broadband strategy would be to utilize existing infrastructure, locate when possible existing infrastructure?

18606 DR. CARRA: Yeah, I think so. I mean -- I’ll just go back to Alberta for the sake of the argument, but I mean we know that each telco provider has, you know, pipes between Calgary and Edmonton for example, right alongside the SuperNet.

18607 COMMISSIONER VENNARD: M'hm.

18608 DR. CARRA: I think if some of those -- and I don’t want to carve off their -- their investment, but you know, if you could carve off some of that and turn it into supporting that open infrastructure size, so every time something new goes in, some of it’s private, some of it’s open, but it creates that whole picture. I think you can almost build a system that’s a little bit more flexible and has some more play and movement in it.

18609 Municipal -- municipalities, you know, as we look at sort of that structural separation model in our submission, are looking at how you can do that. And some of it they carve off as private, it’s secure, nobody touches it except for themselves, it's for, you know, 911 Emergency Response Units, and then some of it they sell and wholesale and lease to people like us, you know. And if we can use what's in the ground, but create an environment that's more flexible like this type of model, I think it would go a long way to help relieve the pressure in terms of getting access to communities.

18610 So a lot of those little tiny communities that are ready to go, they want to do something, they're sitting there, they're having working groups, they're trying to put models together, they're trying to come up with plans in how they would build it and pay for it and, you know, deploy it within their communities. But then they're also trying to figure out how to connect it to the backhaul.

18611 COMMISSIONER VENNARD: M'hm.

18612 DR. CARRA: How can we get from our small town to the next place so we can actually access services? It’s one thing to wire up the community, but it’s another thing to actually have it access something.

18613 COMMISSIONER VENNARD: M'hm.

18614 DR. CARRA: And there's those breaks and points, and I think if we can start breaking those apart and tackling them in little places it would help relieve the pressure overall in terms of building the big picture.

18615 COMMISSIONER VENNARD: Do you have any ideas or thoughts on how we could deal with the donut hole problem that we have been hearing a lot about? How do we get to those ---?

18616 MR. WINSOR: The community broadband will solve a lot of that. The community is, after all, not trying to make shareholders happy; they're trying to make the residents of their community happy, and they're not going to build only to the profitable centre; they will reach all of their ratepayers when they can.

18617 COMMISSIONER VENNARD: In your view, do you think that the community pretty much needs to have a champion for -- to put that together?

18618 DR. CARRA: They do. I mean, a lot of them do need guidance, leadership, instruction on how to do this. They want it, they see the benefit, they look to old, or other of the small communities that have tackled this thing as great examples and seeing these little communities take off, and the students and the colleges thrive. But they don't know how to get there themselves, and so they need a lot of that information and guidance.

18619 COMMISSIONER VENNARD: Yeah, we've heard a lot of that through our hearings too, where people are very dedicated and committed to what it is that they're doing.

18620 DR. CARRA: Yeah, we just came out of a Smart Cities Intelligence Conference in Alberta too that was hosted not too long ago. And that was the underpinning to the entire conference, was how can we get connectivity so cities can start being more innovative with open data, open technologies, looking at wiring up, and increasing efficiencies even within municipal, you know, operations.

18621 And but -- it all came back to connectivity. It's the underlying theme these days in every conversation about how we move forward.

18622 COMMISSIONER VENNARD: Do you see the Commission as having a role in something like that?

18623 MR. WINSOR: Yes, we do. The two main problems that those communities have is access to expertise and access to funds. And at the moment, they cannot readily draw on subsidies to help them buy the expertise and build out their infrastructure.

18624 They need help. Whether that's directly from the province or the territory or through subsidy funds that are made available by CRTC, they need some help to do it. They have the will; they do not have the means.

18625 COMMISSIONER VENNARD: Thank you, those are all my questions.

18626 THE CHAIRPERSON: Thank you, and those are the questions for the panel and legal counsel as well. So thank you very much for having participated and I'm sure you'll participate in the next phases as well.

18627 Just -- and pay attention -- we're starting at 8:30 tomorrow morning.

18628 Donc, nous sommes en ajournement jusqu’à 8h30 demain matin. Merci.

--- Upon adjourning at 1:17 p.m.

REPORTERS

Sean Prouse

Mathieu Bastien-Marcil

Lucie Morin-Brock

Renée Vaive

Lyne Charbonneau

Karen Pare

Ian Schryber

Krista Campbell

Kathy Poirier

Karen Noganosh

Mathieu Philippe

Date modified:

2016-04-27