Despite the notoriously high user cost, the Canadian telecom system has renowned download speeds ranking 6th in the world. This feat is achieved through continued annual investment in infrastructure and R&D. In fact, Canadian company’s investments averaged $78 per connection between 2010 and 2016, which is close to two times the European average of $40 per connection.
Unfortunately, these world-class speeds may be a thing of the past due to the CRTC’s new regulation. A recent CRTC decision which attempts to reduce user costs, if upheld, will force companies that build telecom infrastructure to rent it out to their competitors at below cost. Not surprisingly there has been significant resistance on behalf of the companies, as many have sought orders from the Federal Court of Appeal to suspend the decision. Although this decision would help reduce user’s costs by enabling more players to enter into the Canadian telecommunications sector, it nonetheless would risk stagnating download speed improvements. If companies are required to rent out their infrastructure to companies at below cost, they would lose all incentive to innovate, eventually leading to the telecom system being archaic, outdated and slow.
This ultimately leads to an interesting question: what would users prefer: economic prices with slower speeds, or higher prices and a faster network?
View full article here: https://business.financialpost.com/opinion/the-crtc-needs-to-get-out-of-the-way-its-attacks-risk-gutting-our-world-class-telecom-system