Appeared in the Toronto Star on March 27, 2006 as Ottawa Should Read Telco Report’s Finer Print
Appeared in the Ottawa Citizen on March 30, 2006 as Score One for the Little Guys

It would be easy to dismiss Canada’ s recently concluded telecommunications policy review as little more than an attempt by the large telecommunications companies to reduce their regulatory burden by re-writing Canadian law.  It was the likes of Bell and Telus that actively supported initiating the review and then proceeded to deliver enormous submissions – about the size of a mid-size city’ s telephone directory.

Moreover, the release of the review panel’s 400-page final report last week left little doubt that Hank Intven, Gerri Sinclair, and André Tremblay, the panel’ s three experts, were sympathetic to the big guys’ concerns.  Their 127 recommendations centered primarily on the call for a new regulatory approach that emphasizes market independence over government interference combined with a slimmed-down CRTC and list of policy priorities.

While those recommendations are obviously noteworthy, there are a series of consumer-focused proposals that should not be overlooked.  In fact, having established its market-oriented credentials, the panel proceeded to identify a series of important areas – including network neutrality, ubiquitous broadband access, privacy, spam, and consumer protection – that merit government intervention or support.

Network neutrality recommendations could have the most significant long-term impact on the Internet in Canada.  In recent months, Internet service providers in Canada and the U.S. have begun to sketch out a vision of a two-tiered Internet in which they charge websites to deliver their content to consumers, limit consumers’ ability to use certain applications, and reserve the right to charge premiums for the use of services such as Internet telephony.

While companies such as Telus argued that there was no need for legislation to address these issues, the panel disagreed.  It concluded that "open access is of such overriding importance that its protection justifies giving the regulator the power to review cases involving blocking access to applications and content and significant, deliberate degradation of service."  

After referencing Telus’ blocking of hundreds of websites last summer, the panel recommended that the government establish a new consumer access provision that would "confirm the right of Canadian consumers to access publicly available Internet applications and content of their choice by means of all public telecommunications networks providing access to the Internet."

With conflicting submissions on whether market forces are sufficient to bring broadband access to all Canadians, the panel undertook its own analysis to gauge whether there is a viable business case for the private sector to deploy connectivity for all Canadian communities. Market forces can be expected to meet the needs of some communities, but the panel found that without government intervention as many as 1.5 million Canadians would still be left without broadband connectivity.  

Setting an ambitious goal of ubiquitous broadband connectivity by 2010, the panel recommended establishing the Ubiquitous Canadian Access Network (U-CAN), a government subsidy program charged with eliminating the national digital divide.  Notwithstanding its preference for market-based solutions, the panel said it "would not discourage public ownership or subsidies in areas where no such networks exist and where a business case for expansion of broadband networks is unlikely to emerge."  While the report does not identify specific places, this may well apply in many rural areas with low population density throughout the country.

In addition to network connectivity issues, the panel also focused on consumer confidence in the network by addressing privacy, spam, and consumer protection.

Highlighting the importance of strong privacy protections, the panel concluded that the inclusion of privacy provisions within the Telecommunications Act complemented PIPEDA, the national private sector privacy legislation. In doing so, it rejected some industry appeals to drop the CRTC’s responsibility for telecommunications-specific privacy issues by transferring responsibility for privacy protection solely to the Privacy Commissioner of Canada

The panel also emphasized the need to address cross-border privacy concerns, noting that Canadians’ personal information effortlessly crosses into other countries, yet privacy law effectively ends at the border.  To patch that privacy hole, the panel recommended that the federal government work actively with other governments to develop international mechanisms for privacy enforcement and regulatory cooperation.

Spam was flagged as another impediment to consumer confidence in the online environment.  The panel urged the government to implement the recommendations of the National Task Force on Spam, which called for the introduction of spam-specific legislation.

Although the panel did not make an explicit connection between spam enforcement and the CRTC, its recommendation to add stronger enforcement penalties could open the door to greater CRTC activity in the spam fight.  Since the Telecommunications Act already features a provision that addresses unwanted marketing which was intended to address junk faxes, it could certainly be equally applied to junk email.

The panel had some harsh words for current consumer protection legislation, expressing skepticism about the effectiveness of self-regulatory industry codes.  Concluding that consumer protection law has not kept pace with a technology-driven marketplace, the panel opened the door to new legislation that could mandate better e-commerce consumer disclosures and guard against abusive use of technologies, known as digital rights management, that experience has demonstrated can lead to privacy breaches, security vulnerabilities, and diminished consumer rights.

The headlines may have touted the panel’ s support for limited government regulatory intervention, yet when Industry Minister Maxime Bernier gives the report a closer read, he will find series of critical areas where reliance on the market alone is unlikely to serve the interests of all Canadians.

Michael Geist holds the Canada Research Chair in Internet and E-commerce Law at the University of Ottawa, Faculty of Law. He served on the National Spam Task Force and can reached at mgeist@uottawa.ca or online at www.michaelgeist.ca.