The government of Canada announced an improved program for affordable Internet for low-income seniors and families, called Connecting Families 2.0. As Good as this goal is, the way it is being done is a case study in regressive policymaking. š§µā¤µ twitter.com/NewsroomGC/status/1425453738358153217.
To be clear, people need access to affordable high-speed Internet services, and it is appropriate for government to play a role. How to accomplish that goal is a policy choice. The OG Connecting Families helped some folks. This reboot will help more people at higher speeds. 1/16
On its own, ignoring other issues, then yes, getting some people connected is a good outcome. šš¼
But that's a very narrow view of the issue. 2/16
Simply put: Some people can't afford critical Internet services, and you can fix that problem to some extent by helping those people get services. I like helping people and I'm glad some people got service that they otherwise wouldn't have, or could afford it more easily. 3/16
But that focuses on the surface issue and ignores the underlying reasons why people can't afford ever-increasingly-critical-yet-expensive Internet services. Worse yet, in this case, the bandaid solution on the surface actually allows the deeper infection to fester. 4/16
The fact is, Canada has a highly concentrated market for home and mobile Internet services. We also have some of the highest prices in the world for both services. 5/16
And beyond telecom, if you aren't seeing the broader social unrest in response to the wealth and opportunity gaps and structural inequality in this country, then you're not paying attention. 6/16
Now, the main way Canada introduced Internet competition for consumers, called wholesale-based competition, is utterly broken right now, and is the subject of nearly a decade of regulatory study, conflict, and capture. 7/16
The details would take their own long thread, but it's clear to all observers that telecom competition in this country has been dismantled piece by piece over the past 5 years. Some context: blogs.teksavvy.com/crtc-outrage-speak-out-over-skyrocketing-prices-and-big-telecom-bias 8/16
So the first problem with Connecting Families is that it's a bandaid solution that ignores underlying structural problems. Fixing telecom competitionārestoring the wholesale market, advancing access to fibreāwould reduce prices everywhere immediately. 9/16
The second problem is that the bandaid is actually a poison pill that exacerbates those underlying structural problems. Affordability is an issue in part because of low competition and unbridled market power, but this program reduces competition and reinforces market power. 10/16
As I've said before, the whole program was designed with oligopolist carriers in mind. Behind the scenes, the contracts and program design, and even the price point, simply do not allow wholesale-based competitors to participate. That's why none are! twitter.com/kaplanmyrth/status/1356659421397532676 11/16
Not only can we (TekSavvy) not participate, but we actually lose customers who qualify for the program. That is, this government program helps people by driving them to incumbents, further undermining competition. 12/16
Now in rebooting the program for more people and higher speeds (and prices), they had an opportunity to also include competitors. Did they talk to us? Did they even consider the impact? (spoiler: no, they didn't) 13/16
No, they worked with their "partners" (i.e. all the biggest carriers and a few small ones) and ignored the deeper structural problems.
This is not Building Back Better; it's disaster capitalism dressed up as "corporate giving". 14/16
At the same time, there are glimmers of hope. The Competition Bureau released a report with recommendations from a Summit they hosted, titled "Canada Needs More Competition". The report talks in broad strokes about the need for major change:
twitter.com/CompBureau/status/1425509571838238724 15/16
Takeaway #3 in the Bureau report calls for regulators to use a "competition lens" to inform policy choices.
Connecting Families is a great example of where that lens was missing. The outcome achieves narrow goals, but ignores myriad ways it undermines competition. 16/16
PS: Don't @ me about what TekSavvy should do on its own. Having been excluded from this program, TekSavvy does our own thing in terms of low cost plans where we can, as well as contributing to our community in many other ways. I'm talking about a competition lens for policy.