A day after a hearing wrapped up into whether the federal telecommunications regulator should get involved in pushing rural broadband, Industry Canada announced more funding for providers to bring high speed Internet to outlying communities.

On the weekend Industry Minister Tony Clement announced conditional financial support for 21 more projects in four provinces and one territory. If all are approved 30,184 households will be able to get broadband. It was the third round of projects, the first of which was announced in May.

“The new economic opportunities these projects will create in these communities will benefit Canada for many years to come,” Clement said in a news release.

The $29.1 million that 16 carriers and operators will get will come from a $225 million Broadband Canada fund set aside in last year’s federal budget.

The goal is to bring high speed Internet capable of download speeds of up to 1.5 megabits per second to 250,000 households. By comparison Bell Aliant is offer some residents of New Brunswick download speeds of up to 120 Mbps.

The rural-urban broadband divide is worrying the Canadian Radio-Television and Telecommunications Commission (CRTC), which on Friday ended a two-week examination of its basic services and obligation to serve rules for incumbent local exchange carriers (ILECs) – in other words, incumbent local phone companies.

One of the basic services they have to offer is local dialup calling to an Internet provider at a speed of 56 kilobits per second, about four times slower than 1.5 Mbps.

It isn’t clear how many Canadians still have only dialup Internet access to their homes. Estimates at the hearing ranged from 750,000 to 1.5 million people.

Many of the carriers with the obligation to provide basic service, as well as competitors pushing into their territories such as cable companies and independent Internet providers, are loath to see the regulator impose a broadband obligation.



One telco estimated it could take $7 billion over 10 years to bring broadband close to city speeds to outlying areas. Among other complications is what minimum speed should the CRTC set if it does regulate and how fast should operators be expected to meet it and should the obligation only fall on ILECs or on all providers high cost areas. On top of that is the question of how – or whether – operators in high cost areas can be subsidized to meet a mandatory broadband obligation.

Many who testified feel broadband goals and funding are Ottawa’s responsibility under programs such as the one Clement is using. On the other hand several citizen groups urged the regulator to act.

In the closing minutes of the hearing, in an exchange with Michael Hennessy, Telus Corp.’s vice-president of regulatory affairs, commission chair Konrad von Finckenstein appeared to tip his hand.

Hennessy was trying to frame the issue. Telus is among those saying the CRTC should be patient and review industry progress in three years.

“It gets back to the question of what are the targets and, you know, if the targets aren’t mandatory you can set them as high as you want,” Hennessy said. But, he added, the real question is what does the commission want to achieve?

The U.S. Federal Communications Commission has set a goal of having carriers supply very fast broadband for the needs of business or medical institutions, Hennessy said. Residential users would have different demands, he suggested, but then noted they may want speeds fast enough for “intense” online gaming.

So if the commission wants to set a speed goal, there should be a reason for it. “Then and only then can we tell if we are falling behind,” Hennessy said.

“You have to be realistic,” commission chair Konrad von Finckenstein agreed. “If you make it too aspirational and too high or far out, then it becomes unrealistic. As I said yesterday, I think whatever we set it should be one that we expect the industry can reach and will reach, will serve the purposes that you suggest and we will monitor against it.

“And if, as we monitor against it, either similar — technology advances, then it obviously should be raised. If on the other hand we find that there is a distinct inability of the market to reach that, then we will have to consider intervention. I think that is a logical way to go.”

The 16 operators Clement gave conditional funding to include Barrett Xplore Inc.; Bell Aliant Regional Communications, Limited Partnership; Broadband Communications North Inc.; Chatham Internet Access; Chippawa of the Saugeen First Nation (known as Saugeen First Nation; Communication-Témiscamingue; CORE Broadband Inc.; Davinci Broadband Inc.; the Douglas First Nation (Xa’xtsa) Band; Huron Telecommunications Co-operative Ltd.; Manitoba NetSet Ltd.; Bell Canada’s Northwestel Inc. division; Norway House Cree Nation Broadband; TGV Net Mauricie; True 802 Wireless, Inc. and UNI Connexions Abitibi Inc.

The smallest community to get service will be Dease Lake in northwest B.C., which has 13 households. The biggest will be 6, 384 homes in southwest Manitoba.