Ongoing investment in strong communications networks is vital for economic recovery

As published by the Financial Post.

The global pandemic has reminded us that Canadians are resilient, resourceful and compassionate. Only time will allow us to fully appreciate the truly heroic work done by so many over the past months — the frontline workers in all sectors from health-care to food delivery, the teachers who prepared online lesson plans and the millions of people who transformed their homes into virtual offices (and classrooms) to keep our economy running.

The critical lesson for me is that our country’s communications networks are not just the core of our digital infrastructure — they are the backbone of our social and economic well-being and they will drive our economic recovery.

Without question, broadband infrastructure has become everyone’s vital link to the outside world — for work, school, entertainment, social interaction and accessing critical government programs to keep our families safe. Since the beginning of the pandemic, the traffic on Shaw’s Fibre+ network has increased by as much as 50 per cent, and the daily peak usage period has climbed from three to 12 hours. And then there’s the staggering 160 per cent increase we’ve seen on the Shaw Fibre+ network in videoconferencing.

The demands on our networks have been extraordinary, and Shaw and Canada’s other network builders have met the challenge. We understand that when you are on an important video call with your office, your child’s teacher or your grandmother, there is no tolerance for anything less than a good connection.

For the more than 10,000 people who work at Shaw, our top priority is to keep our customers connected, and we take this job very seriously. Shaw alone has invested more than $20 billion into building and improving our network and services over the past seven years — and we know additional investments will be required in the future to keep ahead of usage trends while connecting more Canadians.

The magnitude of this investment has only been possible because successive governments and the Canadian Radio-television and Telecommunications Commission (CRTC) have maintained policies for decades that supported innovation, long-term capital investment and the economic and social benefits driven by connectivity.

This regulatory framework has helped Canada become one of the best-connected countries in the world, but unfortunately, a recent decision by the CRTC is putting all of this in jeopardy.

That decision requires network builders, like Shaw, to provide wholesale access to their networks to third-party internet resellers, at rates that are far below our costs to build and maintain our network. It’s absurd in theory and bizarre in practice to expect any business to survive if it must continuously invest to maintain its services and then be required to sell them below cost to a reseller who can, in turn, resell them at a severe discount.

Even before the pandemic, the flaws of the CRTC’s decision were clear. If the CRTC’s proposed wholesale rates come into effect, TD Securities estimates Canada’s six largest telecommunications companies will reduce their network investments by $1.68 billion annually — slowing vital upgrades and expansion needed for future demand. The impact will be particularly felt by Canadians who live in rural and remote communities who may currently lack high-speed access.

Had the CRTC’s proposed rates been in place seven years ago, there’s no way that Canada’s network owners could have built the strong networks that have helped carry Canada through this current crisis. Far more businesses would have shut down as working from home would not have been possible, and e-learning on today’s scale would have been inconceivable.

Just a couple weeks ago our investments enabled us to launch gigabit service to almost every rural and urban community we serve. We know tomorrow’s networks will require even more power, speed and resilience. And the real-life example of the past three months has confirmed that continuous network investment is required to prepare not just for future demands, but for unforeseen crises.

We have asked the federal cabinet to send the CRTC back to the drawing board, so that network owners can continue building the networks that Canadians need. The pandemic has taught us a great deal about the importance of our networks. We cannot afford to ignore that lesson.