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Passive Infrastructure

5G networks and the associated services that will be delivered by them will be truly transformative for Canada.

PWC forecasts that 5G technology is expected to generate $94 Billion annually in GDP by 2035, create thousands of new full-time jobs, and improve environmental sustainability.¹

Businesses will benefit from significantly faster data speeds, extremely low latency, and increased capacity, that will enable a vast network of automated and connected devices.

Consumers will also benefit from a new generation of services and experiences, such as virtual reality gaming, driverless vehicles and advanced health services offered remotely in real-time.

Rural and remote broadband connectivity

Most Canadians today, especially those that live in urban areas, are well served by quality broadband services, and are seeing their telecom networks evolve to the next generation of services.

When COVID-19 hit two years ago, and Canadians were forced to seamlessly shift to remote work and schooling, our Internet usage surged 60%. Canada’s networks not only met the demand but surpassed global average broadband speeds by 50%.

However, the pandemic also highlighted the “Digital Divide” in Canada and the urgent need to deliver fast and reliable connectivity to the 2 million Canadians who live and work in rural and remote areas.

These less fortunate Canadians were not only forced to work and learn from home, but they had to do so using less than optimal internet connections.

The federal and provincial governments recognize the challenge and have announced billions of dollars of funding for broadband projects in key unserved and underserved regions across the country. Rogers is already participating in many of these projects and is committed to doing more.

Funding is only part of the solution. If we are to reach the policy goals of high-speed broadband for 98% of Canadians by 2026 and 100% by 2030², telecom carriers need the ability to deploy their 5G networks quickly and efficiently.

Building 5G Networks

Compared to past wireless technologies, 5G requires a massive increase in the number of radios deployed and the associated backhaul facilities.

To deliver the speeds and latency of 5G pervasively, wireless carriers must deploy thousands of small cell antennas. Importantly, this expansion of their networks will result in an enormous growth in data traffic that must be carried back to the core networks, through fibre or microwave.

These network assets are not built in a vacuum. They are installed underground, along streets, highways and railways. They are also attached to a wide array of public and private property known as “passive infrastructure”, which includes telephone poles, hydro poles, municipal street furniture (streetlights, transit shelters, traffic lights) and the exteriors of government buildings.  

Attaching cables and fibre to “passive infrastructure” is one of the fastest and most cost-effective ways to build networks as it reduces the need for heavy construction projects.

The problem is that many of the owners of the infrastructure the provincial utilities, municipalities, and telcos – impose numerous operational and financial roadblocks that act to deter or prohibit the construction of telecom networks.

Seeking partnerships with municipalities

Municipalities and telecoms should be working in partnership for the benefit of citizens. By working together to reduce or eliminate artificial barriers to constructing telecom networks on streets and municipal property, we can create “smart cities” and bring new technologies and services to households, businesses, and government departments.

These barriers include charging supernormal rents to use municipal street furniture, imposing onerous permitting procedures or requiring telecoms to subsidize municipal road and infrastructure projects by making them pay to move their facilities to accommodate these projects. Telecoms should not be seen as a mere revenue opportunity.

Seeking more cooperation from the hydro companies

Broadband networks in rural and remote areas will rely heavily on hydro and telephone poles, being the only existing supporting structures that pass by homes and businesses.

Yet, there is no real incentive for hydro companies to cooperate with telecoms and support the efficient and timely construction of their networks. Telecoms seeking to attach wires and cables to their poles are merely seen as an annoyance, albeit a cash source. None of this facilitates the timely and efficient deployment of world class broadband for the benefit of Canadians.

Accordingly, telecoms face a variety of obstacles and difficulties when seeking to attach to hydro poles. For example, it can take several months for a hydro company to process and issue the permits required to access the poles. It can take even longer for the hydro company to prepare or retrofit the poles (called “make-ready”) so that they can accommodate the telecom attachment.

Frequently, hydro companies will adopt their own design methodology and standards for conducting a structural analysis of a pole. This can result in huge make-ready costs that the telecoms are required to cover. For example, a hydro company may require a telecom company to replace an entire line of poles even though they are perfectly capable of supporting network attachments. This can force the telecom to choose a slower and more costly route of digging up roads or abandoning the project altogether.

The hydros are not going to act on their own. They need to be incentivized, or even legislated, to act as willing stakeholders in the delivery of broadband projects. Indeed, this is what the Province of Ontario is attempting to do with its recent Building Broadband Faster Act.

Seeking more effective regulation of the telephone companies

Over several decades, the incumbent local telephone companies Bell and Telus have built a massive network of poles, many of which are shared with the hydro companies. The hydro companies, in turn, share their poles with the telephone companies. This means that, not only do Bell and Telus have preferential access to the poles they own, but they also enjoy preferential access to hydro poles. Further, as owners or managers of this critical infrastructure, Bell and Telus are able to restrict and even prohibit access by others to both their poles and to hydro poles.  

While access to poles managed by Bell and Telus is regulated by the CRTC, the current regulatory regime can be slow and ambiguous. Moreover, lengthy delays in the CRTC complaint process make enforcement difficult and ineffective. This allows the telephone companies to engage in regulatory gaming with the goal of delaying the deployment of competitors’ networks while building their own networks without any obstacles.

Removing artificial and unnecessary barriers that inhibit competition

If we are to see true competition for the provision of broadband and 5G services, and not just by Bell and Telus, the CRTC will need to respond, in a timely manner, to the inequities and even anticompetitive behaviour that has plagued those trying to build networks to compete with the telephone companies.

Artificial and unnecessary barriers that prevent companies like Rogers from building networks directly impacts competition.  It leaves consumers with a de facto monopoly broadband provider in many instances. It also exacerbates efforts to bridge the digital divide by making it more expensive and time consuming to build networks in rural communities.

This is a complex issue for Rogers and other competitors, but it is imperative that it is addressed. If we are to achieve the shared objective of preparing Canada for a digital future with ubiquitous high-speed connectivity, then we must act now.

Charit Katoch, Director, Public Policy & Michael Piaskoski, Director, Network Access Regulatory.

¹ PWC, “5G, the Digital Economy and Canada’s Global Competitiveness” November 2021
² Federal Budget 2021, Page 153