Full-stream ahead
The race is on to provide consumers with lightning-fast Internet.
Years ago, sometime after the horse and buggy but before self-driving cars, we marvelled at modern technology that could deliver an email over a network to your computer.
Today, we grumble if we get the spinning wheel of death watching Netflix, that symbol that shows your streaming movie is stuck on the on-ramp to the increasingly congested Internet highway.
With the average household having close to six online devices, a number that’s growing, an Internet connection that isn’t robust enough can cause annoying speed bumps.
Telus’ recent announcement that it’s extending its fibre optic networks across the city of Vancouver is only the latest in a shift to the fast lane.
It promises a “gigabitenabled” network. But at least initially, top speeds will be less — 150 megabits per second for residential use, although businesses have the ability to access higher speeds from Telus.
That’s compared to Shaw’s top Internet speed offering of 120 Mbps and the 300 Mbps offered by Novus, with some new installations already at gigabit-per-second speeds. The Novus service is only available to businesses and people living in multi-dwelling buildings in some areas of Greater Vancouver.
For some consumers, it’s all about the speed; others only notice if the hockey puck freezes mid-slapshot or there’s some other Internet connection glitch.
“I’m pretty happy with the way my Internet works,” said Keith Dobie, who subscribes to Shaw’s mid-tier Internet services, paying about $70 a month for a service about halfway between the fastest and the slowest offered.
“I don’t even have the really fast Internet, it’s really not an issue,” he said.
One thing Dobie does notice is the slower upload speed. Check your Internet connection; even if you’re paying for a premium package at top speeds, chances are the upload speed will be considerably lower than the more trumpeted download speed. Why would you care? Well, for Dobie, who does video production for businesses with his company Pathfinder Productions, slow upload speeds can mean it takes a long time to transfer videos to Cloud storage — a growing issue as businesses and consumers increasingly store their data online.
“When I have finished videos they can be quite large, especially HD videos,” said Dobie.
Internet users in one of the handful of U.S. cities with Google Fiber don’t face that problem: Both upload and download speeds are up to one gigabit, or 1,000 Mbps.
According to Canadian Radiotelevision and Telecommunications’ annual Communications Monitoring Report released this week, 96 per cent of Canadians have access to broadband Internet, at speeds of at least five Mbps and higher. That’s up from 86 per cent five years ago, although only 77 per cent of households, according to the report, actually subscribe to broadband services.
Average monthly spending among Canadian households on communications services, which includes Internet as well as wireless and other services, was $203 in 2014, an $11.92 increase over the year earlier.
As part of that overall increase, Internet services were up 10 per cent.
Compare that to 2000, when only 50 per cent of the Canadian population used the Internet. There was no Facebook, YouTube was five years away and Netflix was still sending its movies out on DVDs.
Upgrading aging infrastructure and building new to cope with the increased demand, both for speed and capacity, is a costly undertaking and one that has pitted smaller, independent service providers against major incumbents such as Bell, Rogers and Telus. After a two-year review, the CRTC ruled last summer that the incumbent carriers must give the smaller independents access to their fibre-tothe-home (known as FTTH) networks on a wholesale basis, so the smaller carriers can resell the services and so increase competition.
Initially the ruling is only to be rolled out across Ontario and Quebec, but over time it will extend across the country.
However, no sooner were the ballots counted in last week’s federal election than Bell Canada was appealing to the incoming Liberal government to revoke the CRTC decision.
Building networks is a capitalintensive business.
In Vancouver, Telus is investing $ 1 billion to expand its fibre optic network to all corners of the city, including existing single-family homes, as well as the easier-to-connect new single- family developments, multi-dwelling buildings and businesses.
Telus president and CEO Darren Entwistle says it’s “entirely appropriate” that smaller independents not have mandated access to Telus’ fibre optic network, “given the investment profile we’re making, the investment risk we’re assuming, the protracted payback periods on this investment.”
“It’s a generational investment and it’s a generational return,” he said.
Bill Sandiford, president of the Canadian Network Operators Consortium, represents independent telecom providers who will be opposing Bell’s bid to overturn the CRTC ruling.
“The CRTC came up with a very well thought-out decision and we would hate to see a new incoming government eliminate all the hard work with essentially the stroke of a pen,” he said.
Sandiford said he expects the CRTC will set a rate “to ensure the incumbents are well compensated for their investments.”
“The more competition there is, the better it is for consumers as a whole,” he said.
The issue of wholesale access for independent providers to incumbents’ networks has resulted in more companies offering Internet services in Ontario and Quebec, but it hasn’t had as much of an effect in Western Canada.
Sandiford said that’s because competition between Shaw and Telus (and to a certain extent Novus, although it offers service to a much more limited customer base) for market share has been so intense other companies would find it difficult to make money.
“In the case of Shaw and Telus, where they compete, the cost they are providing services to consumers at is below what we would think is their cost,” Sandiford said. “You have an interesting case in Vancouver — the turf war among Telus, Novus and Shaw has been legendary and it seemed there was no floor as to how low they would go to get market share.”
Whether or not you have much choice in Internet providers depends on where you’re located. For example, TekSavvy Solutions, one of the independent providers based in Ontario and Quebec, has expanded its Internet and phone services to more than 250,000 Canadian homes, including ones in B.C.
Sandiford said that the average consumer or business may not need gigabit speeds, but that is likely to change.
“Maybe not today, but one thing the Internet has taught us, we don’t know what’s around the corner,” he said.
“It seems now that what’s driving speed in the home is video and television services like Netflix, Shomi and CraveTV.”
While Telus’ new fibre-to-thehome will immediately bump its potential speed to 150 Mbps, Shaw already offers a speed of 120 MBps for customers opting for the top tier of its Internet services. As with Internet offerings from other companies, you get what you pay for: Higher speeds mean higher prices.
Chris Kucharski, a Shaw senior vice-president, says the company launched its first trial gigabit Internet through fibre-to-thehome connections back in 2010.
“That was a trial undertaken in an attempt to future-proof Shaw’s network, but it was really about gaining an understanding of the technology should there be a need to provide it,” he said. “To date, really fibre-to-the-home has only been deployed in select new residential and commercial developments. But fibre-to-the-premises is available to Shaw business customers that typically require the speed and capacity that that service provides.”
Kucharski described his company’s network as “fibre rich” with more than 625,000 kilometres of fibre, combined with coaxial cable to most homes.
Shaw isn’t looking to extend fibre optic networks to single-family homes, but instead Kucharski said the company can provide gigabit and higher speeds through a hybrid network of fibre with DOCSIS 3.1 cable technology.
DOCSIS, also known as gigasphere, stands for data over cable service interface specifications. It is a telecommunications standard that allows cable companies to increase bandwidth using their existing cable networks.
Kucharski said currently Shaw’s 120 Mbps Internet service is accessible to 96 per cent of the company’s customers.
“The key point is we are just scratching the surface of the speeds that our hybrid fibre network can offer,” he said.
‘Transformational’
If you couldn’t care less about kilo, giga or any other bits, you’re not alone.
What difference does speed make?
Consider downloading a high-definition movie. With a 60-megabit-per-second service, it would take more than 10 minutes to download the movie; at 120 Mbps, it would take six minutes and gigabit service would zap that through in less than 30 seconds.
And the effect of higher speed Internet connections goes far beyond the home. It is infrastructure essential for a region, or a country, to be competitive. In the United States, a couple of cities have gone so far as to offer up to 10-gigabit broadband service in the competition to stay ahead and attract business investment.
With the Internet ubiquitous not just in the tech sector but right across all business and public sectors, the size and speed of the Internet pipe is increasingly important — whether it’s collaborating with colleagues around the globe on special effects for a movie or telemedicine providing a patient with access to a specialist many miles away.
Entwistle describes his company’s billion-dollar investment in fibre optic technology for Vancouver as “transformational.”
“The simplistic conversation is about speed, but what’s exciting is the transformation that that enables,” he said.
“It’s a transformation we’ll see affect everything from our homes to the delivery of health care, education, to business and in our work and play.”
Less than 10 per cent of North Americans have access to a fibre optic network. Among the handful of American cities that have gigabyte-enabled infrastructure, Entwistle said it has resulted in a small improvement in GDP “and growing.”
Vancouver is only the latest in a string of announcements that Telus will expand its fibre optic networks. It’s already working on cities such as Kelowna and Kamloops, and smaller centres such as Armstrong and Edson, Alta.
Need for speed?
Do we really need the superspeeds? With the information highway, it’s more like a case of “build it and they’ll come.”
David Belson, senior director industry and data intelligence at Akamai Technologies and editor of Akamai’s quarterly State of the Internet Report, suggests gigabit connectivity is more a promise than a reality.
“It’s really something I look forward to seeing become more widely adopted,” he said. “The reality of it in what I have seen so far is that it makes for a good announcement right now.”
Right now, Belson said, people don’t have the applications and content that require all that bandwidth.
“If you had it today as a subscriber, what would you do with it?” he said. “It’s great to have a gigantic pipe coming into your house, but if Netflix is only delivering video encoded at a certain rate, that’s really all the bandwidth you’re going to use.
“Chances are it’s unlikely you’re going to have a hundred or more devices within your home all streaming Netflix at the same time for instance.”
Better image quality, such as 4K video, uses more bandwidth than lower resolution video, but so far 4K content is limited. However, that will change as Netflix and other entertainment content providers move to keep pace with technology.
“Any given piece of media that you’re going to stream from one of these providers is only going to take up a small fraction of a gigabit connection,” said Belson. “But what happens if Netflix starts delivering everything in 4K, or 8K?”
Telecommunications consultant Mark Goldberg said most Canadians don’t choose to subscribe to the fastest Internet service available.
“You need to look beyond what the headline speed is,” he said. “I think most people do just fine with a 20 to 30 to 40 Mbps connection.”
Goldberg, who lives in Ontario, said he opted for Rogers’ 80 Mbps service, but only because “it was a negligible price increase over their slower speeds.”
“Rogers is coming out with their own gigabit service, but I don’t see myself going to a gigabit service unless the price was compelling,” he said. “They’re talking about $150 a month for gigabit service, which is more than twice what I pay.
“I just don’t need it and I like having the choice.”
Internet speeds are always going up. Akamai’s tracking shows Internet connection speeds in 2007 averaged 3.5 Mbps, compared with 11.12 Mbps today.
Despite higher speed options being available, the average peak speed in Canada is 48 Mbps, compared with eight Mbps back in 2007, which was the year Netflix first introduced video streaming.
Novus Entertainment delivers fibre optic network service to multi-dwelling buildings and businesses in Greater Vancouver, with the exception of Delta and it already offers gigabit service in a few newer buildings.
“Trying to deploy infrastructure to single-family homes is just so cost prohibitive,” said Donna Robertson, Novus’ copresident and chief legal officer. “It will be a long time before we get there. It’s a capital-intensive business, believe me.”
Robertson said most customers don’t need the gigabit services.
“It is more of a marketing thing than an actual benefit to most users,” she said. “There are certainly companies and industries that need it, but for most people it’s not necessary.”
The increased demand for Internet services, Robertson said, has “everybody upping their game. It’s not just your network, it’s the equipment at the end of your network that makes the difference,” she said.
“You have to have equipment in each building or at somebody’s home that helps deploy the signal.
“Whatever is at the end of that network is also going to affect the speeds you get.”
‘We need to be leaders’
For Richmond- based Lite Access Technologies, the shift to fibre optic networks is a welcome development.
The installation company recently completed running fibre-to-the-home in 97 Powell River homes. To install the fibre networks, Lite Access cuts micro- trenches and installs microducts that have the fibre air-blown through them.
“We made the decision a number of years back that if we’re going to take this thing to the next level, we need to be the leaders in how this is going to go into the ground,” Lite Access’ co-founder, president and CEO Michael Priest said of the fibre optic networks.
“Traditional deployment is 30 metres a day. We can do 300 metres a day and we have done as much as 500 metres a day,” he said. Priest said the process minimizes disruption to streets and neighbourhoods.
“We like to say we can literally install across a street on a red light,” said Priest, whose company has installed 1.5 million fibre connections worldwide, including British Columbia, other parts of Canada, the United States and other countries.
Priest said his company’s airblown system allows for fibre to be added anytime.
“Let’s say we have a customer who is going to put a 10-kilometre network in downtown Vancouver.
“We’ll put extra ducts into the ground when it’s being built and as they want to bring other buildings on, it’s a matter of blowing fibre through the spare tubes that are there.”
You havean interesting case in Vancouver—the turf war among Tel us, Nov us and Shaw has been legendary.
BILL SANDIFORD PRESIDENT, CANADIAN NETWORK OPERATORS CONSORTIUM