Ottawa doles out cash to close gap on digital divide
$108 million invested so far in 2018 for high-speed internet in rural areas
The federal government has doled out more than $100 million so far this year for high-speed internet access in rural and remote areas, money that’s expected to make a dent in the telecom regulator’s ambitious access targets.
Innovation, Science and Economic Development earmarked $90.48 million — about a fifth of the $500-million Connect to Innovate fund — for improved service in Newfoundland and Labrador, Manitoba and British Columbia in three announcements over the past two weeks. It contributed an additional $15.5 million from Indigenous Services Canada and $2.1 million from the Atlantic Canada Opportunities Agency for a total of $108 million.
The cash, largely for backbone connections to improve shoddy speeds in harder-to-reach places where the business case to build fibre networks is less compelling, will help connect 1,500 households on the East Coast, 23,150 households in Manitoba and “an important number” of households in 154 coastal B.C. communities.
Despite the Canadian Radiotelevision and Telecommunications Commission’s declaration that broadband is a basic service, about three per cent of Canada’s 14.1 million households (about 423,000 homes) didn’t have access to broadband by the end of 2016, according to the CRTC. Only 39 per cent of rural and remote households have access to the CRTC’s high-speed internet targets of 50 megabits per second download and 10 Mbps upload speeds, compared to 96 per cent of urban households.
The CRTC created a $750-million fund to tackle the problem, but more than a year later it is still figuring out a process to allocate the cash. It is expected to release details on the fund sometime this year. Meantime, the federal government continues to announce smaller projects from the Connect to Innovate fund as well as the $305-million Connecting Canadians fund launched by the previous government.
The new projects include Wednesday’s announcement of a subsea cable that will connect communities from Vancouver to Prince Rupert and around Vancouver Island.
The announcement in Atlantic Canada attracted criticism for the high cost per household of about $18,000. In Manitoba, however, the cost dropped to about $3,600 per household. That’s more in-line with costs in cities, where analysts estimate it costs about $1,000 to connect fibre to a home.
Whether critics agree with the spending, the federal funding is helping communities that could only envy digital access enjoyed by urbanites. For instance, non-profit Eeyou Communications Network (ECN) received $8.3 million from the Connecting Canadians fund last summer. On Wednesday, ECN and independent provider Distributel Communications Ltd. announced that by this spring, they will offer gigabit internet speeds to 4,000 homes in the Cree communities and municipalities in the Eeyou Istchee James Bay region in northern Quebec.
Distributel CEO Matt Stein said the companies will offer bundled packages comparable to urban players, including 1 Gpbs internet for $150 per month — a price that would be a deal in Toronto.
It is expensive to build fibre up north, so projects like this wouldn’t be possible without federal funding and local partners like ECN, Stein said. The investment will pay off for years, he said.
“I would argue that every step counts. These are communities that really had no other option and were stuck with satellite, which is not the same. Now they’re going have amongst the most capable connections in Canada.”
But he anticipates “most if not virtually all” residents will be interested in the service, which changes the economics and makes it worthwhile for business, he said. Plus, he believes Canada needs to invest in closing the digital divide.
“We’re investing in our digital future. It’s no different from building a highway.”
I would argue that every step counts. These are communities that really had no other option and were stuck with satellite, which is not the same.