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Redundancy is well and good, but Yukon needs real telco competition

By all means, hurl your tomatoes at the contractor who, through either ignorance or carelessness, severed the fibre optic cable leading from British Columbia to Yukon earlier this week.

By all means, hurl your tomatoes at the contractor who, through either ignorance or carelessness, severed the fibre optic cable leading from British Columbia to Yukon earlier this week, plunging much of the North into yet another day of telecommunications chaos.

“Call before you dig” is such a common phrase in public service announcements, Northwestel’s included, that it has become almost cliche. A little more caution would go a long way toward preventing these kinds of costly accidents that hamper businesses, snarl government work and are just generally a pain in the neck for everyone.

Spare a few jeers too for Northwestel, our monopoly telecommunications provider. No, it is not their fault when an overzealous backhoe operator cuts the fibre optic cable that connects us to the South (though photos circulating online seem to show the cable is exposed to the elements in many places). But their total dominance over Yukon’s telecom market is a problem that is orders of magnitude larger than the occasional internet outage.

This is a company that had to be both lured with carrots and beaten with sticks to upgrade its terrestrial internet systems. The fibre optic line to Dawson City currently under construction, which will be most welcome upon its arrival in the Klondike, was delayed when the CRTC forced Northwestel to lower the wholesale rates it charges other companies to use its network.

Back in 2011, the CRTC ordered Northwestel to upgrade its physical network. Northwestel and its parent company, Bell, tried to make those upgrades contingent on the CRTC’s approval of Bell’s acquisition of a Quebec-based chain of radio stations. It was a shamelessly cynical manoeuvre by Bell-Northwestel, essentially attempting to hold northern customers hostage to Bell’s grander corporate ambitions.

“It’s a dupe,” wrote telecom industry watcher Andrew Robulack in these pages four years ago. “Bell and Northwestel are attempting to play the CRTC against itself.”

Since then, there has been some tinkering by the CRTC to lower the rates of certain packages, although a decision last year to throw out the $20 fee DSL customers must pay to opt out of the local phone service that subsidizes their internet was later overturned. The CRTC too cannot seem to do much for northern consumers, although perhaps the ongoing review of national internet services will yield longer term results.

Northern governments, desperate to improve the region’s woefully inadequate telecommunications services, have resorted to spending public money to expand the reach of fibre optic cables in the territories. Witness the N.W.T. government’s $84-million project to build a fibre line from Fort Simpson to Inuvik.

And there’s the Yukon government’s plan to build a parallel fibre line up the Dempster Highway, where it would meet the Mackenzie Valley line and provide redundant connections in both territories. In a news release issued by fax machine amid Monday’s meltdown, the Yukon Party said it “remains committed” to funding the Yukon line, at an estimated construction cost of $32 million, of which up to $10 million would come from Northwestel, which would own the line. This is, ostensibly, to save us from having to pay for the upkeep on it, but given Northwestel’s monopoly and its aplomb in keeping competitors out of the Yukon internet market, we’ll be paying for it either way.

The redundancy offered is nothing to scoff at. Our neighbours in the N.W.T. and Nunavut, who experience the same inconvenience with every snip of the cable, will also benefit from the new loop.

But Yukon’s telecom market operates in a perpetual state of market failure, thanks to Northwestel’s control of the network infrastructure and its sustained efforts to freeze out any and all competition. This has the same economic effect as a tax, hoovering up money from subscribers and punishing the bottom lines of local businesses. Until the CRTC and the Yukon government get serious about breaking Northwestel’s monopoly, periodic internet outages will remain the least of our worries.

Even so, please remember to call before you dig.

Contact Chris Windeyer at