NorthwesTel responds to criticisms

Paul Flaherty The public hearings conducted last week by the Canadian Radio-television Telecommunications Commission in Inuvik and Whitehorse will, without a doubt, play a huge role in determining future telecommunications investments in Canada's North.

Paul Flaherty

The public hearings conducted last week by the Canadian Radio-television Telecommunications Commission in Inuvik and Whitehorse will, without a doubt, play a huge role in determining future telecommunications investments in Canada’s North.

Yet, at the conclusion of the hearing, the editorial team at the Yukon News chose to sum up the hearings by portraying NorthwesTel as unscrupulous and intent on squeezing cash from customers for the benefit of a larger corporate owner. The editorial also echoed the comments of competitors who have a very clear and vested interest in suggesting NorthwesTel is out to prevent competition from happening.

Unfortunately, these views seriously cloud and distort the picture.

Having the CRTC hearings in the North generated a lot of interest and, we hope, a broader understanding of the commission’s important role with respect to service improvements, fair prices, subsidies and competition in the North. Many of the views expressed by northerners at the hearings were constructive. Sadly, the Yukon News seems to have missed those. It also failed to present an accurate picture of NorthwesTel.

NorthwesTel is indeed part of the publicly-owned corporate entity Bell Canada Enterprises, and its many thousands of Canadian shareholders. That does not mean, however, that the top priority for our business is to buoy corporate financial results. What the editorial ignores is that we operate as our own separate business, with our own management, board of directors and customers to whom we are accountable. These all largely contribute to why we have been able to move forward with investments in the North – like 4G wireless – that otherwise might not have happened because of the economic challenges.

NorthwesTel is also determined to continue investing to deliver the services northerners want. This includes expanding the availability of 4G wireless and faster Internet service to high-cost serving areas, even delivering speeds that, in many cases, exceed the CRTC target of 5 Mbps down and 1 Mbps up significantly in all communities, except those where links from the community to the Outside are served by satellite.

There was plenty of discussion at the hearings about the high cost of satellite network backhaul – something beyond NorthwesTel’s control – and the barriers this represents. Yet, this isn’t mentioned by the Yukon News.

The editorial does reference the fact that our Internet service prices today are comparable to those in Alaska, but it fails to link our recent reductions in overage charges to the real reasons why these charges exist in the first place – to manage bandwidth consumption given the realities of network congestion. We know our customers want more bandwidth and we’re working to meet that demand. As costs for bandwidth decline we’re making better service options more available and affordable.

It also fails to mention that when NorthwesTel went back to the CRTC seeking a review of the rates for our Wholesale Connect service, we did so because we believe those rates should achieve a better balance between what competitors want and the need to encourage investment – something the CRTC can (and should) do by adjusting the methodology it used to calculate the rates. Only then will we be able to continue with fibre investments that will deliver tremendous benefits to Yukoners and, ultimately, competitors as well.

Finally, when the editorial addresses the annual $20-million public subsidy NorthwesTel receives for providing residential local phone service in high-cost serving areas – that is, every community outside of Whitehorse and Yellowknife – it fails to mention this subsidy comes with strict CRTC oversight and conditions that NorthwesTel must abide by. Moreover, there is no mention that half of this subsidy includes the recovery of costs for service improvements the company incurred years ago as part of a successfully-completed, CRTC-approved program.

As we stated at the public hearings in Inuvik and Whitehorse, our modernization plan delivers significant and concrete service improvements for the Yukon and the rest of the North. It will strengthen our economic and social fabric without relying on a CRTC subsidy, and it will do so in a way that enriches the lives of the vast majority of citizens by promoting investment, innovation and greater competition.

It provides a clear path forward and while it cannot be everything to everybody, as the issues surrounding communities served by satellite network backhaul demonstrate, the plan will deliver tremendous benefits for northerners, while also providing for a reasonable return on investment. This is a balance all responsible businesses should (and do) strive to achieve.

A great deal of valuable discussion took place at the CRTC’s hearings in Inuvik and Whitehorse, and transcripts are available on the commission’s website for those who would like a clear and more complete picture.

Paul Flaherty is CEO of NorthwesTel.