Vapourware on the Dempster

The Yukon government's announcement of a backup fibre optic link along the Dempster Highway with NorthwesTel last week reminded me of the term "vapourware.

The Yukon government’s announcement of a backup fibre optic link along the Dempster Highway with NorthwesTel last week reminded me of the term “vapourware.” That’s old Silicon Valley slang for when a tech company hurriedly announces a flashy new software product that, in reality, has yet to be created.

As the Yukon News editorial writers pointed out, the announcement was remarkably sparse on detail even by the standards of government press releases. It even took some digging to find out how much the thing would cost. We still don’t know who is going to pay for some chunks of it.

Compare that to highway projects. Ministers are usually so proud of how much taxpayer money they are spending that they put up coloured signs with the price tag for us to admire.

It is good that we will have a backup fibre link. It is increasingly unacceptable – I would say it became unacceptable about five years ago – for every Internet-enabled device in the Yukon to randomly stop working for hours at a time whenever the backhoe operators of Fort Nelson get frisky.

It goes beyond email, cell phones and using your credit card in a store. The Internet is now nearly as essential to doing business as electricity. We are in the age of the “cloud.” Businesses increasingly rely on things like accounting software hosted in California, online ordering applications for their clients and so on.

It has even replaced “the dog ate my homework” as an excuse for kids. How can they do their homework if their teacher’s web page is offline and their shared project is trapped on a Google Docs server somewhere?

It is also good because having a backup fibre link will allow more and bigger tech businesses to locate here, which they can’t do today since many businesses literally cannot risk being offline for hours regularly or even days in an extreme incident.

However, there are still some important things for bureaucrats to work on as they de-vapour or “de-vape” the backup fibre announcement.

The first is that, as our N.W.T. cousins have done with their fibre link, the government needs to leverage its financial contribution to gain some power over pricing. NorthwesTel has the technical capabilities to run the new fibre. But it also has a strong financial incentive to keep prices high to protect its current monopoly position.

Think back to 1940 when the White Pass railway was the only way into the Yukon. Would it have been smart for the government to pay to build the Alaska Highway, then let White Pass operate it and set the tolls?

If that had happened, the highway would still be a gravel track and we would still be paying through the nose to rattle to Skagway on an eight-hour train ride.

A backup fibre that allows wholesale Internet prices to stay high in the Yukon will fix the problems with your personal email, the kids’ homework and using your credit card at the liquor store. But it will dramatically limit the growth of our tech economy.

Given how the mining, oil, gas, forestry and tourism parts of our economy are doing, it would be dumb to needlessly limit the growth of our tech economy. For example, we won’t have a chance of emulating places like Lulea in northern Sweden, which has attracted a Facebook data centre that saves energy by cooling the servers with crisp northern air.

The new scheme should have some cheap wholesale rates, encouraging economic development the way Iceland or Quebec do with cheap hydro electricity.

The cost structure of fibre cables supports this idea. Most of the cost is the up-front investment. Once built, you might as well light up all the fibres in the cable and use them. That’s from the point of view of the taxpaying public, of course. The interests of a monopoly fibre cable owner with one large government client would differ.

Part two of de-vaping the plan would include figuring out how to attract investment to the Yukon from businesses that will use the new infrastructure. The government should put as much money into luring tech businesses to the Yukon as it does for tourists or mining companies.

The targets include data centres, coding outfits, web marketing firms and the whole gamut of independent contractors and start-up artists. We need to figure out what attracts them, fix any obviously unappetizing policies or practices we have, and sell the idea of locating some of their tech activities here.

Next time you run into a politician at the airport going to a mining conference, ask them why you didn’t see them networking at Cloud Com 2015 in Vancouver? (That’s the IEEE’s 7th International Conference on Cloud Computing, in case you’re asking.)

The government also loses points for not putting the project out to tender, which might have attracted other viable proposals. That is now water under the bridge, however. The main thing is now to de-vape the pricing and economic development plans in a way the builds our economy in the long term.

Keith Halliday is a Yukon economist and author of the MacBride Museum’s Aurore of the Yukon series of historical children’s adventure novels. He won this year’s Ma Murray award for best columnist. You can follow him on Channel 9’s “Yukonomist” show.

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