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Technology law column by Michael Geist

How Telco Lobby Helped Kill Consumer Cell Phone Cost Calculator

Last week I discussed the well-known challenge faced by millions of Canadians as they sort through a myriad of cellphone pricing plans in a marketplace still lacking in robust competition.  Previously unreported, however, is that Industry Canada officials identified the same problem and worked for years to develop an online tool to address it.

After spending tens of thousands of dollars creating and testing an online calculator designed to help consumers select their ideal wireless plan, Industry Minister Tony Clement killed the project weeks before it was scheduled to launch. Government records suggest intense lobbying this spring by Canada’s wireless companies, who feared the service would promote lower cost plans, played a key role in the decision.

The Office of Consumer Affairs (OCA), a branch within Industry Canada with a mandate to promote and protect consumer interests, was the original source for Which Cell Plan? A Calculator. The calculator asked consumers for detailed information about their current or anticipated cellphone use and then provided them with a detailed list of suitable plans from Canadian providers.

Bell and Rogers Square Off Over Internet Speed Claims

As two of Canada's biggest Internet service providers, Bell Canada and Rogers Communications are fierce rivals that frequently battle for the same customers. That marketplace fight rarely spills into the courtroom, yet last month a Rogers advertising campaign prompted Bell to file a $50 million dollar lawsuit.  The result was an end to the campaign and evidence both companies over-promise the speed of their Internet services.

The case began when Rogers launched a direct mail and Internet ad campaign called "Check Your Speed."  The campaign warned users the Internet services "you are paying for may not be what you're getting" and encouraged them to test their connection with an independent third party.  The campaign unsurprisingly offered Rogers services as an alternative, promising a "reliable speed every time you connect."

Just days after the launch, Bell filed suit, arguing in court documents violations of the Trade-Mark Act, Competition Act, along with various torts.  The company sought $50 million in general damages, $1 million in punitive damages, and an injunction blocking Rogers from continuing with its campaign.

Canada Hardly a Leader in Wireless World

Where does Canada stand with respect to the cost of wireless services?  That question recently generated a spirited debate when the Organization for Economic Co-operation and Development released new figures that ranked it as the third most expensive developed country. Critics pounced on the report, calling the results ridiculous and pointing to perceived flaws in the methodology.

Given that consumers have a hard time making sense of the different plans, options, and hidden fees offered by Canada’s big three wireless providers (Rogers, Bell, and Telus), it should come as little surprise that comparisons of wireless services across dozens of countries is exceptionally difficult.  Some countries charge consumers for both incoming and outgoing calls, while many others do not. Moreover, hidden charges such as Canada’s system access fee - which can add as much as 25 percent to a monthly bill - are often excluded from cost calculations.

While the debate will continue to rage, few currently hold Canada up as a model of wireless leadership.  If not pricing, what should policy makers and politicians be focusing on?  Four main issues come to mind.

Designing A Copyright Law That's Built To Last

As the national copyright consultation launched earlier this summer hits the midway point, the first four weeks have attracted considerable interest.  There have already been more than a thousand submissions, one town hall meeting, and five roundtable discussions, with many Canadians visiting to provide their views on copyright reform.

Changes such as expanded fair dealing, legal protection for digital locks, and new digital levies have emerged as the most-discussed issues. However, many are still grappling with one of Industry Minister Tony Clement's core concerns: In an era of rapidly changing technology, how does the government ensure that a new copyright bill is built to last?

Clement's focus on longevity appears to be a tacit acknowledgement that Bill C-61, the last Conservative copyright bill that died with the federal election call last fall, was not sufficiently forward looking.  With specific references to VHS tapes, emphasis on digital rights management, and blocks on the use of network-based personal video recorders, critics argued that bill was past its best before date the moment it was introduced.

Openness and Crowdsourcing Changing Government

The August long weekend goes by many names in Canada - Simcoe Day in Toronto, Colonel By Day in Ottawa, and British Columbia Day in B.C. - but the most common is simply Civic Day.  On the week Canadians enjoyed Civic Day, it is worth noting how our civic institutions are rapidly being transformed by open government mandates that leverage the power of the Internet to foster greater transparency and public engagement.   

The City of Vancouver has led the way with the adoption of a resolution in May that endorsed open and accessible data, open standards, and open source software.  The open data component states, "the City of Vancouver will freely share with citizens, businesses and other jurisdictions the greatest amount of data possible while respecting privacy and security concerns."

The Amazon Kindle and an Orwellian Misstep

For months many consumers have lamented the absence of the Kindle, Amazon’s popular electronic book reader, from the Canadian market.  Now in its second version, the Kindle has proven to be a major success story in the United States with a loyal user base that relish the chance to wirelessly access books, periodicals, and web content on a single, sleek device.

Yet two recent controversies cast doubt on the Kindle and in the process highlighted how consumers may find themselves vulnerable as they embrace electronic books.

The first issue arose soon after the second edition of Kindle debuted.  The new device featured impressive text-to-voice technology that enabled users to play the content aloud.  Just as groups representing the blind celebrated a mainstream device that would provide new access to millions of written works, Amazon backtracked, allowing book publishers to disable the feature.  

Within weeks many larger publishers had shut off the read-aloud functionality, concerned that it could hamper audiobook sales. That decision led to a recent lawsuit at Arizona State University, where the National Federation of the Blind challenged plans to use the device to distribute electronic textbooks to students.

Net Neutrality Hearing Paves The Way for Action

Regulatory hearings on Internet traffic management practices held in windowless rooms in Gatineau, Quebec in the middle of summer are not likely candidates to attract much attention.  Yet for seven days this month, hundreds of Canadians listened to webcasts of Internet service providers defend their previously secret practices while engaging in a robust debate on net neutrality.

The interest in the Canadian Radio-television and Telecommunications Commission hearing may have caught the regulator off-guard (the webcast traffic was, by a wide margin, its most ever for a hearing), but it was the testimony itself that was the greatest source of surprise.

The seven-day hearing was billed as a debate over whether rules are needed to govern ISP network management practices. While many Internet users remain unaware of the issue, behind the scenes ISPs employ a variety of mechanisms to control the flow of traffic on their networks, with some restricting or throttling the speeds for some applications.

The Free TV Era Comes to an End

Since the debut of broadcast television in this country more than 50 years ago, millions of Canadians have grown to expect free access to local television signals.  While the mechanism for accessing those ad or taxpayer supported broadcasts has evolved from rooftop antennae to cable and satellite distribution, access has consistently been free (cable obviously charges for access but it does not pay for carriage of local signals).

Last week, Canada's broadcast regulator issued a decision that will bring the era of free local television to an end for many Canadians. Whether through the elimination of local over-the-air broadcasts or via additional cable or satellite charges to cover a new fee-for-carriage system, free is out and new fees are in.

The changes are the result of two policy decisions by the Canadian Radio-television and Telecommunications Commission.  First, the CRTC set the ground rules for the digital transition of Canadian broadcasting by determining that many Canadian communities are likely to lose their over-the-air signal as part of the change.

Net Neutrality Hearings Open With Conflicting Claims

The Canadian Radio-television and Telecommunications Commission hosts long-awaited network management hearings this week, pitting Canada’s telecom and cable companies against a broad range of consumer, creator, and technology groups in a fight that may help clarify whether Canada has - or should have - net neutrality laws.

The telecom and cable companies will likely maintain that managing their networks, which may include using "deep packet inspection" to identify subscriber activity and limiting available bandwidth for certain applications (a practice known as throttling), is essential to ensure optimal access for all subscribers.  

Consumer associations, independent Internet service providers (ISPs), broadcasters, creator groups, and technology companies are likely to warn against network management practices that raise competition, privacy, and consumer rights concerns.

As the Commission weighs the various claims, it would do well to consider the testimony it heard just a few months ago during the February new media hearings.  The issue at play at those hearings was whether ISPs should face a levy to fund new media or be required to prioritize Canadian content (the CRTC declined to do both in its decision released last month).

Ordinary Thursday Anything But For Canadian Internet

Last Thursday began as an ordinary, rainy, spring day in Ottawa.  Canadian politicians, having just avoided an unwanted election, were only two days away from an extended summer break.  Yet by the end of the day, a trio of events unfolded that could help shape the Internet in Canada for years to come.

The first took place mid-morning, with the introduction of new lawful access legislation.  The bills would dramatically change the Internet in Canada, requiring Internet service providers to install new surveillance capabilities, force them to disclose subscriber information such as name, address, and email address without a court order, as well as grant police broad new powers to obtain Internet transmission data.

The introduction of the legislation by Justice Minister Rob Nicholson and Public Safety Minister Peter Van Loan - accompanied by more than a dozen law enforcement representatives - generated an immediate wave of criticism.  ISPs expressed concern about the cost of the program, while privacy groups lamented the government’s about-face on the issue of court oversight since Stockwell Day, the previous Public Safety Minister, had pledged not to introduce mandated disclosure of subscriber information without it.


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