OTTAWA – Canada needs a stable regulatory environment to support investment in digital networks, argued Robert Ghiz (above), president and CEO of the Canadian Wireless Telecommunications Association (CWTA), during his keynote speech at the International Institute of Communications Canada’s annual conference yesterday.
Ghiz pointed out how during the pandemic, when suddenly people became more reliant on the Internet and mobile communications, there was concern about “whether our digital networks would buckle under the strain.” This did not happen – “Canada’s digital networks rose to the occasion,” he said.
Ghiz attributed this to Canadian network operators having “invested heavily and consistently” in their network infrastructure, as well as to “the regulatory framework that provides the foundation for these investments.” He argued the high level of investment in networks in Canada, and the quality and coverage of those networks “is only possible in a regulatory environment that encourages sustainable competition and investment.”
Pointing to the CRTC’s recent decision on mobile virtual network operators, Ghiz said the Commission acknowledges “sustainable consumer benefits can only be produced by sustainable competition. And the only form of sustainable competition is facilities-based competition.”
“The evidence is clear,” he said. “Facilities-based competition has enabled high levels of investment which have resulted in some of the best networks in the world.”
Ghiz went on to argue moving forward, a stable regulatory environment is needed to enable continued investment in innovation and network building and to ensure Canadians benefit from 5G.
“Through continued collaboration and with a stable regulatory environment, I am confident that Canada will soon be recognized as a 5G superpower, and we will be able to enjoy the economic and social benefits that come with such a distinction,” he said.
Without wading directly into the question of whether Canadian prices are too high or too low, another conference speaker also emphasized the importance of regulatory stability to the future of Canadian networks, while pointing out the importance of looking at pricing in relation to investment.
“A lot of people talk about pricing in Canada being high or low versus other countries but when you look at how much profit these companies make versus how much money they have invested in dollars in networks, it is what you might expect, it’s not that high – it’s not high, it’s not low, it’s decent versus other industries,” said Maher Yaghi, a Scotiabank analyst.
“And so, I urge you to look at those facts when you look at pricing… because at the end of the day these companies need to continue to invest in networks and they need to support the economy.”
Yaghi pointed to the amount of debt Bell, Telus and Rogers have and noted how important it is for them to be able to attract investors so they can continue to invest in their networks.
“From an investor point of view… regulatory consistency is very important,” he explained.
“Flip-flopping on regulation causes a lot of sensitivity with investors, so you have to stick with a consistent track record in terms of how you regulate this industry because there’s a lot of capital at stake and if there’s no certainty in terms of how much return these companies can make on each dollar of investment in capital they’re making then either the capital market will retrench and will not support them in the future, or they will have to themselves retrench and stop investing in the network.”
