Meeting notes show pole replacement and refurbishment listed as significant barrier, but it’s about speed
By Ahmad Hathout
TORONTO – Rogers and Cogeco were among several internet service providers that met with stakeholders in the Ontario government in November 2020 to address wireline pole attachment issues in the province – but the rates to attach equipment were not identified as a significant barrier, according to notes from the meeting obtained by Cartt.ca.
At around $43 per attachment, per pole, Ontario has the country’s highest cost to attach telecommunications equipment on the wood poles, which run along highways and are a primary alternative to run said equipment instead of the more costly underground trenching of fibre cables.
But despite years of clamouring for lower attachment prices, several telecommunications service providers (TPSs) including Rogers and Cogeco apparently held up more significant barriers to broadband expansion, primarily the refurbishment and replacement of the poles, at the meeting hosted by the Ministry of Infrastructure.
“Through the discussion, the wireline attachment charge was not identified as a significant barrier to broadband expansion,” according to four-page notes this publication received through a freedom of information request.
The total annual revenues from wireline attachment charges for all local distribution companies (LDCs) across the province is estimated to be between $15 million to $20 million, according to the document.
“While there was consensus from the [providers] that the process used by the [Ontario Energy Board] to set the charge was flawed, it was acknowledged that the charge is not the sole determining factor in proceeding with an expansion project,” added the notes, which were among roughly 900 total pages of documents requested by Cartt, the rest of which was withheld.
Also known as the “make ready process,” replacing or refurbishing poles are the result of a third-party provider requesting to attach its equipment to the pole, which sometimes results in the need for a replacement when the structural integrity of the pole is at stake. These third-party providers then must cough up the price to replace the entire pole.
The costs, according to the service providers at the November meeting, “can be exorbitant and unpredictable,” the notes said, adding the cost can make up to half of the overall build.
But it’s the timelines and the LDC process that rise above cost as the more significant barrier, according to the notes.
“Between coming to agreement on engineering work LDCs prioritizing their own system upgrades before broadband attachment, approval to attach to poles can take 1-3 years according to TSPs,” the notes read.
“Many TSPs have taken more expensive build options (ex. burying cable) rather than wait to complete LDC approvals,” the notes added. “TSPs also flagged that projects that cross LDC boundaries and require multiple LDCs to approve can create additional complexity.”
Some TSPs, the notes said, even recommended that funding programs would be “more effective” if they directly funded the LDCs for pole replacement rather than doing it indirectly through the telecoms.
The meeting notes also said the telecoms are concerned about the “lack of transparency” around the costs. “LDCs pass on 100% of replacement costs to [telecoms], and often do not provide full costing details until significant project work is underway, creating significant risk and uncertainty.”
“TSPs noted if clearer costing could be provided upfront, more projects would proceed.”
When reached for comment about what changes, if any, were contemplated following the meeting, an Ontario government spokesperson noted the passing of the Supporting Broadband and Infrastructure Expansion Act as “playing an important role in that.”
That legislation, which became law in April, gives the infrastructure minister greater enforcement powers to ensure telecom access to those structures are equitable and timely.
“We will be able to work with partners to hold them accountable to service standards,” the spokesperson said of the legislation. “The Act will help shorten process delays and provide more certainty to telecommunications service providers to keep projects moving faster. This legislation will help reduce barriers for broadband infrastructure expansion in unserved and underserved communities across the province.”
The spokesperson also said the 2019 Broadband and Cellular Action Plan will help address barriers to access that “will reduce delays and unnecessary added costs, which will ultimately benefit people in unserved and underserved communities.”
Rogers and Cogeco did not respond to a request for comment.
Other telecom participants at the November meeting include Vianet, TBayTel, K-Net, Blue Sky Net, Western James Bay Telecom Network, and the Independent Telecommunications Providers Association. The Ministry of Northern Development and Mines, the Ontario Energy Board, and the Ministry of Government and Consumer Services were also involved.
Shaw, which previously lobbied the Ontario government about high pole attachment rates, has been vocal about the replacement and refurbishment of poles for the purpose of attaching its equipment on British Columbia structures. The telecom, which is currently the subject of an acquisition by Rogers, wrote a letter to the BC government asking for the province’s utility company, BC Hydro, to assume a portion of the cost to replace the poles.
The issue of pole attachment costs seemingly usurped the conversation on barriers to structures for years. The telecoms have flagged it as a primary concern in submissions to the CRTC, which is studying barriers to rural broadband deployment. The federal government has made access to these structures a critical piece of its $2.75 billion Universal Broadband Fund, while the Ontario and Quebec governments have highlighted it as a priority for their broadband expansion missions. (Ontario is seeking to connect the entire province with high-speed internet by 2025, while Quebec is shooting for providing access by late 2022.)
In fact, the telecoms have gone to court about costs to access poles, principally to challenge the way the Ontario Energy Board came up with its cost to attach equipment.
Late last year, the Ontario government enacted changes in the ranks of the board of the OEB and made a priority for its mandate a review of pole attachment costs, with which the carriers were pleased.
