During the recent CRTC review of wholesale mobile wireless services, a fairly common speaking point was the CRTC should not (further) regulate the Canadian industry, due to potential negative impacts on infrastructure investment. Lack of network investment in Europe due to ‘artificially’ increasing competition was a spectre frequently found in business op-ed columns, and often made by champions of Canada’s incumbent wireless carriers.
Here’s an excerpt from the Financial Post on September 30th [emphasis mine]:
Georg Serentschy, another expert witness for Telus and the former CEO of Austria’s wireless regulator, said the experience of Europe should serve as a cautionary tale about trying to increase wireless competition through regulation.
“Not many years ago, Europe was the global mobile envy. Fast forward to today, and we see that Europe has many relatively poor-quality networks,” Mr. Serentschy said.
“Consumers and businesses are frustrated on a daily basis by more dropped or failed calls, slower data speeds, poor rural coverage,” he said.
These claims always seemed a little dubious.
One of the things I’ve noted before was that Germany’s Digital Dividend spectrum auction required carriers to rollout LTE coverage to rural areas before moving into the more profitable urban centres. This enabled pretty good rural coverage for relatively high-quality networks. In fact, here’s a link to Deutsche Telekom’s coverage map — it’s in German but pretty straightforward. And you can see that pretty much the entire country has LTE coverage.
Of course, Germany has a total area just smaller in size than the land mass of Newfoundland and Labrador but rollout conditions for Canada’s Digital Dividend spectrum were, in practice, non-existent. While not every spectrum licence should have strict and demanding rollout conditions, sub-1GHz spectrum — ideal for coverage — would seem the ideal candidate. (Mayhap for the 600MHz band?)
What about the claims slower data speeds or less advanced networks? Once again, the coverage map makes an interesting counter-point. Pretty much the entire country has access to 50Mbps LTE speeds, and subscribers can also access up to 150Mbps across their urban centres. So fairly fast. But within the cores of the most urban cities — no Munich or Hamburg, so definitely not everyone — subscribers can also get access to up to 300Mbps LTE-A! And it’s not just Germany (or T-Mobile) but the UK, Finland, France, Spain, Estonia, etc. Heck, even Slovakia is trialing the technology. These LTE-A networks are at the forefront of commercially-deployed mobile networks today, helping leading the way to true 4G speeds, and European carriers have begun rolling them out across the continent.
Europe’s mobile industry did have a lack of investment but that ignored the macro-economic challenges. Europe was going through prolonged recessionary periods and (still) dealing with very high unemployment, in addition to the continued drag of the massively expensive 3G spectrum auctions around the dotcom crash. Using selected snapshots of investment by European carriers can give a very distorted perspective.
Canadian carriers have started to roll out similar technology, although not all — the best I could find on Bell and TELUS is that they are expected to “launch soon”. And one should note that many of the above European examples happened months before Rogers launched LTE-A and the CRTC wholesale hearings began. (Wikipedia lists 22 European LTE-A network launches before Rogers’, and 13 non-European ones.)
Carriers will almost always possess more information and be more knowledgeable about the industry than regulators.1 With such an information asymmetry, regulators must be critical when evaluating evidence provided by actors with vested interests.