In 1999, the owner of a small southern Ontario service provider wrote Industry Canada to support a service provider dubbed Inukshuk, which was looking for a licence to serve small towns hoping for high speed Internet.
“Our area still uses party lines and pulse dialing for some residential customers,” wrote Mark Earl of Orillia ProNet, who feared his town might never see the then leading-edge broadband DSL or cable wizardry.
Earl was right and wrong. Over the last eight years DSL and cable broadband did come to Orillia, a town of 33,000 at the edge of cottage country.
On the other hand, he said in an interview, there are still pockets within the municipal boundaries that can’t get broadband service, and outside the town high speed is still wishful thinking. Satellite providers have moved in to offer wireless service.
Earl’s hopes that Inukshuk, which in 2000 won a string of licences in every province except Manitoba and Saskatchewan, would be able to solve many of the area’s woes has been in vain. Inukshuk has passed Orillia by.
Whether that is good or bad could become clearer in the next few months when Industry Canada examines the organization’s next steps. For while the licences last until 2011, they came with a requirement to extend service to a set list of communities by next March. That’s only five months away, so the department has to make some decisions, including creating another list or leaving Inukshuk alone.
One industry analyst thinks it’s time the government consider reallocating the licences. “Right now I think Inukshuk is a bit of an embarrassment for the government,” says Iain Grant, managing director of the SeaBoard Group, a telecommunications consultancy. “They made conditions possible for things to survive, and looked the other way when licences had to be juggled, and yet very little has happened.”
To judge if that’s true, a little history is required. The Inukshuk of today is a 50-50 partnership between Bell Canada and Rogers Communications for building a network over the 2.5Ghz band using a pre-WiMAX proprietary standard developed by what became a division of Motorola.
It didn’t start that way. The odd bedfellows came together in 2005 after Inukshuk’s early backers, including Microcell Telecommunications, Allstream and an entity owned by U.S. entrepreneur Craig McCaw were either bought out or wanted out.
With Ottawa’s permission, the country’s two major telecom providers took over the licences and began offering service last year. So far, the partners have not only addressed the list of required communities, they’ve added some not on it, like the Muskoka area north of Orillia, Montreal’s Mont Tremblant resort area and the booming Alberta oil town of Fort McMurray.
Not good enough for Grant, known for measuring Canada’s international broadband standing by its degree of penetration. “There are a great number of Canadians who have not yet got access to broadband and are feeling a little left out,” he says.
“We did think about this,” he continues, referring to the fact that the Inukshuk initiative dates back to 1997. “We did address this and we did license some people to do some stuff, and they haven’t done much.”
That brings vigorous protests from Rogers, Bell and Ottawa, all of whom note that as of today some 124 communities across the country — including Toronto — can get Rogers’ Portable Internet and Bell’s Sympatico Unplugged service.
“We’ve effectively gone from zero to [availability in] 6 million homes in just over 12 months, which is a huge deployment,” said Allen Hewett, general manager of Sympatico product management. Between cable, DSL and Inukshuk, almost 90 per cent of Canadian households have the capability of subscribing to broadband, he said.
“We’ve built almost 700 cell sites in three months, which is probably the fastest deployment of service that’s ever been done under wireless technology,” said David Robinson, vice-president of business implementation and a member of Inukshuk’s board. “I don’t know how anyone can say we haven’t deployed this aggressively.”
No easy path
The regulators blame the lengthy rollout in part to original licence holder Microcell’s financial troubles — eventually it was bought by Rogers — and international uncertainty over whether the 2.5 GHz band would be used for mobile as well as fixed WiMAX.
“We did not look away” and give Rogers and Bell an easy path, insists Heather Hall, Industry Canada’s manager of emerging networks. “We dealt with it in a rigorous fashion when the issues came before us.”
Both she and Peter Hill, the ministry’s director of spectrum management operations, repeated during an interview they are satisfied with Bell and Rogers’ performance.
So is Lawrence Surtees, vice-president of communications research at IDC Canada, who noted the wireless technology Inukshuk uses today isn’t even the one it started with.
The bigger question, he asks, is what will Bell and Rogers do with Inukshuk over the next two years when mobile WiMAX takes off: slowly adopt that technology, which challenges their other offerings, or embrace it?
For now, the partnership is cruising. Robinson, who admits he “had a heart palpitation” in 2005 when he learned long-time enemy Bell was buying a mere 25 per cent share of Inukshuk, says they work better than the four-headed monster of the past.
There’s a four-person board, two from each company, and unanimity is the rule. Inukshuk’s only goal is to build a network at the lowest cost, which is split evenly. They share each other’s towers, but each company does its own product marketing.
Communities to be served are chosen on whether there’s enough demand to make service pay. After the government-required list is finished, Robinson and Hewett expect Inukshuk will continue looking at new markets. At some point, Robinson notes, it will have to transition from a proprietary technology to an approved WiMax version.
As for the people outside Orillia and other areas too small for Inukshuk, Surtees says there's hope, noting that Primus Telecommunications is experimenting in Hamilton and Toronto with WiMAX.
