Service providers yearn for deregulation

Some form of deregulation should be brought into the Canadian telecommunications marketplace to ensure a competitive environment, according to a panel of executives and representatives from various Canadian service providers.

Executives took the stage during the Communications 2001 show in Toronto earlier this month for a session entitled The Future of the Internet. The discussion included what the participants are hearing from their customers, as well as what types of services each company intends to bring to the marketplace in the near future. But the topic of deregulation and foreign ownership was also brought to the table, one which seemed to strike a nerve with the speakers.

The Canadian CLEC market has taken a beating over the last year, with several smaller companies having to shut their doors and others finding themselves in financial turmoil. Competition issues have also been making the news in the telecom world, with some companies pointing the finger at the bigger, more expansive ILECs. A sore spot with many telecom companies is the existing need to have to go to ILECs for things such as access to their lines in order to offer services to their customers.

“Why would we want to keep having to do business with our competitors?” asked J. Tal Bevan, president of WorldCom Canada.

Steven Koles, senior vice-president of sales and marketing at Group Telecom Inc., agreed, and reiterated what he told Network World Canada in an interview earlier this month – that there has to be a level playing field for all competitors. (See “Broadband a challenge…”, Nov. 2, 2001, page 1.)

“Certainly there have been issues in start-up competitors trying to compete with the ILECs by using their facilities to compete with them,” Koles noted. “The analogy is someone who is trying to compete with Loblaws, but they have to lease shelf space from Loblaws to compete with them. It is a very difficult business model to make work.”

Bevan said he believes there are several key benefits to deregulation in the Canadian telecom market. The first is that more competition would be created, which would in turn mean pricing would drop for customers. Another benefit he cited is that more money could be brought into the country. And finally, he said companies such as Bell Canada and Telus Corp. will eventually expand out of the country – and if they do that, it would be hypocritical to not allow foreign investment money into Canada.

But, deregulation aside, there are other issues facing some telecom companies.

“We have a fibre highway with no on-ramps,” said Tom Copeland, president and CEO of, a Cobourg, Ont. ISP. He added that while there might be existing fibre in the ground, that doesn’t mean everyone has access to it. In fact, he recounted a story about one of his customers – a school – which his company hooked up via wireless to get service. The main reason behind the move was that the wireless solution was actually cheaper than any other alternative.

While costs are obviously taking priority in the minds of customers, the panellists said that security is as well. Koles noted that he sees customers getting to the point where they don’t want to have to train people anymore, so they are looking to outsource, while Bevan said he is just starting to see questions about security. A lot more people have recently been jumping on board the e-mail bandwagon as well, he noted, due to fears of using the public mail system.

Other technologies the executives said they are seeing more demand for include virtual private networks, peer-to-peer technologies and instant messaging.

“We’re looking at the future of two-way applications, whether that be voice or video, or any other real-time app,” Koles said.

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Jim Love, Chief Content Officer, IT World Canada

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