SSI: Northwestel broadband proposal “half-cocked”

The SSI Group is asking the CRTC to veto a Northwestel proposal to build 3G/4G wireless broadband services for consumers in Northern Canada. SSI pounted out that Northwestel will be using a public benefits fund to fund said project.

Back in July, Northwestel presented a plan to the CRTC where the Canadian communications company would use $40 million from a “public benefits” fund. The money for that fund would come from Northwestel's parent company, BCE Inc., which also owns Bell Canada.

BEC was proposing to purchase the Astral Media Inc. telecommunications empire for $3.4 billion. CRTC rules specified that BCE needed to create a “public benefits” fund using 10 per cent of the Astral Media purchase price. The public benefits fund would pay for things the free market cannot normally supply.

The SSI Group is a competitor of Northwestel. SSI offers Qiniq, an Internet by satellite and wireless service, in Nunavut. It plans to offer VoIP services to Nunavut in the future. SSI also provides the similar Airware Internet network service in the Northwest Territories.

Earlier this September, SSI accused Northwestel of planning to use the $40 million not for the benefit of the public, but for Northwestel's own benefit and that of Bell Canada.

Dean Proctor, chief development officer of SSI, pointed out to Nunatsiaq News in an interview that it would be unfair for the largest market player to strengthen its assets in the market using money set aside from the public good.

Northwestel told the CRTC that it would use the Astral benefit funds from BCE to help pay for a five-year modernization plan with a $273 million price tag.

Northwestel's plan is to offer either 3G or 4G wireless service to the 96 communities and three territories its serves. Northwestel customers will be able to use Apple or Android OS-powered smart phones and tablet devices.

The plan will also allow Northwestel to bring broadband Internet to 79 under-served communities. Its wireless broadband services will reportedly be capable of download speeds of at least 5 Mps.

SSI countered that BCE and Northwestel have not proven that residents of Northern Canada will be able to afford 3G/4G wireless and broadband Internet services. Calling the Northwestel proposal “half-cocked,” Mr. Proctor said that the real issue in Northern Canada is the cost of satellite transponder space.

Mr. Dean Proctor cited SSI's wireless modems used by Qiniq customers in Nunavut as an example. Those modems can offer up to 6 Mbps in terms of combined download and upload speeds. However, Mr. Proctor noted that Qiniq customers simply could not afford using wireles and satellite broadband for extended periods of time. Customers would likewise find Northwestel's planned services too expensive.

He also pointed out that Bell's proposal did not indicate how it would make satellite costs more affordable. “They don’t have a solution for it,” Mr. Proctor said.

Mr. Proctor likewise scoffed at Northwestel’s 4G plan. Again citing SSI’s existing wireless network service -which Proctor says can provide speeds comparable to 4G,- he says that Nunavut customers will only be able to pay for such services through subsidies provided by the government. According to Mr. Proctor, Bell should instead design an entirely new system.

Finally, Mr. Proctor pointed out that public benefits funds are normally used to pay for things like the production of independent television.