If you’re under 30, you can start laughing now. I am about to describe a world that for you will appear unimaginably primitive. From a technological point of view, it will feel like a science fiction account of life after the fall of civilization. In reality, though, it is just going to be a description of how we had to talk to each other when I was growing up.
We had two black rotary dial phones in our house. Black was the only colour available. One of the phones had a huge clunky plug with four prongs on the end of it that allowed it to be moved between two rooms that had the corresponding wall plug. None of my friends had ever seen a phone whose cord wasn’t fixed in the wall. There was only one telephone company.
The FM band on the radio was an exotic one inhabited by few stations because signal quality was poor. Colour televisions were the exception, and we had access to about 4 stations. A new technological innovation, cable, improved reception and increased the number of channels to about 10 — about all there was room for on the dial.
There was no 500 channel universe, no e-mail or voicemail, no mobile phones or pagers, no satellite TV or radio, no text messaging, no internet.
In less than 40 years, everything I have described has been radically transformed. Our increasing ability to talk to each other is perhaps what defines our age. Children today are outraged if their parents don’t give them a cell phone. Half the people in meetings are not listening to the speaker because they are checking their e-mail. Previously separate technologies are converging as you can increasingly get video over your mobile, television from your telephone company and telephone service from your cable provider.
The riotous world of telecommunications has never offered more choice, more providers, or more means of communicating with people anywhere in the world at prices that are almost token given the speed and reach of the service.
But government in Canada has not kept up with this revolution, and this is having increasingly harmful effects on our standard of living, as our investment in new technologies fails to keep pace with that of our international competitors.
Consider, for example, the question of telecommunications spectrum. All our wireless technologies, such as mobile phones, Blackberries and broadband access for computers and other devices, use a slice of the electromagnetic spectrum, just like radio waves. Having guaranteed access to a piece of spectrum is just as important to these technologies as having paper is to this newspaper.
In the old days, though, governments owned the spectrum and gave licences to users for a very specifically assigned frequency, a licence that could be revoked or changed more or less at the government’s whim.
That old mentality was justified in part because spectrum appeared very scarce. No more. Technology is able to put ever greater amounts of data down ever narrower slices of the spectrum. Soon several users will be able to occupy the same spectrum while keeping their signals distinct. The need for heavy-handed government control has gone.
For companies to make the kind of investment that the new wireless technologies require, they need to know they have secure access to a piece of the spectrum and they will be free from arbitrary government interference. The solution, as proposed by Ottawa’s excellent Telecommunications Policy Review Panel, is to allow companies to buy, own and trade that spectrum so it is constantly being shifted to the highest value uses for the consumer. Such stable property rights, together with freer access to foreign capital, will likely unlock a torrent of investment in new technologies.
The Panel proposes a similar modernization of telecoms regulation. The days of the old monopoly telephone company are long gone, especially in urban areas. Cable companies compete with the old monopolists in the land line business, and consumers can use cellular service from competing providers and increasingly voice-over-Internet as well. But our regulators still assume that we need to be protected from predatory dominant providers, even in markets where competition clearly has carried the day. The Panel recommends that we reverse the onus of proof. Regulation would only apply where there is evidence of abuse according to the usual standards of competition law.
Such policy changes would help to bring Canada in line with many of its competitors, who have moved more aggressively to modernize their approach to telecommunications. Our standard of living is immeasurably higher in Canada because of the changes we have already allowed to occur. If we want our children to see improvement on the same scale, we need to take the Panel’s advice and get our regulatory approach out of the black rotary phone era.
Brian Lee Crowley is president of the Atlantic Institute for Market Studies (www.aims.ca), a public policy think tank in Halifax. E-mail: [email protected]