(Please note that an abridged version of this column appears in the print version of Canadian NEW MEDIA)If you follow the public policy circuit these days, you will notice that there is a new issue beginning to attract attention; universality of access to advanced services or the digital divide. Bill Clinton took time out to meet with opinion leaders to assess the digital divide, its moving up the charts at both Canadian Heritage and Industry Canada, and has been put on the table as part of the Senate's study of the communications industry. The problems with worrying about a digital divide or perceiving it as an access issue are many. First, the concept of a digital divide seems to suggest that there are significant structural barriers to the adoption or diffusion of new technologies. That's not proven. Second, the phrase universality of access is a loaded phrase that conjures up the myth of affordability of communications services and requirements for social subsidies to maintain service. And third, these terms put the new economy in the negative, focussing policy makers on problems that may never arise rather than on the enabling opportunities arising out of the integration of technology and communications.DiffusionCanadians are adopting new technology at unprecedented rates: Over 43% of Canadian households had access to the Internet at the beginning of the year; closer to 50% outside of Quebec. That's not universal, but consider that from the inception of browsers, the Internet has diffused more quickly than PCs, radio, television, telephone, autos or electricity -- and the diffusion of the Net continues to ramp up. 30% of Canadians are anticipated to have broadband access by 2003 -- a faster diffusion rate than the Internet or PCs. more than one-half of Canadian households have PCs and as many as two-thirds of Canadians have access to PCs at home, school or at the office. CostThe cost of communications or technology does not appear to present a significant barrier to access. We already have universally accessible and affordable access to telephone service, a CRTC policy supporting toll-free calling to the Net and free ISP services available -- so basic access to the Internet is not an issue. Broadband access is more expensive, but diffusing rapidly and, with the arrival of satellite and wireless forms of Internet access, will soon be ubiquitous. While projections of broadband access tend to plateau near 50% over the next five years, that may have as much to do with perceived utility as cost. You don't need big pipes if all you want is e-mail and not video streaming. Finally, while the cost of PCs may be considered as a barrier to low-income families, costs have declined significantly and continue to decline; refurbished Pentiums can be acquired for $300 or less. The myth of affordability Over the past 15 years, issues of affordability and the "social subsidy" have driven the public policy debate often with unfortunate consequences. Concerns about affordability first delayed the introduction of competition and rate restructuring, and now distort competitive markets as a consequence of the structural effects of contribution requirements. the current freeze on contribution has resulted in a faster decline in local business rates under the price cap regime, and reduced opportunities to enter the local telephone market contribution requirements entrench artificial distinctions between local and long distance services contribution requirements distort competitive markets by forcing redundant interconnection arrangements on CLECs; and proposed contribution mechanisms threaten to increase costs for new wireless and internet services The irony of all of this is that it has never been established that a large subsidy is actually required to maintain affordable telephone service. The sky didn't fall as a result of competition; rather as predicted competition drove costs out of the telephone utilities. Rate rebalancing and rate group compression did not drive down penetration so why did we have to freeze contribution? If affordability is really a concern, why are low-income subscribers in some locations paying $15 a month for service while in other locations they pay $25 or $30? The arrival of competition and rebalancing has not undermined universal access, yet we've paid a big cost in terms of efficiency and innovation by restricting and distorting competition in pursuit of a goal we never defined. We have the opportunity not to make the same mistake again. Issues to consider Some of the impetus about a digital divide may arise from government itself. Government has committed to go online to connect Canadians and reduce costs. But, government is not going to reap substantial savings until online service can fully replace bricks and mortar services. Government needs universal access to the Net to complete its agenda. A universally accessible telephone service already permits ubiquitous access online; it's the PCs that are missing. Cost is becoming less of a barrier to diffusion of PCs. Rather computer literacy and perceived value are more likely to keep folks off line. Face it, there is a large number of people out there who don't care or just see no need to get on-line. Those not on-line are almost as likely to be among those at the top of the income range as at the bottom. It is too early given the diffusion of high-speed services to consider subsidizing their use. Currently, a majority of Net users go online for mail, chat groups and other low speed applications. There is no evidence yet to suggest high-speed service has any of the attributes of an essential service. Before we identify access to advanced services as a problem, we need a lot more information about who uses the Internet and why. Clearly, the young are more connected than the old -- time will close that divide. The greatest potential problem is that a higher percentage of low income Canadians may miss out on the benefits of new technology. Maybe, maybe not, but if it's an income issue, it's not caused by the availability of technology but by larger economic problems like regional disparities and lack of the necessary skills; problems that may ultimately be resolved by computer literacy and the death of distance. E-commerce and virtual communities provide solutions to regional disparities not barriers -- and the infrastructure is already available at low cost. Access to the Internet is cheaper in Canada than in any other G7 country. Computer literacy and the creation of E-commerce opportunities should be the goal of government, not the promotion of unnecessary communications subsidies. In our recent CCTA report ETV, The Integration of Commerce and Culture, we suggest that the success of the new economy in Canada is dependent on the willingness of Canadian enterprises to take greater risk. However, we also suggest government must contribute to the success of the new economy by creating the right incentives to integrate, to start-up and invest in new enterprises, to encourage capital accumulation and financially reward risk taking through positive taxation measures. The connection of schools and community access points in Canada, the development of computer literacy programs and government on-line are positive initiatives that complement market forces. The creation of unnecessary or excessive subsidies is not. Let's make sure we better understand the scope of the digital divide before jumping to conclusions. Michael Hennessy is Senior VP Policy and Planning at the CCTA in Ottawa.