Canada’s utility sector may hold one of the keys to expanding connectivity to more Canadians via community hard-wired networks, a recent conference was told. While Canada has made great strides in its community fibre networks, there is much work yet to be done, according to key players in the utility industry. The United Telecom Council held its 2003 Canadian Utility Telecom Conference in Ottawa March 5-7. The first session of the parlay covered community-based networks.John Macdonald, recently appointed president/CEO of Hydro One Telecom Inc. (NL, March 11/03), praised the country’s success to date. He cited such accomplishments as the SchoolNet program, CA*net 4 and the Government On-Line program. But this is only a beginning and more needs to be done, he added. Macdonald presented figures from the National Broadband Task Force showing that 1,170 communities across the nation have broadband access versus 4,256 that do not. Most of the served regions, not surprisingly, are along the border and in larger urban areas. Nationally, 78.4% of communities do not have access to broadband (see table). All three levels of government are now in the midst of implementing some type of broadband strategy, Macdonald stated. Alberta is in the lead with its $193-million SuperNet project (NL, Nov. 19/02), while Ontario has allocated $55 million for Connect Ontario and a further $55 million for the Connect Ontario: Broadband Regional Access (COBRA) program (NL, March 11/03). Saskatchewan is spending $71 million on its CommunityNet project (NL, Apr. 9/01) and Connect Yukon will cost $17 million to wire 11 communities (NL, Dec. 20/00). Other provinces have smaller initiatives. In addition, the federal government has several regional programs such as FedNor, the Atlantic Canada Opportunities Agency and Western Economic Diversification. Macdonald touted the possibilities for utels in the COBRA project. The program provides up to $100,000 for development of a business plan for hard to serve areas and covers 50% of capital costs of infrastructure in underserved areas. The deadline for the first set of submissions was the beginning of March; the next deadline is June 2. As is the case for the federal government’s $105 million rural broadband pilot project, the eligibility requirements state that proposals must be led by not-for-profit groups or municipalities. Applications led by telecom service providers are ineligible. However, Macdonald points out that the ownership model of utels could confuse the issue. "Does Hydro One qualify as municipally-owned or as a telecom service provider?" he asked. The community network has evolved over the years, Ian Collins, president of Hamilton’s FibreWired Network, told delegates. Since the community market is finite, attention must be paid to customers who wish to connect to other areas. The easiest way for utels to make those interconnections is with neighbouring utilities, Collins explained. The companies probably have a pre-existing relationship, possibly including mutual customers. Different utility firms deploy the same technology and both sides have a desire to get the project done, he said. The utels will likely have a two-way business relationship with traditional telecom carriers, he noted. The carriers are increasingly requiring last mile access and find that utels are the most efficient partner to have to provide that access. On the other side of the coin, utels are discovering that they need to purchase services from the telcos. But carrier interconnects can be more complicated than utility-to-utility deals. The standards used for equipment will usually be the carriers’, not the utels’. Those standards are rarely flexible."You adapt your business and operational process to the carriers’ system," Collins asserted. One of the major hurdles involves credit risk. Utels end up signing two contracts – one with the carrier and one with the customer. The utilities need to align their service level agreements or they will introduce further risk, Collins stated. The telecom carrier is only worried about the credit worthiness of the utel, not the customer. If a client defaults on payment, the utility must still pay for the telecom services purchased from the telco, he added. "If the end-user is a credit risk, will come after you," Collins warned. Similarly, the utel is responsible for offering service to the customer, no matter what happens to the carrier. If a carrier cannot provide service for some reason, the utel receives the complaint, not the carrier. David Dobbin, executive VP of Telecom Ottawa, explained that the vast majority of community-based networks deploy fibre along their backbone. A few non-utility networks have used wireless technology but have failed. "Wireless can be a headache," he noted. A fibre drop to each consumer can be expensive and tends to make the overall business case more challenging. Trying to run fibre to remote areas makes the business case nearly impossible, he added.Dobbin suggested new technologies currently in development show some promise. The 802.11 wireless network standard is inexpensive. It currently only works on short range but that could change. The standard is seen as unreliable and unsecure. Still, Dobbin had muted praise for the system. "This is a technology to watch," he stated. Non-line-of-sight wireless works well in urban applications but is still considered expensive. But some utels are testing the technology.Dobbin was not as enthusiastic about power line communications (PLC) as many others at the conference were (NL, March 11/03). While it does use existing infrastructure and existing rights-of-way, PLC is still expensive, he noted. No standards have been set yet for PLC and significant regulatory hurdles hamper entry into the market, he added. The Telecom Ottawa executive also downplayed the business case for utels deploying DSL technology. DSL is being offered by telcos in competition with cable modems marketed by cablecos. Utilities providing a similar service would merely be replicating what others are doing, Dobbin said.