Broadband Background

The Regional Imperative: To prosper is to compete; to compete is to connect

Southwestern Ontario, once the economic engine of Canada, has lost thousands of well-paying jobs over the past five years as the region's economy (the manufacturing sector in particular) reacts to and retools in the face of competitive global economic forces. Many communities across the region are in economic decline. The situation is particularly stark in many small towns and rural communities across the region in which families and youth are being forced to migrate to other regions and larger urban centres in search of jobs and livelihoods. As a consequence, once vibrant and proud communities are being “hollowed out” not only economically but socially: as local commerce disappears; school enrollment plummets, forcing closures; community services are withdrawn; and, social activities and organizations that once defined the essence of community spirit are shuttered. At the same time, social ills such as poverty, homelessness, alcohol abuse and illicit drug use are increasing at worrisome rates.

In order for communities in the Southwest region to remain viable and indeed prosper in today's global economy they must compete for investment on the global stage and have the tools to grow their economies from within. The WOWC understands that the availability of low cost high capacity Internet-based services is the tool that is enabling ever faster transmission of information (voice, data and video), fueling an unprecedented revolution in how we all live, work and play. Unfortunately, the infrastructure to enable this revolution for businesses and residents in the Southwest region either does not exist or is not equitably affordable versus our more urbanized peers in the Greater Toronto region.

Location and natural resources, once the determinants of economic potential and community prosperity and long the competitive advantage for many Southwestern communities, are no longer relevant in the new global economic order. Rather, it is the ability of business and government to adapt and innovate, the skills and creativity of the local labour force, and the availability of high capacity broadband access to the Internet that now power wealth creation, entrepreneurial activity, new jobs and community prosperity. The demand for faster more robust internet service is increasing dramatically as more and more people become aware of and reliant on Internet-based services and information, particularly video on demand. Continued innovations in e-health, e-government and e-commerce and entertainment serve to extend the societal reach of and dependence on the Internet. The figure below illustrates this point.

Internat Applications

Innovation, skills and adaptability abound in the people of Southwestern Ontario; high capacity broadband access to the internet, less so. With the exception of a few urban centres, the Southwest region is lagging far behind other parts of the Province and indeed many regions of the developed and developing world in availability of and access to high capacity broadband. This is especially true of many small towns and most rural communities within the Southwest region. Without access to competitively robust broadband infrastructure a return to prosperity will elude many communities across the region.

Why the Urgency

Results from numerous studies worldwide consistently show that communities and regions that invest in and embrace high capacity broadband communications and information technologies achieve above average rates of economic growth, job creation, social diversification and environmental innovation. As a result, many countries, U.S. states, Canadian provinces and cities are investing heavily in broadband infrastructure as the backbone of their economic development strategies. Australia for example is developing a nation-wide fibre network that will bring at least 100 Megabit per second broadband service to 98% of the population, including remote outback communities, within a few short years.

Alberta is building a province-wide fibre optic network to encourage greater private and public sector access to the Internet with the aim of spurring on greater levels of innovation and investment.

Nations in Europe and Southeast Asia are providing or planning upwards of 1 Gigabit per second service.

Kansas City is piloting an ultra-high speed fibre-to-the-home network that brings 1 Gigabit per second service to connected homes and internet startup businesses for $70 per month.

Closer to home, the cities of Waterloo and Stratford have achieved enviable results in economic development through the implementation of broadband strategies, such that both communities have been recognized by the Intelligent Community Forum, a New York based broadband think-tank, as two of a handful of “Intelligent Communities” world-wide. In both instances, scalable, broadband infrastructure was fundamental to this ICF designation.

Canada as a whole, on the other hand, has some of the poorest high-speed Internet service in the developed world with download/upload speeds 100 to 1000 times slower than 20 major competitors. According to International Telecommunications Union (ITU) our nation is ranked:

  • 32nd among world nations for consumer internet download speeds
  • 22nd out of 30 countries in broadband adoption, network capacity and pricing
  • 16th in broadband adoption

A few short years ago the Canadian Radio and Telecommunications Commission (CRTC) stated that it expected all Canadians to have access to broadband speeds of at least 5 megabits per second (Mbps) for downloads and 1 Mbps for uploads by 2015; a lowly goal by today's international broadband standards. Yet, many small towns and rural communities in Southwestern Ontario do not even approach that threshold. Broadband download speeds in much of rural Southwestern Ontario approach at best 1.5 megabits/second (where available). Upload speeds, and symmetrical bandwidth flow (upload/download), which is a key to entrepreneurial and business applications functionality, are agonizingly slower. At these very slow speeds rural communities are at a decided disadvantage in attracting investment, achieving entrepreneurial innovation, generating wealth, creating jobs and becoming prosperous.

In the global market place companies and entrepreneurs seek to locate their facilities and base of operations where they can gain the greatest advantage in terms of costs, skilled labour and access to markets. Communities without high capacity broadband cannot even begin to compete and cannot expect to flourish. Potential investors will just pass them by in favour of a better connected community, region or country. Starts-up businesses in rural areas are often forced to relocate to urban centres where broadband infrastructure exists that will scale as their businesses grow.

So, What Does Broadband Connectivity Look Like?

Worldwide experience shows that the extension of broadband to as much of the population as possible reaps significant and measurable economic and social benefits. Communities that embrace high capacity broadband are rewarded with many of following outcomes and attributes (as reported by the Intelligent Community Forum):

  • Ready access to the best available interactive and diagnostic health, learning and training, and business development services, without leaving the community
  • Strong private sector investment as a result of the unparalleled quality of place and advanced low cost open access ultra-broadband communications that support an array of talent working in an environment conducive to collaboration and innovation
  • Open access ultra-broadband infrastructure that facilitates new health caregiver support systems that dramatically expand support for patients with cancer, diabetes and other debilitating ailments
  • Enhanced caregiver supports to facilitate aging with dignity in the home, yielding lower health care costs per capita and a higher quality of life
  • Intelligent buildings, smart grid and other environmental initiatives that reduce the carbon footprint of communities
  • New forms of tele-presence collaboration that stimulate collaborative research, innovation, the creation of new young companies and improved competitiveness of others
  • Intelligent transportation with reduced environmental impacts, improved service, shorter travel times and fewer accidents
  • Educators providing more engaging and interactive learning experiences to meet the diverse needs of learners; Distance learning is made possible
  • Advanced forms of entertainment and information services connected to community home entertainment centres presenting new ways to watch hundreds of cultural, sporting, news and other events
  • Businesses collaborating with the arts and cultural communities to define new frontiers in digital media thanks to a competitive blend of creativity and technology that produces new products, services, investments, international trade and employment opportunities

Making the Business Case for Regional Broadband

If Southwestern Ontario is to be relevant on the global stage and enjoy sustained prosperity, it urgently requires an economic action plan that will make the region top of mind as a preferred destination for business investment. The WOWC recognizes that for such a plan to be effective it must be ignited by government investment in community infrastructure including, as a priority, widely available, affordable high capacity broadband access to the internet.

This requires a dramatic shift in mindset among community and government decision makers at all levels and a refocusing of government infrastructure policy and funding mechanisms. Unfortunately in Ontario today there is no specific upper level government funding earmarked to assist communities in making high capacity broadband available and affordable to all people and businesses within Southwestern Ontario since the 4 year Rural Connections Program administered by OMAFRA concluded.

Prosperous communities are built on sound capital infrastructure. Roads, bridges, culverts, sewer and water lines, natural gas and electricity have been and continue to be essential elements of community infrastructure programs that require upper level government support. We are heartened by the Premier's throne speech on February 19th that noted the need for infrastructure investments as a foundation for economic productivity and quality of life.

The WOWC is asking the Province to also include broadband on the list of essential infrastructure investments and to dedicate as a priority substantial funds towards the extension of broadband infrastructure in the Southwest region over the next five years.

The cost of broadband, relative to other community infrastructure, is inexpensive. The figure on the following page shows that reconstructing a major paved road can cost upwards of $500,000 per kilometer, whereas the per kilometer cost for installing fibre optic wire is in the order of $25,000.

Cost of Infrastructure