Bell conglomerate touts big northern telcom upgrade
BCE Inc. would give $40 million to Northwestel from Astral purchase benefits fund
The BCE Inc. media conglomerate, owner of Bell Canada and Northwestel, would use part of a “public benefits” fund as an essential component of a big, five-year telecommunications upgrade in all 96 communities served by Northwestel in northern Canada, Northwestel said July 3 in a proposal to the CRTC.
If the regulator approves the scheme, Northwestel, 100 per cent owned by BCE, would offer either 3G or 4G wireless service to residents of all communities within its service area.
And in 79 smaller communities, Northwestel would offer high-speed internet at 5 Mbps for downloads and 1 Mbps for uploads.
“Every northern community serviced by the company will join Southern Canada in being able to access HSI [high-speed internet] and with it a vast array of new-media broadcasting content,” Northwestel said in a July 3 application to the CRTC.
About $40 million would flow from BCE’s $3.4 billion purchase of the Astral Media Inc. empire, which owns numerous English- and French-language radio stations and television channels.
Under CRTC rules, BCE must set aside 10 per cent of the purchase price for a “public benefits” fund.
The Astral public benefits money would form an essential part of the $273 million, five-year Northwestel modernization plan.
“With the Astral funding component of the Modernization Plan, Northwestel will be in a position to deliver the same types and levels of services to remote northern communities as are now available in the largest urban markets in southern Canada,” Northwestel said in its July 3 proposal to the CRTC.
In remote communities not served by landlines, such as all communities in Nunavut, these improvements would be done through the purchase of more satellite capacity, Northwestel said.
The introduction of 3G and 4G wireless systems would allow the use of smart phones and tablet devices, such as those using Apple or Android operating systems, in every community in Nunavut, Northwest Territories and Yukon.
This, in turn, would transform the way northern Canada’s residents consume electronic media, Northwestel said.
“Consumers increasingly view broadcasting as a non-linear, interactive moveable feast, and expect to be able to watch the game or their favourite television series on their tablet or smartphone, whenever they want, whether in or out of the home.”
With its purchase of Astral, BCE, which already owns CTV, TSN and other television properties, will add HBO Canada, The Movie Network and numerous another TV channels and radio stations to its burgeoning media empire.
So it’s likely they’re eying northern Canada as a place to sell access to streaming wireless content from these acquisitions, through Northwestel.
Right now, only 26 of Northwestel’s 96 communities even enjoy basic CDMA cell phone service and only 16 enjoy access to 3G wireless.
To pay for its proposed upgrades, Northwestel would spend $233 million of its own capital money plus $40 million from the Astral benefits fund, which Northwestel said is “critical” to the plan’s success.
Northwestel also calculates that its customers would not face any rate increases under the plan
The proposal is a response to a stinging decision that the CRTC issued this past December.
In it, the CRTC said Northwestel “failed to make the necessary investments in its network as evidenced by the company’s aging infrastructure and the unavailability of services in many remote communities comparable to those provided in the rest of Canada.”
The CRTC also asked Northwestel to file a modernization plan within six months.
And they also instructed Northwestel to make preparations that would allow other firms to offer local voice telephone services within Northwestel’s service area.