HomeBusinessRogers outage points to need for greater oversight of critical industry

Rogers outage points to need for greater oversight of critical industry

The massive Rogers Communications outage last Friday that prevented many Canadians from accessing crucial services demonstrates the need to better regulate the country’s telecommunications sector, experts say. 

On Monday, Industry Minister François-Philippe Champagne called a meeting of telecom CEOs, including Rogers’ Tony Staffieri, to talk about ways to prevent similar service disruptions in the future. 

Champagne said he wants to see the companies create a plan within 60 days for mitigating the impact of future outages on consumers that includes providing emergency roaming. 

But experts say the issues facing the industry go beyond a quick fix. 

The outage halted basic communication and internet access, stopped financial payments and in some cases blocked people from making emergency calls, underscoring the essential role of internet providers.

“The fact that we can have one provider go down and knock off so much of our internet, really, I think raises significant questions about how we approach internet regulation, given it’s more and more critical capacity in our everyday lives,” said Fenwick McKelvey, an associate professor of communications at Concordia University and an expert in telecommunications policy. 

On Monday, Industry Minister François-Philippe Champagne called a meeting of telecom CEOs, including Rogers’ Tony Staffieri. Champagne said he wants them to create a plan within 60 days to mitigate future outages. (Justin Tang/The Canadian Press)

Concentrated ownership

Five companies — Rogers, along with Bell, Shaw, Telus and Videotron — account for 90 per cent of Canada’s telecommunications market. (Rogers and Shaw are in the middle of a proposed $26-billion merger but face questions from the Competition Bureau).

Part of the challenge in Canada is that these companies own many of the steps along the supply chain, McKelvey said.

“Rogers is both infrastructure provider in the sense that it owns or leases the lines,” he said. “It’s the one that has exclusive access to that critical backbone and is the one that exclusively administers that and sells it.”

McKelvey suggests making the infrastructure a public utility, which has been done in Australia, and then opening up greater competition between companies for cell phone contracts and other services.

“We’re talking about something which is so foundational to the very operation of society,” McKelvey said. “I think what we lack now is an imagination about different ways of administering and running the internet.” 

Dwayne Winseck, a communications professor at Carleton University and the director of the Canadian Media Concentration Research Project, said increased competition among service providers could help bring down the cost for consumers. 

But that alone wouldn’t address the infrastructure problem that led to the outage, Winseck said. Given the high cost of setting up the cables and towers, additional competition likely wouldn’t lead to more reliable networks. 

“What you would have is competitors buying the most lucrative markets and shaving costs at the margins,” he said. “In those margins would include accepting higher levels of risk for breakdowns and so on.”

It’s imperative, Winseck said, that the federal government and the Canadian Radio-television and Telecommunications Commission (CRTC) better regulate telecom companies. 

“We’ve got a small number of players in what we can call a tight oligopolistic market – basically a market with very few players,” he said.

Ottawa needs to be more aggressive, expert says

Rogers has yet to offer details on what caused the outage, blaming a network system failure following a maintenance update. 

Champagne said the CRTC will launch an investigation into the outage. In a statement issued to CBC on Monday, the independent body didn’t confirm plans to investigate.

Following Monday’s meeting, Staffieri said he welcomed Champagne’s suggestions and added that Rogers would work with other companies to bring the plan into action.

“We are united in our commitment to ensuring strong, reliable wireless and internet connections that meet the high standards Canadians expect,” Staffieri said in a statement.

WATCH | Inquiry into Rogers outage needed, says consumer group

Consumer group asks telecom watchdog for inquiry into Rogers outage

John Lawford, executive director of the Public Interest Advocacy Centre, has requested the Canadian Radio-television and Telecommunications Commission (CRTC) hold an inquiry into Rogers’ nationwide outage and set new rules for all telecom providers.

Dr. Michael Geist, a law professor at the University of Ottawa and an expert in internet regulation, said the first step should be to determine exactly what led to the outage. 

The breadth of the impact — from downed Interac machines to blocked 911 calls —  demonstrates that many sectors and the federal government were ill prepared to deal with such a situation, Geist said.

He said the government needs to put in place standardized compensation and rights for consumers affected by such an outage, as was done with airline travel in 2019.

Geist said the next CRTC chair appointed by the government should be focused on more rigorous oversight of the industry. The five-year term of the current chair, Ian Scott, is set to end later this year.

“There’s been frustration with the government that it hasn’t been inclined over the last number of years to adopt a particular combative approach to the telecom providers,” Geist said. “I think that Canadians are going to be looking to the government to take on a more aggressive, serious tone, recognizing the seriousness of a situation when you can literally lose connectivity for millions of Canadians.”



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