Service providers disagree about who should get a subsidy for internet in the North

A Northwestel satellite dish in Kugaaruk, Nunavut, in 2020. (John Last/CBC)

By Jocelyn Shepel, RCI, CBC News

CRTC currently reviewing submissions and feedback about subsidy announced earlier this year

The CRTC says it’s still working to determine how it will roll out a planned subsidy program for northern internet customers — including how much it will be worth, and who or what should be eligible to receive it.

The commission announced the subsidy in January following a years-long consultation.

It found that given the high price of operating in the North, there wasn’t enough competition to keep northern internet prices in line with the rest of Canada. From 2021 to 2023, customers in northern communities paid an average of $72 more per month for internet, according to an annual pricing survey.

The CRTC asked for input on the planned subsidy and received submissions from service providers, community centres, and customers.

One point of contention among service providers is whether the subsidy should be available to Starlink customers.

In its submission to the CRTC, Starlink owner SpaceX argues that the commission “should apply its subsidy based on location, and without regard for the characteristics of the individual customer,” and also suggested a one-time hardware cost subsidy as well.

However, Bell Canada and Northwestel Inc., in a joint submission to the CRTC, say the subsidy should not be given to Starlink customers because that company offers national pricing. Otherwise, they argue, “it will produce the perverse result that subscribers in the Far North will have less expensive service than equivalent subscribers in southern Canada.”

Marc Coulombe lives just outside Yellowknife on the Ingraham trail. He says his internet options are slim, and that it’s either Starlink or unreliable data plans from Bell.

“What else do we have? How do you keep Canadians connected?” said Coulombe.

Coulombe believes Starlink users in the North should get the proposed subsidy.

“You’re caught between a rock and a hard place. And for me, I would strongly support some form of subsidy for Canadians who can show they have no alternative,” said Coulombe.

Starlink argues that satellites that serve the North are under-utilized compared to satellites serving more southern latitudes. It also notes that not including new competition in the subsidy would further the problem the CRTC is looking to solve.

How much should the subsidy be?

The CRTC consultations are also focused on how much the subsidy should be worth.

The N.W.T. government supports either an overall $55 monthly subsidy, or a $45 subsidy for those who have options aside from satellite and $70 for communities that are satellite-dependent.

Telus proposes a $10 monthly subsidy, while Bell Canada and Northwestel support a subsidy of $25 or less a month for northerners.

“A $25 subsidy is a meaningful amount of money for consumers in the Far North, and, importantly, it is at or above the price of all but one retail residential Internet plan currently being offered to the general public in the Far North,” wrote Bell Canada and Northwestel.

Ron Knowling is a resident of Baker Lake, Nunavut. He said Starlink is the best option in his remote community but it’s still pricey for many, at around $150 per month.

“If the Canadian government wants to build communities in the North that have capacity, that are self-sufficient, that are vibrant cultural living places, then northerners have to have access to reasonably-priced internet,” said Knowling.

Knowling thinks the subsidy could benefit residents but he also says it doesn’t address the wider issue of a northern digital divide.

“Many people just don’t have the money,” said Knowling.

In a written submission to the CRTC, he also said that community institutions and non-profits should be eligible for the subsidy, as it could allow them to improve internet access for people who don’t have it at home.

Telus proposes that community centres and schools not be included in the subsidy because it would be a “redistribution scheme,” and because those facilities already receive funding through taxes. Bell Canada and Northwestel also agreed with that stance.

Eligible communities in territories, B.C. and Alberta

The CRTC states that for the proposed subsidy, it defines the “Far North’” as including the three territories, as well as 19 communities in northern B.C., and Fort Fitzgerald and High Level in Alberta.

One of the B.C. communities included in the consultation is Fort St. John.

Richard Schlosser lives in Fort St. John and he lived in Yellowknife for a while when he was younger. He said he was a bit shocked to see Fort St. John included alongside northern communities, and says offering a subsidy there would be a “waste” of money.

He said he pays around $80 each month for internet service through Telus and that they have access to fibre internet.

“I’m assuming that I’m paying basically the same price you’d pay if you lived in Maple Ridge or in Kelowna [B.C.],” he said.

The CRTC has not said when it will announce its decisions about the subsidy, including how much it will be, who is eligible, and when it will be implemented.

The commission says it is “working quickly to analyze the submissions to the public consultation to inform a decision.”

This article is republished from RCI.