Maha Krishnapillai's APEC-Tel Diary - Canada sets new standard for industry review

May 2006 - This week has seen the release of another round of research – this time from IDC – which found significant room for improvement in broadband coverage, offerings and pricing in the Australian market.

It is timely then, that at APECTel, a case study was delivered which looked at a recent comprehensive review of the ICT sector in Canada.

Why is this relevant to Australia? The goal of the review was to harness the absolute centrality of ICT to the success of Canada's economy. This in turn ensures ICT policy becomes a central component of overall government objectives. To achieve this, the Review aimed to develop a set of recommendations that were largely politically neutral – that would survive regardless of the government in power.

More poignantly, the Canadian Review was born out of incumbent pressure to relax market regulation. It was also driven by the perception that the country was not experiencing productivity improvements that were expected from effective use of ICT.

Australia has undertaken independent reviews of single market segments at various points - ULL and broadband are two of the most recent examples. Not since Reports like the Davidson Report in the 1970s and 1980s however, has there been an in-depth study of the role ICT plays in our economy. Nor has there been a recent industry-wide review that has been driven by policy, not politics.

Aside from timing, what makes the Canadian Review even more impressive is the process by which it was undertaken and the breadth of consultation which occurred.

Human behaviour a key driver in technology take-up

Called the Telecommunications Review (www.telecomreview.ca), the process brought together three imminent leaders of Canada's ICT sector – including Dr Gerri Sinclair – to head a unit of 20 people.

The unit included staff from Canadian Radio and Telecommunications Commission (CRTC), the Spectrum Management Agency and the Canadian Competition Commission. They worked together to develop and implement a three-fold approach which was undertaken in parallel. This included:

1) Seeking submissions from all stakeholders including government departments, industry, influencer, consumers and business users

2) In-depth consultation with industry regulators, government policy makers and legislators in various jurisdictions, as well as both financial and ICT analysts

3) Independent analysis of international markets, which included benchmarking of specific global leaders including Korea, Japan and Hong Kong

The Canadian Review took a fresh approach which involved studying human behaviour and the impact this had on ICT uptake and policy development.

For example in Korea, it was found that the country's exceptionally high level of broadband uptake was not solely due to high density apartment living as is often suggested. Cultural and human behaviour issues were found to be key market drivers. The Review highlighted that incredible competition to excel scholastically was pushing parents to adopt broadband so their children would not be at a competitive disadvantage.

In parallel with the benchmarking, the Review undertook in-dept, two-way dialogue by way of two major participant forums or ‘think tanks'. These were conducted via web cast from regional centres with the goal of:

1) Engaging a broad pool of people across Canada, including regional participants

2) Experiencing first-hand the challenges of accessing and using technology in regional areas

The result of just over 12 months of intensive consultation and review was the development of more than 126 recommendations. These were based on key themes including:

• Consumer access
• Inclusive policies
• Broadband access
• ICT productivity
• Regional access to ICT

The recommendations also included the creation of a ‘Ministerial Council', made up of senior industry representatives, to drive outcomes of the review on an ongoing basis.

The 436 page report and all its recommendations now await the political process. It currently sits with the new Canadian Communications Minister who was appointed several weeks ago following a change of Federal Government.

Food for thought for Australia

The Canadian Review does however, remain food for thought for the Australian ICT sector.

Canada and Australia are remarkably similar on many levels: both have populations of about 20 million and are largely reliant on their resource economies. Both countries have an extremely large land mass with small, remote regional populations, and very high urbanised concentrations. One of the major differences between the two is that we have a lot of sand and Canada has a lot of ice – both of which pose unique challenges when it comes to the national roll-out of ICT infrastructure.

In many fields, Canada's success is attributed to its co-location with the US. Although there is little doubt this is a significant factor, I suspect it is also an over simplification. As the study of Korean broadband uptake identified, there are likely to be other drivers such as human behaviour or policy.

For example, the Canadian Review didn't explicitly target the ICT trade deficit – because it simply didn't need to. Unlike Australia, many Canadian ICT companies have made the leap to mid-to-large and indeed export level businesses – two examples include Blackberry RIM and Nortel. In the Australia however, the trade deficit is a key factor influencing the success of the local ICT sector.

If we were to translate the concept of the Canadian Review to this market we would clearly need to start from a different position. In Australia, recommendations for alternative policies or approaches which address both the trade deficit and the ‘brain drain' or skills shortage, would need to be a priority.

The Canadian Review is particularly impressive because of its ability to look forward, to project into the future. It looked at ICT issues outside of their immediate political environment and reviewed them in the context of broader economic development.

If Australia is to improve the coverage, pricing and availability of innovative ICT services, then this comprehensive, futurist approach is worthy of consideration.

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For more information:
Mandy Galmes
N2N Communications
02 9213 2302
agalmes@n2n.com.au

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