Lower Internet rates


Sarah Thomson will gain lower Internet rates with the goal to having  Free High-Speed (5Mbps) Internet in Toronto

JUNE 17, 2014

Toronto must encourage the strong entrepreneurial spirit of our city’s creative educated population. Our city has the third lowest GDP in North America and it continues to fall.  Gridlock is cutting into our productivity while the cost of living rises and people across the city are finding it hard to make ends meet. From a municipal perspective we are in a crisis, with estimates for loss of productivity hovering around $6 Billion per year, businesses are opting for other cities as our talent slowly leaves for greener pastures.

Ward 20 candidate Sarah Thomson will work to lower internet rates with a vision to have Free High Speed Internet (5Mbps download, 1MBS upload) for all residents and businesses across Toronto.

Key facts 

 Toronto pays some of the highest rates for high-speed Internet in the world with Rogers and Bell cornering the market on service delivery.

• Access ownership gives Toronto a unique negotiation position to capture either higher rents from our large Internet Service Providers or free basic high-speed access.

• Sarah Thomson will make sure that High-speed Internet service is free and treated as a utility (set up fees will be jointly negotiated).

• Sarah Thomson will stand firm in negotiations with the large Internet Service Providers and encourage them to lower their rates and eventually deliver free high-speed Internet to Toronto, in turn allowing them access to up-sell other features and advertising opportunities.

Sarah Thomson points out, “The gap between rich and poor has widened due to the lack of political leadership at city hall. My Tunnel Toronto plan to put 6 priority transit lines underground will help stop the growth of gridlock and bring approximately 450,000 new jobs to Toronto. Aside from transportation, more is needed and that is why I believe Toronto should try to provide free Internet to its residents.

Toronto already has fibre optic channels blanketing the city, but the cost of Internet to households can run well over $670/year from the large Internet Service Providers (ISPs).  The people of Toronto pay some of the highest rates for Internet in the world. My administration will  stand up for a fair value of the access ISPs receive and work with our large Internet providers to provide lower rates and work to gain free access for all residents.”

Real Ideas

• Basic high speed (5Mbps) Internet service must be treated as a utility; Toronto has two clear options: to create the service through the municipal government or to work with current service providers who already have the skill, connections and systems in place. My first choice is to work with our current providers, and negotiate provisions that will enable them to provide lower rates and eventually free basic high speed Internet (5Mbps) service across the city in return for up-sell opportunities and advertising opportunities.

• Toronto owns the rights of way access – or underground conduits – that are currently leased to our Internet Service Providers and we must recognize the true value of this access. We must stop giving it away so cheaply. This is an opportunity for all of Toronto and a chance for our large corporate Internet companies to serve the city.

• Increasing Internet speed will increase Toronto’s GDP. Studies have shown an increase of .3% annually. (http://www.policymic.com/articles/66891/57-cities-now-have-free-wi-fi-but-they-re-not-thinking-big-enough)

Real Solutions

• Lowering the cost of internet and creating a free high-speed Internet city will save residents approximately $670 per year for high speed Internet.

• There are two strategies Toronto can implement to provide free basic high speed (5Mbps) service:

1. Collaborate. Public-private collaboration will capitalize on physical access opportunities and streamline the wasteful duplications now burdening our networks. Toronto must work with our current ISPs who use our right of way access to service their customers and insist on lower rates with the goal to providing free basic high speed Internet in return for the access they now receive for a pittance of what it is worth.

2. Build. If service providers refuse to work with Toronto in the above scenario we will build our own system. The cost of expanding our fibre optic cable network will be approximately 210,000 million. Toronto covers 630 square kilometers (cost based on 6 km sq. that was fully wired through Toronto Hydro’s one zone at the approximate cost of 2 million). The goal is to cover this cost by selling advertising rights for fixed time period, however this would be a last resort only.

• Partner ISPs will have the opportunity to up-sell other services (phone, data etc) and recapture at fair market value the cost of new equipment.

Real Change

• Toronto residents will save approximately $60 per month or $670 per year on high-speed Internet costs.

 • Toronto will be a connected city that enables our entrepreneurs and innovators. We will invest in our people and work cohesively with our large service providers to build a strong open data city.

• Toronto will move from having the highest priced high-speed Internet service to the lowest with the goal of it being completely free (basic high-speed service).

• By investing in our physical capacity to bring high-speed through fibre optic cable and working with our service providers, we will create a connected city that will help to increase our productivity.

• Investment today will give Toronto, our children and grandchildren, a better chance to compete as a global city.

Background Information

In 1997 Toronto Hydro launched a Wi-Fi service – The One Zone – with over six square kilometers of service a of service  ot the cost of just $2 million. They earned back every penny within 3 years through leasing space to private Internet Service Providers.  The One Zone offered free Wi-Fi to the downtown core for 6 months. It was sold to Cogeco in 2006 for $200 million.

Around the globe cities are offering free wireless in their downtown areas, but many lack the speed that private Internet providers offer. The key to having free Internet is the quality and speed that is offered.

Statistical References

http://www.canada.com/topics/news/national/story.html?id=d43b8b28-349a-4d47-822f-b68ffaa78d8c

http://www.cupe.on.ca/d390/public-utility-toronto-hydro

http://www.theglobeandmail.com/technology/getting-on-the-wifi-game/article4194435/?page=all

http://cwirp.ca/files/CWIRP_OneZone_v2.pdf (Study on Toronto hydro wireless)

Real Ideas. Real Solutions. Real change.

#4Real