Bridging the Digital Divide and Building Resilience: A Perspective on Canada’s Telecom Sector
By Ted Woodhead, Senior Associate
Canada’s telecommunications sector is at a critical juncture. While we have made meaningful progress over the last decade by expanding networks, increasing speeds, and improving access; we now face a set of economic, regulatory, and geopolitical challenges that demand clear policy direction and purposeful collaboration.
As someone who has spent years navigating the intersection of business, regulation, and public policy, I would like to share a few reflections on where we are today, and what is needed to ensure we stay competitive, connected, and sovereign in the years ahead.
The Financial State of the Sector
At a glance, our telecom industry appears stable. But beneath the surface, there is a growing concern: debt leverage. When long-term leases are included, Canada’s four national carriers (Rogers, Bell, TELUS, and Quebecor) collectively carry over $100 billion in cumulative debt.
That debt burden limits capital expenditures. As a result, we are seeing less investment in expanding networks, particularly in regions where returns are not in the short run profitable. Without targeted government partnerships, extending service beyond current footprints (especially in rural, remote, and Indigenous communities) becomes economically unfeasible and increasingly unlikely due to counterintuitive regulatory policies.
We have deployed world-class wireline and wireless infrastructure to most households. But unless we address funding gaps and competing priorities, I fear we will not finish the job.
Regulation: Finding the Right Balance
The CRTC plays an essential role as our economic regulator. But its preoccupation with fostering competition (sometimes under heavy political pressure) has, in my view, resulted in over-fragmentation of the market. That may sound pro-consumer in that it may marginally reduce prices in the short term, but it has real financial consequences for long-term infrastructure investment. This is decidedly not pro-consumer and positively dire if you are a rural or remote consumer.
Too much competition can deter innovation and delay deployment of next-generation technologies, such as AI, edge computing, and advanced networking. Other jurisdictions, particularly in Europe, have come to the same conclusion. Canada must learn from that experience. Unfortunately, Canadian policy makers appear intent on replicating the very policies that were implemented in Europe that caused its productivity crisis.
We need a regulatory framework that encourages sustainable competition, while also attracting investment and ensuring long-term national capacity. While achieving that balance is difficult, it is not impossible, but we can confidently say that adopting policies that discourage investment is not a positive or desired outcome.
The Digital Divide: Still a National Priority
Canada’s broadband expansion efforts, made possible through programs like the Universal Broadband Fund (UBF) and the CRTC Broadband Fund, have been successful examples of public/private partnerships. But progress is slowing, largely due to uncertainty around continued funding.
We need a third round of UBF funding. We should either:
Push fibre (or fibre-like) networks further than ever before; or
Develop a homegrown low-earth orbit (LEO) satellite solution, capable of delivering speeds far beyond the current 50/10 Mbps target.
Closing the digital divide will also require purposeful alignment between public infrastructure and telecom investments. For example, if we are building new rail lines to Churchill, let us make sure transport fibre is included. If we are expanding military infrastructure in the North, we should also be investing in digital connectivity—both for sovereignty and service delivery.
Sovereignty and Security in the North
Canada’s government signals that it is “elbows up” when it comes to asserting sovereignty in the Far North. This means telecom infrastructure cannot be treated as a standalone policy item; it must be part of a larger national and strategic vision.
We should be:
Deploying LEO satellite systems with ground stations in northern latitudes
Exploring AI-scale data centres powered by renewable energy
Requiring data sovereignty as a mandatory component of all new infrastructure investments
These efforts must serve not only our national interests, but also our NATO commitments. In fact, we should consider inviting the United States to co-invest in strategic infrastructure that strengthens our mutual Arctic presence.
Geopolitics and the Road Ahead
Geopolitical tension has underscored the importance of sovereign and secure infrastructure is no longer something to be taken for granted. We have seen this with the exclusion of Huawei and ZTE, and we will continue to see foreign technology providers scrutinized more closely. The fall parliamentary session is well underway, and the government is moving quickly to fund much needed investments in defence and housing, all while diversifying the country’s trading partners across the globe. Promoting investment through all means possible in telecom infrastructure needs to be firmly in the spotlight.
My advice to Canadian telecom companies? Plan ahead. Build resilience. Audit your contingency strategies. Advocate for cohesive and coherent policies that include critical infrastructure in programs by design. Regulatory and geopolitical risks are only growing—and those who are not ready will fall behind.
Looking Forward
Canada has the technological know-how, the private sector leadership, and the public policy capacity to remain a global telecom leader. But we need to be realistic about the financial limitations facing industry and clear-eyed about the trade-offs in front of us.
Progress will not come from one party alone. It will take coordinated effort—between government, private carriers, our provinces and communities, and international partners. Together, we can ensure that every Canadian has access to the networks and tools they need to thrive in the digital economy.
We are close. But close is not good enough. Let us finish the job—smartly, securely, and strategically.