SaskTel Encourages CRTC to Maintain and Improve the National Contribution Fund

Regina, October 27, 2010

SaskTel in its oral presentation to the Canadian Radio-television and Telecommunications Commission (CRTC), Telecom Notice of Consultation CRTC 2010-43, encouraged the Commission to maintain the National Contribution Fund and in fact modernize the program by including the provision of high speed internet in rural and remote regions.

“We believe that the CRTC must acknowledge that the differences between rural and urban areas of Canada require very different policy approaches,” said Ron Styles, SaskTel President and CEO. “In urban Canada, competition and market forces are providing advanced telecommunications services, but outlying rural areas will be left behind with slow, unreliable or costly service. Without a National Contribution Fund, the digital divide in Canada will grow and rural residents will be increasingly excluded.”

Unlike urban markets, many regions of Canada are characterized by low populations, widely dispersed over large geographic areas. These areas, by definition, lack the economies of scale needed to substantiate a sound business case for the necessary investment required to deliver advanced, affordable services. To date, the “National Contribution Fund” has been the vehicle used to ensure affordable local phone service to rural residents. It has proven to be an effective and efficient policy instrument.

However, for rural and northern people to prosper and fully participate in the economic and social fabric of the country, there is a need for advanced telecommunications services that go beyond traditional telephone service and the limited speeds of residential broadband. The Contribution Fund must be maintained and reformed to meet the future needs of rural telecommunications including the provision of affordable broadband.

Throughout Canada’s history, special efforts have been made to extend access to communications networks and services to rural, remote and northern areas of the country where it is not profitable to do so. Access to broadband for rural Canadians is the latest example of the need for public intervention where markets are ineffective.

“In urban areas, the private sector is already building a world-class, leading edge infrastructure. Rural areas continue to lag behind because there are no economic margins to stimulate infrastructure growth. There must be a national commitment to a sustainable policy framework to ensure that rural Canadians are not forever left behind,” added Styles.

SaskTel suggests that government programs which provide one-time grants are short-sighted. At best these programs may assist in the expansion of the network but sustainability of such a network in low population environments is of equal importance. What is required is dynamic, long-term financial support such as that available through the National Contribution Fund.

About SaskTel

Saskatchewan Telecommunications Holding Corporation (SaskTel) is the leading full service communications provider in Saskatchewan, with $1.15 billion in annual revenue and more than 1.4 million customer connections including more than 550,000 wireless accesses, 543,000 wireline network accesses, 225,000 Internet accesses and 77,000 Max™ (TV) subscribers. SaskTel offers a wide range of communications products and services including competitive voice, data, Internet, entertainment, national security, messaging, cellular, wireless data and directory services. In addition, SaskTel International offers software solutions and project consulting in countries around the world. In 2009, SaskTel contributed more than $651 million to the Saskatchewan economy through dollars spent with Saskatchewan-based suppliers and sponsorships to non-profit organizations. SaskTel and its wholly-owned subsidiaries have a workforce of approximately 4,800 employees.

For media inquiries only, please contact:

Michelle Englot, SaskTel Media Relations
Phone: (306) 777-4476
E-mail: michelle.englot@sasktel.com