September 10, 2009

Industry Canada has launched its call-for-applications process for Broadband Canada: Connecting Rural Canadians. The program will consider applications to provide service to as many unserved and underserved Canadians as possible, allowing them to participate in the digital economy by giving them access to information, services and opportunities that would otherwise be out of reach.

Applications will be evaluated against a series of criteria with
emphasis on best value and most households served. Applications must
also show capacity to deliver within the timeframe and demonstrate a
viable business model.

Successful applicants will receive federal support equalling up to 50%
of their one-time costs, including: the purchase, adaptation or upgrade
of equipment, hardware or software; long-term investments in network
capacity (such as the lease of satellite transponder capacity); network
deployment costs; and other costs directly related to extending
broadband infrastructure.

Potential applicants have until October 23 to submit proposals to
extend service to the GEOGRAPHIC SERVICE AREAS that were identified as
part of an extensive mapping process that took place earlier this
summer.

Successful proposals are expected to be announced in late 2009 to early
2010, with project builds starting as soon as possible in 2010.

CLICK HERE for more information about this program on the Broadband Canada: Connecting Rural Canadians website.

BACKGROUND
Budget 2009–Canada’s Economic Action Plan provides $225 million to
Industry Canada to develop and implement a strategy to extend and
improve broadband coverage. The goal of this investment is to extend
broadband service to as many remaining unserved and underserved
Canadian households as possible.

Industry Canada defines unserved Canadians as those without Internet
access or with dial-up service only. Underserved Canadians may be able
to access the Internet using a connection with a speed less than 1.5
megabits per second (Mbps).

{mospagebreak}

Under this call for applications, participating providers will be
expected to provide broadband service of at least 1.5 Mbps to currently
unserved and underserved Canadian households.

At 1.5 Mbps, a customer can make a voice call over the Internet,
download an audio CD in seven minutes and experience video-quality
streaming / video conferencing. It is also possible to use multiple
applications at the same time, enabling consumers to make a
voice-over-Internet telephone call while downloading a document.

As communities vary greatly in size, this program focuses on connecting
households. This method also provides a clearer understanding of
service availability for Canadians; the fact that one part of a
community has broadband access does not always indicate service is
available to all households in that community.

Broadband Canada will work with the private sector or consortiums of
companies, not-for-profit organizations and provincial/territorial
entities that build and operate broadband infrastructure to extend
broadband coverage to areas that do not currently have broadband
access. The Broadband Canada program will provide a one-time,
non-repayable contribution to support the expansion of current
infrastructure in the defined areas where there is currently no
business case for Internet service providers moving forward on their
own.

The Canadian Radio-television and Telecommunications Commission
reported that, as of 2008, 94% of Canadian households had access to
broadband. A significant gap exists, however: 22% of rural households
lack broadband access. While all households are within the range of
satellite service, existing satellite capacity can provide service to
only 1% of households.