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NORTHWEST TERRITORIES
NorthwesTel has announced a plan to spend $273 million on a "modernization plan" that would include smartphone-capable networks for every community in Northern Canada but one part of the plan hinges on the approval of the Canadian Radio-television Telecommunications Commission.

Bell Canada Enterprises plans to purchase Astral Media and as a company buying a broadcast entity, Bell is required to allocate a portion of funds to a "public benefit." The amount is based upon the acquisition price.

In order to fund the proposed $273 million modernization plan, NorthwesTel and Bell have partnered to submit a proposal to the CRTC requesting $40 million of the public benefit be allocated to their modernization plan.

"To get the CRTC to acknowledge that $40 million as an appropriate use of the Astral Media public benefit, that's the biggest caveat in all of this," said Paul Flaherty, president and chief executive officer of NorthwesTel. "We need their approval and their alignment to use the funds and use it in this fashion."

The current plan, should it go through, would provide smartphone-compatible networks in all communities and faster, more reliable Internet access, said Flaherty on Thursday. The goal is to have every community in the North running Internet and cell services on wireless systems.

The sum of $273 million would be invested over five years, with $233 million invested by shareholders and the remaining $40 million provided by the public benefit.

Flaherty said the $40 million is vital because it would pay for the initial work required to upgrade or install the technology in each community. He said small communities with Internet service already lose money on the wireline-systems they have, so the cost of putting in a second wireless system was not justifiable.

The wireline system will then be eliminated.

"It'll provide services that are essentially on par with all the major cities down south," he said of the wireless system.

Flaherty said this use of a public benefit does not have a strong precedent, and the argument against NorthwesTel and BCE's proposal to CRTC may be that the plan does not directly impact broadcasting the way the public benefit is intended to.

Flaherty argues that it does provide the broadcast world with a significant boost in the North, particularly as the Internet and broadcasting become more closely connected.

"Our argument is the Internet is used for many things, one of which is accessing broadcasting content," he said.

"So we're going to actually give broadcasters, or creators of content, more of a platform to reach more people than they could have otherwise reached before."

Flaherty said he expects the CRTC to reach a decision by the end of the year and hopes to being work on the modernization plan in 2013.

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