[CRTC Communications Monitoring Report 2017, Table 5.3.5.] 16 CRTC Communications Monitoring Report 2017, Table 5.0.5.
12 | brattle.com TSPs, 12.1% for Cable-Based Carriers and Other Facilities-Based Service Providers, and -8.5% for resellers -- that is, annual investment by resellers was, on average, declining between 2012 and 2016 (see right panel of Figure 7). Figure 7 Source: CRTC Communications Monitoring Report 2017, Table 5.0.5 Given the increase in the number of residential subscribers that rely on Other Service 24. Providers for internet access, the decrease in the rate of investment by Resellers may already have had negative implications for the optimal implementation of innovative technology. From an incentives perspective, Resellers are likely to become even more dependent on the networks of traditional telephone service providers and cable providers, and thus provide less technological competition at the margin. Ultimately, the goal of investment is the introduction of new products and services and 25. new technology at better prices—what economists refer to as “dynamic efficiencies”. Data from the CRTC indicates that Canadian residential consumers have increasingly been subscribing to plans that offer not only faster internet services, but also more capacity. As shown in Figure 8, the weighted-average download speed for residential internet service 26. more than tripled from 12.6 Mbps in 2012 to 42.0 Mbps in 2016 (a compound annual growth rate of 35.1%), while the weighted average upload speed increased from 2.0 Mbps to 8.7 Mbps during this period (a compound annual growth rate of 44.3%). 17 At the same 17 CRTC Communications Monitoring Report 2017, Table 5.3.10.
13 | brattle.com time, the weighted-average download/upload limit across all tiers of residential Internet service plans increased from 103.5 GB per month to 181.7GB per month. 18 Figure 8 In terms of pricing, the CRTC reports that “[w]hile some packages have experienced price 27. declines [between 2012 and 2016], these declines have been offset by movement towards larger, faster packages.” 19 For example, the average monthly revenue per subscriber across all residential internet plans increased from $43.80 in 2012 to $59.67 in 2016. 20 More broadly, the average monthly revenue per subscriber for 1.5 to 4 Mbps residential internet plans (the broadband plans with the lowest download speeds) decreased from $41.87 in 2012 to $22.63 in 2016, while the average monthly revenue per subscriber for 50 Mbps and higher residential internet plans (the broadband plans with the highest download speeds) increased from $59.69 in 2012 to $64.78 in 2016. 21 The observed increasing number of subscribers, decreasing prices for low end packages 28. with consumers moving towards larger and faster packages, and increasing levels of investment suggests that there are no significant market imperfections in the wireline 18 CRTC Communications Monitoring Report 2017, Table 5.3.9.
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