First of all, thank you very much for the opportunity to address the Standing Committee on Industry, Science and Technology. I always just want to call it Industry Canada, so you'll have to forgive my age.
Rigstar Industrial Telecom was originally called Rigstar Communications, and we were an oil and gas upstream technology provider for drilling rigs. We formed in 1998, and as we moved along, in order to provide services to our clients, we constantly had to find ways around the ILECs to provide services and communications services, where we could control the outcome. The end result of that was that Rigstar bought a data centre, partnered with Verizon. We bought an out-of-business asset called FlexiCom that was on rooftops in downtown Calgary. It was using the old Harris radios, and 2.4 gigahertz, I think, that had blistering speeds, at the time, of three megabits per second. Of course, back in 1998, that was cutting-edge technology. I'll come back to why I bring that up in a moment.
We have a small WISP called ABnet, Alberta Networks, that is east of Calgary. This might sound a little crass. We didn't know a lot about wireless infrastructure at the time, and we wanted to learn and cut our teeth on clients who were paying $39.95 a month as opposed to $5,000 a month. We have been operating that since 2003.
We've recently rebranded as Rigstar Industrial Telecom to reflect our overall non-dominant carrier status within Canada. We provide services now that are voice. We provide entertainment packages to remote camps. We provide satellite. We provide private LTE networks. We build towers and we create infrastructure.
We're heavily involved with the Van Horne Institute here in Calgary. We also attend the conferences around the same types of discussions around broadband and the rural communities.
The rural communities right now are really struggling, as everybody knows, in getting the speeds up. My presentation will be around what we can do differently from what we're currently doing to service those.
Whenever any new technology was introduced, and this was the same for Canada, the country was carved up into individual sectors. In the original case it was divided up amongst the provinces. Those provinces had exclusive rights to build the infrastructure within the province, and they had the ability, under those guidelines, to recover their capital infrastructure costs, get cost certainty to their investment, and everybody was serviced to the point where twisted pair was provided to every farm. It's known as the last mile, of course, because that's basically the longest distance a signal will travel over copper wires, about a mile.
I will just say that I think the privatization of telecom has been a disaster in Canada. Any time I drive by three towers side by side, I know that one is Rogers, one is Telus, and one is Bell. It just drives me crazy, the amount of money that has been spent to provide threefold communications infrastructure to people in Calgary, whereas rural communities do not get that same service because the economic return is not guaranteed or in any way planned.
This leads to ad hoc programs, like “let's throw $500 million at it.” But even when you throw $500 million at it, you're asking me to design the network to submit to the Government of Canada in the hope that the grant might come through. The return on investment is not even guaranteed for the design work that we put in, nor for the meetings we put in. We sit down with the counties and we do all kinds of work and infrastructure to support these people, and then it's not approved, and they come to us and ask the simple question, “Why?” Well, the simple answer is that if there's no infrastructure and no capital return laid out by the governing body, then the risk is not worth the capital investment and nobody will make the investment.
In Alberta, this has really sprung up, as the counties now have taken the lead and have decided as they know they cannot get these services from the major telcos or the ILECs. They've now resigned themselves to the fact that to get the service that they and their clients need, they're going to have to fund this themselves. With the help of the Government of Canada, they're allocating their capital projects to build tower infrastructure instead of building a road. They're using creative ways to meet their own needs because the needs are not being met by the free market. The free market is flawed, just flawed.
We're working hard to help those communities leverage the capital grants, but my recommendation at the end of the day, in a really simple form, is that you can use the county outlines for who and where the services are being recommended and you allocate that infrastructure build to one company. Those companies build that infrastructure. They run it for a period of, say, five years. Once their capital has been returned, it's opened up to the free market. Then you have a natural amalgamation of services, not unlike what happened with the cable companies when cable first came out.
Paramount, of course, was the owner of the coax cable technology. The CRTC would not let a foreign entity control a technology such as coax cable for deployment and told Paramount that they needed to get that into Canadians' hands. Paramount turned to the theatre owners across the country and asked who wanted to have the rights for the technology in their area. All the Paramount owners who owned theatres either accepted the technology and went to the banks to invest in the technology or not, but they had defined areas, even in Calgary. When Calgary first started this, the south was Shaw Cable's, and the north was for Rogers', because there were two Paramount theatres in Calgary.
There's been a natural amalgamation of those services over the last 30 years. Now you have cable TV service for everybody, including from Shaw, for where those defined areas were. The cable companies have recovered their capital, and they're doing great.
That concludes my presentation.