After a 24-hour outage, residents of Iqaluit were surprised to see their internet service slowly returning to normal on Thursday. Bell and Northwestel, which operates in the territory, did not respond to requests for comment. According to Northwestel, the outage was the result of a network problem. While some businesses were shut down, others were able to resume operations without difficulty.
Iqaluit’s small population means there isn’t competition in the market
While the town is relatively well connected, you can find very few cheap flights to Iqaluit. You will find that most airlines aren’t particularly cheap, but this is probably due to the small population. However, you can find a good deal on cheap flights if you shop around. You can get cheap tickets to Iqaluit if you take advantage of the seat sales of the airlines.
The small population of Iqaluit means there is little competition in the market, which is beneficial if you want to buy something from a local store. Food is generally cheaper here than in larger cities, but you will find a variety of foodstuffs and local produce. It’s not possible to buy everything you want, but that doesn’t mean you have to settle for mediocre food.
Satellite service is expensive
There is no free Internet in Iqaluit. It is the only jurisdiction in Canada that relies on satellite links to deliver internet service. Internet cutouts and high prices have become a part of life for residents. In fact, government workers have been known to mail data because there is so little infrastructure in the capital. But that doesn’t mean they don’t want to communicate. Despite the high costs, the residents say they will pay whatever it takes to stay connected.
The cost of building communications infrastructure is prohibitive in Nunavut, and this is preventing competition. Instead of subsidizing internet providers, the government should tender redundant backbone infrastructure in each town. Then, companies could compete for retail business and lower prices. And because backbone infrastructure is regulated, competition would drive prices down. Satellite service in Iqaluit is currently expensive, but it’s better than none.
High data caps
Nunavut residents are frustrated with slow internet speeds and mobile data caps. Though the internet has returned to Iqaluit 24 hours after the outage, the speeds remain at or below average. One Nunavut resident, Jared Ottenhof, uses the Internet Provider Northwestel. He can typically download 15 megabits a second. However, he has struggled to check email and Facebook updates.
Another problem with the internet is high data caps. Those caps slow connections and charge users for data over the cap. Occasionally, users are shut off entirely. However, mobile providers like Verizon have maintained that data caps are necessary for them to offer lower prices and ease congestion. They also use data caps as a management tool. And cable ISPs are implementing similar strategies to control congestion, though the complaints are far lower.
No competition in the market
In the Iqaluit market, there is no direct competition between the two airlines that operate Trans-Arctic flights. Only First Air and Canadian North offer regular Trans-Arctic service. This means that there are no other viable alternatives for the transportation of passengers and cargo. Moreover, no evidence of competition between these two airlines was found in the Bureau of Competition’s investigation. Instead, the bureau analyzed documentary evidence pertaining to the determination of fares and flight schedules.
The Bureau of Economic Analysis reviewed evidence and interviewed potential entrants to find out whether this lack of competition was a barrier to entry. The bureau noted that competitors would require major investments to establish a base in Iqaluit. Moreover, the airports located in the northern part of the territory usually have sufficient capacity to accommodate additional airlines. The absence of a cargo facility may serve as a barrier to entry for a competing airline.