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CRTC chairman Jean Pierre Blais, seen here on Oct. 18 commenting on his BCE-Astral ruling.Dave Chan/The Globe and Mail

Canada's telecom regulator is launching a landmark consultation that promises to transform communications services in the Far North.

The Canadian Radio-television and Telecommunications Commission said on Thursday it wants citizens to participate in a public process that will scrutinize how NorthwesTel Inc. offers telecom services to northern Canadians.

NorthwesTel, which is a subsidiary of Montreal-based BCE Inc., is often the only choice for residential and business customers in Yukon, the Northwest Territories and Nunavut. NorthwesTel also serves northern areas of British Columbia and Alberta.

The CRTC's goal is to provide northern Canadians with communications services that are on par with those in the rest of the country. About 107,200 people live across the three territories. A persistent lack of affordable telecom choices and modern networks are barriers to providing basic services such as banking, health care, education and policing.

A robust communications infrastructure is seen as crucial to ensuring Canada's Arctic sovereignty and spurring economic development – both priorities for the federal government. In spite of a burst of investment from mining and exploration companies, the dearth of communications infrastructure remains a stumbling block for northern businesses.

"Canadians expect to have a choice of high-quality telecommunications services, regardless of where they live," CRTC chairman Jean-Pierre Blais said. "Last year, we expressed concern about the services available to northern Canadians and required NorthwesTel to develop a plan to modernize its aging network. The consultation launched today will allow us to conduct a comprehensive review of NorthwesTel's services and its planned improvements."

The CRTC has grown increasingly impatient with NorthwesTel in recent years, noting it "failed to make the necessary investments in its network" despite receiving about $20-million a year in contribution subsidies to improve local telephone services.

That frustration culminated in a December, 2011, decision by the CRTC that opened up the North to local telephone competition, prompting companies such as Iristel Inc. and SSI Micro to announce plans to offer competitive services.

"Northwestel is proud of its long history of providing state-of-the-art communications services to Northerners across some of the most challenging terrain in the world, and we encourage Northerners to participate in the CRTC consultations," spokeswoman Emily Younker said in an e-mail.

Rich Thompson, chief executive officer of Northern Vision Development LP, a real-estate development, property management and hotel company based in Whitehorse, said a shortage of competitive options and spotty service are key challenges.

"NorthwesTel has worked hard over the years to make sure that services are updated, but there's no question that we struggle in the North," Mr. Thompson said.

"It is speed of Internet access and the cost of having quality Internet access for our guests. So, we struggle to get the right packages for our hotel from the telephone company that will allow our guests to experience the Internet the way they would expect to in any other hotel when they are travelling across Canada."

This year, NorthwesTel proposed a five-year, $273-million modernization plan to provide all 96 northern communities it serves with wire-line and wireless services comparable to those in the rest of Canada.

That proposal also included a now-defunct offer to spend $40-million to improve broadband Internet, both fixed and wireless, to give northern consumers better access to broadcast content via smartphones and tablets. That proposal, however, was part of the tangible-benefits package included in BCE's initial $3.38-billion proposed takeover of Astral Media Inc. – a transaction that the regulator rejected.

Although BCE has announced plans for a revised Astral transaction, it remains unclear how that would affect NorthwesTel's plans for the North. The CRTC is giving the company until mid-January to update its modernization plan.

In the meantime, the CRTC is asking Canadians to share their opinions on the company's modernization plan and other issues including regulations, subsidies and competition in northern markets. The CRTC also plans to hold public hearings on June 17, 2013, in Inuvik, and June 19, 2013, in Whitehorse.

Dean Proctor, chief development officer of the SSI Group of Companies, applauded the CRTC for calling hearings in those northern communities.

"They are treating communications in the north in a very fundamental manner," Mr. Proctor said. "With respect to Canadian sovereignty … how do you ensure that the people who live in the North are actually part of Canada and living the life that Canadians deserve to have? It is a very serious matter."