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Innovation, Trade and Rural Development
February 15, 2010

Provincial Government Provides Update on Broadband Activities

Recognizing the value of high speed Internet access in today's social and economic environment, the Provincial Government has taken a deliberate approach over the last six years to improve the province's communications capacity. That results-driven approach has led to high speed Internet access being available to 80 per cent of the population, up from 60 per cent in 2003.

Within the heavily federally-regulated communications sector, the Provincial Government has carefully identified opportunities where it could best leverage its resources and improve the province's communications capacity. Highlighted by investments under the Broadband for Rural and Northern Development and Centre for Distance Learning and Innovation, along with the $15 million investment in the province's second trans-gulf fibre optic network, residential and commercial consumers are benefiting from greater competition and improved services.

"The Provincial Government's financial investments have helped facilitate significant progress in broadband connectivity and led to the development of essential infrastructure that will serve as the foundation for continued advancement of the province's communications capacity," said the Honourable Shawn Skinner, Minister of Innovation, Trade and Rural Development. "These investments have not just benefited a single region but the entire province. Now, more than ever before, Newfoundlanders and Labradorians have a greater selection of communications carriers to choose from, more services, and access to modern technologies."

To further advance the province's communications infrastructure, the Provincial Government issued a Request for Proposals (RFP) to build and manage an advanced communications network. Under the RFP, the communications requirements of the Provincial Government's more than 1,000 facilities that include health care institutions, libraries, schools, and other offices would have been consolidated into one provincially-owned communications network. Currently, the Provincial Government leases its communications services from various communications carriers.

Due to anticipated project costs escalating to more than half a billion dollars, the Provincial Government has cancelled the RFP. Effective immediately, the Provincial Government will be re-examining its approach to improving the communications infrastructure while continuing to build on the progress that has been made over the last six years.

"With anticipated project costs almost doubling from when we first embarked on this process to today, the Provincial Government has cancelled the RFP as it is too expensive within the current fiscal environment," said Minister Skinner. "As a government, we take a very pragmatic approach to managing the provincial treasury – all investments are closely scrutinized to ensure maximum long-term benefit for Newfoundlanders and Labradorians. While broadband connectivity remains a priority, we have to balance our many financial requirements, including significant expenditures in health and education, and stay within our fiscal framework."

"Today's decision does not diminish the Provincial Government's view that advanced communications is fundamental in the province's economic and social development," said Minister Skinner. "We remain committed to stimulating connectivity in all regions. The next step is to work with industry to explore options that will allow us to meet government's broadband requirements and advance connectivity in all regions."

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Media contact:
Scott Barfoot
Director of Communications
Department of Innovation, Trade and Rural Development
709-729-4570, 690-6290 

2010 02 15                                                    3:40 p.m.

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