Sherbrooke, QC, is a mid-size college town about 1h45 drive from Montreal and has some of the cheapest rents in the province. I was paying 500/month for a large 2BR 10 minutes walk from the "downtown" area and an indoor climbing gym.

It also has a bit of startup activity, from incubators related to the university and research spinoffs.

Not sure about fast internet, depending on how fast at what price. You might be able to get FTTN through resellers like teksavvy and ebox. It won't be cheap.

Like most of southern canada, it gets pretty hot during 3 months or so, mid-june through mid-september.

Waterloo is cheaper than TO, Ottawa, Kingston, etc. But even cheaper (and just as close to Toronto) would be a smaller town without a university. I hear that Mt Forest, ON has fibre.