INDU Committee Report

NDP SUPPLEMENTAL RECOMMENDATIONS

During this public health crisis due to the COVID 19 pandemic the need for accessible and affordable wireless and high-speed broadband internet has become obvious to all Canadians. As demonstrated with people sheltering at home and with schools and businesses closed during the lockdowns, Canadians needed fast and reliable internet connections to communicate for work and school through online applications. This was true before the pandemic and will continue to be after it is over. It is an essential utility and must be treated as one. Unfortunately, governments for the past several decades have failed to treat this with the urgency it deserves.

Among OECD and other developed economies, Canadians pay some of the highest prices for mobile wireless and broadband subscriptions in the world. For decades, Liberal and Conservative governments have relied on market forces and the supposed ‘facilities-based’ competition to determine what Canadians pay for their cell phone and internet service every month - despite clear evidence that this model has failed. A 2020 report from Finland-based telecom research firm Rewheel found that Telus, Bell, and Rogers ranked 1st, 2nd, and 3rd most expensive amongst 168 wireless carriers operating in 48 countries around the world. In fact, Canadian telecom companies make more revenue per gigabyte of data than almost any other company in the world. 23 times more than those in Finland and 70 times more than those in India. Yet this has resulted in lower data use than in almost any other country. This damages Canada’s economy and harms consumers. The need for government intervention to address this market failure is obvious. The only definitive way to ensure this, is price regulation, which was used previously in the telecom market to successfully build a universal and, at that time, affordable landline service. An affordable basic plan for everyone that matches OECD average prices, which are drastically lower than Canada’s, must be mandated by regulation.

Facilities based competition in the telecom market has failed to deliver universal broadband access over the past 20 years. In Canada, 63 percent of rural households do not have access to high speed broadband (50/10 Mbs with unlimited data) and 14 percent of highways and major transport roads do not have access to LTE wireless services. In the Northwest Territories, Yukon, and Nunavut, no households have access to high speed broadband (50/10 Mbs with unlimited data) and 72 percent of highways and major transport roads do not have access to LTE wireless services. During this public health emergency, the situation has gotten worse for Canadians in rural and remote areas. The Canadian Internet Registration Authority released data on May 8, 2020 as part of its Internet Performance Test that was submitted to the CRTC for their consultation on barriers to rural broadband deployment that in April 2020, median rural download speeds were measured at 3.78 Mbps, compared to 44.09 Mbps in urban Canada – a difference of 11.7 times. The underfunded government plan to make Canadians wait 13 years to achieve 100 percent high speed broadband access across the country is unacceptable. This can be done using the revenues from the spectrum auctions, a public asset, to achieve this goal within 48 months.

Recommendation 1

The government of Canada immediately direct the Canadian Radio-television and Telecommunications Commission (CRTC) to re-establish retail price regulation for wireless, broadband, and wireline with the consumer costs to be based upon the price average of OECD countries. This would include mandatory quality and service standards.

Recommendation 2

The government of Canada immediately direct the Canadian Radio-television and Telecommunications Commission (CRTC) to re-establish wholesale price regulation for wireless, broadband, and wireline with the 2019 CRTC aggregated wholesale high-speed access services (Telecom Order 2019-288) decision as basis for further implementation.

Recommendation 3

As revealed in the CRTC Report on Misleading or Aggressive Communications Retail Sales Practices, consumers need significant protection from price gouging, outrageous sales and customer service practices, and arbitrating disputes. Accordingly, the government needs to institute a Telecom Consumers’ Bill of Rights which prevents price gouging, aggressive and misleading sales practices, ensures best practice standards across the sector from all providers, set fines and penalties for violations along with consumer compensation with mandatory binding arbitration, establishes complete transparency and accountability of firms by publishing quarterly reports on complaints, resolutions, compliance, and consent agreements.

Recommendation 4

As the CRTC has made decisions which are considered to have negative impacts on consumers, the need to ensure telecom customers’ interests are considered in determinations and protected in the short, medium, and long term, it is imperative that an Office of the Consumer Advocate (OCA) be established. The OCA should be mandated to be involved in the process of CRTC evaluation, analysis and developing decisions through a consumer interest screen. Additionally, the OCA must be instituted with the requisite powers and authorities to initiate investigations, enforce the Telecom Consumers’ Bill of Rights, and be independent of the CRTC. Furthermore, the decisions of the OCA can only be reviewed or appealed to the federal judiciary.

Recommendation 5

To achieve universal high speed internet access and affordability a comprehensive broadband build out plan must be started in the next 12 months with 95 percent to be completed in 36 months and with the remaining geographic challenges being addressed to reach 100 percent within 48 months. The federal government should fund the entire $ 6 billion, based on Budget 2019’s cost estimate, buildout with the revenues from the spectrum auctions and the CRTC Broadband Fund. Include partners in the infrastructure installation and ongoing operations in rural and remote locations such as indigenous communities, non-profits, municipalities and smaller independent telecom and utility companies. Guarantee price equivalency between large metropolitan areas and rural and remote communities with regulatory rate setting for a basic universal affordable plan. All funded projects must be open access. The CRTC's 50/10 basic speed target needs to be the floor, not the ceiling. Fiber must be the default technology being deployed, wherever possible, ensuring the longevity and scalability of these investments.