Thank you for the opportunity to appear before you today.
I am Bob Cox, chairperson of the Canadian Newspaper Association. With me is John Hinds, executive director of the association. We are appearing on behalf of Newspapers Canada, which represents over 850 daily and community newspapers from coast to coast to coast.
You have heard a great deal about news providers in trouble amid the fallout from the digital revolution of the past two decades. I will not add anything to that today. You know how traditional media have been disrupted. You know about falling advertising revenues. You know the impact this is having on many companies and how it threatens some TV outlets, newspapers, and others. You know the stories of individual media companies that are in trouble.
What I ask you to do today is reflect on the fundamental cause behind this situation and what you, as legislators who shape public policy, can do to set the table for the future so that vibrant and healthy news media outlets can continue to serve communities across Canada.
First of all, I'd like to dispel some myths about newspapers, including some that are touted in headlines in our own newspapers.
For starters, readers are not abandoning newspapers. The comprehensive national survey of readership continuously carried out by Vividata shows that four out of five Canadians read a newspaper weekly. Facebook cannot claim the same. Newspapers have hung on to their audiences, continuing to serve them in print and growing rapidly on digital platforms. Many of us have audience in the digital spheres as large as or larger than the audience we have in print.
Second, most individual newspapers make money on an operational basis. They generate revenues greater than their expenses. Individual companies have troubles with debt or other issues, but most of their papers are viable business entities. We continue to be the largest news media organizations in our cities and towns, presenting the most comprehensive coverage of events and issues and providing essential information and support to build and maintain the communities we serve.
Nonetheless, we face uncertain futures. The reason is not simply the Internet. We are adapting to it, and it's causing us to find larger and more varied audiences than ever before. The reason for the uncertain future is that the media economy has changed, while the laws and public policy measures addressing the media economy have not. We have a set of rules for what media looked like in the 1980s, not in 2016.
Yet these changes have affected all news outlets and should be of concern to anyone who cares about the democratic and economic health of our communities. Advertising dollars spent by businesses, governments, and individuals locally, regionally, and nationally used to circulate within a relatively closed media economy, supporting good journalism and the communities where it was produced.
A local car dealer spent money with my company, the Winnipeg Free Press, to advertise and reach consumers. There was an immediate benefit to the car dealer, but there was also a secondary one. The Winnipeg Free Press employed people, reported news, and supported community organizations. That money went back into the Winnipeg economy to people who bought cars. The car dealer supported journalism in its desire to reach consumers; we supported vehicle purchases in our desire to serve readers.
This model is breaking down. As companies increasingly reach consumers by using foreign media, Facebook, Google, Twitter, and the like, advertising money is sent out of our communities and does not return. For the most part, these companies spend nothing to do journalism in our towns and cities or to provide support to community groups. They employ hardly anyone in our communities, and the money is not recirculated.
You'll notice that I did not use the term “digital”. The fact that these are digital companies is coincidental. In the past, Canada has reacted to such seepage of ad dollars to the U.S. by making it harder to have a U.S. TV station that showed only American programs but sold ads to Canadian merchants or to have a U.S. newsmagazine sell Canadian ads into an edition produced south of the border, but we have not become alarmed by this much larger outflow of cash through digital channels.
We should be concerned about it. We should not be concerned about the fate of any individual newspaper company or broadcast outlet or any other legacy medium, but we should be concerned about the environment the news media companies operate in so that we do not end up with media dominated by foreign companies with few Canadian operations. In such an environment, perhaps the only media able to do serious public interest journalism would be the publicly subsidized CBC.
The CBC provides a fantastic service to this country, but in many digital areas it is set up as a competitor in the provision of news and information, creating an environment in which it is much more difficult for private enterprise to develop new, sustainable methods of providing serious journalism. In Great Britain, the government has insisted that the BBC co-operate with, rather than compete with, local papers. No such policy discussion has taken place in Canada.
We have four areas that could be addressed to help ensure that there are multiple sources of local news in the future. Those sources could be old media that adapt and survive, or they could be new start-ups. The changes that I am talking about help everybody, not just newspapers.
First, the federal government could lead the way by having a strategy to spend ad dollars in Canadian media. A decade ago, the federal government spent $20 million in newspapers; in the 2014-15 fiscal year, the federal government spent $357,000 in daily newspapers. That is out of a budget of $68.7 million. The government spent $13.9 million on the Internet. Most of that money went to U.S. firms like Google. Why is the federal government spending millions of dollars in Silicon Valley instead of supporting Canadian media?
Second, the federal government could find ways of encouraging Canadian companies to spend their advertising dollars here. This could be in the form of tax credits or in the form of penalties for using foreign firms. Non-Canadian legacy media are limited by the Income Tax Act, but this has not been applied to digital enterprises.
Third, there could be further tax incentives to encourage investment in newspapers and other local media. This could take the form of tax credits for digital enterprises that provide public interest journalism or do digital development related to it. This could also take the form of tax relief to encourage reinvestment in newspapers. Right now at my company, for example, shareholders are not taking any profits so that we can pay down debt and reinvest in the business, but the federal and provincial governments are taking income taxes from any net profit we make. Why not suspend such taxes until money is paid out in profits to shareholders?
Fourth, we need updated copyright laws to protect original work. Papers invest heavily in original journalism, which is then shared, reused, and rewritten by others, often for commercial gain, because the two-decades-old fair dealing law does not take into account the ease of digital reproduction. If newspapers were compensated for their original content and the investment was protected for longer, it would be a significant boost to our revenues.
I would also urge you to examine the existing support for community newspapers currently provided by the Canada Periodical Fund. The rules need to be updated to encourage production of Canadian content, not just subsidize the distribution costs of paid-circulation newspapers. Many community newspapers are reaching broad audiences with free circulation, but they get no support from the fund.
That is it. I hope I have made it clear that newspapers are not asking for a public bailout. We are not. It is up to us to build successful new business models in the modern media world. What we need are the conditions that make success more likely. We are asking for a better environment that would help ensure that the vital role of newspapers, the role that they have played in this country for 230 years, is continued, regardless of what form they may take.
Thank you, Madam Chair.
It is a pleasure to be here this morning to take the opportunity to join the discussion on the Canadian media landscape. I'm joined this morning by Kurt Eby. Kurt is our director of regulatory affairs and government relations at the CWTA.
The Canadian Wireless Telecommunications Association represents wireless service providers across Canada as well as companies that develop and produce products and services for the industry, including handsets and equipment manufacturers, content and application creators, and business-to-business providers. Our goal at the CWTA is to enable more Canadians to use more wireless to do more, and that is happening.
Consumer preferences have created our mobile-first world, where smart phones and tablets are the preferred choice to communicate, navigate, inform and be informed, shop, bank, work, collaborate, entertain, and be entertained.
The wireless world is growing. Canadians are using wireless services more than ever.
Consumers want wireless services to be even more accessible, convenient, and easy to use. They count on ubiquitous advanced network connectivity to help keep them safe and secure while they stay connected with family and friends and do more and more business. They need to trust that the personal and private information on their mobile devices is also safe and secure. They depend on the wireless industry to continue investing and innovating so they can maximize the value of their wireless experience.
One thing we know is that Canadians benefit from some of the best and fastest networks in the world.
A recent international study determined that, of all the networks around the world, Canadian networks are second in terms of speed. In addition, Canadians are heavy users.
Canadian consumers are among the heaviest users in the world. We currently rank fourth in terms of data consumption on wireless networks per user in the world. Indeed, Canadians' preference for wireless is clear. In only seven countries around the world does the average mobile connection use more than one gigabyte of data per month. Canada is one of those countries, and Canadians currently rank, as I mentioned, fourth highest as consumers of wireless data in the world, at more than one and a half gigabytes per month.
The cumulative effect of more Canadians using smart phones and connected devices to do more is massive growth in overall data usage. The latest projections indicate that Canadian mobile traffic in the next five years will grow by 600%, six times more in the next five years.
No other sector of the economy must consistently and constantly meet a level of demand growth similar to what is experienced in the wireless sector.
So we anticipate that the demand for wireless data in Canada will skyrocket.
This demand is driven by consumers, consumers who prefer to consume all forms of media, including entertainment and news content, any time and anywhere. Ubiquitous connectivity is changing the way Canadians are informed about what is going on in their country and what is going on around the world. Wireless service providers are facilitating this change, but they must also respond to the demand that it's putting on wireless infrastructure, because we cannot support all this without more investment.
That is why the Canadian wireless industry has invested more than $2.5 billion in capital expenditure each year since 2009. The doubling of total data usage every two years keeps the industry in a perpetual capital investment cycle. The industry has invested an additional $8 billion since 2014 to acquire the spectrum needed to expand and enhance wireless networks to meet current and projected traffic volumes.
I want to highlight this. This is $8 billion just to have access to the radio frequencies. This does not add one tower or one antenna site or connect one phone. That is just paying the government to have access to the radio frequencies. It is $8 billion since 2014.
These investments obviously create jobs directly related to network expansion and enhancement in the ongoing delivery of advanced wireless services from Canada's service providers. In 2014, Canada's wireless industry generated over 134,000 full-time-equivalent jobs and an overall economic benefit of $23.5 billion.
Canada's wireless service providers will continue to make record investments to meet the demand of exploding data usage and ensure consistent levels of services for all Canadians. Strategic government policies can facilitate additional investment in wireless network infrastructure and support innovation and economic development here at home.
Specifically, the CWTA has consistently identified four priorities necessary to ensure that the wireless industry can most effectively meet the demands of Canadians. Those four priorities are more spectrum, more towers and antenna sites, lower fees paid to government, and smart regulations.
I want to highlight what we mean by smart regulation. By smart regulation we mean that the federal government must maintain and defend its position as the sole regulator of telecommunications in Canada. Consumers, service providers, regulators, and elected officials are all better served by a proportionate and symmetrical set of federal regulations than by an asymmetrical and inefficient patchwork of different provincial frameworks.
Businesses are also better served when they compete on a level playing field rather than facing disadvantage due to regional regulation.
There is one existing fiscal policy—and this is the main reason we're here this morning—that provides foreign companies with an advantage of up to 15% over Canadian firms, and indeed creates a barrier to doing business in Canada.
There is a tax policy that provides foreign companies with an advantage of up to 15% over Canadian companies.
This policy creates a barrier to doing business in Canada. Currently foreign suppliers of digital products and services such as online news and entertainment services, music, movies, and software are not required to collect or remit HST and provincial sales tax as similar Canadian firms are obliged to do. The competitive advantage given to foreign suppliers by this policy undermines Canadian investment and innovation by encouraging Canadians to spend more money outside of the Canadian economy, to the detriment of Canadian suppliers and workers as well as content creators, programmers, publishers, actors, directors, musicians, and all others in the creative community who benefit from a strong Canadian digital economy.
Specific to this proceeding, this policy puts Canadian news and media outlets at a direct disadvantage relative to their foreign competitors. For instance, while a Canadian subscriber would pay HST on online subscriptions to The Globe and Mail, the Toronto Star, or the National Post, they would not pay the HST on subscriptions to some international press, such as The Wall Street Journal. The policy has been held over from when sales of such products and services were relatively minuscule and effective taxation was more trouble than it was worth. Those days are gone. Canadians' insatiable appetite for digital media, movies, TV shows, apps, books, magazines, video games, and software make closing this tax loophole more important than ever.
Like that. It never stops.
I couldn't time that any better. Thank you. You know, we have staff listening to this, and they call in when it's time.
In Canada we are the fourth heaviest users of data, and that's where it's moving. I remember the first phone I bought was really just to make calls, and then we started texting, and now it's all about data consumption. These are portable computers that we use once in a while to call. In terms of data consumption , Canadians are the fourth-heaviest users of data online, and that's what you're buying.
We also like the most sophisticated device. If you look around this room or you go into most homes in Canada, Canadians love the best devices, the robust devices with a lot of memory, and that costs more. When you package all that, that's the value we get.
We know we have more than 29 million subscribers in Canada, and they're consuming more than ever. However, the one thing that we're concerned with today, and the reason we're here—and what I'm saying is in support of what Mr. Cox is saying—is the fact that there is an uneven playing field when it comes to taxation.
Good morning, everyone. Thank you for being here.
I think this conversation is really fantastic. Mr. Lord, I think it's too bad you don't have any figures concerning this policy. I understand. It's definitely a fly in the ointment everyone is trying to ignore. Everyone is looking for their raincoat and saying they will make no decision on the issue.
International companies are offering their services under the table. In English, the term “over the top” is used, but in reality, it's under the table, as there are no taxes. Housekeepers and mechanics who change our winter tires are criticized for asking us whether we want to pay taxes or not. They do that openly, and nothing is being done on the issue. It's the same thing for anything virtual, such as when we order software on the Internet or anything of that sort. The Canadian government must show some backbone and consult its international peers to make a decision on the matter, as this is a very serious problem.
I'm happy that you are here. We don't know how long you will keep your job. You were talked about a lot over the weekend. As you are a unifying force, we will ask you a bunch of questions.
As you said, everyone wants more and more wireless services. We agree on that. At the same time, we have a love-hate relationship with our provider. The people in the group you represent have very different behaviours. Some of them are pretty difficult. Some know it all, some are entrepreneurial and resourceful, and some are small new players with animal images. They're all very different.
Telus recently announced an end to unlimited data plans. Can you tell us what that means? You are saying that Canadians are increasingly consuming wireless Internet services, but Telus is putting an end to unlimited data plans.
Will this lead to increasing competition for data and larger and larger networks that will require increasing amounts of spectrum to provide those services? Ultimately, it will not be profitable. So should Canadians expect to pay more?
That's an excellent question. When it comes to plans, both the members of our association and associate and affiliate members set their own prices. We don't hold discussions amongst ourselves to determine how or why the price of a given plan is set as it is.
In fact, this is an evolving industry. To answer your question, I will show how the evolution is ongoing in the wireless world.
A few years ago, it was extremely rare for someone to consume 1 gigabyte per month in Canada. However, the average today is 1.5 gigabyte a month, and it is rapidly increasing. It is rare for those under the age of 40 to consume less than 1 gigabyte.
In reality, we use our devices to read news online, watch videos, watch a hockey match, do research or do business. We are increasingly heading toward what we call the Internet of things. More and more devices will be interconnected, and that will lead to more data usage. So we will have to have networks capable of supporting that growth.
Imagine that we now have a four-lane road capable of meeting our needs, but it's announced that, in five years' time, that road will have to have 24 lanes. That's exactly in line with the reality. Our networks of today will have to be six times more efficient and larger in five years.
Let's come back to the taxation issue. You are using the example of Canadian workers, such as mechanics or people who work in the service industry, who decide not to impose GST. That's a good analogy. We currently have a system in Canada that enables foreign companies that are among the largest in the world—you can see that by looking up their value on stock markets—not to impose sales taxes when they sell their products. We are not talking about short-lived U.S. boutiques, but about very large companies capable of selling their services in Canada.
Thank you, Madam Chair.
Madam Chair, members of the committee, thank you for inviting us to appear and provide you with Cogeco's perspective on the media and local communities. My name is Louis Audet, President and Chief Executive Officer of Cogeco. With me today is Nathalie Dorval, Vice-President, Regulatory Affairs and Copyright.
Cogeco was founded by my late father, Henri Audet, six decades ago. We made our first steps in the media industry in 1957 with a single conventional over-the-air television station located in Trois-Rivières, Quebec. As we all know, the media industry has changed dramatically since that time, not only in Canada, but around the world.
Throughout these six decades, Cogeco has embraced change and adapted its business activities to the new realities brought about by technological, social and economic changes. It is this ability to adapt that underlies the enduring success of our company, which provides employment for over 4,600 people.
We are no longer involved in conventional over-the-air television broadcasting, nor are we involved in the print media, though we were for eight years. We do however operate 13 local radio stations in the province of Quebec, and we provide community television services to many local communities through 32 distinct community channels in the provinces of Ontario and Quebec. We also make our French-language radio news service, Cogeco Nouvelles, available to more than 40 additional independent local radio stations in the province of Quebec. Our remarks today are, therefore, focused on broadcasting in the digital world and on how local communities can still be served in this digital world.
You have heard this before from other witnesses, but I will confirm to you that the landscape has changed dramatically for traditional broadcasting media in the global digital age. Audiences continue to migrate to digital platforms for their information needs, advertisers continue to shift their advertising dollars to Internet-based media, and Canadian consumers—particularly young people—are looking for more instantaneous, ubiquitous and interactive ways of informing themselves, mainly over the Internet.
From a public policy perspective, what should we do or avoid doing in the circumstances?
First, we need to recognize that the trend I have just described is irreversible.
Second, we must focus our efforts on effectively transitioning our broadcasting media to the new operating models available in the digital world, and yes, that includes the production and exhibition of local television news and information programming.
Third, we must avoid robbing Peter to pay Paul—for example, taking money away from the community television sector to subsidize the public and private sector traditional, over-the-air local television stations.
Fourth, we should stay away from direct funding of television news and information programming by the state. This idea would add to the risk of undermining our democracy.
We made these points to the CRTC during their recent proceeding on local and community television in more elaborate submissions backed by detailed data available on the CRTC's own website. Our submissions to the CRTC are also publicly available on the CRTC's website, and you may find them of interest as a complement to our appearance before you today. In addition, courtesy copies of Cogeco's final comments and oral presentations at the CRTC hearings have been provided to the clerk of this committee.
We pointed out that conventional over-the-air television stations in Canada are, for the most part, owned and operated by four large vertically integrated groups, mainly BCE, Shaw, Rogers, and Quebecor, which collectively control over 79% of all commercial television revenues in Canada.
These large and very profitable groups, which are present on all traditional and non-traditional television platforms, have the financial resources to transition their local news and information operations to the new realities of the digital world. They should be allowed to do that—to pool the resources from their various media and platforms—and be required to provide local news components in the local communities that they are licensed to serve over the air. As cord-cutting intensifies, over-the-air broadcasting will take on added importance to reach all Canadians and foster a common cultural base.
As for the public sector, mainly the CBC, it is for Parliament to decide whether its mandate should be revised to specifically include the provision of local television news and information in both official languages and whether the CBC's parliamentary appropriations are sufficient to support the fulfillment of its mandate should it be so revised.
This leaves only 19 small, independent, conventional local over-the-air television stations operating in small markets that need to transition to new operating models to avoid being forced out of business by declining audiences and advertising revenues. Since they are required by the federal government to vacate their over-the-air broadcasting spectrum, the federal government should provide them fair compensation for doing so out of the proceeds of the auction for the spectrum that will be taken away from them.
We also presented to the CRTC earlier this year a plan to offer, through our community channels, professional local news programming in up to seven local communities in the province of Ontario and seven local communities in the province of Quebec that are without any local over-the-air television service. Our plan is based on our experience in North Bay, Ontario, where we've been providing local television news on the community channel since CTV closed the only local over-the-air television station in that community several years ago.
We hope you've found this presentation useful and we'll be pleased to answer your questions to the best of our abilities.
Before we begin, first of all, thank you very much. Your pronunciation wasn't all that bad. You're forgiven.
Mr. Dan Montesano is accompanying me. He's the chair of the community advisory committee board. I'll be doing most of the speaking.
Without further ado, Madam Chair and colleagues around the table, thank you for affording us the opportunity to enter into your deliberations regarding the state of some of Canada’s cultural institutions—because I think that's what we're talking about—particularly as they relate to heritage, citizenship, and participation in the development of our country.
We are acutely aware that your decisions and your recommendations to government will have an impact on the survivability of—quote, unquote—local media and, with it, the continuance of iconic instruments for the promotion of our Canadian identity. This is so because the committee, as it has seen to date, knows that the financial stability of some of those institutions—and perhaps most urgently, the print media—in the Canadian mosaic is fragile.
We speak at the Corriere Canadese for ourselves, but our experience is reflected in that of others, bigger and smaller, as you've heard already this morning. They recognize, as we do, that the federal government, by its actions, determines the successes or failures of many industries, including our own.
Our submission may strike you as a plea for assistance. We don't apologize. It should. We are no less exempt from the vagaries of the marketplace than the bigger and larger enterprises, such as Postmedia, in search of government allies.
Before we make that plea, however, allow us to present ourselves and some of our value-added contributions to the Canadian heritage. Some of the history of the Corriere Canadese and the Italian-Canadian community it both serves and represents in Canada will already be known to some of you. If so, please indulge us in the repetition.
The most recent Stats Canada figures place the number of Canadians who consider themselves ethnically Italian to be in the range of 1.4 million to 1.5 million. That's about 4% to 5% of the overall population of Canada. Just under one million of them live in Ontario, and about 800,000 of them in the Golden Horseshoe. Of this total, approximately 250,000 still use Italian exclusively, primarily, or frequently during the conduct of their daily business. These are relevant stats because we're talking about the nature of Canada and the communities that make up its whole.
The Corriere Canadese is Canada’s only Italian-language daily newspaper. It has been reporting and commenting on the history of this demographic since 1954. It also takes editorial positions on the role and the administration of government at all levels and in all jurisdictions. Sometimes it does this in English.
The Corriere Canadese remains the third-longest-surviving daily in the GTA, behind only The Globe and Mail and the Toronto Star. Incidentally, the Corriere Canadese receives no federal government assistance.
It is worth noting that as a demographic and as a medium we do not fit into the funding compartments reserved for either of the two official languages or for first nations, yet Italian Canadians have been a part of Canada from its first documented contact with Europeans. Giovanni Caboto—or as some of you know him, John Cabot—was the first recorded European to come to Canadian shores. There have been others, but he's the first recorded one. In 1497, under the commission granted to him by Henry Tudor, he landed in what has become Bonavista, Newfoundland.
From then until now, Italians have played a role in building the country they now proudly call their own. It is a rare community or industry in Canada that does not feel their presence, from the former steel and mining industries in towns such as Sydney, Hamilton, Sault Ste. Marie, and Sudbury to Winnipeg and Trail, B.C. The same can be said for the 350 forestry- and lumber-dependent towns everywhere across Canada, and it is so also for the agricultural and agri-production centres anywhere from southern Ontario westward.
In transportation, both the CPR and the CNR relied on an Italian labour force, much of which stayed beyond the rail construction phase and became builders of communities from Vancouver and Kamloops to Canmore, Red Deer, Thunder Bay, the GTA, Montreal, and Halifax. Today, they are a significant player in the auto parts industry of southern Ontario.
Everywhere they have been a model for Canadian multiculturalism, even before that model became enshrined in law in 1971.
In fact, since 1954, the Corriere Canadese has been able to tell the story of their and our need to promote integration, participation, and diversity, along with the benefits that these accrue to Canadian social values. In every part of Canada, their children are the first to seek out alliances and partnerships outside their own community in order to promote the interests of the whole.
As my colleague said a few moments ago, it is an essential element to the democratic aspect of Canada.
Perhaps there are no clearer examples of this than the immediate past presidents of the Canadian Labour Congress, the Business Council on National Issues—now the Canadian Council of Chief Executives—and the founding president of Service Canada. All of them are scions of that integrated community in Canada.
There are numerous other sterling examples of Italian-Canadian leadership in pension funds, philanthropy, food services, academia, the arts, foreign affairs, and so on.
But let us go back to Corriere Canadese. It used to be fiscally equipped to tell those Canadian stories of success and the values they represent. We would like to continue to do that, and to maintain that all-important connection to Europe, and Italy in particular. Italy is now a significant Canadian trading partner, and one likely to become even more so if the CETA is ratified.
However, as with our English-language counterparts, our revenue stream is challenged. You've heard that this morning. Consequently, our ability to reach into the communities in the outer reaches of Canada’s vast geography are severely limited. We now focus on the GTHA, where we can generate subscription revenue, single-copy sales, and limited though relatively consistent advertising.
We consider ourselves a job creator, an incubator for the creative arts, and a vehicle for reaching out to the Canadian citizenry. Everything we do is generated, produced, and distributed in Canada. Our paper is not distributed free of charge. It costs money to manufacture product.
The Government of Canada can be very helpful if it so chooses. It is a major league advertising presence because it needs all vehicles to inform the public on matters of importance to all Canadians. Nonetheless, the department that coordinates the ad buys for the purpose of informing the public about government activities actually excludes the Corriere Canadese completely from those ad buys. It claims—and I paraphrase—that the Italian community is not a target of its communications strategy, and that at any rate, the community is serviced by mainstream media. How does it know?
Just like that, 5% of Canadian society disappeared from the government communication strategy, and with it, all of its contributions this demographic makes toward sustaining our society, our economy, and our governing apparatus. It's a bit like what Mr. Audet said about the local communities everywhere around Canada: poof, they disappear.
Somehow it was deemed absorbed, assimilated into another. How? Ironically, the mainstream press in our market complains of precipitous loss of readership, so what are they reading? Please understand that the annual—
To answer your question, my first observation is that democratic countries around the world refrain from regulating Internet content because they know it presents a risk to democracy and the free flow of ideas.
We object to the Quebec government's decision to ban certain Internet game sites and make them illegal, forcing Internet service providers to block access. This approach poses a problem. For each case that arises, there are good reasons for such a decision. However, if the decision is applied to case after case, censorship eventually becomes an issue. Countries therefore refrain from getting involved.
That said, to answer your question directly, I don't think anything would prevent Canada, when establishing a normal tax structure and collecting taxes such as the GST and QST on goods and services, from implementing something legitimately. It would be a good first step.
Afterward, if the government says that players wishing to use its space must contribute to Canadian content production, it would be another step. However, I think the first step is taxation. The government must have taxation powers, as it does for any other good or service provider in the country, regardless of the good or service sold.
The government already makes substantial contributions to the marketplace, and it does so willingly when it makes its ad buys or, as you've heard others say, what they do is tax some and not others.
The presentations this morning were pretty explicit. They said to bring equitability back. You don't want to tax everybody heavily, but at least tax those who come from outside our borders to make revenue from within our borders at the same rate you would tax us, or, as I think you heard someone else this morning say, get us some equitability here in terms of the way the GST is applied, or the HST in Ontario.
If it doesn't apply to these who come into our marketplace to take away the revenue stream that is afforded to us by advertising, at least follow the example that's being followed by the Italians and the French today. They are going after Google and Facebook in order to get a more equitable income from the taxes that they appear to be able to avoid.
For example, in Italy Google invoiced $14 billion in revenues last year and paid $11 million in taxes.
Mr. Kevin Waugh: Yes, I saw that.
Hon. Joseph Volpe: How does that help anybody's revenue stream, including the government's? If that's an action that's replicated here in Canada—and I think a presenter before us made that case—at the very least balance off what you're going to do.
How can you do it? You can tax them and thereby increase the government revenues differently, or you can not tax us in order to give us a little bit more of a competitive advantage. There are only two ways that we pay taxes. One is HST/GST and the other one is the payroll taxes that everybody cannot avoid—
First of all, it's important for one very essential reason, and that is that the Government of Canada is actually playing in the market. It takes money and it distributes money. It conducts programs, whatever the government program, and it informs its citizenry about their efficacy. What happens is that they nurture community and involvement by redistributing some of those taxes in that environment.
Many of us, including us in particular, are excluded from that story. We can't participate in the developing of the story except through an electoral process, but then we can't participate in having any elements of our community represented in the way some of the decisions are made and how they're affected.
For example, you mentioned your husband and the family, which are great elements not just of an Italian community but of a community that's integrated into the Canadian environment and is infusing it with a different character, a diversity—a common term that people use today—that's making up the Canadian home. I just happened to meet one of my former students—I used to be a teacher at one time—and he survived my process and he's now the president of OMERS. That is one of the biggest, most significant investors in Canadian infrastructure anywhere, but the biggest impacts on his life are like those dinners that you talked about and the experiences that are brought into those dinners.
I don't want to make it schmaltzy and diminished, but the man's a genius. He's absorbed all that is Canada and he has his own imprint. That's a story that very few people are telling. We'd like to tell it. He's just one of many, whether he's Italian or from anywhere else. If you come from the GTHA, chances are 53% that you weren't born here, but these are all Canadians whose stories have to be put into the telling of the story of what Canada is, what it represents, and where it's going.
From an economic point of view and a trade point of view, the governments of Canada, irrespective of their stripe, are reaching out all over the world trying to make the Canadian presence felt and to get revenue from a trade that sells the “Made in Canada” product. Well, we're a made-in-Canada product. We tell the stories, the single elements, of that jigsaw puzzle that is Canada. We just want the Government of Canada to recognize that we're there. It's a small contribution.
You've heard the other, bigger players. They say that you're not spending money, and what little you are spending is giving off a message. The message is “Don't advertise in the Canadian market. Advertise with somebody else.”
I notice that Monsieur Nantel mentioned l'affichage. You know, you get the big signs. Where do they put their signs? They go and put them on an American network. They go and do it with an American or a multinational company. They don't do it with a Canadian company. Sooner or later, that Canadian community, small or large, is going to be diminished in its ability to be able to tell the Canadian story.
We're an example. I could give you a litany of achievements of Canadians of Italian background here in all aspects of research, whether it's medical science or technology or whatever, but that's why we exist. It's because people want to hear that story.
Thank you, Madam Chair.
I just have a small correction on Mr. Volpe's presentation. Giovanni Caboto actually landed in Newfoundland, not in Canada, in the home of the Beothuk people. It doesn't really matter, because Canada had the good fortune of joining Newfoundland back in 1949. You are all very welcome.
I want to get to the point of federal advertising. The federal government follows the people, and one of the things I found in my campaign was the number of people who are on Facebook, who are online, and that is where we want to follow people.
The fastest-growing online market is in seniors. For instance, of those 75 and over, 5% were online in 2000, but 27% were online in 2012. Half of them are on Facebook, which is not a surprise to me, and over a third of them are on every day. On an interesting note, there are more people 75 and up doing online gaming, at about 36%; it's 27% for baby boomers. It is a huge online presence, just among seniors. That is just Facebook alone, when you look at it.
On that note—and considering that the federal government is going to follow where the people are when it comes to its advertising—what is your online presence, and what sort of growth have you seen there?