Good afternoon, everyone. I call this meeting to order.
Welcome to meeting number 13 of the House of Commons Standing Committee on Industry, Science and Technology. Pursuant to the order of reference of Saturday, April 11, the committee is meeting to receive evidence concerning matters related to the government's response to the COVID-19 pandemic. Today's meeting is taking place by video conference, and proceedings will be made available via the House of Commons website.
I would like to remind members and the witnesses that before you speak, please wait until I recognize you by name. When you are ready to speak, please unmute your microphone and then return them to mute when you are finished speaking. When speaking, please speak slowly and clearly so the translators can do their work. As is my normal practice, I will hold up a yellow card when you have 30 seconds left in your intervention, and a red card when your time for questions has expired.
I'd like to welcome our witnesses. From the Canadian Communication Systems Alliance we have Jay Thomson, chief executive officer, and Ian Stevens, board member and CEO of Execulink Telecom; from the City of St. Clair Township, Steve Arnold, mayor; from OpenMedia, Laura Tribe, executive director; from the Regional District of East Kootenay, Rob Gay, board chair and director of electoral area C; and from TekSavvy Solutions, Andy Kaplan-Myrth, vice president, regulatory and carrier affairs.
Each organization will present for five minutes, followed by rounds of questions. We will begin with the Canadian Communication Systems Alliance. I believe, Mr. Thomson, you are speaking on their behalf, and you have five minutes.
Thank you very much, Madam Chair and members of the committee, with special greetings to my MP, Mr. Amos.
It's nice to see you here, Mr. Amos.
As said, my name is Jay Thomson, and I'm the CEO of the Canadian Communication Systems Alliance, or CCSA, as we call ourselves. Joining me today is a member of our board who is also the CEO of Execulink, based in southwestern Ontario in the town of Woodstock, and that's Mr. Ian Stevens.
Thank you for this opportunity to participate in your important deliberations regarding Canada's response to the COVID-19 pandemic.
Like Execulink, CCSA's members are small and mid-sized independent communications companies that provide broadband Internet, video and telephone services, mostly to smaller and rural communities across this country. Their services have become essential to Canadians during this pandemic, a fact that all governments have recognized and confirmed.
I want to assure you that our members take this essential designation seriously. They are committed to keeping Canadians connected during these challenging times and to meeting the increased demands for installation, higher speeds and more monthly band.
In that respect, our members' proactive initiatives include the voluntary suspension of Internet data caps and overage billing, continued service calls—with heightened safety precautions—and the waiver of late payment fees. In addition, as video providers, our members are currently working in co-operation with many broadcasters to provide free previews of a number of TV channels, including children-oriented stations, in order to make available additional activities for those who must still stay at home.
As you know, Madam Chair, last week the House of Commons held its first-ever and historic virtual parliamentary session. The session used video conferencing, just like thousands of Canadians have been doing over the past few weeks to connect with family and friends and access online education and emergency services, and to continue working, just like we're doing now.
Unfortunately, as we know, last week's virtual parliamentary session was not without issues. Several participants had trouble hearing the member who was speaking at the time, and others had difficulty accessing the simultaneous interpretation. The ability of a member to fully participate in the session was largely dependent on where they live, and that's because the quality of their Internet connection is dependent on where they live.
While the majority of Canadians live in urban centres with good broadband connections, millions of others outside those centres continue to have issues with connecting. The trouble that MPs had participating in the recent virtual parliamentary session serves as a perfect illustration of Canada's shortcomings when it comes to universal access to high-quality broadband Internet service.
It's because of those shortcomings that CCSA and other organizations representing smaller communications providers have come together to jointly ask the government to expedite its financial support for rural broadband to help connect more Canadians faster. As this committee looks at ways for Canada to recover both financially and socially from the COVID-19 pandemic, making expedited investments into rural broadband should be high on your list.
Increased and expedited government investments in Canada's broadband infrastructure will advance the ability of all Canadians to participate in our digital economy and will be crucial for stimulating economic recovery by generating employment opportunities and promoting business growth.
Hundreds of locally based independent Internet providers in this country are keeping Canadians connected during this crisis. They also seek to expand their network so they can connect even more, but the reality is that low population densities in the areas they serve means it will be uneconomic to do so without government help.
With the right amount of funding, properly allocated, and with partnerships with government, locally based service providers will be able to reach many more Canadians and do it soon.
Over the years, we have worked constructively with all levels of government to ensure that Canadians, wherever they live, can actively participate in our digital society and economy. We recognize now more than ever that we all need to work together to keep Canadians connected to these critical communications services so that they may access necessary, accurate and up-to-date information and stay in touch with family, friends and colleagues.
For Canada, the return from investing in rural broadband is clear. With universal access to quality broadband services, more Canadians will be able to fully participate in and contribute to our modern economy and to help us quickly get back on our feet.
No parliamentarian, regardless of the riding you represent across this vast and great country, will again be deprived of the ability to fulfill your democratic duties because of a problem connecting.
Thank you again for this opportunity. We look forward to responding to your questions.
Good evening, and thank you for having me today.
I'd like to begin by acknowledging that I am joining you today from Ottawa, the traditional unceded territories of the Algonquin nation.
My name is Laura Tribe. I'm the executive director of OpenMedia, a community-based organization working to keep the Internet open, affordable and surveillance-free.
Eight weeks ago today, the World Health Organization declared a pandemic. Today I'm here to focus on the one thing that's getting us through it all: the Internet. In a matter of just days, we saw the entire country shift online in a way we never thought possible. Workplaces instantly went remote, stores adopted e-commerce solutions, restaurants switched to delivery apps and schools pivoted to e-learning.
The Internet is holding our country together, it's keeping people employed, it's keeping families connected and it's allowing our democracy to continue to function, bringing me to you today from safe within my home.
Imagine the stress you would feel if your Internet connection went out right now. What if it were out for a week? What if it were out for a month? What if the government told you it would take another decade to fix? That is a reality for rural Canadians across this country. Unless you change course urgently, hundreds of thousands of Canadians could be left behind for the next decade. That's what I'm asking you to fix.
Here are some quick statistics on Canada's home Internet landscape. One in ten Canadians households does not have a home Internet connection. Only 41% of households in rural Canada have access to the CRTC's basic broadband speed targets of 50 megabytes per second download and 10 megabytes per second upload. On first nations reserves that's even lower, at 31%. That is not acceptable, and COVID-19 hasn't helped. Before the pandemic, those who didn't have home Internet access could use public libraries, schools or Tim Hortons Wi-Fi to help bridge the gap. That's no longer an option, and even for those who do have Internet, things aren't great. Over a third of Canadians are reporting slower speeds since COVID-19, according to a recent survey. This isn't good enough.
There is some good news, however. We've heard from your parties across the political spectrum that we need to address the digital divide. has promised to speed up rural broadband rollout. released a new plan to connect Canadians by 2021 instead of 2030. has been calling for a national broadband strategy. Your parties represent the overwhelming majority of Canadians across this country, and they're saying that more needs to be done to get everyone online during COVID-19. The debate about whether or not to act is over. Clearly more needs to be done.
So now the question is this: What are you going to do about it? We need immediate short-term solutions and we need long-term systemic fixes. We have a long list of suggestions, but to start, here are the top three things that you, as parliamentarians, can do right now.
One is to mandate a basic Internet package to ensure that every single person in Canada has access to affordable high-speed Internet. Over 3.5 million people applied for CERB in the past two months, and Canadians already pay some of the highest prices in the world for Internet access. People should not have to choose between food, rent or connectivity.
Two is to release new funding to support shovel-ready infrastructure development projects, connecting underserved rural areas with high-speed 50-by-10 access during COVID-19. Where upgrade projects are ready, give them the money and get them off the ground. Ensure this money helps promote more choice for customers by prioritizing smaller independent service providers and network operators. An economic crisis is a scary time especially for small companies to tackle large infrastructure investments, but you can provide the financial backing to help make them happen and promote greater competition in the process.
Three is to provide a detailed plan with new funding to ensure universal connectivity much sooner than 2030. OpenMedia has been calling for a national broadband strategy since well before the CRTC declared the Internet a basic service in 2016. If I were an MP from a rural riding, I would be genuinely afraid to tell my constituents that they would have to wait until 2030. You have the power to speed this up. Please do it.
Fixing Canada's digital divide only takes two key ingredients, political will and money. You can make both of those happen. There's no going back to normal when this pandemic is over. Our world has been changed forever. Remote work is the new normal. E-learning is here stay. We wouldn't tell rural, remote and indigenous communities that they deserve second-class doctors, teachers or medicine, so why are we telling them to settle for second-class Internet?
When you leave this meeting today, I want you to imagine going back to a town hall in your community. What are you going to say to them? That you're doing every single thing you can to bring them the lifeline they need or that they'll just have to wait and see?
If there is one thing I want you to take away from today's meeting, it's this: The Internet is an essential service. It is your job to ensure that every single person in Canada has access. The country needs Internet heroes, and I hope you'll be one of them.
Welcome. It's my honour to present to you this evening. I certainly appreciate all the work you're doing. I really have to build a little bit on what Mr. Thomson and Ms. Tribe have said. I'm going to make exactly the same points, but more in a regional forum.
I'm from East Kootenay in British Columbia, in the extreme southeast corner of British Columbia. I've been involved in local politics for about 15 years now. I chair something called a regional broadband committee, which is a regional approach. There are three or four regional districts. We represent about 160,000 people scattered throughout the mountains, so it's a very expensive area to serve.
Our present state, and why we have a problem, is that what happens in our area—and I'm sure in much of Canada—is that big telecoms come in and look at a business case. Their business case is predicated on where the density of population is, and they take that. That's fine. That's how business works, but the people on the fringes—they could be 50 metres out of the fringe, they could be 10 minutes out of that fringe—will not get service. As was mentioned by others, this is an essential service for all of us. That really leaves us with a tough problem.
Who came along to help us solve the problem? It was the small Internet service providers that were talked about by previous speakers. These businesses are small, localized, and are faced with a difficult problem. The cost of infrastructure in most of Canada is such that it generates low revenue, especially where you have mountains, where you have to build lots of very expensive towers.
This is not a formula for sustainability in business; hence, all orders of government, be it our local government, municipal governments, or the federal government, need to provide these small carriers with access to funds so they can provide the service to rural people. Much of rural Canada is not profitable. We understand that, and that's our role.
I think, from your point of view, how might you help? We, in local governments, provide essential services. That's what we do, providing things like water and sewer, and we fund them by a formula where the taxpayer, the person receiving the service, will pay for that. For the infrastructure, it's usually a funding formula among the local government, the provincial and the federal governments. Once the service is established, it's not that difficult to pay for the ongoing operations.
To our experience, again I must agree with the previous speakers. We lack, in this country, any sort of strategic plan for this. We have programs. This is the way this has been managed for many years: We have programs. One I was first involved with was called connecting Canadians. I recall it was a good program because it focused on rural programs. Then we had a program called connect to innovate. We applied for it. We weren't successful.
What that program did—and I won't criticize it—is that it gave people who a decent level of service a great level of service. Those who had no service—and you heard the statistics earlier—still had no service. That program didn't go very well. It took almost two years for us to rewrite our applications about four times, and ultimately we were told no. Programs that are very goal-oriented support one part of the country, but again, they're not based on a strategy, from our perspective. What we need to do is to make some programs that reduce the administrative burden on these small Internet service providers. We need to get away from these goal-oriented programs.
Can we create a new granting model that focuses on the strategic needs of the community and the region? This might include consideration of the very real business challenges faced by the local ISPs. Can the grant process be modified toward more localized measures of success? These small carriers are our private sector solutions for offering affordable high-speed Internet.
Another option—and you'll probably hear it, and maybe some of your communities do it—is where the municipality takes a role. That has not been our choice, but it's not something that we won't do.
Again, as the other witnesses have said, we very much lack high-speed Internet for all the reasons you're well aware of. COVID-19 is just making it that much more difficult for our residents, our students at home, for telehealth, to get the job done.
I have included in my report an appendix to a report issued April 23, 2020, by the B.C. Broadband Association. They talk about varied success—access to spectrum is a big one, and the lack of infrastructure.
Thank you very much. I appreciate your time.
Good evening, Madam Chair, vice-chairs and committee members.
Thanks for the opportunity to speak with you.
My name is Andy Kaplan-Myrth. I am VP, Regulatory and Carrier Affairs at TekSavvy.
TekSavvy is an independent Canadian Internet and phone service provider based in southwestern Ontario and Gatineau. We've been serving customers for 20 years and now provide service to over 300,000 customers in every province. We have consistently defended some very simple values concerning the Internet. We believe in affordable, competitive access to the Internet, and we have consistently defended network neutrality and our customers' privacy rights.
TekSavvy invests in building broadband networks in southwestern Ontario, as well as delivering services across Canada, using wholesale services that we buy from incumbent carriers. Wholesale-based competitors like TekSavvy serve more than one million Canadian households and businesses, and we act as a competitive alternative for countless more.
For more than 20 years, with mixed results, successive governments have worked to nurture telecom competition, but the entire framework is at a breaking point, and competitors are at risk of disappearing. If we don't act to protect broadband competition now, then we risk coming through this pandemic with a more expensive and a less competitive market for Internet services.
As you know, the CRTC sets the rates we pay for the last mile of broadband services. Those rates are required to be just and reasonable, fully compensating incumbents for the cost of their investments. In an important decision last year, based on years of study, the CRTC dramatically lowered wholesale broadband rates. The commission also ordered that incumbents pay back the difference between the inflated rates and the final rates going back to early 2016, an amount that's estimated to be around $350 million that competitors collectively overpaid to incumbents.
We knew the incumbents might appeal that decision, but we decided that Canadians deserved the benefit of those lower rates, and we immediately reduced our prices. Other competitors did as well. Of course, phone and cable companies have launched multiple appeals of those final rates and, meanwhile, they're charging us the old inflated rates. As a result, going into 2020, we were already losing money, but rather than raising prices on our subscribers, we decided that we were in a strong enough position that we could stay the course and lose money for the next year while we defend the appeals.
With COVID-19 and the move to work from home, a reliable residential Internet connection is more important than ever. To support our subscribers, we immediately suspended any charges associated with exceeding bandwidth limits, but the main impact of COVID-19 has been to exacerbate those pre-existing rate problems. In particular, to address the increased traffic generated by people working from home, we have significantly increased the capacity we buy from incumbents, all at the old inflated rates. Revenues are essentially flat while our costs continue to mushroom.
We had expected to carry financial losses for up to a year while the incumbent appeals played out, but the impact of COVID-19 effectively put us where we had expected to be at the end of this year. To manage those costs, TekSavvy has taken drastic and painful steps, laying off almost 30% of our workforce and increasing service prices by $5 a month. We have also had to delay planned investments in rural networks. This is a perverse outcome. Those underserved areas ought to get service more quickly because of COVID-19, but instead their service will be delayed unless the government steps in to fill in the funding gaps.
TekSavvy strongly encourages the government to take a long-term view even while addressing the immediate pressures of the COVID-19 public health crisis. This must be a competitive market that serves the needs of all Canadians and should not be replaced with monopoly markets.
From TekSavvy's perspective, the COVID-19 pandemic has not, on its own, created problems for competitors; rather, the foundations of the regulatory regime that support wholesale-based competition were already crumbling, and COVID-19 is adding stress and exposing just how dire the situation is.
Thank you for your time.
I look forward to your questions.
Thank you, Madam Chair.
This is all a new experience for me over the last month with Zoom meetings and things like that, and I appreciate the opportunity to be able to discuss St. Clair Township's Internet coverage before, during and after the COVID-19 pandemic.
As you said, my name is Mayor Steve Arnold. I represent a community that has a population of approximately 15,000 people within 640 square kilometres, and our western border is the United States. They're less than half a kilometre away from us.
The balance of the property that we have is approximately 90% rural and 10% urban. Half of our assessment, and also half of our water usage, is based on heavy industry, which is well serviced by fibre optic cable. Because they're big customers, everybody wanted to make sure they were serviced.
In 2011, I was part of the western wardens who established the SWIFT initiative in southwestern Ontario. We also started trying to entice high-speed Internet providers in 2004 in our municipality to expand service to commercial and light industrial companies, and to our residences in areas outside of where our industrial complexes were. During that time, from 2004 to 2019, we have worked with eight different providers with limited success. Usually what happens is that they get all excited, and they come and charge you $60 to see whether or not you have a strong enough through-the-air signal, and 90% of the time you don't. You pay your $60, and they say sorry and go back to wherever they came from.
The residents who currently have Internet, even in our more built-up area, which is Corunna, they get it through the cable providers at 45 megabits per second transfer speeds, and anybody else who can get anything through the airwaves gets between five and seven megabits per second transfer speeds, but if you do your checks, on the lower end, it's usually around 0.5 to one, which makes it pretty well impossible to do anything.
I'm told that downloads of larger files can take from two hours to two days for movies and homework. I've had teachers call me to complain because now they have to do online learning, due to the COVID stuff, and it's just impossible to get it out to the rural communities. Even on the Internet that I have—I use a satellite connection—I'm getting slow speed detections that are shutting me down and taking me offline for sometimes a couple of days at a time. It's very frustrating for us.
There are a number of households that I've been contacted by that are now using two providers in order to get enough service to complete even simple tasks. With our proximity to the United States, signal piracy is common. Canadian providers install a new through-the-air tower, and then the reception and transfer becomes as poor as prior to the installation. They're very entrepreneurial when you cross the international boundary close to us.
However, the good news is that we are very pleased to have been successful in working with Cogeco to receive a SWIFT fibre optic cable project and grant, which will service our most under-serviced and largest population outside of our village of Corunna. It is their hope that we will see this project completed within 18 to 30 months. It's a $5.8-million project and it will provide service to approximately 30% of our total land mass and approximately 5,000 more residents than we currently have serviced. However, we will still be limited....
Am I done? Okay. Thank you very much.
Thank you to all the witnesses.
I would just like to start by saying that Internet access is not a luxury. It is a requirement for equality of opportunity and I think it's becoming a barrier to equality of opportunity to economic growth and productivity. So this isn't an issue that we can just ignore and hope that the status quo will fix.
What I hope to hear tonight is some consensus on a few issues. First of all, 2030 is not an aspirational or appropriate target for universal, reliable access to the Internet.
I'm going to start my questions with one directed to Ms. Tribe. Investment is important as we work toward access across this country, but would you say that spending is the metric that we should be driving to? Perhaps it should be to connect every Canadian with the 50-down/10-up requirement that you set forward within an aspirational timeline? I want to shoot for the end of next year.
Thanks to our colleagues and, in particular, our witnesses for joining us today.
Representing a rural riding in western Quebec, I cannot think of a topic that is more germane and important to the entirety of my riding.
I had a call this morning with a mayor and council from a small town who remain frustrated with their Internet access. This is the number one infrastructure issue in my riding. It has been since the start of my service as an MP in 2015, and it will continue to be until we get to that 100% connectivity target.
I share the passion of those witnesses with us today whose articulate presentations I really appreciate.
I would highlight that we really have reached a point of consensus in Canada. Many of you will be aware that in the previous Parliament, I advanced a private member's motion, M-208, which called for heightened investments in our Internet infrastructure across rural Canada. Thankfully, we had united support across all parties, so I think we really are at a moment where there is violent agreement that it is absolutely necessary. I think the question is really more about how we get there.
I agree with the point made by Ms. Tribe. Waiting until 2030 won't satisfy my constituents. People want Internet yesterday, and they deserve that, but the challenge is a technical and financial one. I don't think, though, that at this point it's a question of political will. I believe that our government has demonstrated that we're willing to step up.
I would note, just as a point of history—and this was brought up by our representative from the Kootenay region—there were programs prior to 2015, but they didn't go to private residences. The federal government provided subsidies that enabled schools, municipal halls, fire halls and libraries to get hooked up, but individual households were left without that support. They were left to the vagaries of the free market.
We have changed that, and the connect to innovate program does bring fibre optics to homes. Up to now, our government has connected nearly 400,000 homes, and leveraged federal and provincial funds to enable $1.2 billion worth of projects. That's not insignificant, but more needs to be done. We all acknowledge that.
I'll go to Ms. Tribe and to my friend and constituent, Jay Thomson, on this issue. What in the design of the next program—in the universal broadband fund, when it is brought forward—needs to be altered to ensure that it is a successful program?
I'll go first, but I will try not to take up so much time. I'll make sure Mr. Thomson also gets to speak.
I think it needs to include a focus on ensuring that the high speed is actually available in homes, not just technically available. We really need to make sure it's getting into the homes. It also needs to involve a consultation on what the individual communities look like, particularly indigenous communities. There's a lot of interest in their having decision-making powers over the types of services available to them.
We think the technology really needs to be future-proof. This is not about hitting the 2016 targets. They're a minimum. We want to make sure the technology being deployed is essentially fibre everywhere. If we need stopgap solutions now, there should be a plan for long-term connectivity.
We also need to make sure the speeds are actually being met. The advertised speeds are a big problem we have now because people aren't necessary receiving them. That came up from multiple people in the technology tests done in advance of this.
I think the biggest challenge—again, not to harp on the money aspect of it—is it has felt very piecemeal. It needs to be nationalized in that every single community needs to know when they're going to get service, how that's going to happen and what they can expect from it, with enough money to back it. The biggest failing of the programs to date over the decades, although not any particular program, is even though they have been chipping away at problems, every time an announcement is made a different community feels left behind because it wasn't done.
As others have already said, it's important to look to the smaller, locally based providers that are actually in the communities and fully understand the needs of their local customers. Money can be made available to them, perhaps in smaller amounts than have been the case in the past. We don't necessarily need huge multi-million dollar projects in smaller communities, but we need a way to get access to money quickly and through a simple application process, with the ability to use the smaller amount of funds for local projects.
There is another aspect to it. There's more to this than just the capital expenditure to build the network. Once it's built, it has to be maintained. The economics of rural Canada and smaller populations are such that the cost impact is the same for builds as it is for maintenance. Operational support is also important so that once built, a network can be maintained and even improved over time.
Thank you, Madam Chair.
I'm very pleased that we're finally addressing this topic. I'm happy to see a consensus. I still want to emphasize one point that I had in mind and that Ms. Tribe just raised, namely, the idea of nationalizing the service delivery. I think that this idea is worth considering.
My question is for Mr. Kaplan-Myrth. It's good to see you again, Mr. Kaplan-Myrth.
The crisis obviously affected your business model, including the monthly price, the ability to generate traffic and perhaps the ability to provide unlimited data to your customers. Is that the case?
To be clear about this, Bell, for example—or any of the incumbents, really—builds the broadband networks and then uses those broadband networks to provide services to its own customers on a retail basis. It also sells wholesale access to those networks to providers like TekSavvy and other wholesale-based competitors, and we take those wholesale services that we buy, put them together with other services that we took to make our Internet service and sell them to our customers. The requirement is that everyone who is buying those wholesale services from Bell is buying essentially the same services. There's some variability because of off-tariff agreements, but the tariff services that we all buy, I assume are essentially the same. We have a level playing field among the competitors, but that is very different from the service that Bell provides to its own retail customers.
This is really not just about Bell, it's about all the incumbents that are mandated to sell wholesale services. They typically have many advantages that they can leverage when they're selling services to their own retail customers, operational advantages and efficiency advantages, and they obviously have a lot of information about what services, capacity, backhaul and other sorts of things are available and can manage that in ways on their retail side that we can't on the wholesale side.
This goes back to some of the ideas of structural or functional separation that Laura Tribe was talking about earlier, where if Bell, for example, were required to buy its own broadband services on the same terms that we buy its broadband services to serve their retail customers, I think that would create a level playing field and would probably improve the services that we all got from their broadband network.
One of the things we haven't touched too much on just yet and that I think is important is that this country actually had spectrum auctions and gained $20 billion of revenue for essentially no real product for which they had a cost to roll out. The spectrum has taken in around $20 billion—the last numbers are going to be even more important for our future—and we haven't put that back into the system.
In fact, what we've done is that we've created a very low competition market. We have areas that are poorly serviced, by design, in what we have now. We've had experiments in the past, through Maxime Bernier, in regard to opening up for foreign competition, but then at the same time not even having mandates to protect that competition or allowing it to do anything other than just having a precursor introduction into our market.
Still, what we don't have yet is a basic package commitment from the government, and 2030 is absurd. That's just not acceptable.
My first question is for you, Ms. Tribe, with regard to the universality suggestion you made. I think there is an example that was handled poorly in the past, when we actually forced a skinny package for cable and Internet providers for news and basic services. There should be a political decision or a drive to mandate a basic set of services at a lower price at the minimum threshold you should expect for a Canadian who needs to use the Internet now more than ever before.
Even before COVID, we saw government services moving online. We've reduced public offices where you can actually get service and help and we've streamed people to online services. We've made it even more important to be connected, let alone that it is important for your education, the economy and so forth.
With regard to your suggestion of a basic package, can you highlight a bit of what you would see as features for that?
One of the challenges we've seen with ideas like a skinny basic package around cable is that in the past they were buried on websites. They were impossible to find and impossible to navigate. I think what we're talking about with a universal package that's available to everyone is to make it as inclusive and as widely available as possible.
We can look at any of the affordability packages that have been put forward in the past. They tend to be incumbent led, particularly around cellphones or for home Internet for subsidized housing in plans that are restricted in the amounts that people can use and restricted in the speed. Even though they may be affordable—for something like $10 a month—if they don't actually give people the services they need, it's a problem.
I think what we're looking at right now is something like a plan for $20 to $25 a month. It gives people those high-speed access services. If you want something faster than the minimum basic from the CRTC, you can do that, but I think we need to recognize, those who are making that call, that for companies like TekSavvy that are providing wholesale, that's a real challenge, because of where the wholesale rates are at right now, to make that actually feasible.
That's really where this isn't just regulating at the retail rate. It has to get at a lot of those systemic, underlying issues of everyone being overcharged at the base level off the bat.
You raised an important point. I was there when Mr. Amos' motion 208 went through. The problem we have is that it was a motion, so it's not legislation. We need it enshrined in law. It was good, and we had some really good discussion on it. It highlighted and moved some things. I don't have any criticism whatsoever, other than how we need this to be more mandated by law.
If you want to actually play in the market, I see this spectrum auction as an opportunity to do that. On this spectrum auction, I'll again follow up with you, Ms. Tribe. I've been advocating—you can disagree with this, so feel free—that instead of getting the money from the spectrum auction, we need to focus on access to service and having specific claw dates to actually have accountability for that spectrum.
What we have right now is $20 billion in revenue from our current system. As for where it's gone, we have no idea. I've asked the government many times about that. They've put very little of that money back into rolling out Frankenstein packages all across the country to try to fill in the gaps. When we do this spectrum, I would rather see it focused less on money and more on actually getting access.
Thank you, Madam Chair.
I really appreciate all the witnesses being here today. Really what I'm hearing is that in order to connect Canada, it will take political will to change the status quo. That comes with creating good policies, so I really appreciate the comments we're hearing here today.
My questions today will go to you, Mr. Gay, from the Regional District of East Kootenay. In rural communities such as yours, access to mental health services were limited, at best, prior to the pandemic. With the added isolation that today's physical distancing brings, mental health concerns are on the rise. Video calls with family members and friends are very important to help reduce this isolation.
What would increased access to the Internet in your community mean to health and well-being?
Thank you. That's a very good question. I don't think we really realize the depths of that issue, because people are home; they're solitary.
When it comes to mental health issues, it would allow them to at least communicate with somebody. We're an aging community. For many of our seniors, loneliness is one of their biggest issues. As was mentioned by another speaker, maybe some seniors can't afford the access, but they can go to their local libraries to get it. Those libraries happen to be closed now.
All our communities are rural, and I think people are suffering more than they need to. Lots of things could be provided online in terms of counselling and coaching. We have a doctor shortage here as well. We're trying to bring more doctors to our community. There are lots of things in terms of mental health. In British Columbia, telehealth is quite a growing aspect, but again, without connectivity and high-speed Internet, telehealth isn't much good.
Yes, I have seen the document. I recognize that your committee will also be doing a study on the various aspects. I think you'll end up in the same place. I think most of us know it.
Certainly your document talks about a strategy at a national level, with some priorities. As I mentioned in my presentation, these program-based things solve a particular program for somebody, but it's not a universal fix, so I think that strategy is good. The discussion talks about infrastructure and the need for more money in infrastructure. As was mentioned, the money or the services could be available through the auctions. In this auction of spectrum, we're selling air. It's the greatest way to earn money. In politics, we'd love something like that. So put the money back or get these companies to provide the service. That's really important.
It does talk about a solution around municipalities owning it. At the Regional District of East Kootenay, we do own some fibre. When we first got into this, we were going to try to do it ourselves. We had a vote. Our citizens knew the importance of it. I think we own about 40 or 50 kilometres of fibre in our Columbia Valley area. In fact, it's funny, because we lease it back to Shaw, one of our larger carriers.
I'd like to change tack a little bit and focus on digital proximity tracing.
Laura, I understand OpenMedia, alongside the BCCLA and some other privacy and civil liberties focused organizations, released a statement of principles in relation to digital proximity tracing. I also understand that, today, privacy commissioners jointly released a similar statement about principles. I agree with almost everything in those documents, but I do wonder a little bit about the importance of voluntariness. I say that despite the indicating that voluntariness was critically important too, to build trust in these applications.
My challenge, and I wonder how you would respond to this challenge, is on the question of efficacy when we see that adoption rates are so low. We've seen 20% adoption rates in other countries, for example, that have a voluntary system. That adoption rate is not going to be effective. We've seen research out of Oxford that suggests a 60% national adoption rate is sort of a standard that one would look to, to say that would be effective.
Do you see a way to overcome that challenge, and to ensure there are adoption rates in a voluntary system?
I think the concerns that we have in these privacy principles.... That is one of the other things we're putting in the written record of this proceeding, because there's only so much time today. We will have more on it.
I think the biggest concern for us around voluntary versus mandatory is that, if it's mandatory, this is no longer consensual. The privacy protections that we have in place through PIPEDA and the Privacy Act are insufficient to actually protect Canadians' data. It's really rare that the voluntary piece needs to come in. I think there are huge concerns, taking a step back from the privacy principles that we've put forward, around the effectiveness of these apps, even where they are adopted.
I take your point around the efficacy concerns for adoption rates, but I think the testing that needs to happen needs to come first. The contact tracing needs to come second. This app is really a supplemental piece and a tiny fraction of the puzzle. I think one of the concerns that we have, or one of the things we've been hearing around the voluntary adoption, if the government is to go this way.... All of those privacy principles that we have put forward are done with the intention of making sure there is trust, because if there is no trust in this service, people will not use it, even if it's mandatory. People will leave their phones at home. They will not take them with them.
I think it also puts a huge disadvantage to those who, as we were talking about earlier, are on the other side of the digital divide, who don't have a phone. If this is now something that is being used to give people the permission to leave their houses or ride public transit and you don't have a device, you're now effectively being penalized and left behind even more.
I think that's a good point, where you tie privilege to the use of an application and people are left out as a matter of the digital divide, whether we're talking about seniors, the homeless or other circumstances where people don't have access to the technology. That is a real challenge that would need to be overcome.
But, when we're talking about initially what is effective, I wonder, the go-to to voluntariness... and I say this as someone who's been incredibly vocal and supportive of privacy overall as a parliamentarian, but if we're not even going to get in the door of any efficacy or usefulness out of this because of the barrier of voluntariness then.... I'll use an example here maybe. I read the privacy commissioner's statement, and de-identification is an incredibly important principle, but then they also note that de-identified, or aggregate, data should be used whenever possible unless it will not achieve the defined purpose.
Couldn't we take the same approach of necessity and proportionality writ large when it comes to voluntariness as well?
Thank you so much, Madam Chair.
Of course, I just had a notice that my Internet connection is unstable, so hopefully I'll be able to get through this.
First of all, I want to thank everyone for appearing at this virtual committee hearing today. Those of us from rural areas have spent many hours trying to sort out these issues of our own connectivity. Of course, it's an ongoing battle made worse now that COVID-19 is forcing so many Canadians to try to adapt to a new paradigm of work, study and social connections from a computer monitor.
From my own perspective, hopefully the two geese that were trying to nest on my cell tower this morning have moved on to other parts, and we can go from there.
As the former vice-chair of the industry committee, I was honoured to help initiate the study on rural and remote broadband in the last Parliament. There was a great flurry of activity with respect to promises from this government regarding their connect to innovate program. There were some discussions about the connecting Canadians program that we had before. Well, that was five or six years ago.
We recognized the initial rollout that was associated with that, but of course, as Mr. Gay indicated earlier today, if you happen to have been fortunate enough, you might have been able to have some money come through the connect to innovate program, as many people in this country have, but there were a lot of places that were left out. I think that's really why we're so concerned about this.
Also, I believe there was some commentary about the consultation process that the Conservatives were doing on rural Internet access. One of the proposed recommendations we made had to do with the detailed strategy plan to address the geographical and economic disparities that exist as we embark on this goal to improve rural broadband access. One of the items preparing for further crises that might be part of that could be considering temporary deployment of cells on wheels to get out to some of these areas that have a lot of really serious problems.
When it comes to the disproportionate impact of rural broadband access to Canadian society, I'd like to get your thoughts on this and other measures that we could take to mitigate this inequality.
Perhaps I could have our folks from TekSavvy speak to this, please.
Thank you very much, Madam Chair.
Thank you to all our witnesses.
I think we can certainly agree the urgency of ensuring connectivity across Canada has been heightened through the pandemic, as so many of you have pointed out.
My riding of Markham—Stouffville does include a very rural area. Some of the comments made by Mr. Gay and Mayor Arnold really resonated with me because through the years there has been a concerted effort by municipalities, by York Region, to try to improve connectivity through the rural areas. Of course there has been the situation—Mayor Arnold, you referenced it in particular—that people come in, do an assessment and somehow it's not worth their while. There's no business case to improve the connectivity in particular areas. In particular, it seems—and I've heard this from rural MP colleagues—that some of the incumbents—Bell, Rogers, Telus—have made it quite clear they don't see a business case for them to connect rural Canada.
Mayor Arnold, could talk to that experience a little?
Thank you very much for the question.
You're absolutely right. We get non-stop charges for roaming in the United States. We can be as far away as 10 to 12 kilometres from the border and we're still picking up those charges. You end up having to get your bill redone, and you always end up paying more.
The Internet is worse. We had a new Rogers tower put up just outside the village of Sombra, which is right along the St. Clair River. What happened is that in the first two weeks the Internet was wonderful in the village. People couldn't get over it. Then, all of a sudden, the Americans in Marine City found out it was there. They sucked all the bandwidth out of the tower, and it was far worse than it was before. What Rogers did, in their infinite wisdom, was they turned the satellite signal around, and it did absolutely nothing.
You're absolutely right. It's a real challenge. That's why fibre is the only option for us.
Thank you, and thank you for your patience.
When we are talking about the plans for putting this forward, for us, the plan needs to be national and the funding needs to be national. In terms of who the government is funding, I don't necessarily believe, and we don't necessarily believe, that the government needs to own those networks.
It could be a matter of the government building them on an open access model and then allowing other providers to provide the service over them. I think that what is more likely and probably faster than having the government decide to get into the Internet service business is to instead ramp up the services we already have, which are investing in those who have the expertise in those areas, to make sure they're building on the services they've already started.
Does that help?
Thank you, Madam Chair.
Thanks to the witnesses.
Ms. Tribe, you highlighted three short-term, let's say, steps that would help us with the emergency situation we are dealing with. On the third item, you talked about detailing a plan that would expedite getting us way ahead of 2030. In follow-up questions, you talked about coming up with a national strategy. You constantly referred to the government, and I would assume you're talking about the Government of Canada, the federal government, as the key driver of this through subsidies, through funding for infrastructure.
Where are the other players, from your point of view, playing in this puzzle? We still have provinces. We still have regions. We still have municipalities. We have IS providers, larger ones and smaller ones. We have some of the infrastructure that is already in place. We also have the residents.
How do you think these players, these stakeholders, play into this national strategy and the national rollout that you're talking about?
Let me share with you the experience I've had, at least over the last six years, as the federal government introduced a lot of infrastructure programs. Where we run into a bottleneck is when those infrastructure programs come to the provincial level or the municipal level. A lot of, let's say, positioning had to take place to make sure they were prioritized.
Despite the fact that the Government of Canada, at least in the case of my riding, identified infrastructure investment as a top priority, when it came to the province and when it came to the region there was that friction, or there was misalignment, I would call it, and timing that didn't allow us to roll out that infrastructure in a timely manner.
Yes, we can drive it, but we need partners at the table to develop this and agree on it, rather than us saying, “These are the pieces,” and then, “Province, this is your piece to go.” What are your thoughts on that?
You will all know better than I do how difficult it is to get multi-layered government projects aligned, particularly with elections, when governments can change in different cycles at different times. There are different interests that come in. However, for starters, this is an issue where there is a lot of alignment at all levels of government. People need connectivity, and I think you can start there.
Then, if the government is firm in its commitments, and the provinces, the municipalities, the regions know that you're going to be there in one year, two years or three years to follow up and to continue on this—this isn't just a press release, it's not just an announcement, but it's actually a plan that's going to be followed through on—I think you're going to be amazed to see they're willing to sit at the table knowing that suddenly you're going to help them get their communities online.
When those conversations are taking place, there's absolutely an expectation that those communities are participating in the conversation. They are helping to drive what services they're looking for or what the set-up is they're looking for. That's in cities and towns, as well as first nations communities. That consultation process is something the federal government is well positioned to facilitate in those smaller circles.
I'd like to thank all of the witnesses for being here with us this evening. I was actually just logged off because my Internet was faulty. Luckily, I got back on just in time.
Obviously, we live in a time when we completely depend on the Internet more than ever. Every single Canadian should have access to the Internet. I'm happy we're having this conversation today.
My first question is for TekSavvy.
You were answering that you were having some difficulties pre-coronavirus and needed the government's help with regard to keeping the company going. I was wondering if you had an increase in demand after the virus hit and once people were forced to work from home.
We'll start with that question.
We were actually already seeing dramatic increases in how much capacity we needed to carry our customers' traffic late in 2019, before the pandemic. It was already getting expensive. That's partly a factor of a lot of new streaming services coming online all at the same time. We also lowered prices. People increased their speeds. There were a number of factors. We were working really hard to add capacity to our network as fast as we could.
With the pandemic, yes, we definitely saw an increase in the amount of traffic on our networks, and not just during the day, but overall, and at peak times, which is really the limiting factor for us. The way we provision our networks is by buying the amount of capacity we need at peak time.
We saw huge increases in the amount of capacity that we needed. We immediately placed a lot of orders to add capacity to our networks. That's a process that takes time for us. It's a service that we buy from the incumbents.
It was helped somewhat when YouTube, and Netflix, I believe it was, reduced the quality of their streams. That saved a lot of bandwidth and we had some relief from that.
But, yes, we saw very large increases in the amount of traffic generated on the networks.
Thank you, Madam Chair.
In my opinion, we have a duty of fairness to all consumers. I'm thinking about the idea of a universal floor price in the country, meaning in Quebec and Canada, in both urban and rural areas. This price would be fixed by a government agency. It would be a universal fixed price for data use, and the provider would offer this price to the distributor. The goal is to ensure that the customer doesn't pay more, whether the customer is in an urban or rural area. Of course, this could give competitive advantages to small providers.
My question is for the representatives of the Canadian Communication Systems Alliance, who referred earlier to the idea of stepping up financial support for broadband services in rural areas.
Do you agree with this principle of independence between the provider and the distributor?
Also, do you agree that each distributor should have a legal obligation to maintain the same ratio of customers in urban and rural areas?
Thank you, Madam Chair.
I want to take a moment to thank our researchers. They did an amazing job in pulling together some good data with regard to the coverage that each province has and the private companies that are involved. That needs to be noted because we get some really good service here.
Ms. Tribe, I want to ask again about universality and the streaming and net neutrality issues we have. Has that taken a back seat right now given what has taken place in terms of connectivity? What I worry about to some degree, just as I do with privacy rights, is it becoming subservient during times of crisis to expediency, which can undermine our pillars of democracy, and also with net neutrality and streaming, advertising and other things could be affected. Do you have any comments related to that?
Thanks. I love to talk net neutrality.
As for where net neutrality stands in Canada right now, the CRTC has made a number of strong decisions that support net neutrality as far as content not being prioritized over other content is concerned. It is up for debate, in the review of the Telecommunications Act, what any new legislation would look like.
The biggest thing I take away from this pandemic with regard to net neutrality is that so many of the arguments we have heard from the incumbents on why certain content should be prioritized over other types of content are about traffic management needs. It's the same reason they justify low data caps, which we have seen artificially suppress usage. We've seen our major ISPs remove data caps across the board in this time of crisis, and therefore, fundamentally, we need to look at whether they are needed the rest of the time. If we can uphold net neutrality now, I think it will set a strong precedent for when things return to a more normal state, whatever that looks like. Those principles need to remain then, too.