44th Parl. 1st Sess.
November 23, 2022 02:00PM
Madam Speaker, it is an honour to rise once again in the House and to be able to speak to what I think is a fantastic bill by my colleague from Dauphin—Swan River—Neepawa in Manitoba. As a result, we are continuing the conversation about reliable Internet access.
There have been many speeches and questions in the House on this issue, and there are many members from different parties all across the country who care about the issue. The government has made announcements and promises over the years, but progress has been slow.
Bill C-288, however, is doing something more than talking about a problem; it is taking some practical steps forward that will make a real difference for Canadians.
To begin this debate at second reading, the member for Dauphin—Swan River—Neepawa did a great job of laying out the three pillars of this legislation.
The first is a requirement for Internet service providers to provide Canadians the typical download and upload speeds they offer, not just the maximum theoretical speeds.
The second is a requirement to provide Canadians with the quality metrics they can expect during the peak periods, when people are most likely to use the service. For people at home who wonder why that is so important, the first reason in particular is that it deals with mostly what people would think of with their cellphone. A lot of the cellphone companies will talk about how their LTE speed on their cellphone could be up to 80 megabytes per second, or it could be 100 megabytes per second. The reality is that people are going to realize those speeds only if they are standing within 100 metres of the tower, with nobody else connected to the tower. That is the only time they are going to theoretically get that 100 megabyte speed. As technology has advanced and moved along, we are slowly getting to the point at which more people might be able to realize speeds closer to that, but it does not change the fact that for years people have been told that they could theoretically get that, without ever actually coming close to getting it.
The second metric that I mentioned is especially important when we think about companies that are providing service via satellite, or maybe via a wireless-to-the-home connection. They are told they are going to get x amount of speed, but the reality is that as more users are utilizing the system, it is going to drag that speed down to a point at which it almost becomes unusable. As we all saw over the last couple of years with people doing school from home and people working from home, it has become almost impossible for a lot of people, particularly people in rural Canada, to be able to participate in the economy and to be able to participate in school. That is why I think these are a really good first couple of steps with this bill.
The third pillar is to begin a consultation process with the CRTC and develop a framework that can work in the public's best interest.
These are three simple things that are meant to work together so customers can have accurate and transparent information about the services they are paying for. It sounds like this should be something basic to the experience of buying anything, but in this case it is not, and certainly not for millions of Canadians.
I want to make sure everyone understands the situation with Internet service in our country, which this bill is trying to improve. Let us start with some data that will help to put it in perspective.
Last year, the Canadian Internet Registration Authority, or CIRA, released a report called “Canadians Deserve a Better Internet”. Here is what it had to say about the performance of quality experienced by customers. It states:
ISPs market their service tiers as “up to” certain speeds, but when asked how often they feel they receive those speeds, only one-third of Canadians said it was most of the time or all of the time.
If only one-third consistently reach those advertised speeds, what does that say about the remaining two-thirds of Canadians? That would make for a strong majority of customers who do not believe they receive the quality of service they are paying for. With a number like that, it is clear something is not working for members of the public, and this creates a lack of trust, which weakens the industry itself. This is the problem Bill C-288 has in mind. A key part of the solution is transparency and, more importantly, accuracy. That is exactly what the first two points of this legislation would provide.
As the report noted, Internet providers market their service packages in a given area by saying they go “up to” a certain speed. This is called the maximum theoretical speed. It is a positive spin that sounds good to the potential customer and helps with making sales, but many do not realize the actual speed they are going to get does not match up with what they were told.
For some people, it is obviously annoying and inconvenient, but they can still get by, and that is bad enough, because they still feel like they are not getting what they paid for. For others, however, depending on where they live, it could make a more significant difference. They might be paying for Internet in theory, but it almost does not exist in practice. That is something that is a common occurrence in rural areas and that many members of this House have brought up, either in this debate or in other debates when we talk about broadband access. Either way, those people are likely to get a different impression as a customer if they are told about the typical speed on average and what the speed is during peak periods. It is a better reflection of the quality they will get when they are using the Internet, and it could affect the decision they might otherwise make when purchasing the product. Without having this information for more context, it is misleading in too many cases.
I proudly represent a rural riding myself. Over the years, I have heard from many people who have this problem with their Internet, and I actually saw it first-hand in my career prior to being a parliamentarian, when I worked as an Internet service provider technician. It was my job to not only install but also repair and fix people’s Internet services.
As someone who had to deal with people who were told that they were getting one thing, but the reality was that they could only possibly get a fraction of that, I saw that it caused a lot of confusion and headache. I can tell members that, for an installer, this legislation would make life a lot simpler, knowing that customers have the accurate and appropriate information prior to either signing a contract for service or purchasing equipment for their services.
For a lot of these paying customers, as well as for those of us working in the field, but especially for those customers, it would have been easier for everyone involved if there had been realistic information from the start, which, again, is what this bill would be doing. Bill C-288 would require that to be made available to Canadian consumers.
This is in line with what the Standing Committee on Industry, Science and Technology recommended in a report last year. I know that the member who spoke before me already mentioned this recommendation, but I am going to say it again for the context of my speech. It recommends:
That the [CRTC] require Internet service providers to make information available to consumers on the usual download and upload speeds they can expect during peak periods so they can make more informed purchasing decisions based on accurate and transparent information, thereby improving the industry’s competitiveness overall.
It would be simple enough to do it, and I think all parties can see the benefit. After this recommendation was put forward, the government side has tried to say that it announced a proposed policy directive to the CRTC earlier this year. In reality, it is not the same thing. Its proposal is vague, and it does not mention the issue with typical speeds or peak periods.
That is what we need to see happen, and the sooner, the better. We do not need to wait around for the lagging speed of government to catch up. It is good to see the member for Dauphin—Swan River—Neepawa bring forward a bill trying to get it done. We need to act on this like it is a real priority.
As of last week, we have seen progress from the FCC in the United States. It will require broadband providers to display easy-to-understand labels with key information. This will include typical upload and download speeds, as well as typical latency.
For years now, Australia has had standards for advertising for typical speeds during peak periods. As a result, going back to 2018, the Australian Competition and Consumer Commission has found benefits for consumers. It has also improved the industry by strengthening market competition. We can learn from them and do the same thing. We can encourage more innovation.
This is something that will benefit all Canadians, not just those in rural areas. I want to make sure that this point is clear to everyone. Part of the problem we sometimes have in this place is that there are different ideas of what “rural” actually means.
For one of the government's programs for rural connectivity, I once asked for a definition, and I was told that communities of 30,000 people or less were eligible. The largest community in my riding, for example, is only 18,000, so it is interesting to see how that fits in. We are dealing with the population of a city, at least, as I have mentioned to members, it is where I am from.
Another example we had was that the definition of “rural” could be described as any community that uses oil and gas or agriculture as its main economic driver. I think of some of the cities that we have out west, such as Edmonton and Calgary, which would be more than happy to say that those are some of the driving forces of their economies. I think that we would also agree that Calgary and Edmonton are not rural communities.
When it comes to Internet access, there was a recent news article published online with this headline: “Internet services in rural GTA ‘like living in the dark ages’: Oshawa residents”. People who live near urban areas of the GTA are describing problems similar to what I hear from my constituents back in rural Saskatchewan. One of the residents said, “We are within minutes of a shopping center and yet no internet”. That does not sound like someone living in the middle of nowhere.
Another person spoke about paying “an exorbitant amount of money for service that is less than adequate.” She continued, “We’ve tried almost every service provider available, and the end result is the same – spotty at best internet connection.”
My plea would be for everyone to consider supporting Bill C-288 because it would get the job done for getting accurate reporting for Canadians.
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I have a great audience tonight, Madam Speaker. I hope I will be able to concentrate.
Stephen Hawking once said, “We are all now connected by the Internet, like neurons in a giant brain.” In this giant brain, good Internet is equivalent to a high IQ. It lets us go further in life. The issues in the Internet service market involve both the providers themselves and the legal framework in which they operate, and can be summed up in two points that are intrinsically linked. The first is the inadequate service quality and download speeds, and the second is the exorbitant rates that Quebeckers and Canadians pay for their telecommunications services.
This bill seeks, among other things, to give consumers the ability to make an informed decision when choosing an Internet service provider. In other words, Internet providers will no longer have the right to advertise the highest theoretical speed possible, but will have to indicate the average speed, especially during peak periods. That is a good start.
We should note right from the outset that the proposed measures apply only to fixed broadband service and not mobile phones, even though everyone knows that cell phone rates in Canada are much higher than elsewhere in the world, but let us move on.
This bill will contribute to improving the situation, but other actions will have to be taken. As I will explain, there needs to be a discussion on competition and the market power of the telecommunications giants.
I would like to begin with the importance of having access to high-quality Internet. This service is beyond essential. The quality and affordability of Internet services are closely linked to the economic performance of Quebec and Canada.
Let me share a quick story. In my former life as a consultant, I had a contract in the Republic of Palau. It is a small island paradise in the middle of the Pacific, and I was able to help its finance department improve their environmental, social and accounting standards so they could receive money from foreign funds. The Island of Palau does not really have Internet. My stay went very well with a bit of an Internet connection, and therefore less work, potentially, but ultimately, we can see that Palau's economic development has suffered a great deal due to this. I experienced that.
The trend has been moving towards digitizing the economy for several years now, and the pandemic only accelerated this. The massive shift to telework and people's ability to work remotely should encourage the development of the regions of Quebec and Canada. Unfortunately, the Liberal government is struggling to keep up with technological developments and the digitization of the economy. Its outdated policies mean that Canada often lags behind on telecommunications affordability.
We cannot talk about economic development without considering the quality of Internet access. It is as important to economic development as the power grid was in Quebec in the 1960s.
The Quebec government is working hard to improve Internet access, particularly in remote areas. High-speed Internet access for all eligible households in Quebec is a priority for the Quebec government. Furthermore, it has invested huge amounts of money in this area. To date, the Quebec government has budgeted $1.3 billion to get households connected faster to high-speed Internet. In comparison, the Government of Canada has invested $1 billion this year, bringing its total investment to $2.75 billion. In Quebec, the amount is about $150 per person. In Canada, it is half that, or only about $75 per person.
Now let us look at what is happening internationally. Every year, The Economist compiles data on Internet services in about 100 countries. Although Canada scores well for quality of infrastructure and literacy, which is Canadians' understanding of and ability to use Internet services, its rank is rapidly declining because of its competition and affordability scores.
If the government really wants to bring telecommunications costs down and improve service quality, it has to use the Competition Act. Canada has a frustrating tendency to tolerate and sometimes even encourage monopolistic practices. In many of the country's markets, including telecommunications, a handful of companies dominate the entire market. The upshot is that providers have a lot more leeway when it comes to deciding how much to charge.
Time for a quick economics refresher. In an ideal market, the price of a service is equivalent to the marginal cost, that is, the cost that the supplier pays to provide the service. It is quite easy to demonstrate, and this has been studied by economists, that in Quebec and in Canada, we pay a price that is much higher than the marginal cost. There are people who agree. For example, Bell, Rogers, Shaw and Telus collectively account for 71.7% of Internet service revenues. That is what we call an oligopoly, a market dominated by a small number of suppliers. For cellphone services, it is even worse. Three companies, Bell, Rogers and Telus, hold nearly 91% of the market.
As a general rule, increasing the number of companies in a market does two things that benefit consumers and are ultimately good for the economy. Healthy competition in a market tends to lower the prices paid by consumers. In addition, companies often improve the quality of their services to attract and retain customers. While this rule is not absolute, it applies particularly well to telecommunications markets. Let us look again at what is done in other countries. Telecommunications prices are much lower in Europe, where there are a large number of telecommunications service providers. In The Economist's list, France, Spain, the Netherlands and Sweden all rank higher than Canada on the Internet affordability index.
This summer, the Liberal government passed a competition reform that does not do enough to result in real change. The Liberal government's competition policies are outdated and not very well suited to the reality of the digital economy in Quebec and Canada. In practical terms, some sections of the Competition Act, which dates back to the 1980s, are obsolete and due for a serious update. It is not just the Bloc Québécois that is saying that. The competition commissioner is, too. In fact, in January, he published a list of recommendations to modernize the Competition Act. One of them involves removing the provision on the efficiency gains argument, which allows one company to merge with another on the pretext that it will be more efficient. Let us acknowledge right off the bat that this provision is an anomaly. It does not exist in the rest of the world. It exists in Canada and it is putting many consumers at a real disadvantage, so it should be removed from the act.
This very argument could be made in the transaction between Shaw and Rogers, which is currently before the court. Let us recall that two out of the four companies that make up the oligopoly on Internet telecommunications want to merge their services. When this provision is invoked, the Competition Bureau cannot block the transaction, even if it is anti-competitive. In a market that is already perceived to be run by an oligopoly, this transaction should not go through. Speaking before the Competition Tribunal quite recently, an economist from Dalhousie University, Mr. Osberg, said that low-income Canadians who are already dealing with inflationary pressures would be the most affected if the cost of telecommunications increases in the wake of the merger. The last thing we need right now is to further reduce competition and guarantee that prices increase even more.
The other thing the commissioner recommended as an important change to the Competition Act is related to the fact that the Competition Bureau does not have the final say on a transaction. A minister, an elected official, someone who is anything but neutral, can make a decision that goes against the bureau's recommendation. That is what happens. In the case of the Shaw-Rogers merger, the Minister of Industry intervened to defend the transaction. Yes, he is defending the deal, suggesting that part of Shaw be acquired by one of the other four providers instead. Guess what the bureau's response was. It said no, that is not a good enough solution. Unfortunately, it is not up to the bureau to make that decision. The minister will have the final say.
In closing, the Bloc Québécois is in favour of Bill C-288, because it will allow consumers to make more informed choices about Internet packages. Consumers need to be able to see the actual download speeds they will be getting, rather than the theoretical highest speed. Since speeds are lower at peak hours, it is important that consumers get accurate information about the service they will receive at those times.
In short, the bill is a step in the right direction, but it clearly does not go far enough. As my leader likes to say, the Bloc Québécois is never against apple pie. However, I know that apple pie alone does not make a nutritious dinner. We need more.
I hope that I demonstrated, in a short amount of time, the importance of in-depth reform of the Competition Bureau, real reform that will stop the telecommunications giants' lobbyists from abusing their position of power and ensure that consumers, honest citizens, are finally protected.
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