Evidence of meeting #22 for Industry, Science and Technology in the 41st Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was trademark.
A recording is available from Parliament.
4 p.m.
Conservative
The Chair Conservative David Sweet
We'll have to stand that answer. Hopefully somebody will answer it in response to some other question when it comes down the line.
Mr. Warawa, you have four and a half minutes.
4:05 p.m.
Conservative
Mark Warawa Conservative Langley, BC
I thank you, Mr. Chair.
I appreciate the question of my colleague, Judy Sgro, and I don't think anybody around this table would think that any one thing, Mr. Chair, would fix the problem. The common theme we've heard and the common comments are that cellphone prices are too high, that we need more competition. No one thing is going to do it, but I think I'm hearing that it's one of a suite of things and that we're heading in the right direction. The fact is Mr. Bruce Cran from the Consumers' Association of Canada, one of your colleagues, Mr. Lawford, said:
Canadians are paying too much for cellphone service because their market is lacking real competition at the national level....
He went on to say:
We support the Government of Canada’s spectrum policy because it is designed to help introduce this badly needed competition in the Canadian wireless market.
Do you agree with that also?
4:05 p.m.
Representative, Consumers' Association of Canada, Executive Director and General Counsel, Public Interest Advocacy Centre
Yes, and since I'm here today speaking for Bruce as well, I really do. His point is one I meant to make during our remarks, which is that the roaming amendment will make it possible for regionals and new entrants to offer nationwide plans. That's where you get pricing pressure. Because the big three market nationally, they design their packages nationally. If you have a competitor that can say, “Yes, you can get a phone from us and you can go across this country, just like you have for Bell, Telus, and Rogers”, that's where competition is really going to happen. I absolutely agree with that statement.
4:05 p.m.
Conservative
Mark Warawa Conservative Langley, BC
He also went on to say that, “We are happy that new Industry Minister Moore is staying the course”.
Would you agree with that also?
4:05 p.m.
Representative, Consumers' Association of Canada, Executive Director and General Counsel, Public Interest Advocacy Centre
Yes, I think that Mr. Moore faces quite the vehement opposition to some of the efforts he's made. It takes a lot of effort to change the course of things.
4:05 p.m.
Conservative
Mark Warawa Conservative Langley, BC
Good. Thank you.
Mr. Anderson, you also were talking about the need for competition and the high cell prices. You said that high cellphone prices are acting as a dead weight on job creation and economic opportunity across the country. I'm sure you stand by that statement and agree with the government that the priority is a strong economy, jobs, a prosperous economy, and competition, and that lower cell rates are very much a part of that.
You're aware that the government has invested millions of dollars in infrastructure and is now creating a more competitive environment where Canadians can pay less. Would you agree that we're on the right track in doing that? We haven't done everything as you pointed out. We can do more, but would you agree we're on the right track?
4:05 p.m.
Executive Director, OpenMedia.ca
I think the government is on the right track. However, I would say that the investment in infrastructure that you mentioned was a bit of a letdown. If we're looking at other countries around the world, we should be investing the full proceeds of the wireless spectrum, the $4 billion, into keeping up with the rest of the world, because we're falling behind on speed as well as cost.
We're moving in the right direction, but at this point, considering how important our digital economy is to our overall economy and that business and consumers have affordable prices and the kind of multiplier effect that has, we need to be as bold as we possibly can. We're moving in the right direction, but I'd like to see the government be a little bit more aggressive in these ways.
4:05 p.m.
Conservative
Mark Warawa Conservative Langley, BC
Would you agree that rates have dropped and that by introducing more competition into the market, rates will continue to drop?
4:05 p.m.
Executive Director, OpenMedia.ca
Well, we have less competition now than we had a year ago, but I appreciate the historical and the more recent actions. I think there was kind of an area in between where there was a lack of action. I'm not sure that rates have dropped; I think that's a contested figure. So—
4:05 p.m.
Conservative
The Chair Conservative David Sweet
I'm sorry. Time is always our enemy.
Mr. Masse, go ahead for four and a half minutes.
May 12th, 2014 / 4:05 p.m.
NDP
Brian Masse NDP Windsor West, ON
Thank you, Mr. Chair. Thank you witnesses for being here today.
It's worse off today than a year ago. That's the reality of what we have. Tomorrow will be my 12th year here in this place and it will be the 12th time we've gone in a circle, where the government has promised to reduce rates and increase service, yet it's never happened.
One of the things to note though, will this...? Mr. Anderson, you had mentioned systemically blocked barriers. Can you expand on that? Will this bill actually reduce those?
4:10 p.m.
Executive Director, OpenMedia.ca
No, it will not. This bill will not address at all that start-up in Toronto I mentioned, and a range of others. I'm skeptical that the CRTC process will go that far.
4:10 p.m.
NDP
Brian Masse NDP Windsor West, ON
With regard to the CRTC process, and no monetary penalty—and I'll open this to everyone—how significant a barrier is this going to be? How serious are companies going to treat this, when it's like Minister Kenney putting you on the blacklist for temporary foreign workers? There's no real penalty.
How do you think companies will react to this, knowing that the CRTC is toothless at end of the day?
4:10 p.m.
Representative, Consumers' Association of Canada, Executive Director and General Counsel, Public Interest Advocacy Centre
It'll be interesting to see how it plays out. The very practical effect of the bill, or this section of the bill, if passed, is that immediately there will be an adjustment of rates for roaming, which is one of the big inputs. To be honest, that will have some effect. Whether it's enough for a new entrant or a regional to consider launching a nationwide roaming talk-text plan, say, or a data plan across Canada, will remain to be seen. Then the CRTC will have to decide if a different rate is really necessary to launch that competition.
4:10 p.m.
NDP
Brian Masse NDP Windsor West, ON
With regard to new entrants, given the volatility of what's taken place over the last several years with this industry, have we poisoned the well a little for new entrants, in that they're feeling a little spooked about making an investment in Canada?
4:10 p.m.
Representative, Consumers' Association of Canada, Executive Director and General Counsel, Public Interest Advocacy Centre
If I may—and, Steve, you can certainly answer too—the market is so tied up with various factors. With spectrum having to be planned years ahead, and the complications with that, with tower-sharing not working the way Industry Canada I think intended at first, and with roaming only now being fixed, we have a timing problem. The new entrants started five years ago, but they've faced barriers to roaming, tower-sharing, and spectrum acquisition that have made it very difficult. It may be characterized as a failure, but we prefer to view it as a longer-term job than perhaps was first recognized.
4:10 p.m.
Executive Director, OpenMedia.ca
I think some investment has definitely been scared off. Not recently, but for a couple of years there was definitely an incoherent approach to government policy in this area. I think that the independent providers were assured they would have the cost-based roaming, the tower-sharing, very quickly, and obviously we're just talking about this now, so it's been quite a while.
On top of that, the spectrum allocation recently, rather than being a bolder and more straightforward set-aside of 40%, which we called for, there was a cap, which is a bit more of a half measure. It's clearer now, but the last couple of years have been not so much.
4:10 p.m.
NDP
Brian Masse NDP Windsor West, ON
With regard to other examples, you mentioned Ireland. Can both of you highlight a couple of things really quickly that perhaps other countries have done, that would be helpful in this situation?
4:10 p.m.
Counsel, Public Interest Advocacy Centre
Thank you.
Other countries and Europe have had far more extensive experience with international and domestic roaming and have gone to a pricing model that's more reflective of cost. That's the message John and I are trying to relay. The fix that's in this bill today just passes on whatever rates the big three can charge, and they can charge quite high rates by virtue of their market power, so we're advocating—and we expect the CRTC process will unfold—a process that's more tied to reality, and that isn't raising the prices of an essential service for Canadians.
4:10 p.m.
Conservative
The Chair Conservative David Sweet
That's it. I'm sorry.
We'll move on to Mr. Van Kesteren for four and a half minutes, please, sir.
4:10 p.m.
Conservative
Dave Van Kesteren Conservative Chatham-Kent—Essex, ON
Thank you, Chair.
Thank you for being here. It's good to see you again.
We've spoken about this quite a bit, John, I think, in the past.
This is a very difficult issue, isn't it? When we think about traditionally how Bell Canada, as you said in your opening remarks, laid out the groundwork across the country, the thinking was that when the company became privatized, when we opened it up, they were able to do that as a monopoly, and as such it really belongs to the people of Canada. Now what we're really doing is we're taking all of that infrastructure and forcing companies to share it. It gets more complex, because these companies now become public companies, and lots of people's pensions, or their investments, go into these companies. It really is a very difficult situation when we try to determine just what is fair and what isn't fair.
On top of that is the geography. We talked about Ireland. Of course, Ireland is probably the size of, I don't know, maybe New Brunswick, with the population of half of Canada. The same thing is true for so many others. They don't have the severe winter. This is a really tough place to do this.
First off, did we make a mistake, or did we lay out the wrong groundwork, when we broke up Bell? Were the rules not put properly into place at that time, and are we just trying to patch it up? Ultimately, if we're going to attract new businesses, they have to be profitable. At the same time, we can't steal profits, legitimate profits, from other companies that have poured shareholders' moneys....
Where's that balance? I guess that's what we're looking at. Can you maybe comment on that?