Information & Ethics Committee on Feb. 13th, 2018

[Peter Kent, Conservative, Thornhill, ON]

Thank you, Chair.

Thank you all for appearing before us today.

One of the two dissenting FCC commissioners in December painted a pretty dire scene of the future, given the potential changes. As Commissioner Rosenworcel said, “As a result of today's misguided action, our broadband providers will get extraordinary new powers.” She went on to essentially say there would be a rather brutal economic survival of the fittest, and there would be major winners and major losers.

I'm just wondering whether any of your companies have, since December, done strategic analysis on the potential collateral damage, given the elephant-and-mouse comparison and the size of the companies involved, and the fact that Canadian Internet traffic very often moves through the United States. Have you done any analysis in any of your companies to look at the potential collateral damage?

[Ted Woodhead]

We've done some analysis. We don't view this as some sort of existential threat. We believe that the Internet is based on a dynamic technology that undoubtedly has changed the way we do business and communicate with each other globally as a global network. Its whole value, both on a commercial basis and on a societal basis, is about being open to the legal exchange of information.

[Peter Kent, Conservative, Thornhill, ON]

Does anyone else have anything?

[Pam Dinsmore]

We haven't done a substantial analysis, but we have taken the position publicly that as far as Rogers is concerned, we don't believe this will have an impact on Canadians' access to U.S. websites. Where it might have an impact is if Canadians are doing business in the U.S. or if Canadians are trying to retail their products and services into the U.S., and the ISPs, for whatever reason, decide to favour some content over another.

By the way, this legislation is still a long way from being passed and is probably going to be challenged in the courts, so the road is still evolving.

That may happen. We may find that applications that might otherwise have been developed won't be developed if that happens. We may find that app developers come to Canada because of our robust net neutrality regime. These are all things that are within the realm of possibility, but so far nothing has changed because the order, although it's been repealed by the FCC, has not yet been passed by Congress or signed by Trump, and the court challenges haven't yet been heard.

[Dennis Béland]

I would say that I'm not aware of any specific analysis done in that regard. Clearly, we're very aware of where our traffic goes, where our peering points are, etc. Similar to what Pam just said, I would say it's best to say we're in wait-and-see mode right now on that point.

[Rob Malcolmson]

From a Bell perspective, Ms. Dinsmore was correct. I think if there is an impact, the impact will be on Canadian entities using the U.S. pipeline, for lack of a better phrase. They may experience an increased cost of doing business as a result of the ability of ISPs south of the border to charge differentially for bandwidth, but in Canada, thanks to our robust net neutrality laws, it will be business as usual. The pipeline will operate in a neutral fashion under the CRTC's rules.

[Peter Kent, Conservative, Thornhill, ON]

All right.

Mr. Gourde, do you have any questions? No?

When the CRTC appeared before us last week, we were assured that there are regular international meetings and discussions between companies like yours, companies in Europe, and those in the United States. Since December, have your companies engaged with Europeans, for example, to get their opinions, their input, or their feedback on their reaction to the FCC decision?

[Ted Woodhead]

We have not been in discussions with foreign carriers about this at all. Perhaps I misinterpreted it, but I believe Mr. Seidl was referring to the fact that the CRTC is in communication with other regulators internationally. We have had no discussions on a company-to-company basis about this.

[Pam Dinsmore]

I think it's important to recognize that as ISPs, we operate here in Canada and we are subject in our operations to the rules that exist here in Canada.

I think it's extremely interesting to follow what's going on in different parts of the world. Certainly with the U.S. right next door, that's even more interesting, especially in the context of NAFTA ongoing and the discussions around that, but we're subject to the Canadian regime. What's going on over there is interesting, but it can be somewhat academic. If there are zero-rating plans happening in Europe and various countries or if there are these changes in the United States, it's not going to change the way we operate here in Canada, given our robust net neutrality regime.

[Dennis Béland]

I'm not aware of any specific company-to-company exchanges on that point. No.

[Peter Kent, Conservative, Thornhill, ON]

Thank you, Mr. Chair.

[The Chair, Conservative, Bob Zimmer]

Thank you, Mr. Kent.

Next up, for seven minutes, is Mr. Masse.

[Brian Masse, NDP, Windsor West, ON]

Thank you, Mr. Chair. Thank you to our delegations for being here today.

Carrying on for a little bit with the FCC hearing, is it potential...? I guess one of the repercussions of the decision still hasn't translated into reality yet, but it could actually act as a non-tariff barrier for Canadian competition, not only in our agreement with the Americans but also internationally, if we are now having to compete and we have issues related to throttling, for example, when dealing with American companies when our Canadian subsidiary companies have parent companies in the United States.

[Pam Dinsmore]

We have thought about this. Certainly in the digital economy, where the Internet plays such an important role, it would be an extremely great ambition to have similar net neutrality regimes in the countries with which you do trade, so that when businesses that are, in our case, Canadian, are doing business in our trading partner's country, we would have the same net neutrality regimes; ergo, our websites wouldn't be throttled, etc., as you're alluding to.

We're aware that this issue was raised in December by Steve Verheul. We're not aware of where that's going to go. We haven't seen the text of the CPTPP, nor that of NAFTA. When we do, it will be interesting to see whether this notion is captured, but in the context of what's happening in the U.S., it's difficult to see how you're going to get the horse back in the barn through a trade deal when you already have it running down the track through Congress.

[Ted Woodhead]

I don't think I really have anything to add to what Pam has said, other than that you raise an interesting point that was brought up by Professor Geist when he appeared in December. To the extent that a theoretical harm could occur, it's not really a telecom regulation issue, but a trade issue.

[Brian Masse, NDP, Windsor West, ON]

I understand that, but it does affect a number of things.

I want to move over to deciding interpretation of legal content. You've all claimed that the current rules should stay the same, with the same framework. How do you base your decision-making if Internet traffic and competition become an issue in terms of prioritization and what it's being used for?

You mentioned, Mr. Guerriere, medical devices and medical treatment, but there is now more going on. There's much more use of devices that have not only consumer interest, but there are also autonomous cars, vehicles, real-time analysis for emergency response, and so forth.

How do you determine whether there's enough response capability in there, Mr. Woodhead?

[Ted Woodhead]

The way I address this kind of stuff.... It's a very good question, sir. The answer is in the field of “I'll know it when I see it”.

Are health applications a reasonable prioritization, or if a hospital district wants to do remote home monitoring, is that a reasonable thing to give some priority to? I haven't looked at it, but I suspect yes.

Does the federal government ask for priority on the public safety broadband network that they have an RFP out for? At the moment, absolutely.

[Brian Masse, NDP, Windsor West, ON]

I guess one of the things I would like to hear everyone respond to has to do with blocking legal content. When in the court system do you decide or determine when you should follow the law? I don't know the answer to this question. Is it during an appeal process?

A legal case goes forward on content, or a website. It has been challenged. It goes to the court, one level of court, or it goes to a United States court. At what point do you determine whether this should be removed or impeded in terms of your site provision to your servicers?

[Pam Dinsmore]

I think what you're asking is if an ISP is ordered to block a website by a court, at what stage does the ISP actually do that blocking if, in fact, that decision gets appealed.

[Brian Masse, NDP, Windsor West, ON]

Yes.

[Pam Dinsmore]

Presumably—

[Brian Masse, NDP, Windsor West, ON]

Sorry. I could have phrased it a lot more clearly.

[Pam Dinsmore]

It's a fair question. Presumably, we would be obliged, under a blocking order, to block a given website unless there was a stay to the order that was applied for by the website provider. If there was a stay of the decision, pending the appeal and the conclusion of the appeal, we would not block that website for that time period. However, unless there was a stay to the decision, we would be obliged to block.

As an ISP, in this context we wouldn't block unless there was a blocking order. We wouldn't take it upon ourselves to make the determination on whether content is legal or illegal. We would await the court order and we would follow it.

[Brian Masse, NDP, Windsor West, ON]

And is that the same...? I get a lot of questions about that. Have there been any cases of ISPs responding differently, or has it been the standard practice of everyone to follow that approach?

[Ted Woodhead]

I would say that in 99.99999% of the cases, that is what happens. There aren't a lot of cases of this kind of stuff. However, there might be, theoretically—and probably actually—an example or two over a couple of decades of what are termed “exigent circumstances”, when certain things are done because there's a threat to life or property.