Evidence of meeting #21 for Industry, Science and Technology in the 39th Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was competition.
A recording is available from Parliament.
4:40 p.m.
Conservative
4:40 p.m.
Bloc
Robert Vincent Bloc Shefford, QC
Thank you, Mr. Chair. I would like to thank the witnesses for being here today.
My question is for Mr. Mayrand. In your view, what stages will we have to go through before achieving equal competition?
4:40 p.m.
Vice-President, Corporate Affairs, COGECO Inc.
That's a very broad and, at the same time, quite fundamental question. I'll try to answer it in 30 seconds or so.
The process is essentially the one the CRTC followed in the context of the present act. That act provides for a process before abolishing regulation. In our view, the CRTC did what it had to do, that is to say it held a complicated hearing at which many briefs were submitted, where significant evidence was filed on the way in which you move from a regulated to an unregulated environment for local telecommunications services.
That work is essentially done. We're now seeing the accelerated deployment of competition in a number of markets. We should stick to the game plan and allow the process to take its course. We've practically reached the end of the process.
What is the point in reinventing the wheel and trying to question how we should achieve the final result. The regulatory authorities of the world have asked themselves the same questions, come up against the same problems and, strangely, drawn the same conclusions. There is a concept called dominant market position. We must ensure, market by market, that dominance is no longer a problem, before proceeding with regulation. That's the general principle.
In practice, that means that someone must verify, with supporting evidence, what is going on in each relevant market, whether it's in Saint-Georges-de-Beauce, Sept-Îles or Roberval. That's the heart of the matter.
4:45 p.m.
Bloc
Robert Vincent Bloc Shefford, QC
That's fine, but to get back to competition in isolated regions, how can the CRTC show or ensure that there is a certain amount of competition in those regions? You can have a certain amount of competition in the major centres, but you can only think about competition in the isolated regions. As Mr. Shaw said, you can take a truck, drive it at 70 kilometers an hour and try to catch it, but it's not certain that you'll be able to do that.
How could we manage to get a certain amount of competition in those isolated regions so that they are not dealing with a monopoly?
4:45 p.m.
Vice-President, Corporate Affairs, COGECO Inc.
There's no absolutely universal solution. There will probably always be specific situations in small markets where competition will take longer than in others, but, in general, what is necessary, first and foremost, are clear rules and assurances that, when a new arrival invests so that there is competition in a local market, it will be able to establish a basic position which is viable and enables it to recover its investment. If the rules aren't clear and new arrivals get the impression that their investments will be at risk, they won't take any risk. That's my answer.
4:45 p.m.
Bloc
Robert Vincent Bloc Shefford, QC
I understand, but you're talking about the possibility that there is really this kind of competition. However, if people have to try to obtain services by turning to the biggest businesses and those businesses charge the same prices as subscribers are paying, what do you do if a new player wants to get established in those regions?
4:45 p.m.
Vice-President, Corporate Affairs, COGECO Inc.
I think that, in a system like the one that's currently in place, where there are no new players, there is still a control over prices. That's the current state of affairs, when a local market isn't deregulated. When new arrivals penetrate one of those markets, when competition is established and there is every indication that the competition will be sustainable, the market economy takes over, competition is established and consumers benefit from it.
Those are essentially the two aspects of a single reality. You can't have both, everywhere, at the same time. There is inevitably a transition. However, you have to have assurances, in cases where there are no new arrivals in a local market, which has certain guidelines and certain safeguards like those we talked about earlier, that the framework ensures that new arrivals are encouraged to enter as many markets as possible and to stay there when they enter them.
4:45 p.m.
Bloc
Robert Vincent Bloc Shefford, QC
If I understand you correctly, you prefer the current way of changing all that, as the minister intends to do.
4:45 p.m.
Vice-President, Corporate Affairs, COGECO Inc.
We're in a rapidly changing situation, in which competitive services are being added almost continuously. You only have to read the announcements of the new arrivals, in press releases. Announcements are regularly being made.
We're in an accelerated transition phase. So we can't say that we're in favour of a static situation. On the contrary, we're in favour of expanding competition as quickly and completely as possible, in the best interests of all the markets concerned and of all Canadians who...
4:45 p.m.
Independent
André Arthur Independent Portneuf—Jacques-Cartier, QC
Mr. Mayrand, Mr. Lavoie, for how long are you going to ask the CRTC to hold back the telephone companies before the race starts? At what point, how long do you think it will take for the balance necessary for competition to be achieved?
4:50 p.m.
Executive Vice-President, Corporate Affairs, Quebecor Inc., Vidéotron Ltée
Mr. Arthur, if I may, right now, the rule isn't a time rule, but a market share percentage rule. You'd be surprised, and you will be surprised, to learn that, in Vidéotron's case, we are deploying our residential telephone service so quickly that we are about to reach the 25% level in some of our areas.
4:50 p.m.
Independent
4:50 p.m.
Executive Vice-President, Corporate Affairs, Quebecor Inc., Vidéotron Ltée
I would never say anything of the kind, Mr. Arthur. I'm not saying that our discussions are becoming pointless, but that the process is taking its course. We could have a debate. And the CRTC has agreed to engage in that debate. Was 25% the right percentage? Would 20% have been preferable? We can debate that.
4:50 p.m.
Independent
André Arthur Independent Portneuf—Jacques-Cartier, QC
As the rules currently stand, when do you think we can let the telephone companies run after you?
4:50 p.m.
Executive Vice-President, Corporate Affairs, Quebecor Inc., Vidéotron Ltée
I don't know, but I'm going to ask Yves to answer that himself.
It would almost be unfair to force me to answer that question, but I would say that we're not completely opposed to the idea of setting a time limit. We're ready to live with a time limit. However, Mr. Arthur, we aren't ready for all these conditions to be lifted tomorrow morning. I can imagine what our favourite big monopoly would do: it would make sure we got out of the way, if you will.
4:50 p.m.
Independent
4:50 p.m.
Vice-President, Corporate Affairs, COGECO Inc.
I don't think we can set a deadline, and I'll tell you why. What's always important—this is a fundamental concept of competition—is what's happening in the relevant market. What's a relevant market? Let's take an example. Let's take the case of a place like Roberval. What's important for the inhabitants of Roberval is not an artificial date for the country as a whole, but that there be competition in their market.
So, we agree...
4:50 p.m.
Independent
4:50 p.m.
Executive Vice-President, Corporate Affairs, Quebecor Inc., Vidéotron Ltée
You'd like us to make a prediction.
4:50 p.m.
Independent
4:50 p.m.
Executive Vice-President, Corporate Affairs, Quebecor Inc., Vidéotron Ltée
There's no clear answer to that question. I'd say that, in the Montérégie region, for example, it would be less than a year.
4:50 p.m.
Vice-President, Corporate Affairs, COGECO Inc.
If varies, but we're talking about a period of time that is limited in practice. It can probably be stated in terms of a certain number of months or, perhaps in some cases, a few years.
4:50 p.m.
Independent
André Arthur Independent Portneuf—Jacques-Cartier, QC
Mr. Shaw, a few minutes ago you talked about one year, and most of your colleagues looked a little shaken by that.
