Thank you, Mr. Rajotte.
Mr. Chair, Bell Canada believes that Minister Bernier’s framework for retail forbearance in local telephone markets is both correct and long overdue. The minister has evidence before him that Canada has fallen behind the rest of the world in a crucial sector of the economy. He has the support of consumers—your constituents, our customers—the very people who should be benefiting from competition today, but are not. He has the support of boards of trade, chambers of commerce, labour groups, and businesses large and small from coast to coast.
Under the minister’s proposal, Canadians will finally start to benefit from vigorous competition. Bell is already preparing for the day when the draft order in council is in effect. We are preparing new and innovative offers for consumers that will provide better value, offers that we cannot now make but that our competitors can, promotions tailored to the different needs of customers—people who are moving, trying out new services, or simply upgrading existing ones—and bundles that allow consumers to realize the true value of multiple services.
Consumers want these now. Yet you have not heard the consumer's voice among your many witnesses, just the complaints of competitors, particularly wholesale competitors, whose very existence depends on the government. Of the 12 witnesses you have heard to date, nine were either competitors or their representatives. The only independent experts you have heard from are CRTC vice-chair, Richard French; Commissioner of Competition, Sheridan Scott; and Hank Intven, representing the Telecommunications Policy Review Panel.They all substantially supported the minister’s proposals. I'll paraphrase the Who, and maybe I'm showing my age, but don't get fooled again.
When I last appeared, I cited a 2005 Decima consumer survey commissioned by Bell, Telus, and the Public Interest Advocacy Centre, each of which reviewed and approved the questions. At that time it showed that 89% of Canadian consumers believed that the same rules should apply to telephone companies and cable companies. That belief in level playing fields and open competition has never wavered in survey after survey.
Later efforts to alarm Canadians about regulatory change by those who claim to speak on the consumers' behalf have not weakened consumers’ resolve. Quite the contrary, their resolve has strengthened, as we found when we commissioned an Ipsos Reid study in early January to do a comprehensive survey of consumers. Now, 93% of consumers believe that federal policies should treat all telecom competitors the same; 77% believe the consumer, not government regulators, should determine what price to pay for local telephone services; 79% believe that telephone companies should be able to offer promotions; and 85% believe that telephone companies should be able to immediately compete to win back their business. These numbers are very consistent right across the country.
As the TPR Panel noted, for too long telecom policy and regulation has been shaped by a misconceived need to protect competitors. Cable companies need no protection. They are some of the largest and most successful companies in Canada, possessing ubiquitous networks, multiple product offerings, and a well-established base of subscribers.
It has been a year since the Telecom Policy Review Panel report called for an urgent need to phase out regulation of retail services over a 12- to 18-month period. Twelve months have passed, and there has been no forbearance yet. None. Yet over the same period, the four largest cable companies have seen their combined market capitalization grow by $14.4 billion. That is an increase of 61%. What you have witnessed is a massive wealth transfer, much of it from consumers, to cable owners. Why? Because consumers have not yet seen the financial rewards they expect from vigorous competition.
Mr. Chair, the TPR Panel concluded a year ago that Canada was falling behind the times in the telecommunications industry. The TPR Panel’s message was clear, and I quote: “The urgency for reform…and the time constraints of the legislative process” necessitate taking steps “under the existing statutory framework, in advance of legislative amendments, in order to begin the reform process at an earlier stage”.
In acting decisively, the minister is moving neither too fast nor too far. In our view, he is moving too slowly, and we think consumers agree.
As Mr. French told you last week, the minister is well within his authority, and he has proposed a proper economic test, one supported by the Competition Bureau and the panel. He has decided to take action and is exercising the powers given to him within the Telecommunications Act.
David Lloyd George, a great parliamentarian, once said, “Don't be afraid to take a big step if one is indicated. You can't cross a chasm in two small jumps.” That is the kind of leadership that will ensure consumers finally enjoy the full benefits of head-to-head competition for their businesses.
Thank you very much.