Industry Committee on Oct. 5th, 2011

[Phil McColeman, Conservative, Brant, ON]

I do.

[Peter Braid, Conservative, Kitchener—Waterloo, ON]

I would be happy to share my time with Mr. McColeman. If we have time left, perhaps we will save some for Mr. Hsu to use in the next Parliament.

[The Chair, Conservative, David Sweet]

He has an opportunity in this round.

Please go ahead, Mr. McColeman.

[Phil McColeman, Conservative, Brant, ON]

It is known internationally that our economy has been a leader—it is well respected around the G-7. Forbes, a well-known magazine, recently recognized that Canada is the best place to do business. This is the subject matter we are talking about today. We are bringing in new legislation to move towards positioning ourselves even better.

You are right at the heart of it, right in the midst of it all. You are seeing what we are doing and how we are moving forward on this. I hope you will be able to make comments on this. Do you see anything else that we might be able to do? Are there any other areas where we can improve our global competitiveness? How does it relate to this e-commerce initiative that we are moving forward with and trying to put in place sooner rather than later?

[Helen McDonald]

In terms of the international positioning, we are a little hampered by the delay in our data, and if we compare 2007 in Canada to 2010 or 2011 in another country, we're going to look a little backward. So I'm glad that Forbes has declared us a good place to do business, but in terms of measuring how well we're performing as a country on e-commerce, we're a little hampered in our ability to do that in a timely fashion.

But to answer your question, I think the promotion of adoption is clearly where the game is because that's where you get the benefits. So I would say anything that can be done on that behalf would be good, not just within the private sector but also within the public sector—for example, delivery of health care, delivery of education, smart grids, how you manage your electricity, how you promote awareness of climate change, and delivery of government services are all areas in which we all need to look at how well we're doing. On the skills side, many of you have pointed to the problems in getting graduates and entrepreneurs who understand how to use ICTs smartly to improve their bottom line and beat off the competition. I think these areas are harder to get at but areas that are very important to us.

[Phil McColeman, Conservative, Brant, ON]

It's interesting that you mentioned applying technologies and business best practices to the public sector and how we could actually make some really significant gains in that area because it represents a large amount of expenditure. Could you comment further, without getting too philosophical about it, but mixing that in with the idea of the competitiveness of the things we do in the public sector? Do you see any opportunities from having studied and been part of this for a long time?

[Helen McDonald]

In the newspaper reports about Shared Services Canada, where there's a consolidation of the IT spend of the government, I'm reading that this is a way to improve the smartness of the spend and perhaps improve the cost-effectiveness of that spend rather than have duplicative data centres or networks. That would be one example of how to improve.

On the public services, I think if we look around the world we see everyone is concerned about rising health care costs for an aging population and asking how we can use these technologies to keep people in their homes instead of moving them to hospitals and still provide good levels of health care. If those opportunities are around the world as well as in Canada—and I know the government is taking action through the Infoway to try to help on that—it also means sales opportunities for the Canadian ICT industry. If we need products and services in the health care field or in smart grids or smart transportation, those are export opportunities for us that we should also be trying to exploit. So to my mind, the emphasis on adoption helps on an e-commerce front, helps on getting benefits to Canada, but also helps on our GDP.

[The Chair, Conservative, David Sweet]

Thank you very much, Ms. McDonald.

You now have the floor, Ms. LeBlanc.

You have five minutes.

[Hélène LeBlanc, NDP, LaSalle—Émard, QC]

Ms. McDonald, there is more and more concentration in the telecommunications sector. I could perhaps ask this question of Ms. Campbell as well, because it also concerns competition.

You talked about the big spectrum sale and the fact that the big players would like to have as much of it as possible. You also talked about the vertical integration of telecommunications companies that offer several services.

Do you think that this concentration in the hands of a few players could be bad for e-commerce or bad for consumers, given that there would be less competition between the players?

[Helen McDonald]

This is an answer that is best shared between us because

you can see that the concentration or that integration offers consumers more choice. It is often a question of scale.

[Hélène LeBlanc, NDP, LaSalle—Émard, QC]

Yes.

[Helen McDonald]

Without economies of scale, it is difficult to have

the reach, the strength, the innovation....

That is one aspect of the issue.

[Lisa Campbell]

In answer to your question, as my colleague Ms. McDonald mentioned, I would say that three companies in Canada have 90% of the market, and Canadians pay some of the highest prices for mobile services in the world. The government therefore held an auction to allow other companies to enter the market.

As it now stands, there is a case before the courts with regard to something one of these big companies said. That company claimed it provided better service with fewer dropped calls compared to the new entrants. That is what the company claimed. However, our investigation revealed that it was false advertising. This kind of advertising really strikes a chord with consumers. Indeed, for them, the cell phone is increasingly becoming their tool of choice for work, for personal business, for social networking and for Internet access.

[Hélène LeBlanc, NDP, LaSalle—Émard, QC]

If the prices are high for consumers, they are just as high for small businesses that would like to engage in e-commerce. But the costs to enter the e-commerce market are too high for some small companies, as compared to the gains they expect in return.

[Helen McDonald]

But prices are currently going down.

[Hélène LeBlanc, NDP, LaSalle—Émard, QC]

I see.

[Helen McDonald]

That is what happened after more competition was introduced. It is the same thing for small companies and consumers. That is why the government made the decision to bring in more competition in order to bring down prices.

[Hélène LeBlanc, NDP, LaSalle—Émard, QC]

Do I have any time left?

[The Chair, Conservative, David Sweet]

Yes, you have one minute.

[Hélène LeBlanc, NDP, LaSalle—Émard, QC]

Ms. Campbell, you talked about consumer trust and the importance of knowing how much something is going to cost.

What measures do you intend to propose to lawmakers to regulate e-commerce, to ensure that companies are truly acting in a more transparent manner?

[Lisa Campbell]

There are several aspects to the issue. We chair the Fraud Prevention Forum. We do a lot of awareness-raising each year. We also do work internationally. It is important that our citizens be aware of these issues. They know how to surf the Internet. The new anti-spam legislation will also boost consumers' trust when they do business on line. They will have more confidence that doing business online is safe and that they can spend their money that way.

Another committee member raised the issue of security breaches. You have to pay for online security. There is a cost, and it is not something you will only pay for once. You have to pay again and again because online security systems are only good for a couple of months and then you have to pay again.

[Hélène LeBlanc, NDP, LaSalle—Émard, QC]

That is fine.

[The Chair, Conservative, David Sweet]

Thank you very much.

The government has relinquished their spot to make sure we have enough time for closing remarks from the witnesses.

Mr. Hsu has a brief question.

[Ted Hsu, Liberal, Kingston and the Islands, ON]

Thank you, Mr. Chair.

Sometimes when I'm buying things online I have to wade through all these websites to find a Canadian company. Is that something you could do anything about, or should do?

[Helen McDonald]

I think it's difficult to look to the government to become the advertising agency for all things Canadian, outside of Canadian cultural content, which is treated differently. Part of the challenge is trying to find out where the electronic world really differs from the physical world. I know in certain sectors of the economy the industry associations promote Canadian products with the client group. I know the Canadian forestry industry promotes wood products to Japan and tries to help their industry sector that way.