Thank you, and good morning, all. We really are pleased to be here today.
Thank you for inviting us to discuss access to broadband Internet across Canada.
As the chair mentioned, my name is Pamela Miller, and I am the director general of the telecom policy branch at Innovation, Science and Economic Development Canada.
I am going to speak to the deck that you have, “Broadband in Canada”, giving the overall overview, and then Sue Hart is going to describe in more detail the programs that our department has available for broadband.
As you know, telecom and broadband connectivity play an integral role in our country's economic prosperity, as well as in our everyday lives. Internet access is an essential service, whether it be to look for employment, register for government services, or do banking online. For Canadian businesses, the Internet is a doorway to global markets, cloud-based services, and remote workers. Governments are investing in digital infrastructure as it is also an opportunity to support economic growth, innovation, and social inclusion, particularly for indigenous peoples.
A wide variety of research has linked broadband to a number of positive economic outcomes, including GDP growth, productivity and efficiency gains, improved research and innovation, and enhanced opportunities for local communities. I don't think I have to convince you; you are all here and want to study this topic because you know how very important it is.
I just want to take a brief moment to talk about the technologies that play a role in providing Canadians across the country with broadband access. With constant advances in technology, broadband Internet services have been made available over a variety of platforms. Wired networks include fibre optics, digital subscriber lines, and cable networks, which can typically achieve the highest speeds. These networks have good coverage of urban and suburban areas. Almost 90% of Canadian households have access to at least one wired network.
Fixed wireless networks provide access using towers and wireless radios, with subscribers using antennas fixed to their residence to receive the signal. They are typically used in lower-density regions, such as rural areas, to provide broadband service where the distance between households makes it unaffordable to run wires.
Mobile wireless networks have a national footprint, helping to keep people connected no matter where they are. Satellite networks offer national coverage and are typically used in rural and remote areas that are the most challenging to reach.
In Canada, the principal driver of telecom investment is the private sector, which has made considerable investments—over $13 billion in 2015, which is very impressive. The government has taken actions to support broadband by establishing marketplace frameworks to foster competition and investment, effectively managing the spectrum to encourage the availability of mobile broadband, and providing funding for rural and remote broadband network expansion, which we'll talk more about shortly.
I am pleased to report that there has been good progress. There are certainly gaps that remain, but we have also made progress. Over the past several years, market-led development supplemented by government programs has made significant improvements in broadband coverage and speed. Virtually all Canadians have access to some form of broadband. Broadband coverage at 5 megabits per second is available to 96% of Canadians, and it is anticipated to reach 98%.
The most dramatic jump has been in the availability of higher speeds, sometimes referred to as next-generation networks. In 2015, for example, 75% of Canadians had broadband speed of 100 megabits per second, a jump from just 28% in 2011.
These improvements have been primarily due to cable network upgrades and telco investment, which are bringing fibre closer to customers' homes in large urban markets. Service providers are also making some big investments in gigabit networks. A gigabit is equal to 1,000 megabits. For example, Bell and Telus each have announced $1 billion of investment in Toronto and Vancouver, respectively, and Rogers has expanded gigabit Internet to its entire network footprint of four million customers.
Internationally, Canada performs strongly at speeds such as 100 megabits per second, and we are in fact second in the G7.
Canada is also doing very well when it comes to mobile coverage. Over 99% of the population has access to a mobile network, and 4G LTE, which allows even greater speeds, is available to 97% of the population.
As I mentioned investment, an important indicator is telecom investment, as it provides insight into how much capital is going into network improvements and upgrades. In this regard, Canada performs well in terms of investment for both wire line and mobile compared to our peers. Total telecom investment in Canada as a percentage of revenue is over 20%, which is above the OECD average of 15%.
If you look at the progress, there have been gains in rural and remote access as well. In 2011, 87% of Canadians had access to 5 megabits. Now it is 96% of Canadians, and it will reach 98%. New technologies, such as next-generation high throughput satellites, have also come on line, providing more capacity for users reliant on satellite connectivity.
Despite the strong progress, as we all know, there are still broadband gaps in certain parts of the country, particularly in rural and remote areas. These areas typically have lower population densities, making the business case for private sector investment more challenging. For example, 99% of Canadians in large urban areas have access to speeds of 50 megabits per second. In rural areas, only 29% of Canadians have access to these speeds.
Canadians living in rural and remote areas, such as Swan Lake first nation or La Tuque, Quebec, expect to have the same access to high-quality, affordable broadband services as Canadians living in Calgary or Montreal. They want a broadband service that meets their needs, that allows them to fully participate in the digital economy.
The north in particular is a challenge, as there are nearly 100 communities that are completely reliant on satellite technology. Many of these communities are very difficult to serve, as they can lack access to a permanent road network or the electrical grid.
Turning to adoption of the Internet, Canada does well in terms of the percentage of households that subscribe to broadband, with 85% of households reporting that they use the Internet. However, adoption rates are lower for low-income Canadians. For example, only 63.5% of Canadians in the lowest income quintile subscribe to broadband compared to over 98% in the highest quintile.
I'm now going to turn to my colleague, Sue Hart, who is going to describe the connecting Canadians and connect to innovate programs.