Industry Committee on July 25th, 2022

[The Chair, Liberal, Joël Lightbound]

I call this meeting to order.

Welcome to meeting No. 31 of the House of Commons Standing Committee on Industry and Technology. Pursuant to Standing Order 108(2) and the motion adopted by the committee on Friday, July 15, 2022, the committee is meeting to study the Rogers Communications service outages in early July.

Today's meeting is taking place in a hybrid format, pursuant to the House Order of Thursday, June 23, 2022. For members in the room, if you wish to speak, please raise your hand. For members on Zoom, please use the raise hand function. The clerk and I will manage the speaking order as best we can.

For the first hour today, we will be hearing from, and we thank him for being available, the Honourable François‑Philippe Champagne, member for Saint-Maurice—Champlain and Minister of Innovation, Science and Industry. He is accompanied by Simon Kennedy, deputy minister, as well as Éric Dagenais, senior assistant deputy minister, Spectrum and Telecommunications Sector, and Mark Schaan, associate assistant deputy minister, Strategy and Innovation Policy Sector.

For the second hour, dear colleagues and members of the public, from Rogers Communications, we will be hearing from Tony Staffieri, president and chief executive officer, as well as Ron McKenzie, chief technology and information officer.

Without further delay, Mr. Minister, the floor is yours.

[François-Philippe Champagne, Liberal, Minister of Innovation]

Mr. Chair, esteemed colleagues, it is a pleasure to be with you today.

We are here today because on July 8, something unacceptable happened in our country. I am convinced each and every one of you heard countless stories from frustrated constituents who were impacted by the Rogers outage on July 8—I know I did.

The Rogers outage concerns all Canadians, and not only the company's more than 12 million clients who were directly impacted. As I have said many times, what happened on July 8 is absolutely unacceptable, period.

Canadians rightfully deserve answers for what happened.

Mr. Chair, this is why it was so important for me to come before this committee today. Let's remember that during the outage, millions of Canadians were without cellphone and Internet access for more than 15 hours. Literally hundreds of thousands of small and medium-sized businesses had to turn customers away because they were unable to use Interac to complete transactions. Government departments lost the ability to provide services to Canadians. Most worrisome, countless Canadians lost the ability to call 911.

Again, this is simply unacceptable, full stop. That is the message I conveyed to Tony Staffieri, the CEO of Rogers, on multiple occasions since July 8. I used my voice to amplify the voice of millions of Canadians and expressed in no uncertain terms their frustration with this unprecedented outage in our country. Mr. Staffieri has acknowledged that Rogers has broken the public's trust and has agreed to taking a series of actions to address this matter promptly and decisively.

While the responsibility for the outage rests solely with Rogers, we now have to be in solution mode. That's the attitude I have adopted since the very first hours of this outage.

I was informed of the outage by my team in the late afternoon of July 8 Tokyo time—which was very early morning on July 8 here in Ottawa—as I was wrapping up a week-long mission to Japan. A few hours later, I received an update indicating that the outage now seemed more serious than originally anticipated. I immediately picked up the phone, not only to contact the CEO of Rogers, but also the CEOs of Telus and Bell to see how they could possibly help.

As soon as I landed back in Canada the next day, I convened a meeting with the CEOs of Rogers, Telus, Bell, Videotron, Shaw, SaskTel and Eastlink. I directed them to take immediate action to improve network resiliency and reliability across Canada. As a first step, I demanded that within 60 days the companies enter into a formal binding agreement ensuring and guaranteeing three things: emergency roaming, mutual assistance, and a communication protocol for advising the public and government on major outages and other emergencies.

Folks, the clock is ticking and there are 45 days left to deliver on that commitment.

In a similar fashion, the U.S. Federal Communications Commission recently adopted measures to improve network resiliency, on July 6.

As you know, the CRTC is also conducting a detailed investigation of the outage, including the measures that Rogers is putting in place to prevent similar outages. I've also directed the Canadian Security Telecommunications Advisory Committee to develop additional proposals to improve network resiliency on the basis of their findings.

As I said from the outset, we will consider more measures to have the network resiliency that Canadians deserve.

To conclude, I would note that all Canadians deserve strong, reliable, affordable and resilient communications networks. That is why we are going to insist that Canada's telecom providers are better prepared to prevent future outages. We also need to continue to hold Canada's telecom providers accountable, and we will do so on behalf of Canadians.

In closing, let me say this: there are some who will see an opportunity today to talk about a number of issues relating to telcos in Canada—from competition, to the proposed Rogers‑Shaw merger, to many other subjects, I'm sure. While I'll be more than happy to answer those questions—to the extent I can—I think that today, Canadians expect us to talk about two things.

First, what happened on July 8 and why. Second, what solutions do we have going forward to ensure that a situation like this does not happen again.

With that, I will be happy to take questions from my House of Commons colleagues.

[The Chair, Liberal, Joël Lightbound]

Thank you very much, Mr. Minister.

We'll now begin the first round of questions.

Mr. Généreux, you have the floor for six minutes.

[Bernard Généreux, Conservative, Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC]

Thank you very much, Mr. Chair.

Mr. Minister, thank you for being here this morning.

You are absolutely right, we could indeed ask several questions in relation to this incident. However, I'll stick to what you suggested. I don't know if we can see this as an advantage or disadvantage, but in order to cover all of Canada, you had to contact five companies, which represent 95% of the customer base in Canada.

Do you think this incident highlights the lack of competition or the lack of players in Canada to serve the entire population and prevent this type of thing from happening again?

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

First of all, thank you for the question, Mr. Généreux.

In fact, there is no doubt that competition promotes resilience. It is a challenge. As you know, from the beginning, I've been talking about affordability, competition, and innovation. That's also why the first thing I did when I spoke to the president and CEO of Rogers was to express the frustration of the 12 million Canadians who had been deprived of service, the hundreds of thousands of small‑ and medium‑sized businesses across the country, but also people who deal with emergency services.

I called for immediate action to improve resilience in this country. I also asked the telecommunications companies to establish this mutual assistance agreement through a formal agreement. It already existed, but we want it to be done by contract

I also asked that we allow for the roaming that we need for emergencies in these cases. We also need a better communication protocol with Canadians. I also think that, in this regard, I have expressed the frustration of Canadians regarding the problem of communicating with citizens and customers during this unprecedented outage in the country.

[Bernard Généreux, Conservative, Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC]

Mr. Minister, we know that 95% of the Canadian population is served by about five or six large companies. You talked about the lack of resilience and the problem of being in a situation where almost a third, if not half of Canadians are no longer able to communicate, particularly with emergency services.

You have asked the companies to talk to each other and establish a contract. I'm in business myself, and I know that all companies have different levels of commitment when it comes to investments, prioritization of areas served, and so on.

You spoke to the executives of Bell, Telus and Videotron. These companies do not see themselves at the same level, not only in terms of competitiveness, but also in terms of the infrastructure that they share or own.

What assurances have you received from their leadership that in 45 days, as you said, this agreement will indeed be concluded?

Have you obtained a commitment from these companies?

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

Yes, I have obtained this commitment.

When I spoke to the heads of the companies, the issue could not have been more serious. In fact, I didn't ask, but demanded that they establish a formal contract to do three specific things.

It's good to have a mutual assistance arrangement, but I want it to be established by a formal contract between the companies. I also want emergency roaming codified and to have a well‑established communication protocol with government and customers.

So it wasn't just about intent, it was about obligation, and I was assured—

[Bernard Généreux, Conservative, Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC]

Mr. Minister, I doubt that such an agreement can be reached in 60 days, and in the middle of summer. I regret to say that I am skeptical.

What will the repercussions be for these companies if they are unable to reach an agreement within 60 days?

What authority do you have in this regard?

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

First, there is no doubt that telecommunications companies in Canada listen to the Minister of Innovation, Science and Industry, who is the regulator. Second, I have the formal commitment of the executives of each of the companies. I can tell you that when I spoke to them, it was not a time for opinions. What I asked them was clear and direct. It was a formal requirement. You'll have the opportunity to verify that, because I think you'll have the president of Rogers as a witness.

A committee has been formed, which is overseen by the Canadian Telecom Resilience Working Group. It's an existing working group, co‑chaired by representatives of Rogers and Éric Dagenais, a senior official in our department. They are leading the work that will be done in the remaining 45 days.

Mr. Généreux, I can tell you that when I called the company executives and asked them to come on Monday, everyone showed up to find solutions. I think everyone recognized that we have experienced an unacceptable incident and that immediate action is needed.

I must be clear with you, Mr. Généreux: this is only the beginning. I told the executives that I am going to demand even more from them. The CRTC will still continue its investigation, and we will review the recommendations that will be made. Then, I will require further action from these companies.

I can tell you that, at this point, company executives agree with me that more needs to be done to increase the resiliency of telecom services in this country.

[The Chair, Liberal, Joël Lightbound]

Thank you very much, Mr. Minister.

We'll now turn to MP Dong for six minutes.

[Han Dong, Liberal, Don Valley North, ON]

Thank you very much, Chair.

Minister, it's so good to see you. It's been a while. Thank you very much for coming to the committee.

I woke up on July 8 and couldn't get any of my devices working. Like many Canadians, my family has a bundled service with Rogers—for more than 20 years—so it caused a bit of panic. Luckily, one of my work phones was served by Bell, so I learned from social media, as reported by all news outlets, that there was a massive outage, but there wasn't any communication from Rogers until closer to noon.

As Rogers customers, we all wanted to know what happened and when the service would be returned.

You acted very quickly on that weekend, reaching out to Rogers, but before you reached out, were any proactive measures taken on Rogers' side to explain to you, as the head of the department, what was going on or happening?

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

Thank you very much, MP Dong. It's great to see you again as well, my friend.

As you know, I was wrapping up a mission in Japan as the events unfolded, when I was made aware of the initial issue that we had with the Rogers network. With the time difference, I think it was in the very early hours in Tokyo, if I recall—around 4 or 5 a.m.—that I was made aware it was more serious. At that point, I did reach out immediately to Tony Staffieri, the CEO of Rogers.

Obviously, he understood the seriousness of the situation and the obligation he had to inform the minister of industry of the situation. On that call, I first inquired about the network situation and how long it would take. Obviously, at that moment I was expressing the frustration of millions of Canadians, but I was also in solution mode. When you have a crisis of that nature, which is unprecedented....

Immediately after that call, I reached out to the CEOs of Bell and Telus. Everyone offered their assistance. The Canadian Telecom Resiliency Working Group was also called upon to make sure that an update was provided by Rogers, but I would say, MP Dong, my takeaway from what happened....

This is why I demanded—I did not ask, I demanded—three things from the telecom companies in Canada, as I landed in Canada a few hours later.

I convened a meeting with them. First, I wanted to formalize the mutual assistance agreement. I knew that some form of informal mutual assistance existed between the networks, but I said, “This is not good enough for Canadians. Now you need to enter into a binding formal agreement to include that.”

The second thing was emergency roaming, and that is quite similar to what the Federal Communications Commission did in the United States recently on July 6.

However, I went beyond that, MP Dong, to address exactly what you said. They failed to inform the Canadian public properly. They failed to inform the Government of Canada properly. It should not be up to the Minister of Industry to reach out to the CEO of Rogers. It should be the other way—

[Han Dong, Liberal, Don Valley North, ON]

That's my point, Minister.

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

It should be the other way around, and I think—

[Han Dong, Liberal, Don Valley North, ON]

Exactly. The waiting period not only was creating frustration, but also had the potential of creating chaos. A lot of people were guessing what was going on: Was there a cyber-attack on Canada?

You said you first learned about this at four or five o'clock in the afternoon Toronto or Ottawa time, but when did you first talk to the CEO of Rogers?

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

Let's make sure we don't confuse the time zones, because let's remember, MP Dong, that I was in Tokyo at that moment. When I said four or five, I meant 4 or 5 a.m. Tokyo time. This was still pretty much early morning for me in Tokyo, so one would have to work back.

I immediately called Tony Staffieri. Your point, if I may, MP Dong, is exactly the point that I made to them. It should not be for the minister to chase the CEO of a major telco in Canada when something like this happens. Rather, it should be the other way around.

That's why I insisted on the three points I noted. I want a formal agreement, and I insisted that we have a communication protocol first with the public, because the public is entitled to know what's going on, and second with the Government of Canada. It's to make sure that when any such thing happens, there's a better communication channel.

I must say that since this happened, the CEO of Rogers has reached out to me to update me regularly, and I think we already see improvements in that respect. This needs to be codified, and that's what the formal binding agreement will be doing.

[Han Dong, Liberal, Don Valley North, ON]

This is not the first time. As recently as 2021, they had a regional outage as well. At the time, the CEO said, “We're not just going to get to the bottom of this but work very hard to make sure it doesn't happen again”, but sure enough, in less than two years this is happening.

What gives you the confidence that all of these additional measures you mentioned are actually going to change the industry and make sure that Canadians don't suffer in the future in an event like this? I ask because by Rogers' explanation, all of these updates are quite routine, so it could happen again.

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

This was Rogers' failure, and let's be clear that this is a failure by one company. To your point, I agree with you. That's why from the get-go, as you may recall, MP Dong, I not only spoke to the CEO of Rogers, to the CEOs of Bell and Telus and to a broader network, but also went to the public and the media and explained the situation. At the time, I very openly and very clearly expressed my frustration. I said this was unacceptable and that we need to implement immediate action. I immediately said as well that these would be initial steps. That's why I think the work of this committee is so crucial, as is the work of the CRTC, in understanding the root cause.

As we understand the facts, this was a coding error in a routine update. It poses some questions. How could this ever happen? What kind of system needs to be put in place? What kind of review needs to be put in place? It is a bit like with a near disaster investigation: You need to take the time to get to the root cause. Once we understand better the chain of events and what failed at Rogers, we will obviously make sure that we take additional steps to close that gap. I've been very clear with the CEOs that I will demand more of them. Those were the initial steps, I would say, within hours of the outage.

[The Chair, Liberal, Joël Lightbound]

Thank you, Minister.

Mr. Lemire, you now have the floor for six minutes.

[Sébastien Lemire, Bloc, Abitibi—Témiscamingue, QC]

Thank you, Mr. Minister.

Mr. Minister, you asked for a mediation meeting on July 4 and 5, particularly with the Competition Bureau and various competitors of Rogers, if I can put it that way.

You just said that what happened was Rogers' failure. Before that meeting, did you hold a technical briefing with the people from Rogers? Did the executives explain to you what happened during that outage?

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

I'm happy to see you again, Mr. Lemire.

First, let me tell you that the telemeeting I held was with the heads of the telecom companies. The CRTC, which is an independent body, did not attend this meeting.

In the early hours of the outage, when we were still wondering if it was a cyber‑attack, in the first discussion I had with the president of Rogers, he informed me of what had happened. He explained to me the initial findings of an internal investigation. He told me that the company had asked international experts to help them determine the nature of the outage. They also asked their equipment vendors to help get the system back online as quickly as possible.

I spoke to the president of Rogers another time later. Later, we had this telemeeting with the heads of the other six major telecommunications companies in the country. That's the timeline.

[Sébastien Lemire, Bloc, Abitibi—Témiscamingue, QC]

Who at Rogers has been mandated to update you on the progress of the discussions and implementation of the resiliency plan?

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

The president and CEO of Rogers, Tony Staffieri, will be appearing before you in a few hours. I had all my communications with Rogers. The same is true for the other telecommunications companies, I communicated with their respective executives.

[Sébastien Lemire, Bloc, Abitibi—Témiscamingue, QC]

How confident are you in the governance of Rogers?

In fact, in the wake of last year's blackout, a rather cavalier clean‑up has taken place over the past few months.

How confident are you in the current governance of Rogers, particularly in the context of the merger with Shaw?

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

I was very clear with the head of Rogers. You can ask him. I have expressed the frustration of millions of Canadians and hundreds of thousands of small‑ and medium‑sized businesses that couldn't conduct transactions through the Interac network. I also expressed the frustration of first responders across the country about not being able to access 911.

So I was very clear with him. I told him that the situation was absolutely unacceptable and that I expected corrective measures to be put in place quickly. I told him that we would investigate this matter and that, in due course, we would seek further action to make the telecom network more resilient. I also told him, and I've expressed this publicly, that everything that has happened will remain in my mind and in the minds of many, and that this shows that we need a resilient and competitive system.