Industry Committee on March 20th, 2023

[Howard Maker]

I'm going to try to answer what I think are a few questions wrapped up into one there, if I may.

What I always say is that we have over 400 participating service providers across the country and we resolve almost 90% of customer complaints. I think that number by itself is an indication that once something comes to us, we get pretty good co-operation from the industry. Otherwise, we would have a much lower resolution rate.

In terms of which companies are generating complaints, we publish all of that data regularly, so it's all in the public domain.

Josée may have some more detailed stats at her fingertips, but the large providers—I think it's the top five, or is it the top 10, Josée?—account for about 80% of the complaints. It's pretty typical to vary by size of service provider.

I hope that answers your question.

[Josée Thibault]

I think the only thing I would add is in terms of the volume. In the last calendar year, there were over 1,200 complaints about the quality of Internet service. That's a fairly significant number, given that in order to get to us, customers are generally at their last stage of trying to get something fixed. We really represent the end stage of complaints for them, so it's a fairly significant number.

CCTS has been around for 15 years. Both Mr. Maker and I have been around for pretty much the entirety of that time. I can say that I don't think I have ever come across any situation where we haven't felt that service providers can always do better to make sure that customers understand what they are getting, what's included in their service and what the limitations are, and that disclosure of information is really key to ensuring a good consumer experience.

[Brian Masse, NDP, Windsor West, ON]

Thank you.

I'm running out of time.

I think Ms. Knight said it best: If we can't do this, then we really can't do anything, quite frankly.

This is a good piece of legislation. That should be universal across all political parties in the House and so forth. It's a start for public accountability, I think. If we can't get the industry on side for this, then it's just a fist fight all the way through.

Thank you, Mr. Chair.

[The Chair, Liberal, Joël Lightbound]

Thank you very much, Mr. Masse.

Mr. Perkins, the floor is yours.

[Rick Perkins, Conservative, South Shore—St. Margarets, NS]

Thank you, Mr. Chair.

Thank you, witnesses.

I'm going to do a little prop thing again, because there are hopefully people out there watching who want to understand exactly what we're talking about. We're talking about the marketing that's done by the Internet service providers on what you're buying. You can go to their websites and see that marketing.

Mr. Maker mentioned buying a package that's 150 megabits per second going through a server, which means it probably has some sort of boost that's done through business or whatever, but he's not getting 150. In fact, Bell's 150 costs $110 a month, and the next step down, the 50, costs $90. I believe it is possible that a consumer is paying for much more than they get.

Mr. Maker, not that this is your personal case, but I just wanted to confirm with you that this is what you see. It's that people are basically paying for a level or two up and actually getting a level of service down when they look at the performance.

[Howard Maker]

As Ms. Thibault mentioned in our opening comments, that's right. We do often see that. We try to take care of that mismatch by re-rating the plan as if the customer had been on the proper plan from the get-go.

Yes, the issue is that in many cases people are not getting the speeds they thought they were getting and not understanding that what they bought was the maximum quote.

[Rick Perkins, Conservative, South Shore—St. Margarets, NS]

It's just a small percentage of consumers who actually check their speed. I think most people probably pay the bill every month.

I think the telecommunications companies have sales practices whereby you buy a phone for a two-year package at a rate of x dollars, and after two years, when you've paid for the phone, for some reason they don't automatically reduce your cellphone bill because you've already paid for the phone. If you continue to keep the phone, they keep charging you at the same rate.

Shouldn't it be, Mr. Maker or the other witnesses, that the Internet service providers who are monitoring the service you're getting are required by law to actually automatically reduce what you're being charged each month if you're paying too much ?

[Dr. Reza Rajabiun]

Technically and theoretically, you could develop a system that does that, but I think that it could be very complex in practice.

[Rick Perkins, Conservative, South Shore—St. Margarets, NS]

Thank you for that.

I will continue with a question for you. In your “Lemons” paper in 2015, you mentioned that you didn't think it was possible to set minimum speeds.

If I understood you correctly from the questioning earlier by Mr. Erskine-Smith, you actually do believe that you can set minimum performance standards now. Is that correct?

[Dr. Reza Rajabiun]

I'm sorry. I'm not sure if that was mentioned in that 2015 paper. It was a while back.

Yes, definitely, and minimum service quality standards are being implemented in various countries. The CRTC already has worked on this issue to some extent in their technical committee. They have a good understanding of what it could be, but they just haven't implemented it.

[Rick Perkins, Conservative, South Shore—St. Margarets, NS]

I have a question on that.

Before I ask that question, could you table a document later, if you have one, that we could have as evidence that shows what other countries are doing on that?

[Dr. Reza Rajabiun]

It would be a big research project to go through the different countries and put it together, but I can direct you to the European Commission's regulations, article 4.1(d) and 4.1(e), if you like.

[Rick Perkins, Conservative, South Shore—St. Margarets, NS]

Thank you.

I'm running out of time. I just want to ask one more question of Ms. Knight.

Ms. Knight, given that this is clearly going on and most Canadians are oblivious to it, do you think this is intentional false advertising by these companies?

[Erin Knight]

I see it like this: If you talk to a telecom company, I'm sure they will tell you they believe they are giving you the service quality you're paying for. Many of them will say that to you if you talk to them. However, in my opinion, if there's nothing wrong with their average network performance according to the telecom company, they have nothing to fear from a bill that makes that network performance data transparent and publicly available.

Customers win in either case or direction. They get good-quality service and empowering information, or, in the other direction—if it turns out it's true that people are not getting what they pay for, customers win in that scenario as well. They get more information about what they're paying for and there's more onus on the telecom companies to deliver the services they're advertising.

[Rick Perkins, Conservative, South Shore—St. Margarets, NS]

I still have 30 seconds.

I have one more question for Ms. Knight or any of the other witnesses.

Do we have any idea of the percentage of Canadians who actually understand or know the speed they're getting? Is there any research out there that shows whether or not Canadians are knowledgeable about what they're getting?

[Erin Knight]

I'll let Reza take this one.

[Dr. Reza Rajabiun]

Over the past few years, there has been a lot of progress in this area, especially in rural areas, where there has been lots of Internet testing, because official data about access.... They say that this many people or this percentage of the population has access to 50/10 megabit-per-second packages that you see in the universal service debates. Those are all based on advertised speeds. Areas that advertise speeds higher than that benchmark are not eligible for funding. Therefore, a lot of rural communities have been doing their own speed tests or community testing, using different platforms to better understand it.

There has been quite a bit of progress on that. People know when they're not getting the speeds they're paying for. Nothing is a problem as long as it's working; everybody has knowledge when they're not getting what they're paying for.

[The Chair, Liberal, Joël Lightbound]

Thank you very much.

Mr. Dong, the floor is yours.

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

Thank you, Mr. Chair.

I'm very happy the witnesses coming forward are giving us their insight, especially the CCTS.

I will start my questions with Ms. Thibault and Mr. Maker.

In my experience as a provincial member in Ontario, there's something called Tarion for developers or builders. It's an insurance program. It's mandatory to enter into it. If a building falls flat, the owner can take it to Tarion. What happens is that this will affect their insurance rate for the next year. Usually builders rush to fix the problem—whether it's a door, sink, drain or whatever—so they can avoid further escalation to Tarion.

I'm bringing this up because I see that the CCTS, in its original establishment, was created as an independent, industry-funded resolution centre for consumers. However, what's the incentive for providers to join and fund you, knowing you're going to be a watchdog over their shoulder? I'm trying to learn a bit more about the CCTS.

[Howard Maker]

Mr. Dong, to answer your question, service providers are required by the CRTC to participate in the CCTS. They join because they are required to. It's true that we have to drag some of them on board a bit, but it is a regulatory requirement.

The other incentive, I suppose, is that in our experience, we've found that larger service providers in particular are very concerned about the numbers we report publicly in terms of who had how many complaints filed by their customers with the CCTS. They're very sensitive to that, so there's a disincentive to not resolving those problems.

Certainly there's a financial disincentive, because part of the funding formula requires them to pay for each customer complaint that comes to us.

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

Oh, I see. That makes sense. You spend the most resources on the providers that have the most problems, so they have to pay more to cover this.

[Howard Maker]

That's right—or they need a team of staff to work on those complaints as well.

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

Right.

This bill, Bill C-288, will “require Canadian carriers to make easily available certain information in respect of the fixed broadband services that they offer”, which means that this information right now is not available to consumers. If that's the case, how do you resolve a case or how do you prove to the providers that they haven't delivered what they promised?

[Howard Maker]

Josée, do you want to respond to that one?

[Josée Thibault]

Sure.

When we're handling a complaint, we're going to look at a number of things. One of the main things we're going to look at is this: What was the customer advised when they agreed to take the service? We do that by looking at terms of service, contracts and those sorts of things. We then require the provider to engage in troubleshooting and technical tests, if they haven't already done so, or sometimes we require them to do it again. Then they submit to us the results of those tests.

We can then see and compare what a customer was expecting to get and what they're actually getting. If there's a difference between those two things, then we can make that right for consumers and require the provider to reimburse them, say, for the cost difference. We also have the authority to issue additional compensation to the customer.

That's generally how we approach these things. This is also why in our comments we mentioned that having speed information directly in contracts is a useful tool for an organization like CCTS as well, because it makes it clearer in terms of what the customer is supposed to get.