Industry Committee on Feb. 8th, 2022

[Ed Fast, Conservative, Abbotsford, BC]

Yes, I agree. I'm not trying to be disingenuous here.

Do you have any idea of how much federal and provincial investment has gone into our broadband rollout across Canada since, say, 2015?

[Ian Scott]

I don't have a number in front of me. I recall appearing in front of this committee with the then deputy of ISED, and we were asked what we thought it would take—I think was three years ago—how much money it would take, to extend broadband to all Canadians. At the time, the estimate was in the area of $8 billion—

[Ed Fast, Conservative, Abbotsford, BC]

If I told you, Mr. Scott, that it's in excess of $11 billion, would you be surprised?

[Ian Scott]

Of money that has been committed in principle or money spent...?

I'm not sure. I can't answer the question.

[Ed Fast, Conservative, Abbotsford, BC]

I can tell you. If you look at the government records, it's at least $11 billion.

Most of that funding goes to help our large telcos make those investments across Canada, yet here we are. You made a decision to reverse your initial decision, which lowered those wholesale rates, and you returned them to the 2016 rates, which were higher. It is these large telcos that, for the most part, received the largest benefit of the public investments that are being made in our broadband systems across the country. Of course, those subsidies end up going to the bottom line of the big telcos.

If you look at Rogers', Telus's, Bell's or Shaw's bottom lines, there are significant profits being made, yet your organization made a decision to effectively make it more expensive for the small telcos to compete and provide Canadians with better pricing and better service.

[The Chair, Liberal, Joël Lightbound]

Mr. Fast, I'm afraid we're 30 seconds over time already. Perhaps Mr. Scott will have the chance to respond at a later point.

I'll go back to Mr. Masse for two and a half minutes.

Mr. Masse.

[Brian Masse, NDP, Windsor West, ON]

Thank you, Mr. Chair.

I'll let Mr. Scott respond to that. It's a good question and Mr. Scott hasn't had a chance to answer that.

[Ian Scott]

Thank you.

Again, I have to take issue with the premise. No, our decision was about costing. It is important that we get the cost right. It doesn't matter whether it's a large company or a small company. Our task in that case is to apply a costing methodology and to come up with a just and reasonable rate that reflects the actual costs involved in providing the service.

That is what we did. As we've already mentioned, we made an error and then it was corrected as it needed to be.

With respect to the awarding of programs, I can't speak to other government programs. I can speak to the CRTC's awarding of [Technical difficulty—Editor]. We do not favour one group or another. We have objective criteria that were developed as a result of a fulsome process. We apply it fairly and impartially. We award projects where no one has access to 50/10 service. We are doing our best to extend service in those remote areas. We do not care via which technology or who it is, as long as they meet the criteria and improve service for Canadians.

[Brian Masse, NDP, Windsor West, ON]

That's pretty well my time.

Thanks, Mr. Chair.

[The Chair, Liberal, Joël Lightbound]

Thank you very much, Mr. Masse.

Mr. Dong now has five minutes.

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

Thank you very much, Chair.

I hope you give me an extra 30 seconds, as well. I'm just joking.

It's very good to meet you, Mr. Scott.

I have two lines of questions. Let's start with scam calls.

Scam calls are becoming a daily routine for many Canadians. [Technical difficulty—Editor] we've seen reports of increased use of this and using more advanced technology, as well. Just this morning, I got three calls from “Service Canada”. We know that these are particularly harmful to newcomers and to also our senior population. At the same time, it actually reduces the credibility of our public institutions.

I understand that there is a law enforcement part of the solution, but what is CRTC doing about this problem?

[Ian Scott]

Thank you for the question. I'll try not to use up all of your time.

We're doing as much as we can. It is truly a terrible problem. We have agreements with the FCC and the Australian regulator and others, such as memoranda of understanding, to work together to try to address it.

Some of the measures that we've taken include blocking calls at source. For what are called malformed numbers—things that are obviously not real numbers—we've authorized the carriers to block those at source. We've introduced a system called Stir/Shaken, which, as it's applied, will allow companies to indicate to consumers whether or not the call has been verified. We've also recently approved what was a trial to use artificial intelligence to identify and screen out some of these calls.

I do have to quickly add that a couple of years ago when I looked at the numbers, we were talking about numbers that were something like 200,000 calls per second in the United States.

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

I'm sorry.

In addition to the issue we're talking about, has there been any requirement from the CRTC to private companies and carriers so that they are under pressure to correct this phenomenon? At the end of the day we, as consumers, are paying for their services.

[Ian Scott]

Yes, they are. We instructed them to do those things—

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

Okay. I want to get to my next question.

The CRTC is new to me, and I'm a new member of INDU. I'm learning that the CRTC has different functions. On one hand, you administer government funding to partner up with carriers and to expand broadband coverage infrastructure. On the other hand, you approve wholesale rates, and then you act as a supervisor and regulator for the industry. On top of that, you oversee the thousands of broadcasters.

Do you find it challenging to balance all these different hats? I'm asking this question in the context of Canadian customers, who are paying some of the highest rates in the world.

The fact is that there's a lot of responsibility on your shoulders, and, at times, there might be conflicts when you have to make important decisions. I compare it to the electricity system, which is equally complex. They have multiple regulators, each taking a part of the whole system.

In short, do you feel that it may be time for change? Do you think there's too much responsibility for one agency?

[Ian Scott]

I don't know that it's my place to talk about the future design of the CRTC.

My short answer would be no. We are able to.... We're a very competent organization. We have a very skilled staff.

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

You have never felt that there might be a situation with a potential conflict.

There are only a few players in the market. You're approving their wholesale rates, and then you may or may not work with them to carry out government programs, funding and whatnot.

Have you never felt there was a chance for conflict?

[Ian Scott]

No. We act impartially at arm's length as a quasi-judicial agency, so no, I don't see any conflict.

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

Thank you very much.

Thank you, Chair.

[The Chair, Liberal, Joël Lightbound]

Thank you very much, Mr. Dong.

[Brian Masse, NDP, Windsor West, ON]

I have a point of order, Chair.

I have to excuse myself from the meeting. I have a border crisis in Windsor.

I apologize to our witnesses.

Please allocate my time appropriately to anyone who would like it.

I apologize [Technical difficulty—Editor] later on.

Thank you very much. I apologize for disrupting the meeting.

[The Chair, Liberal, Joël Lightbound]

It's completely understandable, Mr. Masse. Thank you.

I will now turn to Mr. Kram for five minutes. The floor is yours.

[Michael Kram, Conservative, Regina—Wascana, SK]

Thank you very much, Mr. Chair.

I'd like to welcome the witnesses from the CRTC to the committee today.

When I go to the malls to buy a cellphone, there's always a Rogers store, a Telus store and a Bell store. There's also a SaskTel store, because I'm from Saskatchewan, but there's no AT&T, no Verizon, no T-Mobile. Why don't we open up the the Canadian cellphone markets to American competition?

[Ian Scott]

First, I'd have to say that it's not the role of the CRTC to set government policy; rather, it's to regulate the Canadian industry. I can offer you a comment, if you wish. That would be, first, that the market is not entirely closed. It is open in certain areas. With respect to wireless, for example, carriers could come in as long as they don't have more than a 10% market share.

However, you're correct if you're saying they can't come in and, for example, buy from Telus or Rogers, which may or may not be in the public interest. There would be other foreign-investment reviews.

What we are responsible for at the CRTC is to ensure that Canadian carriers that meet the regulations are indeed Canadian-owned and controlled. That's as far as our jurisdiction goes.

[Michael Kram, Conservative, Regina—Wascana, SK]

When you think of all the laws and regulations that the CRTC has to implement, if we were to open up the marketplace to more foreign or American competition, how big an undertaking would that be from the CRTC's perspective?