2017 Canadian Telecom Summit


Speaking Points 

The Honourable Navdeep Bains, PC, MP
Minister of Innovation, Science and Economic Development

Toronto, Ontario
June 5, 2017

Check Against Delivery 

Thank you for your warm welcome and for inviting me to kick off this year’s summit. 

Your sector has been at the forefront of the digital revolution. 

In fact, Canadians were pioneers, starting with the Communications Research Centre. 

It established the first international connection to the precursor of the Internet. 

Who would have predicted then that high-speed Internet would become the backbone of a global and digital economy?  

Increasingly, the prosperity of Canadians depends on their access to high-quality, high-speed Internet. 

Affordable wireless and broadband services are no longer luxuries. 

They are basic tools for all Canadians, regardless of where they live. 

They need these services to do business, learn new skills and build communities.    

So I’m here today to talk about the strengths of this sector and how we can work together to ensure that Canada remains a global leader in telecom technologies. 

I also want to talk about areas where this sector can improve and what those of you in this room can do to help. 

Let me start by thanking you. 

Because of your investments, Canada has some of the world’s most advanced and efficient telecom networks. 

Very high-speed Internet is available to more than three quarters of Canadians. 

That’s up from 2011, when only a quarter of Canadians had this service. 

As well, virtually all Canadians are covered by the latest wireless technologies. 

And Canada’s wireless networks are fast. 

They rank second among G7 countries for average connection speeds. 

Canadian telecom network investments exceeded $56 billion between 2011 and 2015. 

These high-speed networks enable Canadians to do more online, whether it’s buying and selling, collaborating on work projects, or staying in touch with their kids and grandkids in other parts of the world. 

These networks turn consumers into producers, observers into participants, users into innovators.  

Our government understands that Canadians want three things from their telecom services. 

Quality: Is the service fast enough to do what I want it to do?

Coverage: Is the service available where I want it? 

Price: Is this service affordable? 

These three areas are clearly where service providers need to compete. 

That’s why our government is doing its part to promote competition and investment. 

The goal is to improve quality, coverage and price for all Canadians.  

To improve quality, we have doubled the amount of spectrum available for next-generation wireless networks.  

That means Canadians will have access to faster, more reliable networks, regardless of traffic load. 

To expand high-speed Internet coverage, Budget 2016 committed $500 million for the Connect to Innovate program. 

This program will build the digital backbone that enables Canadians in rural and remote communities to have access to high-speed Internet. 

Up to 300 communities across Canada will benefit.  

I am delighted to say that Canada’s Internet service providers have expressed overwhelming support for this program. 

Connect to Innovate is heavily over-subscribed because of your interest. 

That means our government can select the best proposals with the greatest benefit to consumers. 

And that’s great news for Canadians in rural and remote communities. 

But there’s still more to do. 

For example, too many Canadians are still being left behind, either because they live in parts of the country where high-speed Internet and fast wireless networks are still not available or because they can’t afford to pay for those services. 

Only about one in four Canadians in rural communities has access to high-speed Internet. 

But access isn’t the only challenge.  

The bigger barrier is prices, which are especially high for low-usage cellphone plans.

Subscribers pay more for basic cellphone service in Canada than for similar services in the U.S. and U.K. 

I get letters regularly from Canadians who are concerned that they are being priced out of the market.  

People like the father of three who’s struggling to keep up with the high cost of his family’s cellphone bill, which keeps rising every year. 

Low-income Canadians spend a higher share of their household income on cellphone and Internet bills than high-income Canadians. So it’s not surprising that only 6 out of 10 low-income households in Canada have Internet service. 

By contrast, virtually all households that earn $125,000 annually have it.  

This digital divide is unacceptable. It represents a real barrier to continued prosperity for Canadians. 

Every child who’s unable to do school assignments or download music online is one less consumer of your products and services. 

Each one of these children is potentially one less software developer for your industry—and one less job creator for our country. 

We need every Canadian to be innovation ready—ready to spot opportunities, imagine possibilities, discover new ideas, start new businesses and create new jobs.   

All Canadians need access to high-speed Internet, regardless of their income level or postal code. 

Until we bridge this digital divide, Canadians will not reach their full potential. 

Some of you have taken first steps to address this issue.  

In particular, Rogers and Telus have introduced a service that charges low-income households $10 a month for basic Internet. 

More service providers need to follow their lead. 

And our government is doing its share. 

Budget 2017 proposes to invest $13 million to make it easier for all service providers to offer these programs to low-income families. 

In fact, our government would like to see more package options and price points offered to all Canadian families—particularly in the wireless sector. 

Other countries have benefited from service innovations that support low-cost options for consumers.  

Innovations such as Wi-Fi–first applications have created a new low-cost business model in the wireless market.   

This model depends far less on routing signals through commercial wireless networks. 

Instead, Wi-Fi–based service providers route phone calls and data primarily through Wi-Fi networks. 

It only falls back on a commercial wireless network when customers are out of Wi-Fi range. 

South of the border, Republic Wireless offers such a plan for as low as US$15 a month.  

This new Wi-Fi–first model could benefit Canadian consumers, especially those with low incomes who are not well served by existing plans. 

Ladies and gentlemen, middle-class Canadians—and Canadians who are working hard to join the middle class—are concerned about the rising cost of their Internet and cellphone bills. 

They deserve more affordable options. They deserve more choice. 

That’s why our government is taking action. 

To that end, I am directing our national telecommunications regulator to reconsider one of its recent decisions and launch a new proceeding. 

On March 1, 2017, the CRTC issued rules for regulated wholesale roaming by wireless providers. 

This decision excludes Wi-Fi–based providers from access to regulated roaming services. 

And that effectively prevents Wi-Fi–based providers from offering their low-cost plans to consumers. 

This lack of choice does not benefit Canadians. 

For this reason, I am directing the CRTC to rethink its decision and reconsider the Wi-Fi–first model. 

This model could provide Canadians with more choice and affordable prices. 

As the CRTC looks at this model, I will also ask it to maintain a strong investment environment that supports facilities-based competition. 

That’s how Canadians will benefit from faster, more reliable services across the country.

But that’s not all.

Fees that service providers charge to unlock cellphones are a major irritant for consumers. 

Last year, Canadians paid nearly $38 million to have their phones unlocked. 

I know that the CRTC is looking at this issue.

And our government will closely monitor the results of the CRTC’s review.

We will continue to do everything possible to promote more competition and choice for consumers.

To that end, I’m pleased to announce today that our government has made changes to its licensing process for satellite-based providers of high-speed Internet.

This action will encourage next-generation providers to enter the market.

And that’s good news for Canadians living in rural and remote communities because new low-Earth-orbit satellites have the potential to revolutionize the delivery of rural broadband.

Our government will continue to manage spectrum in ways that benefit all Canadians.  

The goal is to improve the quality and capacity of our wireless networks, especially as Canadians’ never-ending love affair with their wireless devices has triggered an explosion in demand for more data and faster networks.

Demand is also surging as advanced devices merge with networked sensors and software, which is ushering in the age of connected cars and the Internet of Things. 

That’s why our government is making low-frequency spectrum in the 600 MHz band available to wireless service providers.  

The 600 band will improve the quality and range of wireless coverage for Canadians.

In particular, it will extend more wireless signals to Canadians living in rural communities.

And let me be clear about our approach to the 600 MHz auction. It will provide an opportunity to support more competition and lower prices and to encourage investment.

But that’s not all.

For Canada to be a world leader in innovation, our country needs to develop and use emerging technologies, such as 5G wireless networks.

The 5G market is expected to be worth $36 billion globally by 2020.

Canada must be ready to compete.

5G would allow Canada to become a global leader in emerging technologies such connected cars and smart cities.

That’s why I am pleased to launch a public consultation on releasing spectrum to support the development and deployment of 5G mobile networks.

That’s how Canadians will have access to faster, more reliable networks, regardless of the traffic load.

Ladies and gentlemen, there is no difference anymore between the digital economy and the rest of the economy.

The digital economy is the economy.

For that reason, our government is taking steps that reflect this fact.  

We will review the Telecommunications Act and Broadcasting Act as was announced in Budget 2017.

These two acts were written before the Internet became an ever-present part of our lives.

These acts need to be examined through the lens of current and future trends in technology.

Above all, we must respond to the changing needs and expectations of Canadians.

The Minister of Canadian Heritage and I will work together to review both acts.

The goal is to position Canada at the forefront of the global and digital economy.

That’s how we will create better jobs and business opportunities for all Canadians.

That’s how we will encourage more Canadians to be Internet developers and content creators. 

Our government looks forward to co-investing with you on our digital future.

Thank you.

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