Ian Scott to the Standing Committee on Industry, Science and Technology

We begin by applauding your members for your study on the accessibility and affordability of telecommunications services. We take this opportunity to reiterate the need to close the digital divide by ensuring universal access to high-speed Internet and a high-quality cellular network. All Canadians need fast, affordable and reliable broadband Internet and mobile access to participate fully in today’s economy and society.

November 26, 2020

Ian Scott, Chairperson and Chief Executive Officer
Canadian Radio-television and Telecommunications Commission (CRTC)

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Thank you, Madam Chair, for inviting us to appear before your Committee.

I am joined today by Renée Doiron, Director of Broadband and Network Engineering, and Nanao Kachi, Director of Social and Consumer Policy at the CRTC.

We begin by applauding your members for your study on the accessibility and affordability of telecommunications services. We take this opportunity to reiterate the need to close the digital divide by ensuring universal access to high-speed Internet and a high-quality cellular network. All Canadians need fast, affordable and reliable broadband Internet and mobile access to participate fully in today’s economy and society.

This is something the CRTC has been actively advancing since declaring broadband Internet a basic telecommunications service a few years ago.

The CRTC’s universal service objective calls for all Canadians to have access to fixed broadband at download speeds of at least 50 megabits per second (Mbps) and upload speeds of 10 Mbps, as well as an unlimited data option. It also calls for the latest mobile wireless technology to be available to all Canadian homes and businesses, and along major roads.

While meeting this standard has been a priority for some time, the profound economic and social upheaval caused by the COVID-19 pandemic has reinforced the need for broadband in communities that are underserved.

At the CRTC, we want – and expect – all Canadians to have access to broadband Internet services on both fixed and mobile wireless networks so they can work, learn and access health care and civic institutions.

It is currently not the case, as many rural and remote communities are underserved by Internet technologies. According to the latest data, 45% of households in rural and remote areas had access to the CRTC’s universal service objective by the end of 2019. While that’s progress from the 41% who had access in 2018, far too many households are being challenged by poor Internet connections.

To help resolve this unfortunate reality, the Commission launched the CRTC Broadband Fund to improve services in rural and remote regions that lack an acceptable level of access.

The $750 million Fund – spread over five years – is designed to help build or upgrade access and transport infrastructure to provide fixed and mobile wireless broadband Internet service in underserved areas. The key word here is help. The Fund is a complement to existing and future private investment and public funding.

Up to 10% of the annual amount will be aimed at satellite-dependent communities. Special consideration may also be given to projects in Indigenous or official-language minority communities.

Our first call for applications was issued in June 2019. The call targeted the hardest-to-serve areas in the country: the territories and the satellite-dependent communities.

This past August, we announced the first recipients of this targeted funding. Five projects will share a total of $72.1 million to improve Internet access services to more than 10,100 households in 51 communities in the Yukon, the Northwest Territories and northern Manitoba. The majority of these communities are Indigenous. There will also be a total of 316 km of new fibre installed in the Yukon and Northwest Territories to connect many communities.

The projects will serve some of the most remote areas in Canada, where the geography and climate present unique challenges to providing broadband Internet access and mobile wireless services. The prices committed to by the recipients must be maintained for at least five years after the infrastructure is built. We expect that construction for these projects will begin in the spring of 2021.

In terms of affordability, recipients must provide broadband services at a price that is no higher than broadband services provided by service providers in major urban areas in the same territory of the project. For projects affecting satellite-dependent communities in the Northwest Territories, Yukon and northern Manitoba, the rates proposed by applicants were compared to the rates for comparable services provided in Iqaluit, Nunavut.

In November 2019, the CRTC issued a second call for applications, which was open to all eligible regions across the country. By the time the call closed in June 2020, we had received 593 applications requesting more than $1.5 billion in total funding. The assessment of these applications is a high priority for the Commission. We are working to identify those projects that will yield the greatest benefits in closing the digital divide – and some projects may be approved sooner than others.

We expect that 90% of households across the country will have access to fixed broadband Internet services that meet our universal service objective by the end of next year. As a country, we are on the right path to achieve this target. The percentage of homes and businesses with such connectivity had risen to 87.4% by the end of 2019.

Of course, we want all Canadians to enjoy the same level of connectivity as soon as possible. This will require private-sector investments as well as government programs. We were delighted with the government’s announcement earlier this month that it is increasing funding for the Universal Broadband Fund. Several provinces have also announced programs to fund projects in their regions.

These measures, combined with the service providers’ investments in their networks, will bring broadband to even more households and help close the digital divide.

Our work at the CRTC is also focused on the affordability of broadband and mobile wireless services. Measures are being taken to address this issue. I should warn you, however, that there are a number of matters before the Commission and we may not be able to provide detailed responses to your questions at this time.

Access to broadband is crucial to spur innovation and empower Canadians to excel in a post-pandemic world – not just in major urban settings but also in villages, towns and small cities from coast to coast to coast. As COVID-19 has underscored, an individual’s or business’s physical location, even during periods of lockdown, is immaterial if there is equitable and high-speed access to the Internet.

Speaking of COVID-19, let me conclude by adding that since the earliest days of the pandemic, we have worked closely with our partners across government to reduce the harm caused to Canadians by COVID-themed scams. Protecting Canadians from fraudulent activities is something we continue to work on.

So, again, my colleagues and I want to thank you for shining a light on the important issue of the digital divide in Canada. As your committee’s study will no doubt confirm, few things are more important to Canada’s future than making sure Canadians in rural and remote areas have access to high-quality Internet service – just like their urban counterparts.

We would now be happy to respond to your questions.

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