Proceedings of the Standing Senate Committee on
Transport and Communications
Issue 2 - Evidence
OTTAWA, Wednesday, April 28, 2010
The Standing Senate Committee on Transport and Communications met today at 6:46 p.m. to study emerging issues related to its communications mandate and the wireless sector, including issues such as access to high-speed Internet, the supply of bandwidth, the nation-building role of wireless, the pace of the adoption of innovations, the financial aspects associated with possible changes to the sector, and Canada's development of the sector in comparison to the performance in other countries.
Senator Dennis Dawson (Chairman) in the chair.
[Translation]
The Chair: Good evening, Mr. Courtois. Colleagues, I told Mr. Courtois that he had the opportunity to be the last witness heard by the committee for our study on emerging issues related to its communications mandate and on the wireless sector. As politicians have somewhat of a tendency to listen to the last person talking to them, I told him that he had the advantage of having our attention just before we start writing our report. Mr. Courtois is accompanied by Mr. Brendan Glauser, Communications Manager at the Information Technology Association of Canada.
At the end of the sitting, we will spend a couple of minutes to deal with future business of the committee, and thereafter, members of the Subcommittee on Program and Procedure will meet to continue the preparation of the report.
Mr. Courtois, you have the floor.
Bernard Courtois, President and Chief Executive Officer, Information Technology Association of Canada: Thank you, Mr. Chair. We are very pleased to be here. We consider that your work is of the utmost importance for our country. For those who do not know our association, we are the Information Technology Association of Canada. We represent only that industry, which is quite diversified and includes everything that is related to mobile and fixed telecommunications, including software, information technology services, et cetera.
As a national association, we are involved in significant public policy issues. At this time, we are principally concerned with the issue of a digital economy strategy for Canada.
[English]
The digital economy strategy for Canada is obviously very much based on the core building block, which is a broadband strategy. We are not the only country developing a digital economy strategy. We are very happy that the government put it in the Speech from the Throne and that we will get something done over the coming months.
Countries like Britain, France and Germany have created Digital Britain, Digital France and Digital Germany. The European Union had a strategy targeting 2010, which they are updating at the moment. They will announce in the coming months to target i2015. The reason why so many developed countries are creating national strategies on this — and many developing ones and many of our new competitors out there are on the landscape for us — is that the digital economy is transforming our societies and economies. Most people realize how fundamental it is to economic growth, prosperity, social progress and competitiveness.
Ten or 12 years ago a number of countries did a similar round of strategies, but at that time, it was to get businesses and consumers on the Internet. Since then, the next wave has taken a more comprehensive and holistic approach to take advantage of the digital economy across a whole range of government operations and policies — a whole-of- government approach. We are using the new tools provided by the digital world to forge ahead in terms of progress and competitiveness.
One illustration of this is that in the United States the Federal Communications Commission was mandated about a year and a half ago, to do a study of what should be a broadband strategy for the U.S. That 360-page report came out about a month ago. It covers a whole range of subjects and exemplifies the degree to which broadband reaches out into every aspect of society, whether it is government services, public services, health, and obviously economic development throughout a modern economy.
Today, the question of broadband is more than about just rolling out broadband connectivity to all Canadians at, say, 1.5 megabits of connectivity. I know that job is not fully complete. In the policy sphere, everyone's mind now has to turn to next generation broadband. There are debates as to whether that is 100 megabits, 25 megabits or 30 megabits or whatever. I am not sure anyone can ever set a number in the digital world that becomes the end all and be all. There are questions arising now as to whether the X megabit/100 megabit target is really the most relevant thing.
There was a time when you bought computers with advertised measures of clock speed and things like that and you do not see that anymore because it is becoming irrelevant. The system has gone beyond that in terms of the differences it can make. The important thing in terms of broadband and next-generation broadband is the ability to do interactive video and probably high-definition video to be able to take advantage of the possibilities of broadband. The possibilities will allow a doctor and a patient or a nurse and a patient can have an exchange. Doctors will look at MRI images and x-rays in a very precise way or even conduct telemedicine so that citizens can interact with public services and governments among each other.
Rolling out broadband at 1.5 megabits to a country as vast and sparsely populated as Canada is enough of a challenge. We will face similar challenges when we look to the next generation of broadband. We should have in our objectives to achieve next generation broadband for Canadians in the next five years, or maybe by 2017, which will be our sesquicentenary.
Things are changing, however, both in what we can achieve and how to get there. Technology is changing and continues to evolve at a rapid race. Various elements of technology are becoming higher performing and at very high- cost performance metrics that allow more things to be done. That is, in fact, causing a change in our behaviour and how we run things and communicate with each other. However, from a wireline standpoint you have DSL technology that is upgrading to DSL2, which is faster. You have coaxial cable with DOCSIS 3, which will be delivering to Canadians within a couple of years. It is already delivering 50 megabits in some cases, soon will be 100 megabits or more.
Fibre is being rolled out in more parts of the country either in pilot projects or in greenfield developments directly to homes or to a node very close to homes and businesses. We have Wi-Fi, which is the existing most popular way of connecting wirelessly other than mobile. We have WiMAX coming on stream and LTE, which is the fourth generation. LTE is the fourth generation in Wi-Fi, WiMAX as well, and we have advanced 3G, which is already delivering, on a mobile basis, much of the capacity that we think of in terms of next-generation broadband.
In terms of satellites, each generation of satellites is able to deliver a much higher throughput and reduce the lag time in transmission, so satellites become a more and more realistic and substantial part of the picture of rolling out broadband.
In Canada, we have a private sector, facilities-based competition model that is not the same as a central, one- network supply system and we have an open economy, largely private-sector driven. The investment cycles in a world like that will be driven by the combination of technological advances, competition, as well as public support, as needed.
Other economies can be much more directive in terms of driving the rollout of broadband for a certain period of time, but I believe that the competitive and facilities-based, private sector investment model catches up and leaps ahead. That is what we see now with our 3G situation compared to where we were just a year ago, and the various different types of technologies being used in Canada for both wireline and wireless.
We are also in this period now — and in the coming five years — where we will witness a continued shift to mobile, to mobility, to people accessing what they want, when they want. This will include mobility inside the home among devices, mobility from the home network to the public networks, and mobility generally as people move around.
The other trend that is happening is the world of content is now much more integral to the broadband networks and broadband service suppliers than it was a few years ago. That phenomenon will accelerate and raises issues about digitizing all the content we have, particularly in terms of public archives and so on, as well as the driving of our public services so they take advantage of the broadband capability to provide 21st century service to our citizens and that our citizens of course can get the benefit of that.
One of the things we see in ITAC as a national association is the important element of thinking about rural and remote Canada separately from the urban environment. The economics, the competitive circumstances and the technologies to be used are different. In rural and remote areas it does not mean only the farthest reaches of the Far North of Canada, it can sometimes be on the fringes of our major urban areas.
Broadband is more important in those areas than it is in the downtown cores of our big cities because the ability to reach out and eliminate distance is of greater importance to economic and social development in those areas. The means to address those needs will be different and will use a different business model, economic model and different technologies, as I said. It is very important to look at that.
I would say that we think Canada is well placed to achieve the goal that I think we should set for ourselves. By 2015 or 2017 we should plan to have in the hands of all Canadians — or available to all Canadians — a next generation broadband capability.
With those few comments, Mr. Chair, I am prepared to answer any questions.
Senator Plett: Thank you for that presentation. I am certainly happy to hear that Canada has a plan for 2015-2017. I own a Kindle. I got that Kindle almost a year after they were available in the United States. Canadians, as far as I know, were not able to obtain an iPhone until one year after the initial launch in the United States or the Kindle until two years after its launch and only then without some wireless capabilities available in other countries. Other devices and applications are unavailable in Canada.
What effects do lags in availability of new wireless devices and applications have in Canada? In what way, if at all, could the lags in availability affect the competitive position of Canada's high-tech firms?
Mr. Courtois: A number of factors are involved. One could be a marketing strategy on the part of the people who rollout those devices. Sometimes they take a more exclusive approach and rollout with only a small number of suppliers. Sometimes it is linked to their ability to negotiate content rights with content providers. As well, the size and density of the market are to be considered.
In some cases, Canada might be used as a trial location for certain things. Usually, a company will go first to the much bigger markets and spend more time trying to negotiate content rights with content creations. There tends to be a bit of a lag for Canada, which is not something that we like to see. At times, it is a question of capacity in the networks. On that basis, at this time, I do not see any difficulty.
For us, another element is quite a challenge: Smaller Canadian businesses are not adopting technology as quickly as their U.S. counterparts to change their business. The demand in Canada is a bit lower. Our consumers are usually very good as lead users except that they seem to be a bit reluctant about e-commerce, which is a much more efficient way of doing business and more advantageous for both the business and the consumer. Given the vast distances across our country, e-commerce should be a natural to adopt. For some reason that we are trying to understand and address, our consumers are a bit reluctant.
We are also trying to think through how we could address the whole question of not using technology to its fullest extent to make businesses more competitive and grow more. We have some views about that. Some of it is simply the size of our market. If you have a market that is economically 12 times larger, like in the U.S., then you will go to a lot more trouble to get more revenue growth. We have to counter that in Canada by getting information together and focusing on getting it done.
We have always been leaders in communications. Our climate, our distances and our sound technological capability have always helped us to do that. We are still viewed in the world as leaders in communications, although we like to look at ourselves and make sure that we catch up where needed.
Senator Plett: Not wanting to get into a debate, some committee members were in Estonia and Belgium a few months back. I question somewhat the comment about our being leaders in communications. I saw Estonia as the leader in much of the wireless technology industry. Of course, we do not see much television coming out of Estonia. I am willing to accept that we can be behind Estonia and Belgium. When I watch my television and see them introducing the iPad 50 miles away from where I live, I know that I can go across and buy one if I want to travel for an hour. I find that a little frustrating.
I strongly encourage whoever we should encourage — maybe the government — to do something to keep up with our next-door neighbour, even if we cannot keep up with countries in Europe, and not have to wait two years for a new product.
The deputy chair has a sporting event that he desperately wants to watch, and he has $10 riding on it, which he will lose tonight.
Senator Mercer: Did he bet on Washington?
Senator Plett: I bet on Washington. Money is money.
The recent Speech from the Throne proposed the liberalization of foreign ownership rules in Canada's telecom sector. In your opinion, what changes should be made to the existing foreign ownership restrictions?
Mr. Courtois: First, I have a quick comment about Estonia. What they have done is admirable. They had many challenges and decided to focus on information and communications technology. They have done tremendously. On the other hand, we invented the BlackBerry, so we are not behind.
The Chair: They invented Skype.
Mr. Courtois: ITAC has been around for 60 years. We have always found that open markets in all respects are good. In terms of foreign ownership and telecommunications, we are realistic. However, we realize that as the world of content, culture and technology blend more and more, we cannot blindly say we will do something in telecommunications without thinking through the cultural consequences. While we have views in terms of culture and how the world of technology will open up many opportunities, we have not found the solution to resolving cultural issues. Maybe it is because we are not as savvy in that area.
Senator Plett: I will accept that. When General Motors introduces a car across the line, we can buy it on this side of the line. I do not see the difference between a car and an iPad. Thank you for your answers.
Senator MacDonald: Mr. Courtois, thank you for being here this evening. I have a couple of questions on system access fees. We have heard a great deal about major companies eliminating system access fees. That raises a couple of questions. Why are they eliminating them? Why did they have them in the first place, if they can eliminate them now?
Mr. Courtois: They had to cover some changes. For many years, the Canadian market was not big enough or dense enough, making it a big economic challenge to our carriers. One advantage held by the European countries is that they settled quickly on one standard of one technology to promote adoption. The wireline network was a pay-per-minute system. For a variety of reasons, they adopted it more quickly than we did. There was a huge economic challenge. The wireless operations were not viewed favourably by the financial markets, but at some point, they caught up. Now, another wave of entrants is coming in that will cause a disruption in the market. Those normal cycles happen in the marketplace and because of that, you will see a diversity of approaches. That is likely what has caused the dropping of system fees.
Senator MacDonald: It all comes down to the consumer. We all use these phones that have become indispensable to many.
Why are phone fees so high in Canada, compared to the Scandinavian and other countries? We have very expensive phones in this country.
Mr. Courtois: I do not know that is the case. There is a lot difficulty in comparing prices across different countries. The OECD has had considerable difficulties and has announced recently on its website that it will try a different approach to doing it. It is hard to compare apples to apples. We have a completely different way of charging than Europe does. Here, you pay for making a call or for receiving a call. The European system was on a per-minute basis, starting with the wireline system whereby the calling party pays. In Europe, you often pay for the set and you get some lower charges for your calling, whereas here the set is largely subsidized.
In Europe, people were in the habit of buying smaller packages. They still do have to pay for their local wired home phone, and they buy smaller packages than we do. If you try to compare a 50-minute package in Europe to a package that Canadians buy — maybe 200 minutes or 100 minutes— and compare those prices, the price per minute in Canada will look high because you are only counting 50 minutes or whatever.
The OECD also has all these countries to compare. They pick a point in time when they make a comparison, and that point in time might be awkward for one country but might work well for another. I hear a lot of controversy around those OECD price comparisons. They are picked up by Harvard and other groups and are repeated.
The sense I have is that, if you buy many minutes, like a thousand minutes like a business would, the U.S. is the cheapest place because they are heavy users in business. As I said, they use the technology more and the providers have developed packages to meet that use. Canada is a midway; it is close to the U.S. in terms of price and better than Europe if you buy substantial packages. Europe has small packages, but if you use many minutes, it will be more expensive than Canada.
It is not a simple thing. I do not think we have that big of a problem. Our performance is good when you consider how important density is to the economics of a network business.
There might be a better way to illustrate this. When the government held an auction for wireless spectrum, for example, for the Greater Toronto Area, the one I was directly involved with years ago, it was sold for more than the entire rest of Canada. Even in population, territory, or whatever, it seems to make no sense. However, the economics of a highly dense population are so much better for a network builder and provider that it is actually amazing that Canada does as well as it does in terms of our prices.
Senator MacDonald: However, our system is identical to the system they use in the U.S., yet the population is denser in the U.S.
Mr. Courtois: Yes, the economics are completely different.
Senator MacDonald: The urban centres in the U.S. are more equitable in terms of comparison to the urban centres in Europe. I am curious why the European system would not be more applicable here or in the U.S., or vice versa.
Mr. Courtois: Countries like the Netherlands, Belgium or Denmark are postage stamp sized compared to the size of Canada. The population density is probably higher in those countries than even in the U.S. In the U.S., you have problems in the biggest cities having enough network capacity to handle what they have, so in Canada we are a lot better.
However, the economics of the business are that Europe should be able to do at least as well as the U.S. and it does not. There are a number of other factors involved.
In the U.S. market, as I said, not only do consumers use a lot more, and there are more people and more density, but businesses use the technology a lot more and therefore, that changes the economics of the business. They buy large quantities of capacity.
Senator Banks: Thank you, Mr. Courtois. I am not a regular member of the committee, so I may be asking a question that was asked before by others. Your members sell stuff, access, services and operate networks that sometimes are used by people to circumvent laws having to do with intellectual property. What is the view of your association with respect to the burgeoning possibility of new copyright legislation from this government?
Mr. Courtois: We see the world changing from an economy based on bricks and mortar and physical things to an economy based on knowledge and transactions that occur in cyberspace and innovation and creativity. In that kind of world, it is extremely awkward for a country like Canada to have copyright legislation that actually predates the Internet. The Internet goes back a long way, but it was only around 1996 with the World Wide Web and other capabilities that usage started to boom.
Our copyright legislation was designed before that age. In this day and age, it is absolutely essential that we develop new copyright legislation. I think it is also essential in the traditional Canadian way that we find consensus.
In the age of the Internet, something awkward takes place. When people use email at first and sometimes see, a week or two later, how loose they were and how they expressed themselves, they would like to take it back and say they should have been more careful.
Senator Banks: That is what the Senate does with law.
Mr. Courtois: The opinions can be extreme in the world of the Internet. They can be intolerant. Our society has not yet adapted to that. When you have a topic like copyright, we must in a Canadian way put a little water in our wine and build consensus where we look after all the interests.
In our view, copyright legislation is needed for our consumers. There are consumer rights and advantages that we should put in new copyright legislation. It is important for creators and for distributors. The traditional approach to copyright, particularly in this country, in many judgments of the Supreme Court, is that copyright is a balance between the rights of creators and users and distributors. Without that balance, you do not maximize the benefit of knowledge and disseminating knowledge.
I am hinting that, although it will be controversial, we absolutely have to come together on this and build consensus.
Senator Banks: There is no doubt of the need for new copyright legislation for all of the reasons to which you referred, but I am wondering, in particular, about the view of your organization. I presume you will be having input into or making suggestions about the nature of that legislation with respect to the protection — and let me be specific — of the interests of creators of whatever it is.
Mr. Courtois: Yes.
Senator Banks: I ask because there are many people who do not understand the concept that you buy music; it is foreign to them. However, if someone does not buy or, in some way, pay for the music, then none will be made. That is an exaggeration and an overstatement, but that is the nature of my question.
What is the position of your organization in respect of that kind of question? My question could also apply to poets, authors of books and I suppose patents, as well.
Mr. Courtois: Absolutely it could. The businesses in our industry that create software and services cannot operate and we cannot be building an innovation-based economy without protecting the rights in cyberspace, so that someone cannot take my property on the Internet any more than they can take my house away from me.
I also believe that young people understand that. The notion that they do not think of paying for music is transitory, I believe. I was involved in a whole period where we had satellite television piracy, and the solution was to upgrade the range of services offered and to get into a significant public education campaign.
However, I think people hit a certain age and they do that, but their parents can tell them, they grow up and they get into business and they realize it is wrong. They probably all know, and the studies show, that they know it is wrong. No one is doing anything to stop them, so they will continue to do it. I do not believe that is a permanent state of affairs.
Senator Cochrane: Thank you for coming, Mr. Courtois. You said that different technologies are needed for rural and remote Canada. Would you elaborate on those technologies?
Mr. Courtois: Depending on the density of a given area and the topology of the landscape, you may need to use a fibre link. If there is no road to an area, you have to use microwave. In some communities, depending on their density, you might have a wireline connection to homes and businesses. With a little greater spread and less density you will use fixed wireless, and with a little greater density, you would use mobile technology or satellite technology, either reaching homes individually or reaching a central location in a community and then reaching out from that location.
All of those technologies are changing, and I am told that the next generation of satellites will be able to provide a business with 20 megabits both ways. Particularly in rural and remote Canada, that is very good next-generation broadband that allows you to do everything you want to.
In addition to the technological challenges, people must understand that the business model is different. In the very dispersed population areas of our country, people talk about wind chill time. Although wireless systems and satellite- based systems do not break very often, when you have to fix them it is not a question of your technician driving two blocks between one customer and another; he or she may have to drive 30 minutes. That changes the economic model. You need someone with points of presence in enough places to be able to serve the population well.
Again, we are seeing businesses emerge in those parts of Canada that can do this in a sustainable way. Sustainability is also important because you want the community to get involved and to support and work together on getting these networks built. If you choose a vehicle that is not a sound and stable commercial operation, you may find that in the coming years, no one is able to maintain the system, and it will become a problem.
There are a number of problems. The technology is progressing so well that mobile can now handle next-generation broadband, and as it is upgraded from 3G to 4G; hopefully it will do better. There are places where the government will need to do a backbone to bring traffic back to the larger networks and help make the business case more sound. However, in terms of public investment, that is one of the highest payback investments you can make because, as I said, the economic impacts are much greater in those areas than they are in the densely populated parts of our country.
Senator Cochrane: You say this may happen by 2015?
Mr. Courtois: Yes, there are satellites coming through in 2012, 2014 and 2015. The 3G networks are already providing that capability, although their coverage will have to be increased over time. In another five years after that, there will be another generation that will increase considerably, so there are real prospects. If we can get the business models built up so that the operations are viable on their own, Canadians in rural and remote areas will not be left behind.
Senator Cochrane: I look forward to that.
Senator Moore: I would like to follow up on Senator Cochrane and on your earlier comments with regard to the urban and rural situations. I think it is true that Canada was the first country to have Internet links to all of our schools, yet we are said to be far from a leader in the penetration of high-speed Internet and broadband.
Are we in any danger of creating a divide between the urban and suburban or rural areas of our country with regard to the provision of the technologies that are coming? What can that do to us?
Mr. Courtois: We need to be vigilant to prevent that. I do not want to paint too rosy a picture. It is extremely important that committees like this maintain the focus of Canada on how important this is.
It is well within our reach to prevent that divide from happening, but there will have to be public will and government leadership so that businesses and communities fall in behind that.
In the late 1990s, we were world leaders on broadband because we got in well ahead of others. We have to accept that countries that are no bigger than a dot in Canada will, in time, do better than us in terms of penetration. For example, we are still well ahead of the U.S. in penetration of broadband in our homes, which is absolutely amazing considering the density and the size of the markets.
The competitive forces that we have in Canada will continue to play so that urban Canada will be well treated, if we want, in terms of national priorities with investment incentives and so on, and that will help.
Last fall, we talked about the digital economy strategy for Canada. We asked whether we would be ready to come out with a plan for rural and remote Canada. Canadian businesses would like to see more urgency and more intensity. We realized that we were not quite ready yet within next-generation broadband because of the evolution of technology and business models. Industry Canada had a process for people to bid on rolling out 1.5 megabit broadband to all locations. We will see who takes up those things and where there are gaps. Then we will see the combination of new business models, technological progress and where the government has to intervene. We do not want to wait indefinitely. In our view, a plan has to be put out this year.
Senator Moore: The briefing note that we were provided says that in a speech in mid-February, the chairman of the U.S. Federal Communications Commission noted, ``More than 20 countries already have broadband plans and are pushing to capture the jobs and economic advantages that broadband enables.''
Canada does not currently have a comprehensive broadband plan. Should Canada have such a plan? If so, what should be included in the plan?
I take it that you are talking about the will and saying that we have to embrace this and develop an approach now. What do you see happening in terms of overall broadband use, penetration and the potential divide that I asked you about earlier?
Mr. Courtois: We are still working on rolling out the current generation of broadband, so in that sense we have a plan. However, in this day and age, as I said, we need next-generation broadband. We are almost there. Looking at what the U.S. and other countries have done, there is no doubt that we cannot afford to wait around much longer. We may need another round of information gathering. We need to figure out whether we want public support to accelerate the rollout of next-generation broadband throughout Canada. We need to figure out where the needs will be in rural and remote Canada for backbone and to what extent public dollars will have to come in there. Then, based on the business proposals, plans and the technological advances, we will need to figure out to what degree, if any, the Canadian government will have to invest public money to reach individual consumers.
I believe there will be a need; there will be a gap in the business cases. However, it will not be the same need as there was two or three years ago because, as I said, businesses are progressing. Businesses will be out there serving those customers already and making money out of it.
Senator Moore: You say we need to figure these three things out. Who does the figuring out? This seems to be evolving very quickly for business and consumers to be able to catch up. When do you buy the first one; when do you jump in? Who will do this figuring out, given the evolution of technologies and business models you mentioned?
Mr. Courtois: At ITAC, we are gathering a community who are the people who do the technology, who serve those kinds of customers, and who are aware of the problems. We get them to talk to Industry Canada and Industry Canada consults the public. It use a website approach to get information on what is going on. It has other contacts as it rolls out the current plan to a whole range of communities.
Industry Canada should be able to get all those pieces together this year and map out the plan for the next five years.
Senator Moore: Do you have a current report that you can make available to this committee?
Mr. Courtois: No, I do not have a current report. As we tried to work on this last fall, we realized that too many of the pieces were still changing. In particular, the rollout of what the carriers are doing with the money the CRTC had them put aside, and the rollout of the current federal and provincial plans and which businesses will get what, was a matter of months away.
Those people know the technology. They know when the technology will be available, but the business side is being influenced quite a bit. We have decided to create a council within ITAC. We have advised them to let a few of these things sort themselves out. In the next month or two, we want to get them together and say how we will carry this information over to the government so that the government has the accurate picture and puts that in a plan this year.
Senator Mercer: I only have one question, but I want to give a very short preamble. You have talked about too many pieces changing. We are close to the end of this study, and we have to make some recommendations.
You mentioned that the current laws predate the Internet. How do we draft laws, policies or recommendations that account for what has happened since the last time laws were written, and also projecting to the future, so we can anticipate the changes that we all know are coming? How do we do that?
I do not think that we want to come back and have this study again in 12, 18, 24 or 36 months. We would rather come back in 18 months and look at the good work we have done and recognize how forward thinking we were.
How do we take all of those historic things into account, as well as what is happening today and what is likely to happen, and anticipate what the government's role should be and how they have laws, regulations or rules that will affect the industry?
Mr. Courtois: The most important thing can you do is express the goal that public policy-makers should be leaders in this and set a path of where Canada wants to be in 2015 or 2017. For example, policy-makers could set the goal to have next-generation broadband capability available to all Canadians. We have to recognize that the way of getting there is absolutely within our reach and the means of doing it are getting better as technology and business models progress. There will probably be some need for public money; however, the most important thing is public leadership and public goals. The private sector actually aligns behind that a lot. People do not realize how often in the boardrooms of the nation people line up to the goals by the leaders of the country.
We have been able to achieve tremendous things. We wanted to eliminate our deficit. We did it. The rest of the world admires us for that. We wanted to have competitive tax rates, which we have, and other countries try to dig themselves out of debts much worse than ours. They will have a hard time eating away our advantage. Something like this next generation broadband is fundamental to the future of our economy. You set those objectives and recognize there will be more means of getting there. Legislation is obviously a domain where you can not only set the goal but also actually make the legislation.
It is obvious to everyone that we need to have 21st century copyright legislation and that legislation has to produce advantages for consumers and distributors.
Senator Martin: I apologize for being late. I missed the witness' presentation but I had a chance to look at your organization. I have a question regarding one of your priorities, which is eHealth.
My father was in the health system when, on a day when he had to have blood drawn from one hospital and then have to be transferred in an emergency situation, he had to go to the next health authority 10 minutes away and they had to draw more blood. Records do not follow the patient between health authorities. I think ensuring the system is more efficient is such an important area for the health of Canadians.
What progress have you made on this particular priority and could you talk a bit about how we could be helping the current system via technology?
Mr. Courtois: It is in a handful of top priorities. If you are in the information technology industry and you experience dealing with the health care system, you are shocked at the waste and duplication. It is shocking how the practitioners in the system have their time wasted and how much they could better serve patients, which is what they want to do.
Many risks take place because of these multiple hand-offs. I come from the telephone industry. I remember the days when we decided to sell DSL service for a certain price per month that was like $15 less than was being charged. We came to our network people and said, ``You just need to have the cost fit the price we think we can set it at.'' They said, ``We will go back through every step along the way. We will take away all the hand-offs. We will automate it all.''
When you have anything to do with IT, you are shocked. I do not think Canadians know that their system is as backwards as it is. The doctors feel it.
In the last few years, all players in the system realize that they absolutely have to get into a digitized system. We have made investments in some of the big back office systems that have to be created. Now the shift is taking place. It is time to focus more attention on the point of care, not only in the hospital, but also in doctors' offices. I think 80 per cent of the encounters with the health care system are in doctors' offices rather than in clinics.
When a person presents in emergency or visits a specialist, the doctors should not have to guess whether the patient has had certain tests, or what kind of medication the patient is taking. Often, out of prudence, the doctor orders another set of tests. People should not have to walk around with their x-rays. That is changing.
At the moment, inside the system, everyone realizes this has to be done. As when we digitized the phone system, huge savings and improvements are to be made when more of the pieces come together. There is an electronic health record; the doctor has an electronic medical record; and they interface easily when a person goes into hospital.
Currently, there is great realization of the need for electronic records and much frustration that we are not there yet. Trying to do anything in the health care system is very complicated because of all the people and interests involved. We are moving in the right direction. Approximately 75 per cent of the $500 million allocated in this year's and last year's budget to Canada Health Infoway will go for electronic medical records in doctors' offices that, hopefully, will meet a standard where they are reasonably interoperable. There is a patchwork among our provinces. The Infoway money is added to money that provinces are already spending to multiply the impact. There is more to come on that issue. We are glad for the realization of need.
There is much talk about our health care system not being sustainable and gobbling up all our money. We do not want to get into the debate whether you should use the private sector or the public sector. The U.S. experience of using the private sector seems to be more expensive rather than less; that is not the solution. The U.S. spends 50 per cent more per capita on health care than Canada does. Therefore, we could spend more without causing bankruptcy.
However, if we digitize the health care system and give people the tools to take advantage of that, we will eat up much of the feared cost increases and soak up all our revenues in running a more efficient system. It will result in a completely different wave of wellness where we can proactively manage health. Patients will be more involved in managing their health care. You will have another set of gains in costs to the system, which is even more important as our population ages.
The Chair: I must repeat to Mr. Courtois, we asked him many times to adapt his calendar to ours. We are happy we could accommodate our mutual calendars. You are also the last witness on this study. We will go into the phase of writing the report.
[Translation]
I thank you for being here. You are now free to go, if you please.
[English]
While Mr. Courtois departs, the committee has two or three informal items to deal with immediately.
We expect Senator MacDonald's bill on vehicles to be sent to this committee over the next few weeks. Senator Mercer will be the critic. Therefore, we will alternate between the report on telecom and the bill. This probably will not happen before next Tuesday. Unless something dramatic happens, we will not meet on Tuesday morning.
Next Wednesday evening, we will discuss the next subject for future committee debate.
I will free all of you except Senator Frum and Senator Housakos. We will have a steering committee meeting to give a mandate to Senator Mercer.
(The committee adjourned.)