THE STANDING SENATE COMMITTEE ON TRANSPORT AND COMMUNICATIONS
EVIDENCE
OTTAWA, Wednesday, February 8, 2023
The Standing Senate Committee on Transport and Communications met with videoconference this day at 6:46 p.m. [ET] to study Bill S-242, An Act to amend the Radiocommunication Act.
Senator Leo Housakos (Chair) in the chair.
[English]
The Chair: Good evening, honourable senators. I call to order this meeting of the Standing Senate Committee on Transport and Communications. My name is Leo Housakos, a senator from Quebec and chair of this committee. I would invite my colleagues to introduce themselves.
Senator Simons: Senator Paula Simons, Alberta, Treaty 6 territory.
[Translation]
Senator Miville-Dechêne: Senator Miville-Dechêne, Quebec.
Senator Cormier: Senator René Cormier, New Brunswick.
[English]
Senator Omidvar: Ratna Omidvar, Ontario.
[Translation]
Senator Clement: Bernadette Clement, Ontario.
[English]
Senator Quinn: Jim Quinn, New Brunswick.
Senator Wallin: Pamela Wallin, the province of Saskatchewan. We are usually more organized than this, really.
[Translation]
The Chair: Honourable senators, we are meeting to continue our study of Bill S-242, An Act to amend the Radiocommunication Act.
For our first panel of witnesses, we are pleased to welcome before the committee, by video conference, the following representatives from TECHNATION: Michele Lajeunesse, Senior Vice-President, Government Relations and Policy, and Michael Dugeri, Policy Analyst.
[English]
From the Canadian Association of Wireless Internet Service Providers are Jonathan Black, Executive Director; and Neil Smellie, Director.
Welcome and thank you all for joining us this evening. We will begin with your opening remarks, starting with TECHNATION and then CanWISP. Ms. Lajeunesse, the floor is yours.
Michele Lajeunesse, Senior Vice-President, Government Relations and Policy, TECHNATION: Thank you very much. On behalf of TECHNATION, we are thankful to the chair and members of the Standing Senate Committee on Transport and Communications to offer our comments on your study of Bill S-242. We would, however, also welcome a follow-up discussion with the Senate committee or its officials to discuss our position.
For those of you who don’t know us, TECHNATION plays a central role as the industry-government nexus for technology prosperity in Canada. Our goal is to unite technology and government community for Canada’s future by leading as a catalyst and conduit for the future of technology and innovation in Canada.
As a prominent advocate for the expansion of Canada’s innovation capacity, TECHNATION encourages technology adoption to capitalize on productivity and performance opportunities across all sectors. We are member-driven and not‑for-profit. TECHNATION has served as the authoritative national voice of the $230 billion ICT industry for over 60 years. More than 36,000 Canadian ICT firms create and supply goods and services that contribute to a more productive, competitive and innovative society.
The ICT sector generates over 1 million jobs directly and indirectly, and invests $8 billion in R&D, more than any other private-sector performer. We support such efforts as Bill S-242, which we believe can expand opportunities for innovation, especially for micro, small and medium enterprises, MSMEs, in the technology industry that rely on access to broadband to remain connected and competitive.
At TECHNATION, we have first-hand knowledge of the importance of broadband access in rural communities from many of our interactions with SMEs on Canada’s Digital Marketplace, which is a digital platform we developed to provide a simple consolidated access point for Canada’s technology solutions suppliers.
For Canada’s leaders at all levels, the marketplace is a one‑stop shop for public and private-sector officials to view the incredible Canadian innovation on offer from small and micro businesses across the nation.
Spectrum is a limited and valuable public resource that has the capacity to bring true high-speed connectivity to remote, rural and Indigenous communities across Canada. When spectrum licences are sold, there is a moral obligation to ensure that the spectrum is actually used to deliver on that connectivity.
Rural connectivity has the potential to significantly support rural prosperity. A recent study from Canada 2020 on rural prosperity highlighted the importance of connectivity as a precondition for economic growth, educational outcomes and social benefits.
Ultimately, think about a small or medium business in a rural community, like those in the tourism sector. Without sufficient connectivity, they will struggle to market their destinations while also being challenged to offer a competitive product compared to other designations where connectivity is already available.
Similarly, think about Indigenous entrepreneurs who are working to build companies on their traditional lands. Connectivity allows them to upscale online and reach the world with their products and services while staying connected to their community. Furthermore, the successes that flow from those efforts have ripple effects throughout the community.
In turn, government has access to a more diverse supply chain to meet its challenges.
Finally, think about the environmental impacts. If we want to reduce our greenhouse gas emissions, especially on farms and in rural communities, we’re going to have to ensure that folks can implement new technologies and create opportunities for virtual learning, virtual medicine and virtual employment. Simply put, connectivity will take cars off the road while delivering a higher quality of life for rural Canadians.
But to achieve this, we need to put spectrum to work. Simply put, if spectrum is not being used by the people who bought that licence, then it needs to be redeployed to someone who will.
To circle back to the economic impacts, it is important to note that in putting spectrum to work in rural communities, carriers and the owners of the licences employ fulfillment partners to do the work, and the majority of those partners in rural communities are small and medium businesses.
On behalf of TECHNATION, we thank you for the opportunity to offer our comments on Bill S-242.
The Chair: Thank you very much.
Mr. Black, you have the floor, sir.
Jonathan Black, Executive Director, Canadian Association of Wireless Internet Service Providers: Thank you, and good evening. Thank you for the opportunity to participate in this hearing or proceeding. I’m here with Neil Smellie, who operated a small rural internet service provider in the Muskoka area for 24 years. He is currently a director of CanWISP and has joined me this evening.
Our members build, own and operate networks, providing internet access to households and businesses in rural areas across Canada from coast to coast. Our members use a combination of fibre technologies and fixed wireless technologies, which is distinct from cellular wireless technology.
In total, there are approximately 200 small rural-focused internet service providers serving hundreds of thousands of rural residents and businesses. These providers are the family farms of the Canadian rural connectivity industry. They exist because large companies have not invested in their rural communities. Most of these operators are not able to access licensed spectrum. The vast majority of licensed spectrum is held by large national and regional carriers, and a lot of this spectrum is unused in rural areas.
CanWISP strongly supports a use-it-or-lose-it framework, and we’ve advocated for this principle in the past. From that perspective, we support the fundamental premise of Bill S-242.
We do, however, believe that the bill in its current form will not encourage rural connectivity as it hopes to do.
The bill imposes a one-size-fits-all approach to deployment requirements. As noted by ISED yesterday, spectrum doesn’t work that way. Issues such as geography, population density and even the physics of radio frequencies mean that a one‑size‑fits‑all approach won’t achieve the goal of rural connectivity. Laws and policies designed for Toronto or Edmonton aren’t going to work in rural PEI or coastal British Columbia.
The bill explicitly excludes smaller licensed areas — in ISED’s words, Tier 5 — or the 654 geographic zones of Canada, as designed by ISED. To support rural connectivity, we need to do the opposite. We need to apply deployment requirements to smaller geographic areas, ensuring that rural deployment cannot be avoided simply by deploying in urban or exurban areas only.
The civil liability imposed by the bill, while tantalizing to the spectrum have-nots, is likely to discourage investment and would, at the least, require additional clarification.
ISED has the policy tools available to support rural deployments. Rural Canadians are frustrated by the state of their connectivity, but this legislation will not result in faster internet sooner in rural areas. If the government wants to support rural connectivity, there are practical options that can help, in particular more proactive policies in a few areas. Spectrum auctions all but exclude rural ISPs. Lot sizes are so large and prices are so high that rural ISPs can’t participate. Spectrum is acquired by major players that have no interest in rural connectivity and instead deploy additional layers of technology and spectrum in urban areas that are already well served.
I expect they do this because that is where they can get the best returns for their shareholders. There is no incentive for spectrum owners to sublicense their unused rural spectrum, and in fact, many of them see sublicensing as assisting a competitor.
A combination of updated spectrum rules and new, enforced sublicensing requirements are needed to make it feasible for smaller providers to participate in filling gaps in rural and remote connectivity that larger carriers do not and will not fill.
Government funding programs and access to the Canadian Infrastructure Bank, or CIB, favour large companies. In many cases, the projects funded by those means are unnecessarily overbuilding existing rural networks instead of facilitating new builds where there are gaps in the delivery of broadband services. This needs to change. Funding must be available to smaller services providers on an equitable footing.
Infrastructure, and especially transport facilities, built with government funds are not made available to other ISPs to serve underserved areas. A properly constructed and enforced pro‑competitive access regime linked to any public funding of transport facilities is necessary.
In conclusion, this bill is well intentioned, but it does not solve the problem of better access to broadband in rural and remote communities. We need to focus on spectrum usage now.
The largest clawback of spectrum licences in history is currently in process. Spectrum used today by many rural ISPs to provide service to rural Canadians is being taken back by ISED so that the major players can bid for it in the upcoming 3800‑megahertz auction. It would be a tragedy if this spectrum used today to serve rural Canadians is purchased by major players and then not deployed in rural Canada.
Rural ISPs across the country are trying to figure out how they’ll serve their customers in just a few years’ time.
There are many challenges in connecting rural communities, and CanWISP members live those challenges daily. Bill S-242 recognizes one of these challenges — unused spectrum — but it does not, in its current form, address those challenges. Rural communities need the support of the federal government to ensure that spectrum, a public resource, is used for the benefit of all Canadians. This will require a more proactive policy stance that overcomes the major obstacles like the ones we’ve just discussed.
We are encouraged to see concrete efforts to make better use of spectrum in rural areas, and CanWISP is always happy to talk with you about how, together, we can bring better broadband services to rural communities. I look forward to your questions.
The Chair: Thank you very much. I will be turning it over to the deputy chair of the committee to start off the questioning.
Senator Miville-Dechêne: Thank you to our witnesses for your presentations.
I’m puzzled, Mr. Black. Could you explain in more detail your mention of 650 geographic zones that are excluded? Could you explain this? Where is it in the bill? What is the problem? Because I didn’t get it.
I’m also very worried about when you mentioned the largest clawback, but let’s start with the first question.
Mr. Black: In the bill, there is a reference to Tier 5 areas being excluded from the legislation. ISED has divided the country into five levels of licensed areas. Level 1 is national. If you buy a spectrum licence in Tier 1, it is for the whole country, and it gets smaller as you go from Tier 1 to Tier 5. At Tier 5, there are 654 zones or geographic areas.
The upcoming spectrum auction is being auctioned off in Tier 4 areas, which I think they referred to as 790 zones. We have been advocating for smaller zones for quite a while, which would allow a measurement of spectrum usage to be more closely monitored.
The Chair: Mr. Black, I hate to interrupt. Can you give us a specific example of a Zone 5 or a Zone 3 geographically so we can wrap our heads around this?
Mr. Black: Yes, Mr. Smellie has some good experience with that.
Neil Smellie, Director, Canadian Association of Wireless Internet Service Providers: If you are familiar with the city of Kingston, Tier 4 encompasses from Lake Ontario to many miles north of the Highway 401 corridor. Nested inside of that tier are what we call Tier 5 areas. One of those Tier 5 areas is the urban area of Kingston, and then above that are more rural areas, and those nest inside the Tier 4.
Our point is that in a tier like Tier 4, the spectrum is very valuable because Kingston is a large population centre. It also has the Highway 401 corridor running through it, so any regional carrier or any incumbent trying to get into the market will find that spectrum along the Highway 401 corridor and in that city centre very valuable.
Five miles to the north of 401, that’s where the problem is. That’s where they’re not utilizing their spectrum and our members don’t have access to it.
Senator Miville-Dechêne: So you have no explanation for this exclusion? You would like it not to be there?
Mr. Smellie: We would like to go further than that. We would like the measure of connectivity to be based — we understand it will be auctioned off at the Tier 4 level, but we believe that the test for connectivity should be based on Tier 5. So if someone buys Tier 4, they have to meet the deployment requirements for all of the Tier 5 areas that are nested within that Tier 4.
Mr. Black: If I could give an example, if someone purchased the Tier 4 that included Kingston and the surrounding towns and villages — you might be very familiar with this — under the proposed bill, they could serve 50% of the population by only serving Kingston. And then the other areas like Sydenham — I’m trying to think of the other small towns in the area — would not need to be served and would still fulfill the requirement of deployment under the proposed bill.
The Chair: I have a follow-up question. Can you give me a geographic example of Tier 1? You said Tier 1 would be very national in scope.
Mr. Black: Tier 1 is the whole nation. I believe Tier 2 is provincial, and then it gets smaller from there.
The Chair: Forgive my ignorance because I am still in algorithm mode. Why would we be selling spectrum in Tiers 4 and 5 when we could be selling Tier 1 spectrum that would cover the whole nation? I don’t know if that question makes any sense.
Mr. Smellie: That would exclude most carriers. Not many carriers could afford to purchase the spectrum in that large of an area or, in turn, deploy that amount of spectrum. Certainly, TELUS is stronger in the West, while Rogers and Bell are stronger in the East.
The Chair: So I guess only TELUS, Bell and Rogers would be buying Tier 1 spectrum?
Mr. Smellie: It is also very unusual for ISED to auction anything off on Tier 1.
Senator Miville-Dechêne: If I can just add, yesterday we heard from the government officials. They said they want to sell off smaller portions in the future, and I was thinking, if you sell smaller portions, nobody will want to buy Tier 5 because there is no money or not much money to be made with it and everybody will concentrate on buying the spectrum that is in the cities. You would not be better off, would you?
Mr. Black: “Better off.” Maybe that depends on how we define it. If “better off” is maximizing the dollars, that is one measure. The Kingston Tier 5 would likely still be purchased by a major carrier that will deploy services there, and the tier that sits in Sydenham and other small towns outside would not go for the same price because the population density is different and may be available at a reasonable price to a smaller provider.
Senator Miville-Dechêne: So we need good reform.
Mr. Black: Yesterday I mentioned that they have been auctioning off spectrum in smaller tiers, if you will. I believe this upcoming 3,800-megahertz auction in Tier 4 is a smaller tier or smaller zone than they have typically auctioned spectrum in. We would say we should even go as far as Tier 5 for auctions.
It does make it administratively more difficult. You may have two carriers side by side trying to work out boundaries, but if that’s the price we have to pay to get that spectrum used in rural Canada, maybe it’s worth it.
The Chair: Would Ms. Lajeunesse or Mr. Dugeri want to weigh in on those questions?
Ms. Lajeunesse: I think the team is good in terms of what we heard from Mr. Black. From a deployment standpoint, we definitely support establishing a baseline standard. It is a good idea.
The one thing I wanted to ask, if I could, of my fellow panellist when you say “administratively more difficult,” can we just clarify for whom? Are we talking for the government, the carriers or for all of the above?
Mr. Black: It is definitely more difficult for ISED to carry out an auction in several hundred territories rather than a few, to which I say maybe it is just time to make your computers work harder or faster. It is a little bit cheeky, but we are not in the paper and pencil era anymore.
Ms. Lajeunesse: To that, I would definitely agree with my fellow panellist that we need to make life easier for our SMEs and our businesses to actually serve our rural communities. I absolutely agree; let’s find a way to get automation working in the government, for sure.
Senator Simons: I had a separate question I was going to ask, but I have to come back to this question of the clawback, which Senator Miville-Dechêne didn’t have time to have answered.
Explain this to us, because we heard from the government yesterday that they were going to do this big auction, but they didn’t say anything about taking spectrum that people were already using. How is it that you’ve been using this spectrum, and why would they take it away from you?
Mr. Black: There are several ways you can use spectrum. Some spectrum is allocated for free and open use. That’s typically used by your baby monitor, your garage door opener, et cetera, the Wi-Fi device in your home.
Spectrum at the other end is purchased at auction, and there are other spectrum areas that have been set aside for what we call “lightly licensed.” There is a very minimal charge, and the buzzword is WBS or the spectrum is 3.65 gigahertz. That has been used extensively throughout Canada for delivering internet to rural Canadians. It doesn’t have interference from baby monitors and garage door openers.
It’s also prime spectrum for 5G, this technology we’ve all been hearing about and some of us have experienced. As we understand it — and ISED can and will address it — their desire was to have a contiguous block of spectrum, from 3,500 to 3,900, that the carriers could use to deliver 5G services with no breaks in the middle. That was the intention, to take that spectrum that has been lightly licensed.
By lightly licensed, when Mr. Smellie wanted to roll out and use the spectrum, he would apply to Industry Canada and say I’m putting up towers here and this is what I’m doing. There was a small fee that could be levied, hundreds or thousands of dollars — not hundreds of thousands — and he could use that to deliver internet to his neighbourhood, his community or his rural area. They have said that we, the small rural ISPs, must vacate that spectrum by either 2025 or 2027, depending on whether it’s a rural area or a more urban area.
Senator Simons: Will you be provided with any compensation? It sounds like sheep clearances in the Scottish highlands.
I want to come back to my actual question. Senator Patterson made a compelling case, and I think you would all agree with the intention of his proposal, but it’s becoming increasingly clear to me that one-size-fits-all will not work. I hate to reject this bill out of hand because I think it’s trying to get us to the right place. I’m trying to figure out if there’s a way to tweak it.
For example, instead of having both a 50% and a five-year time limit, if you had a bill that said, “You must live up to what your assigned commitment was within three or five years,” would that work, rather than saying 50%? I can imagine that the deal somebody made was that they would do 30%. Could we just shorten the timeline without having the 50%? Would that get us where we want to be?
Mr. Smellie: The timeline in some cases and in some spectrum is reasonable. We’ve discussed it around our board table. We feel that three years would be a good time for ISED to check that spectrum and see how it’s being deployed. If the company is in the process of deploying that in some kind commercial fashion that makes sense and delivers the spectrum to Canadians, then maybe they are allowed to go to the five-year or seven-year milestone that’s there now.
If ISED goes to a spectrum holder in year three and finds out that they haven’t deployed the spectrum and haven’t made any arrangements to deploy the spectrum, then maybe it’s time for them to turn the spectrum back in. That’s one of the ideas we had. The mid-band spectrum that we’re talking about, this 3‑gigahertz spectrum, is prime for that type of thing. In higher millimetre wave spectrums, 50% of the population in a tier might be aggressive because that technology doesn’t cover as many people, so you need far more infrastructure to be able to cover an entire tier.
Senator Miville-Dechêne: At the same time, you just made the counter-argument that if somebody acquires Tier 4, they also deserve the pockets that are in Tier 5, so that would mean deserving 100% or more.
Mr. Smellie: It would change the deployment requirements. If we use the Kingston example again, if they purchase a Tier 4, they could put a single tower in the city of Kingston and meet their deployment, which I don’t think is the intention of the committee, the bill or ISED, for that matter. What we’re saying is that is they can still buy that Tier 4, but when it comes to the review of how they are using that spectrum, they need to make sure they can guarantee that Kingston is taken care of. They need to go to the outlying rural tiers and make sure that the company has deployed in those tiers as well.
Senator Wallin: My understanding of what Senator Patterson, the author of this bill, was trying to get at, because he has been questioned about it here and in other places, is that there are half a dozen things we need to do with the way government deals with spectrum and delivery of services to rural areas. The list goes on. He is trying to focus on a pretty narrow area. I think that he and I often have this problem that the definitions of rural are different.
If you’re rural outside Kingston, Toronto or Saskatoon, that’s not rural in his world or mine. He lives in the North. If you try to do this population-based or geographic-based, there needs to be some other system for doing it. It’s the same where I live. I have vast areas with very, very low population. Nobody wants to put a tower up for 100 people. It is true that Tier 5 doesn’t always use it and Tier 4 is problematic. If you’re outside of Kingston, it’s a lot easier because you know you will at least get your money back on that score.
I think that what he was trying to do with his “use it or lose it” option is that he didn’t want that applied to Tier 5 and to the smaller producers. I think he was trying to say to the government, “Get out there and put your money where your mouth is, or your rules and regulations where your mouth is, if you’re really serious about getting internet and service delivery to rural areas.” And we mean seriously rural areas, not just outside of Kingston.
I understand that you’re saying this bill doesn’t accomplish all that, but we need to be speaking the same language when we say, “rural.” I think that’s where we’re getting to that Tier 5 issue, which is that I didn’t know about the government trying to auction all this stuff either. This is ludicrous. I think what we’re trying to get at is letting Tier 5 and maybe giving the Tier 5 people access to some Tier 4.
Mr. Black: Our members should live up to deployment requirements. If they have spectrum, they should live up to those requirements. The example we gave about Kingston would also apply in other areas of the country. Those Tier 5s are different sizes. It isn’t a square kilometrage, it’s more of a population. The tier in northern Saskatchewan would cover a very large area, Tier 5. Even though it’s Tier 5, it should still get to that population. They shouldn’t be allowed to serve one community and have that requirement. Maybe the number 50%, then, is too low.
Senator Wallin: That is the point. We also seem to have the government not imposing the rules that they say exist. Is that the issue you see in other places as well?
Mr. Black: ISED has many policy tools at their disposal.
Senator Wallin: “That they don’t use” — is that the end of that sentence?
Mr. Black: I think they are using them more than they have in the past. In fairness, is it fast enough? We would have loved to have seen them do these deployment tests sooner, five or ten years ago. It didn’t happen. Now we’re dealing with the situation where rural Canadians don’t have anywhere near the internet access that urban Canadians do.
Senator Wallin: What is your understanding from an industry point of view of why that’s the case? Do you have any idea? They promise this almost on a weekly basis.
Mr. Black: Recently. I wish we had been in this room five, seven or ten years ago discussing this. It could be that the whole industry just hasn’t been paying attention to it. I wish we could go back and redo some things. Maybe we all do.
Senator Quinn: Thank you, folks, for being here this evening. This is another one of these areas on the communication side of transportation and communications that I’m a newbie on — this whole discussion. However, when you tie the discussion tonight to last night, it is interesting because they talked about the spectrum being bid on and captured and then not all of it being used and the part that isn’t being used being sold off. One of the numbers was hundreds of millions of dollars of profit to the company that got the spectrum. I’m sitting here as a former bureaucrat thinking that I don’t get it. Somebody can bid on something, probably with no intention of using part of that spectrum, and then sell it off and make big dollars, and the next person can have it and speculate — I think my colleague used the word “speculate.”
What amendments would you propose in the bill that would get to the heart of the issue you’re describing tonight? Because I must admit that I had the question on Tier 1, Tier 2 and Tier 3 backwards — the country, the provinces. Now we got it. But it’s really annoying about the Tier 5 example you gave for Kingston. They’re making big dollars by providing a service to the citizens of Kingston, and they’re ignoring these small guys outside of town. To me, that’s something that needs to be addressed. With so many things you said tonight, I keep wondering what the amendments are that your organizations would recommend.
Mr. Smellie: The application of the deployment requirements on the Tier 5 basis would be, number one, a review of the licence holders at approximately year 3 to see if they are fulfilling their requirement. At that point, I think there would be a decision on whether to look at revoking that spectrum or taking some sort of punitive action or deciding whether the company is making a reasonable effort at deploying the spectrum.
Also, if the incumbents continue to buy spectrum at Tier 4, and they’re only interested in deploying in a small city, if we can subordinate that licence to a smaller provider that serves outside that city area because typically our members do not serve a city — they serve outside the city. If we can have the incumbents service the city and the highway corridor and then have some incentive to say, “in this Tier 5 nested inside what I just bought I really don’t have a business case to deploy that, so I will subordinate it to a smaller company.” That would be beneficial.
The other benefit might be is that it may force them to start deploying in those Tier 5 areas to meet their licence requirements.
Senator Quinn: The other question I have is two parts. One is whether there should be a punitive type of an approach because there are people who buy spectrum and then intentionally or unintentionally don’t use it, and they’re going to sell it off or sit on it until it’s clawed back like this auction we’re hearing about tonight. Should there not be a punitive approach? They’ve installed their spectrum usage in Kingston, they’re making money in Kingston, and they’re ignoring the others. They’re not fulfilling what they said they were going to do.
Mr. Smellie: In the case you speak of, yes, there should be some sort of repercussion. The problem with the bill, though, is that if you look at that Tier 4, and they deploy in the urban area of that Tier 4, they have met the 50% of population requirement. There needs to be another test there that, again, encourages them to subordinate that spectrum to someone else — or maybe the price of spectrum itself will drop because they’re going to have more capital costs to meet that licence requirement. Right now, they know the size of that tier, they know the population, they know they can just deploy in that urban centre, and they know how much capital that will require and how much revenue they will get. They can ignore the urban areas in their entirety because they don’t need it to meet the requirement.
Senator Quinn: The other question is for those folks who are the smaller providers in those Tier 5 areas. This has to be a capital-intensive business to be in — like the construction of towers. How is that funded today? How do you fund yours?
Mr. Smellie: I started my wireless deployment in 2007. I was fortunate that at that time I did some builds with FedNor, and we were able to build over a hundred towers in the district of Muskoka. We deployed them in a matter of two years, and we wouldn’t have been able to do that. We used unlicensed spectrum at the beginning, so we did not have a spectrum cost.
The disadvantage of our unlicensed spectrum is that we share it with other devices like baby monitors, and we are also restricted on the amount of power we can use from those antennas. That mid-band — that 3-gigahertz spectrum — that we’re losing, we didn’t share that with the likes of baby monitors. We were also allowed to use a higher power from those radios, so we could reach further from our infrastructure. That tool in our bag is gone. Quite frankly, some of our members are looking at the loss of that spectrum and the other options that all have significantly lower power and at a higher frequency so that we don’t get the same penetration. They’re worried they will start orphaning Canadians that are connected to their networks. When they lose that spectrum, they don’t have a tool anymore to reach the person that’s far away from one of their infrastructures.
Mr. Black: Can I add to part of that question? Senator Quinn, our members are also highly creative. When we think of a communications tower, we all probably have in our minds this 200-foot tower painted red and white with lights on top and a big building at the bottom. Our members will use silos on farms. They will trade the farmer access to the silo for free internet. They will build smaller towers — more of them and smaller. There are incredibly creative ways to get out there and serve, because they don’t have access to that capital. Does it mean the towers aren’t as robust as what you see along the 401 with the cellphone equipment on it? It gets the internet there. It gets their neighbours the internet.
Ms. Lajeunesse: It’s not solving the problem, right? We would agree on that. Yet again, the people who are in the community serving citizens aren’t getting the best.
One of the things that was raised earlier, Senator Quinn, was the comment about punitive. I don’t know if it’s punitive, but I know that in other parts of the government, there are vendor performance frameworks where, if you’re a repeat offender — let’s call it that — you know you’re not going to get access to certain things that you should or that you were getting access to before.
When we talk about those that aren’t fulfilling commitments, I don’t know if the way they’re assessing the fulfillment is similar to what you said earlier — where as long as they’ve done this in the way it’s currently assessed, they’re fulfilling the commitment. Perhaps that needs to be revisited as well.
I think what we’re hearing, though — as was raised by one of the senators — is that the bill goes far, but it doesn’t necessarily go far enough. It’s definitely got the right intention, and we definitely agree with that. I think it needs a bit more. What you’re hearing today from the people on the street, like Mr. Smellie and members of TECHNATION who have the ability to contribute, is how to actually augment this act to have teeth — to actually do what we understand Senator Patterson is intending to do with the act.
[Translation]
Senator Cormier: I want to get a good grasp of the issues involved. There are many of them, and some are more on the technical side. So, here, we’re dealing with both large and small internet service providers. There is access to urban and rural areas, correct? The issue right now, as I see it, is that the definition of “rural region” seems to vary. In fact, there seem to be different ways of identifying what a rural region is.
Under this bill, major internet service providers must provide services to 50% of the population within three years. Is this realistic? Do you really believe it is in the best interests of large providers to serve rural areas? Is this a profitable business model? Would increasing the 50% threshold expand the geographic area and make it mandatory for them to provide service in rural areas? That’s my first question. I’m not sure if it’s clear to you.
[English]
Mr. Black: There are definitions of rural and remote and urban. ISED has actually identified which of their tiers are rural and urban and remote. It is a big question. ISED has identified some. Is it a sustainable business model? I can say that our members are profitable. Not wildly profitable. Our members don’t get paid what the CFO of Bell Canada gets paid, I’m pretty sure. But they can make money. They do serve their community. And they can go to Tim Hortons or to the hockey rink and hold their heads high and say, “I give you good internet. That’s my job; I do that well.”
I don’t know if there is a business model that fits with Bell Canada, Rogers or TELUS. I do know that our members have a business model. They are making sufficient profits. They are profitable. It is difficult; it is hard work. There is a business model for certain-sized companies. I’m not sure I answered all of your question.
[Translation]
Senator Cormier: Yes. Does the bill, as drafted, put your members at a disadvantage, given their size?
[English]
Mr. Black: None of our members have spectrum at the Tier 4 size. It really wouldn’t apply to them at all.
Ms. Lajeunesse: If we turn this question on its head, I think the real issue here is that everybody should have access to the internet, regardless whether you’re rural or urban. We need to get to that, regardless of making — always having to have this differentiation between urban or rural. Every Canadian should have access to the internet.
[Translation]
Senator Cormier: For my last question, I’m going to refer directly to subclause 1(8) of the bill, on the reissuance of spectrum licences. It reads as follows:
If a spectrum licence has been revoked under subsection (4), the Minister must, within 60 days of the effective date of the notice of revocation, use a system of competitive bidding to select the person to whom the licence will be reissued.
If a license is revoked and auctioned off to another party, is 60 days enough time for an internet service provider to prepare their business case and say they are ready and can make a proposal?
[English]
Mr. Black: Sixty days is very fast. It would be wonderful, but it may not be enough time for either ISED to prepare or for, as you said, a business case to be prepared, financing to be arranged and to be ready for it. It may be overkill. More time would be better and would help the process be more efficient. Let’s face it —
Ms. Lajeunesse: We actually think 60 days should be sufficient. Back to the automation of systems, there really is no reason — we’re not talking about thousands and thousands of carriers to get it in the hands of, so 60 days should be sufficient.
Mr. Smellie: I think we disagree with the 60 days. I have participated in auction spectrums where we were not successful because we didn’t have the financing behind us. In order to get that kind of money and explain to the bank that you want to buy something that you really don’t own is an onerous thing for a small company to do. It is not easily understood. So 60 days would be a very tight timeline.
It depends on what infrastructure you have in place. In the case of my network, I covered an entire Tier 4 area with existing infrastructure. If I had the funds in place, 60 days would have been enough time for me to decide whether to bid on that or not because I had all the tools in place.
If it was something where I had to build infrastructure and towers, 60 days is not enough time.
Mr. Black: ISED has recently proposed something called access licensing. It is a very creative and a very hopeful opportunity to get unused spectrum into the hands of people who can use it. We wish it would be applicable to a broader range of spectrum. It was a very narrow set of spectrums that ISED was looking at deploying it in, and we wish it was here yesterday.
Senator Cormier: Yes.
Mr. Black: So that may be an option that is not a full-on auction.
Mr. Smellie: Yes, auction is not the only tool in their bag as well. If they have an area that is particularly difficult to deal with, they could go to a first-come, first-served model, where there really isn’t a price to deploy in that area, but once you’ve deployed in that area, it is considered served. They have lots of other models that they can use other than auction.
Senator Cormier: Thank you.
Senator Omidvar: I am a bit of an interloper on this committee, so you will forgive me if I ask a question that has already been asked and answered, but I’m curious about it.
Canada is not the only country that has large swaths of land with small populations. I am comparing us to similar jurisdictions like Norway or Australia. Do they do a better job? Can we learn something from them? Is there something that they do that would strengthen this bill?
Ms. Lajeunesse: Yes, senator. The challenge we deal with in Canada is the unique geography. We have very vast geography. Compared to other jurisdictions, we have a lot more rural, remote — or remote, let’s say, than we would deal with in other jurisdictions.
I will turn to my panellists to add to that.
Senator Omidvar: I’m not sure the Sami people in Norway would agree with you. I am grappling for answers here. There has to be something else.
Mr. Smellie: If we look at the FCC in the United States, in a very similar 3 GHz spectrum, they have performed an auction, and those Tier 1 carriers have deployed where they will deploy. That information is all put into a database. Smaller operators can obtain what they call PAL licences. There is a database that says there is no service here; so you as a small provider can use this database, and do your deployment there. It takes care of things like frequency coordination. There are lots of other models that encourage rural deployments.
We were a little bit disappointed when — normally Industry Canada will follow the models of the United States, and we were quite disappointed that they didn’t adopt a — they call it Citizens Broadband Radio Service, or CBRS. We were quite disappointed they didn’t follow that model because we could have kept our mid-band spectrum and the carriers could have deployed in it as well. It is a decision that puzzles us, but I’m sure they had their reasons.
Ms. Lajeunesse: Mr. Smellie, would you also add the fact that — back to the senator’s question around Norway, we are also dealing, though, senator, with — and, Mr. Smellie l, can you add to this in terms of mountains — “geography” was probably the wrong word to use, senator, but when we talk about vast geography, we are also talking about terrain that is also very difficult to navigate.
Is that a fair statement, Mr. Smellie? I know our members have raised it before with us. Is that something that we would deal with that also makes it a little bit more difficult than perhaps what Norway would have dealt with?
Senator Omidvar: This is just an observation, not a question. I think we are fast approaching the time when access to the internet will officially be deemed a human right. It is like water. You can’t live without water. I think, at some point, without access to the internet, you don’t have — your basic human rights may not be fulfilled.
It’s just an observation I make as opposed to a question.
Senator Clement: I’m working hard at trying to follow everything. I think I, too, am stuck in an algorithm, Senator Housakos. I will forever be stuck in some various algorithms.
The first question is for Mr. Black. I want to come back to the issue of sublicensing. Just to follow up on Senator Omidvar’s comment, you called it a moral obligation to make sure that spectrum is available.
Mr. Black: I don’t think I used that term.
Senator Clement: You didn’t? Oh, somebody said that.
Mr. Black: I think one of our other panellists did.
Senator Clement: I’m sorry. Maybe it was Ms. Lajeunesse who said that.
Mr. Black: I wouldn’t fight it.
Senator Clement: Okay. You agree?
Mr. Black: Yes.
Senator Clement: But you did say that sublicensing doesn’t happen and that the reason they don’t do it is they may see it as aiding a competitor. Can you go a little more into detail about sublicensing? Because that would be a solution. How do we incentivize that? I know we talked about penalties, but how do we encourage that?
Mr. Black: Currently, there is no stick and there is no carrot, to use that analogy, for sublicensing. For a multi-billion-dollar company to have a discussion with a small, 10-person company about sublicensing a section of frequency outside Kingston is like — the money they would get from that won’t even pay their lawyers’ fees. It is such a disparity in size and complexity of the task. There’s been no need for them to do it. They don’t need to do it, and maybe some day they may decide to try to provide some internet service outside that urban area, in the rural setting, but now they’ve given up that ability to use that frequency.
It could be that sublicensing would help them achieve their 50%, 60%, coverage of the population. That could be part of their carrot, if you will. They’d get to meet the requirement.
It has not worked successfully between the major carriers and the small companies. There are a few examples where it has worked but very few. We don’t even know who to call. There is no database to say, “If you need this spectrum, here is your contact at the licence holder.”
Senator Clement: That’s not coordinated at all?
Mr. Black: Not that we’re aware of. There’s no incentive for them. There’s no reason they should. They would end up with another competitor in a small area. Why would they bother? It’s expensive to even process it.
Ms. Lajeunesse: You’ve got competitors that are sitting on licences that they could sublicense to a competitor, but there’s no incentive. Right, team? Yes. That’s really getting at that issue, for sure. I’m not saying that I have the answer here today, but we would probably be open to bringing back some suggestions if we were granted the opportunity to do so.
Mr. Black: I could imagine a simplified process where there’s no negotiation. “This is the form. This is the application. It’s processed quickly through ISED. We don’t need to get lawyers involved.” I can imagine a process like that, but —
Mr. Smellie: In fact, ISED has a process in place for tower sharing. All of us who own tower infrastructure have to report — I believe it is twice a year — on how many towers we have in the network and whether we’ve had a request for leasing space on that tower and what the outcome of that was. That’s a current requirement. That whole process could easily be moved over to spectrum and away from the actual towers.
Senator Clement: What do you think of ISED’s public consultation model? Do you have any comments about that?
Mr. Smellie: I do. We participate in a number of ISED consultations. Maybe I’m speaking personally here and not on behalf of CanWISP, but I see that the consultations are important to us. They dictate how we can do business or how we can’t do business. There’s a level of frustration from small providers as we participate in these. They take a large chunk of our budget. We think we put forth suggestions that would help our members and their size. I don’t think ISED understands a company smaller than Shaw or Cogeco. They don’t understand what our members do.
When we decide to do these consultations now, there is a conversation at our board level saying that the outcome isn’t likely to be favourable to us; do we really want to extend resources to answer this?
Ms. Lajeunesse: Yes. We also understand — and this is the hypocrisy of it all — that the Indigenous communities are not being reached because they don’t have broadband. The consultations are not representative of the diversity. Right there, the fact that they are not even consulting with Indigenous communities is a very important point. Thank you.
Senator Clement: Thank you.
The Chair: Before I go to a second round, obviously, this is a complex issue. If it were not complex, it would have been solved a long time ago, but I will make an effort to try to simplify it with a question.
It seems to me that the large players in this country — large telcos, the internet provider companies, telecommunication companies — who have been privileged by the legislation and regulation in this country for decades, are providing services in urban centres and making a killing. They’ve just decided that rural parts of this country are not worth their investment. That’s what I get. They’re getting around regulation, and they’re getting around the fact that they can actually buy spectrum and speculate with it because governments have not had the political will to implement the regulation and penalize them for not providing the service for the spectrum they’re acquiring.
Is it because they are powerful lobbies? Is that one of the reasons they have gotten away with what seems to me is highway robbery? Don’t be shy. You can answer the question. If I’m wrong, I’m wrong. If I’m right, let me know.
Ms. Lajeunesse: If I may, I think it’s unfair to make a blanket statement because some of our members — and I’m sure Mr. Black would say the same — aren’t trying to make a killing. They are actually wanting to do right by our citizenry and to play fair and play by the rules. But, yes, there will always be bad players.
The other thing I would encourage — and we’re having great success at TECHNATION in working with government — is continuous engagement. By having meaningful consultation and leveraging industry — whether it’s a discussion with a telco or a discussion about the cloud — we are bringing our industry members as advisers to help work through this.
The one comment I would make on consultation is that it’s exactly that; it’s a one-way kind of dialogue. It’s not an interactive discussion of how we co-create a roadmap to actually deliver broadband to this country.
And I will say this because I have the opportunity right now. I don’t think standing up another innovation agency is a good use of money right now. If we put broadband in the hands of all people in Canada, we would not have the innovation issue we have in this country. We’re missing out on great talent and innovative technical Canadian solutions because those individuals just don’t have access to broadband. Thank you.
Mr. Black: If you look at our history as a nation, the carriers have built some very robust, strong dial-tone networks. They work. They’ve kept our people safe; 911 works on that dial tone, on that buzz. Most of you do remember having a buzz when you picked up a phone; you’re not just cellphone people. Some of you remember party lines, but they worked.
We’ve moved so quickly out of that dial tone into data tone where there are more providers and more possibilities. We’ve moved from that necessary monopoly to serve our people. We haven’t moved quickly enough into that competitive world in which we live today.
I’m not sure it’s fair to say that the spectrum owners have broken laws. I expect they have abided by the laws that were in place at the time they purchased that spectrum. We all wish, in this room — as a rural advocate, I wish — that the requirements had been different then. I don’t think they were. It could be that the spectrum hasn’t been removed quickly enough nor revoked. Really, shame on us as a country for not doing that and for not redeploying it to rural Canada where it’s needed. I am not sure I would say they purposefully avoided —
The Chair: To be clear, I never said anyone broke any laws. I’m saying that the regulations and the rules have been done in such a malleable fashion that it has benefited certain players more than others.
I will follow up on this before Senator Miville-Dechêne’s supplementary question. We have a vast country. I was on the board of VIA Rail once upon a time. VIA Rail was a very profitable organization in some highly populated corridors. The Montréal-Windsor-Toronto-Ottawa-Quebec-City corridor was a good corridor. But we were obligated to run trains in Alberta and in other remote parts of the country — not that Alberta —
Senator Simons: How noble of you.
The Chair: No, but what I’m saying, senator, is that it was a requirement from the federal government; it was a requirement and an obligation that had to be done. Air Canada gets a number of privileges when it comes to cabotage and other elements, as do other airlines in this country. They run some routes that we know are not necessarily very profitable. Of course, now with COVID and all the other excuses, we are having some difficulties with our airlines as well. It’s an ongoing challenge.
What I’m saying is that it is possible, if there is a political will, to say to the providers of spectrum, “This is a very profitable region. We know this is not as profitable. But be prepared to lose some money and put it in your business model, because our number one objective is to make sure that there isn’t this embarrassing divide in our country between rural and urban.” That’s more of a comment on the record. This study, which was supposed to be a short study, has really piqued my curiosity.
Senator Miville-Dechêne: I want to clarify something with Ms. Lajeunesse. You said at the beginning that you were representing people who need spectrum in rural areas. Is TECHNATION also representing companies like TELUS or Rogers?
Ms. Lajeunesse: Yes. I can say that TELUS is a member. Rogers is not a member, nor is Bell.
Senator Miville-Dechêne: TELUS is a pretty big player.
Ms. Lajeunesse: Yes, TELUS is a big player.
Senator Simons: This has been an absolutely fascinating conversation. As you can tell, we are all learning a lot.
I’ve talked about squatting and upselling. I think my new word of the day is “hoarding,” for what people are doing with spectrum.
At the risk of derailing a fascinating conversation, I want to return to the text of the bill, specifically clause 7, the section on civil liability. I raised this concern with Senator Patterson yesterday that if we have this section that allows, for any person who lives in a geographic area who does not get coverage on the timetable laid out in the bill, to bring a civil action, that it might actually discourage smaller providers from bidding on the spectrum for fear of civil liability, if they are not able to live up to their requirements. There’s one thing about a big company that’s hoarding and a small company that’s just taking a little more time to get the penetration that they need.
I want to ask each of you what you think about the civil liability section, if you think that’s a workable model of a stick as opposed to a carrot.
Mr. Black: I think it would disincentivize the smaller players, for sure. To have lawyers on staff to deal with complaints would disincentivize them from using that spectrum.
Ms. Lajeunesse: Would you give me a second to confer with my team? Thank you.
The individuals who are impacted negatively, in the sense that they lose coverage, yes, they should have some ability to sue the carrier.
Senator Simons: Are you worried that any of your members might be disinclined to purchase at auction if they ran the risk of having to fight hundreds of lawsuits?
Ms. Lajeunesse: Not if they are delivering their licences. That’s the thing. If I take TELUS, for example, I think they have deployed 90% of their spectrum licences in the rural communities. They have done what they needed to do. I can’t speak to the others because they are not members of TECHNATION.
I wanted to clarify for the senator prior to you, if I might, that TECHNATION has close to 200 members; 60% are large tech and 40% are small, medium. I didn’t want to give you the sense that we only represent large tech. And we are very invested in terms of getting MSMEs connected in this country. I didn’t want to misrepresent that.
Senator Simons: Sneeze is a thing I do into my mask, which is messy. What is SMEs?
Ms. Lajeunesse: Small and medium enterprises. But we would also talk about micro. In this country, about 97% of businesses are under 100 employees. SMEs, small and medium enterprises; and micro, small and medium enterprises. Micro is under five employees, and that would represent quite a few, a large percentage in this country.
Senator Simons: Thank you.
Senator Quinn: My question is very short. I want to come back to the 60 days. Is that enough time to do what needs to be done, from your perspective? Whatever it is that you need to do — business case, et cetera — where does that go? Does that go back to government for assessment before they award?
Mr. Smellie: In the current modelling, no. You bring a chequebook and pay for the spectrum at close.
Senator Quinn: So that it would function the same way under this proposed bill?
Mr. Smellie: It sounds like it, yes.
Senator Quinn: Because my comment was going to be that I don’t understand how the private sector could do their work in 60 days, which is tight to me. But there is no way the government is going to assess that in the 60-day framework. So I just need to clarify that.
Mr. Smellie: I think that an operator would be very challenged to meet the 60-day requirement. There would be certain examples, like perhaps they were a bidder in the original auction and they came in second and they already have their business case and financing in place and they are ready to roll.
Senator Quinn: My point is that if you are preparing a business case, somebody has to look at that business case and assess it to see if the criteria have been met. It wouldn’t just be a question of, “Here is my business case. Don’t look at it,” and here is the cheque.
Mr. Smellie: That would be a funder, like a bank, that a company would deal with. There is no review of the business plan at auction by ISED or any other government entity. You bid on the spectrum, and when you are the winner, you write a cheque. There is no technical plan you have to write or coverage maps that you have to submit or anything. You are committing to meet the requirements.
The auction is very clear on the requirements. It is selling this geographic area. And there are currently deployment requirements. You know those when you go into the auction. I think ISED is just telling you to meet the requirements, but there is no review of your plan.
Senator Quinn: Again, I would be shocked if 60 days were viewed as enough time.
Ms. Lajeunesse: Can I also add, if I might: Are there that many new players to spectrum? It is my understanding from members that typically, if you were a newer player, you would probably be working with the larger carriers to actually do the deployment. Is that fair?
Mr. Smellie: I think it is the opposite. We have identified 200 companies in Canada that operate in the space that aren’t partners of the carriers, do have infrastructure and can deploy rural spectrum in those underserved areas because they are serving it with the tools they have. So I think that’s completely false. I think there are companies there. We would consider ourselves a new entrant into licensed spectrum.
Ms. Lajeunesse: I wasn’t trying to make that as a true statement; I was asking. I appreciate your clarifying that. Thank you.
Senator Wallin: I have a comment and a question about whether or not it would be possible.
Sometimes when people propose legislation — and it’s certainly not just in this area — but you really try to focus and solve a problem here and not in the rest of the world, because you can’t. If you put a bill in front of Parliament — or any of us — that is that massive, it bogs down by its own weight.
Are there other ways? I would ask you to think about this and, if you had any brilliant insights, to send to the clerk a note to say: Let’s break it up. Let’s let Senator Patterson’s bill try to deal with this specific issue about that kind of definition of rural versus what’s going on in other places, and how the auction process works, and what the government is and isn’t doing on everything from imposing penalty decision-making timelines, consultation with people who don’t have the internet so they can’t actually be consulted with, et cetera. If there were some other things that weren’t legislative fixes that we might also want to recommend, we would appreciate any of those thoughts. Thank you.
The Chair: Colleagues, I would like to thank our panel for their patience. We went over our allotted time. We appreciate you indulging us. Members found your testimony very helpful and interesting. Thank you for participating and being here this evening.
For our second panel of this meeting on Bill S-242, we’re pleased to welcome with us Nour Abdelaal, Policy Analyst, Leadership Lab, Toronto Metropolitan University. Welcome, and thank you for joining us this evening.
You can commence with a short five-minute presentation. If you go over, given that you’re our only witness on the panel, we won’t be too rigid. After your presentation, we’ll open it up to questions and answers from senators. You have the floor.
Nour Abdelaal, Policy Analyst, Leadership Lab, Toronto Metropolitan University, as an individual: Good evening, senators. Thank you for having me.
The Leadership Lab is a think tank at Toronto Metropolitan University, formerly Ryerson University, where we work to advance public policy solutions for the responsible governance of technology and a strong democracy.
I wanted to take time today to highlight how gaps in digital connectivity continue to impact too many Canadians and how Bill S-242 and efforts to ensure spectrum is used in a way that benefits Canadians in rural communities is one important step in closing Canada’s digital divides.
Too many Canadians still face connectivity gaps that limit their ability to access an internet connection at sufficient speeds and at an affordable price. According to the latest data from Statistics Canada, 6% of people in Canada still do not have a home connection to the internet, and 8% said they did not use the internet at all in 2020. Of those who are connected, not everyone can access the internet at sufficient speeds to meet their needs: 15% of households in Canada do not have an internet connection service at the CRTC’s 50-megabits-per-second download targets.
Those connectivity gaps are even more pronounced for rural and Indigenous communities, as my previous panellists have also noted, where areas lack the infrastructure needed to connect to home internet. Although 99% of urban households in Canada have internet speeds available at the 50-megabits-per-second target, more than half of rural households — 54% — and almost two thirds of First Nations reserves cannot connect to the internet at the same speeds.
Ensuring that all resources, including spectrum, are used efficiently to close connectivity gaps for rural and Indigenous communities is critical.
Having said that, while we do believe closing those infrastructure gaps is important, it is not enough. Equity-deserving groups, regardless of location, continue to face greater barriers accessing home internet. Low-income and older adults, as well as Indigenous people and people with disabilities, all have lower levels of digital connectivity. According to the latest data from the CRTC, almost half of households in Canada with an annual income of $30,000 or less did not have high-speed internet.
Understanding how unique groups are impacted by the digital divide should better inform spectrum policies, which should aim to prioritize expanding access for underserved groups that continue to be disproportionately impacted by digital divide.
The allocation of spectrum can support telecommunication providers at the local, regional and national levels that are proactively working to expand access for those specific underserved groups.
In addition to advancing programs that address barriers for underserved groups, spectrum policies should also take into account differences in individuals’ ability to afford and connect to home internet service. According to the Canadian Internet Use Survey, 26% of Canadian residents who did not have internet connectivity at home said the cost of the internet service is the reason. For Indigenous people, the situation is even worse: Among those who did not have the internet at home and identified as First Nations, Métis or Inuit, 42% said the cost of service is the reason, compared to the 26% overall.
When you look at these numbers that show cost barriers to accessing the internet, it becomes clear that many low-income Canadians will continue to be left out of digital spaces if these barriers are not addressed, no matter how much spectrum is used or unused.
Lastly, we believe spectrum policies can encourage the deployment of locally owned community broadband, as well as open-access networks, particularly networks that are Indigenous owned and operated. This can be done through set asides. However, supplementary policies are needed to ensure that the spectrum, which is a public resource allocated to these initiatives, is deployed as promised by those organizations to increase public access, control and competition in rural areas.
To conclude, the message I want to leave you with today is as we think about connectivity gaps resulting from unused spectrum, we should also consider the particular groups that are impacted by Canada’s digital divide. Ensuring spectrum is used in productive ways to expand digital connectivity for all underserved people is a step in the right direction, but only one area among other aspects of Canada’s digital divide that should be addressed.
Thank you so much for the opportunity.
The Chair: Thank you very much, Ms. Abdelaal, for your presentation.
We have dived into this bill thanks to Senator Patterson. So far, it’s been fascinating to see the divide between urban and rural Canada and the divide between our Indigenous people and those who choose to live in rural parts of the country.
The stuff I’ve read over the last few days particularly concerned me because we saw that divide accentuated during COVID and the difficulties that we faced. I find it incredible. We spend so much time pontificating and navel-gazing in this country about national reconciliation and all this nonsense, and in the meantime, we have a significant number of our First Nations people who are not connected. In 2023, that’s absolutely unacceptable.
So far, this study has more questions than we have answers. I’ll ask a pointed question before I turn it over to my colleague Senator Simons.
In your opinion, is Senator Patterson’s bill the right bill to mitigate the situation? Is it a step forward, not as all‑encompassing as our last panel said? I’m curious about your perspective specific to Bill S-242.
Ms. Abdelaal: I definitely think that the bill is a step in the right direction. It really gets at providers who are not using spectrum at all to be able to meet those requirements.
I do agree with the previous panellists that it’s definitely not all-encompassing. It doesn’t necessarily target a lot of the areas that would meet those requirements simply by operating in an urban city that is located in the spectrum zone that would easily fulfill the requirement. In that sense, it doesn’t get at the problem there.
I do think that it focuses so much on geography, which is a huge part of the spectrum question. What we’ve tried to do in our research at the lab is to bring into the conversation anything related to digital connectivity, including spectrum policies, to also include a lot of the other equity-deserving groups that have been left out of the conversation. In that sense, it is not fully all‑encompassing of the different aspects of the digital divide and where the lack of connectivity really lies, such as for low‑income Canadians, for example.
Senator Simons: Thank you very much, professor. I want to follow up on Senator Housakos’s question and ask something specifically about service for First Nations communities. It seems to me that there ought to be a public policy imperative to make sure that First Nations communities, especially larger ones, have access to reliable, good-speed internet.
In your understanding, is there any federal government policy that targets First Nations to make sure that they have access? As Senator Omidvar would have said, they still don’t all have access to clean water. But assuming we consider that internet access equality is an important part of reconciliation, as Senator Housakos has suggested, does the federal government have any policy that specifically targets those communities?
Ms. Abdelaal: That’s a good question. I think there are a lot of federal funds that exist for just infrastructure projects that increase or expand digital connectivity, a lot of which have specific allotments for Indigenous communities and Indigenous service providers, but I would say that from our conversations with Indigenous communities, these applications for the money take a lot of time and cost them many dollars. Many are not fully equipped to be able to fully take advantage of the money that’s on the table. That’s one of the first problems.
The second problem is that money is not enough. Even if they have some of those funds to provide some kind of improvements in their internet infrastructure, I think community-owned networks’ control over their broadband networks for long-term empowerment of these communities is a key priority. Having money to build infrastructure projects that aren’t necessarily equipping them with the right skills that they need to be able to continue these projects in the long term doesn’t get to the core of the problem.
A lot of community-owned networks are finding it very difficult to survive, especially with wireless connections now. Starlink is also making it very difficult. When you have wireless, low-cost options from large providers, it leaves no room for community networks to flourish.
Senator Simons: Thank you very much.
[Translation]
Senator Cormier: Thank you for being with us tonight and for highlighting some very real issues.
I appreciate you raising these issues that seriously affect people living with disabilities and those with low incomes, particularly, but not exclusively, in rural areas.
With respect to the licensing of internet service providers, wouldn’t it be a good idea to add criteria for obtaining those licences, since they’re issued area by area right now, so that service providers also have an obligation, or at least a responsibility, to take into account the issues you talked about?
[English]
Ms. Abdelaal: Yes, I would absolutely agree with that. At the lab, we’ve worked on the digital divide issue for a couple of years now, and our main takeaway is that it’s not just the digital divide between urban and rural anymore. It’s a series of divides that encompasses many different groups.
A lot of our government policy specifically has focused exclusively on this urban-rural issue, which is very important, but if we really want to connect every single Canadian to the internet, which, as the senator has previously said is almost going to be a human right, then we have to start looking at groups that have been left out of the conversation but that we can bring in using tools like spectrum policy. I think the licensing requirements are one of those tools.
[Translation]
Senator Cormier: If we assume that this would be included in the licensing criteria, the issues you raise are addressed through other means. The federal government has other types of programs to support low-income people and to deal with the problems you raised. Do you feel that this is necessary? My question is the opposite of what I originally asked; would your concerns about these targeted groups need to be addressed through other measures?
[English]
Ms. Abdelaal: Other measures and avenues all come together to solve the same problem, which I think is good. In terms of government funds or even programs and initiatives within telecommunication companies themselves, like TELUS for Good, and Rogers has a similar program as well that seeks to provide discounted internet prices for low-income families have strict eligibility criteria. You have to show that you’re receiving the maximum Canada child benefit, it is limited to families. They’ve recently expanded the program to include low-income seniors. Previously it was only for 10 megabits per second, which is nowhere near the target. Now they’ve increased it to provide more for $20 instead of $10, so they’ve also increased the price with the increase in megabits per second provision. There are still definitely too many low-income individuals who are left out of this conversation. It’s definitely not reaching everyone. Those strict eligibility criteria make it hard for everyone to be able to access those kinds of initiatives.
Senator Cormier: Thank you very much for your answers.
Senator D. Patterson: Thanks to the witness. I was just able to catch your testimony.
Professor, as someone who studies our internet policies thoroughly, could you advise this committee if this approach of the past has been working effectively to support getting Canadians connected?
Ms. Abdelaal: Which approach do you mean?
Senator D. Patterson: The approach to date, the approach of the past, the approach I’m trying to change. It’s my bill.
Ms. Abdelaal: Progress is accelerating. We’ve made some infrastructure progress, but I think to connect the last few people who are still unconnected, if we limit the conversation to just infrastructure, I think we lose out on a lot of people who are still not connected. This is where our efforts should also be focused in parallel.
Senator D. Patterson: We’re not doing very well on the cost, either.
I understand a previous witness spoke of the need to tailor our deployment conditions to each provider. That’s how we’re been doing things, and I think many people feel it hasn’t been working well. Should we not be creating a stringent baseline, as this bill does, that the government could then tailor to meet laudable policy objectives, like you’ve mentioned, through its deployment policies?
Ms. Abdelaal: I think this is where my opinion on the bill largely lies. We know a one-size-fits-all is not going to solve every single problem and every unique provider in every unique geographic location. But if it can at least get at extreme cases where spectrum is not used at all for that minimum requirement, it could be a step in the right direction. It sets a precedent, I think, for government policy to be able to influence and create more regulation and more criteria when it comes to actually using spectrum in an efficient way.
Senator D. Patterson: While I don’t really see the bill as creating a one-size-fits-all that everybody has to somehow fit into, but rather creating this minimum baseline. Hopefully, the work of the committee and perhaps even, dare I suggest, its observations, may provide incentives to the government in its deployment conditions. The devil is in those details. I don’t think legislation can possibly anticipate all of those nuances. The government in its deployment conditions could set out policy objectives and revise them as conditions change. Would that not work to achieve those worthwhile objectives you’ve talked about, professor?
Ms. Abdelaal: Yes, I would agree. I think this does function as a solution to extreme cases where service providers are not meeting this minimum requirement. It provides avenues to be able to use spectrum policies in the future to be able to also get at unique groups that are in urban and rural areas alike.
Senator Clement: Professor, it’s good to have you with us. I’m a poverty law lawyer and a former mayor, so I’m going to ask you a couple of questions based on that.
Through the excellent work of the staff in my office and the intern, I’ve become more familiar with the work that you’ve done and the writing you’ve produced around poverty issues and cities, municipalities and the role of municipalities. My first question is about the series of divides that you refer to. Do you think this bill makes sufficient reference to those divides, or should it make reference to those additional divides in addition to rural and urban?
Ms. Abdelaal: I think it definitely does not make sufficient reference to the series of divides that I’ve mentioned. I would agree.
Senator Clement: I don’t know if you have a comment on where you would put that, if you could add that to your answer.
The second question is around municipalities and what role do you see municipal partners playing in dealing with the digital divide? Because the federal government doesn’t listen to municipalities very respectfully. I’ve said that publicly, and I’m saying it again now. I’ve experienced that. They talk about partnerships, but municipalities are not fully at that table. If you could comment on that as well.
Ms. Abdelaal: Yes, that’s an excellent point. We’ve worked with the City of Toronto on their ConnectTO strategy. I think municipalities are in a unique position to provide municipally owned broadbands that they can leverage to be able to access and serve underserved groups like low-income older adults in long‑term care, in institutional or even geographic locations, in urban areas and in rural areas, for municipalities in more rural reach to be able to more minutely identify who is still not connected and be able to target those groups specifically. Municipalities have a huge role to play because they are much more intimately connected to their communities and know exactly where communities need to be better served.
Senator Clement: In terms of the references to the series of divides, if you referred to that in this bill, could you comment on where that would be?
Ms. Abdelaal: I wouldn’t presume to have all the answers about exactly what the bill would look like, but at least in terms of requirements for licensing requirements and deployment requirements, it could play a huge part there to ensure that providers are seeking to expand their services to underserved groups. In terms of set asides, I think a lot can be done in terms of spectrum policy to prioritize specific communities, like Indigenous communities, and make sure that the resources aren’t depleted by large players or large actors and make sure that small regional players also have a substantial role to play.
Senator Clement: Thank you, professor.
The Chair: Is part of the problem, professor, that underserved communities have not been well organized in order to put enough pressure on public officeholders in order to move the yardstick on this?
Ms. Abdelaal: That is absolutely one of the issues. They are not well organized. They are also different groups that aren’t necessarily all aware of one another and have unique needs. Older adults and their relationship with technology will be very different from a low-income individual, a youth, for example, who understands it and is completely aware and needs the internet but just can’t afford to have one.
The problems for the groups are different. There hasn’t been unity, but I think it’s becoming a lot more clear that these issues are really what make up a lot of the digital divide question. It would be an accurate statement to say that they haven’t been extremely well organized to be able to influence policy in this way.
A lot of them are also disadvantaged groups. I think as the pandemic has shown us, most of these groups have realized how important the internet is. Maybe two or three years ago people could get by without the internet, at least for government services and the like, but three years into the pandemic, I think all these groups have realized the importance of the internet. It’s becoming a huge need, so the situation is even more dire.
In that sense, maybe even more effort has been put. More voices have been leveraged and heard to be able to provide the internet for those groups. The conversation is sparking, but many of these groups are disadvantaged and also have other priority areas on which to focus and leverage their voices.
The Chair: If I understand your testimony correctly, you think this is a good bill. You think it is a step towards the right direction.
Ms. Abdelaal: I think it is a step in the right direction.
The Chair: Colleagues, are there any other questions for this witness? Ms. Abdelaal, do you have any closing remarks, or do we call it a night? I will give you the last word to wrap it up.
Ms. Abdelaal: Thank you so much for having me. I appreciate the opportunity. On behalf of the Leadership Lab, we thank you for your time and consideration and hope that this has been a fruitful conversation.
The Chair: It has, very much so. Thank you for appearing before our committee.
(The committee adjourned.)