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News release

August 5, 2009

CRTC issues second annual report on the communications industry

OTTAWA-GATINEAU —The Canadian Radio-television and Telecommunications Commission (CRTC) today issued its second annual Communications Monitoring Report. The report, which is based on 2008 data, provides information on the various sectors of the telecommunications and broadcasting industries, as well as on how Canada compares internationally.

The communications industry made an important contribution to the Canadian economy as revenues increased by 6%, climbing from $51.3 billion in 2007 to $54 billion in 2008.

Telecommunications
Telecommunications revenues came in at $40.3 billion for the twelve-month period that ended on December 31, 2008. This improvement of $2.1 billion, or 5.5%, in one year was achieved on the strength of the wireless and Internet sectors. Revenues generated from the provision of home telephone service rose by 0.5%, or from $4.85 billion in 2007 to $4.87 billion in 2008. In addition, 8% of Canadian households subscribed only to wireless telephone service.

Competitors continued to gain ground on the established telecommunications companies, with their total revenues increasing by 10%, going from $15.9 billion in 2007 to $17.6 billion in 2008. While their share of residential Internet subscribers held steady at 55%, competitors gained an additional 4.6% share of the residential telephone market.

Approximately 94% of Canadian households can access broadband Internet services through telephone, cable or fixed-wireless networks, and 91% of Canadians can access these services by using their cellphones.

Broadcasting
Broadcasting revenues were up $900 million, or 7.3%, and totalled $14 billion for the twelve-month period that ended on August 31, 2008. The delivery of television services showed the highest growth with revenues going from $6.3 billion to $7 billion in one year. According to Statistics Canada, the cable and satellite services index increased twice as much as the consumer price index between 2002 and 2007, or by 22.7% compared to 11.4%.

The amount of time Canadians spend online increased in 2008. Anglophones spent 13.8 hours online per week, up from 13.4 hours in 2007, while francophones spent 11.1 hours online, up from 9.8 hours. Eighteen per cent of anglophones and 16% of francophones reported viewing a television program online. Canadians also spent more time listening to podcasts as anglophones and francophones reported usage increases of 46% and 40%, respectively.

In 2008, the broadcasting industry contributed more than $2.8 billion to the development of Canadian talent and to the creation and broadcast of Canadian programming.

Communications Monitoring Report

The CRTC

The CRTC is an independent public authority that regulates and supervises broadcasting and telecommunications in Canada.

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These documents are available in alternative format upon request.

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Backgrounder on the Communications Monitoring Report

The Communications Monitoring Report contains broadcasting data for the year ended August 31, 2008, and telecommunications data for the year ended December 31, 2008. The report therefore does not reflect the impact of the global financial downturn on the Canadian broadcasting industry.

Broadcasting highlights

i) Radio

• In 2008, Canadians could access 1,213 different radio services, which consisted of 897 English-language services, 270 French-language services and 46 in other languages.
• The average time spent listening to the radio remained unchanged at 18.3 hours per week. Private commercial stations captured 79.1% of the weekly radio tuning share; the CBC, 12.6%; and other stations, 8.3%.
• Private commercial broadcasters saw their revenues rise from $1.5 billion in 2007 to $1.58 billion in 2008, a 5% increase.
• In 2008, commercial radio stations contributed $28.6 million for the development of Canadian content.

ii) Television

• In 2008, Canadians could choose from 707 television services, which consisted of 453 English-language services, 125 French-language services and 129 services in other languages.
• Canadians watched an average of 26.6 hours of television per week, which represented a slight decline from 26.8 hours in 2007. Canadian television services attracted 98.5% of the French-language viewing audience in Quebec and 75.3% of the viewing audience in the rest of the country.
• Revenues for commercial television services increased by 4%, from $5.3 billion in 2007 to $5.5 billion in 2008.
• Private conventional television broadcasters saw their revenues decrease by 1.5%, from $2.17 billion in 2007 to $2.14 billion in 2008. Reversing a trend from a year earlier, revenues for English-language stations fell by 2% to $1.7 billion, while those for French-language stations grew by 1% to $384 million.
• Specialty, pay and pay-per-view television and video-on-demand services generated $2.9 billion in revenues in 2008, an increase of 8% from $2.7 billion in 2007.
• In 2008, private conventional television broadcasters invested $619.6 million on Canadian programming, which was marginally higher than the $616 million spent in 2007. During the same period, spending by specialty and pay television services on Canadian programming increased from $918.6 million to $1 billion.

iii) Broadcasting distribution

• In 2008, 8.4 million Canadian households subscribed to cable services and 2.7 million subscribed to satellite services. Of the total number of subscribers, 6.8 million, or 61.6%, received digital television services.
• Revenues generated from the distribution of programming improved by 10.2%, climbing from $6.3 billion in 2007 to $7 billion in 2008.
• On average, subscribers paid $3.57 more per month in 2008, an increase of 7.2% over the previous year. This increase can be explained by higher monthly fees, a greater consumption of pay and pay-per-view services, and consumers upgrading to digital or high-definition television services.
• The cable and satellite services (including pay television) index, as calculated by Statistics Canada, increased by 6% between 2007 and 2008.
• In 2008, broadcasting distribution companies contributed $323 million to Canadian programming, including programming for community channels. These companies allocated $299.2 million for the same purpose in 2007.

iv) New media broadcasting

• The amount of time Canadians spend online increased again in 2008. Anglophones spent 13.8 hours online per week, up from 13.4 hours in 2007, while francophones spent 11.1 hours online, up from 9.8 hours.
• Eighteen per cent of anglophones and 16% of francophones reported watching a television program or a clip from a television program online.
• The streaming of AM and FM radio stations over the Internet has experienced a decline over the last few years. The percentage of anglophones who streamed a radio station in a given month dropped from 23% in 2005 to 16% in 2008. Similarly, the percentage of francophones who engaged in the same online activity decreased from 16% to 13% during the same period.
• However, between 2007 and 2008, podcasts saw an increase in usage of 46% among anglophones and 40% among francophones.

Telecommunications highlights

i) Revenues, expenditures and penetration

• Telecommunications revenues totalled $40.3 billion in 2008, an increase of 5.5% from $38.2 billion in 2007.
• The revenues earned by the competitors of established companies increased by 10%, from $15.9 billion in 2007 to $17.6 billion in 2008. Competitors captured 44% of the total revenues.
• Capital expenditures jumped by 54.1% in one year, going from $7.8 billion in 2007 to $12 billion in 2008, due in large part to the government’s Advanced Wireless Spectrum auction.
• Approximately 99% of all Canadian households can access at least one telecommunications service, including residential, wireless or Internet telephone service.

ii) Wireless telephone services

• Wireless telephone services showed the highest growth among all sectors of the telecommunications industry, and now account for 40% of all revenues. Revenues increased by 10.5%, from $14.4 billion in 2007 to $15.9 billion in 2008.
• However, expansion in this sector slowed slightly when compared to the average annual growth rate of 14.3% achieved from 2004 to 2007.
• In 2008, there were 22.1 million wireless telephone subscribers, an increase of 9% over the previous year. In addition, 8% of Canadian households chose to subscribe only to wireless services, and did not have a land-line telephone.
• The penetration of smartphones nearly doubled in one year, from 12% to 21%.
• Among other investments, companies expanded the coverage of their advanced wireless networks (3G or 3G-equivalent) to 91% of Canadian households, up from 78% in 2007.

iii)Internet services

• Revenues from Internet services increased by 9.4%, growing from $5.7 billion in 2007 to $6.2 billion in 2008.
• In 2008, the number of residential Internet subscribers increased by 5.6% to 9.8 million, or 74% of all Canadian households.
• The majority of Canadians favoured faster Internet services, as 52% of all households subscribed to a broadband service that offered speeds of at least 1.5 megabits per second.
• As in past years, Canada led all G7 countries when comparing the proportion of households subscribing to broadband Internet services.

iv) Local residential telephone services

• Total revenues for local residential telephone services were $4.87 billion in 2008, a growth of 0.5% from $4.85 billion in 2007. Cable companies increased their share of these revenues from 13.6% to 18.6% in one year.
• In 2008, there were 13 million residential telephone lines. Cable companies held a 22.5% share of these lines, which represented 2.9 million lines. A year earlier, they held a 17.9% share, or 2.3 million lines.

v) International perspective

• Most prices for Canadian telecommunications services compared favourably with those available in the United States, the United Kingdom, France and Australia:
  • residential telephone rates were the lowest among the five countries
  • wireless and broadband Internet rates were generally within the middle of the group, and
  • rates for bundled services (including residential telephone, wireless, Internet and television) also fell at the median point.