Government of Canada
Symbol of the Government of Canada
Skip to content Skip to institutional links

Common menu bar links

Home > Media > Speeches

Speaking Notes

for Konrad von Finckenstein, Q.C.

Chairman
Canadian Radio-television and Telecommunications Commission

Federal Communications Commission Workshop on Consumers, Transparency and the Open Internet

Washington, D.C.

January 19, 2010

Introduction
  • Good afternoon. I'm delighted to be here. I've never participated at a Federal Communications Commission (FCC) Workshop before, but I've read many of their results. I think it's a wonderful innovation, which we should probably copy in Canada.
  • I wanted to share with you today my views on network management. We've struggled with the same issues, and we recently issued a major decision that I would like to explain to you.
  • The Canadian Radio-television and Telecommunications Commission (CRTC) receives its mandate from the Broadcasting Act and the Telecommunications Act.
  • Internet service providers (ISPs) are subject to the Telecommunications Act. Aside from mandating access to wholesale customers under fair and reasonable terms and conditions, we mainly monitor their activities and act on complaints about their business practices.
  • With more consumers taking up broadband connections, the Internet is increasingly being relied upon for communications needs, commerce, health, education, entertainment and governance. These issues are very much coming to the forefront.
  • The demand on network capacity is rising with the growing popularity of new applications, such as real-time video streaming, gaming, high-definition video and soon 3D.
  • We actually had a case that pointed out the need for some rules. We dealt with that case on its terms and then held a major policy hearing on what you call network neutrality, which we call Internet traffic management.
  • To what extent should Internet service providers (ISPs) be permitted to control or influence a user's Web experience? This question was debated at length in Canada last year.
  • The CRTC held a public proceeding covering many of the same issues as the proceeding currently being undertaken by the FCC. It included numerous written submissions, as well as an online consultation that attracted more than 1,400 comments, and resulted in a six-day hearing.
  • In October 2009, we announced a comprehensive approach to Internet traffic management practices, or ITMPs. I would like to give you a brief overview of our decision.

Background

  • During our proceeding, we found that some Canadian ISPs were not using any Internet traffic management practices, some were using them at certain times of the day and others were using them at all times.
  • We also found that ISPs were using economic practices and technical practices to manage the traffic on their networks.
    • In the first case, ISPs manage traffic through economic measures, for example by charging consumers rates based on how much bandwidth they use each month.
    • In the second case, ISPs use technical measures such as deep-packet inspection to manage the traffic on their networks, for example by slowing down or prioritizing certain types of Web traffic or limiting the bandwidth of heavy users.

Approach to retail market

  • Our approach applies to both retail and wholesale services, but I'll only talk about the retail side since you don't have a mandated wholesale market in the U.S.
  • We firmly reaffirmed our often-stated view that the first response by ISPs to bandwidth demands should be to make investments to increase its network capacity.
  • Secondly, we established that ISPs can employ Internet traffic management practices without the CRTC's prior approval, as long as they are consistent with our framework, which I will explain in a moment.
  • Economic ITMPs should always be given priority due to their transparency and inherent equity.
  • If ISPs have to use technical ITMPs, they have to do so in a manner consistent with the Telecommunications Act and the framework – i.e., without undue discrimination or preference.
  • The CRTC will use its framework on an ex post facto basis to review practices if they raise concerns or generate complaints.

CRTC framework of analysis

  • Our framework of analysis to evaluate ITMP's is based on the concepts of unjust discrimination or undue preference. These are key tests given to us by our legislation, which is unique to Canada.
  • The Telecommunications Act states: “No Canadian carrier shall, in relation to the provision of a telecommunications service or the charging of a rate for it, unjustly discriminate or give an undue or unreasonable preference toward any person, including itself, or subject any person to an undue or unreasonable disadvantage.”
  • The framework we established works as follows:
  • If we receive a complaint from a retail or wholesale customer about an ITMP, we will use the following criteria to decide if it is acceptable. An ITMP should only be implemented if:
    • it is designed to address a specific purpose and nothing else
    • it is as narrowly tailored as possible to achieve the desired result, using the least restrictive means
    • it causes as little harm as possible to the retail customer, application provider or the ISP that is a wholesale customer
    • network investments or economic approaches would not effectively achieve the same purpose, and
    • it is well advertised in advance.

Exception to ex post facto review

  • An ISP will always need the CRTC's prior approval for actions that affects content. Under the Telecommunications Act, a telecommunications company must obtain the Commission's prior approval to “control the content or influence the meaning or purpose of telecommunications carried over its network.” We do not consider such actions to be proper Internet traffic management practices.
  • An ISP would need prior approval before implementing a practice that would:
    • block the delivery of content to an end-user, or
    • slow down time-sensitive traffic  (ex: videoconferencing or Internet telephone services) to the extent that the content is degraded.
  • It is hard to imagine a case where we will approve such actions; truly, it would be a most exceptional case.

Transparency

  • As I said before, we found during our proceeding that some Canadian ISPs were not using any Internet traffic management practices, some were using them at certain times of the day and others were using them at all times.
  • Consumers were generally not aware of the use of technical ITMPs since not much information was made available. More transparency was needed in this area to help them make informed decisions about the Internet services they purchase and use.
  • We decided that an ISP must inform its customers at least 30 days in advance of adopting a technical ITMP to manage the traffic on its network.  This notification must be in plain language, displayed prominently on the ISP's website and describe:
    • why it is being introduced
    • who will be affected
    • when it will occur
    • what type of Internet traffic is subject to the management practice, and
    • how it will affect a user's Internet experience, including the specific impact on speeds.

Privacy

  • We also established provisions to protect consumer privacy. Any data collected in connection with the use of ITMP's, often collected without the knowledge or consent of consumers, may only be used for that purpose. The CRTC has directed ISPs not to disclose this information or use it for any other purpose, such as for third-party marketing activities.

Mobile wireless services

  • Mobile wireless is becoming more important, as Chairman Leibowitz mentioned. In Canada, data services are currently exempted from our regulation. We made that decision 10 years ago, when these services were obviously far less important than they are today.
  • There has since been an explosive growth in mobile wireless services, fuelled by the popularity of smartphones and other multimedia devices.
  • Although traffic on mobile networks has been on an upward trajectory, we saw no evidence to suggest there is an issue with traffic management practices at this time. Currently data services provided by wireless ISPs are exempt from the undue discrimination and preference provisions of the Telecommunications Act.
  • We expect ISPs offering mobile broadband services to comply with our framework. If problems arise, we will review the regulatory measures that apply to them, or in other words we will lift or cut back the current exemption.

Conclusion

  • The CRTC's framework is intended to foster an environment where ISPs, application providers and users have the utmost freedom to innovate. At the same time, it respects the legitimate interests of ISPs to manage their networks.
  • Our decision on Internet traffic management practices was well received by all stakeholders: consumers, ISPs, technology companies and other interested groups.
  • The decision came into effect 30 days after its release. ISPs have been disclosing their traffic management practices, as required by the decision. We will review their practices in response to any complaints we receive or if we consider it necessary.
  • I look forward to our discussion this afternoon and to answering any questions you may have about our framework. Thank you.
Date Modified: 2010-01-29

Top of Page
Important Notices