Speech by Jean-Pierre Blais, Chairman, Canadian Radio-television and Telecommunications Commission
To the annual conference of the Canadian Chapter of the International Institute of Communications
October 29, 2012
Check against delivery
Thank you very much. I'm very grateful for your invitation. It gives me a chance to look ahead to the year 2017.
That will be the year when we celebrate Canada's 150th birthday. Much less significantly, it will also be the end of my term as Chairman of the CRTC.
What will the CRTC have accomplished by then? Marshall McLuhan has noted our human habit of looking at the future with the eyes of the past. He said, "The past went that-a-way. When faced with a totally new situation, we tend always to attach ourselves to the objects, to the flavour of the most recent past. We look at the present through a rear-view mirror. We march backwards into the future."
So I'm going to take his warning to heart. I’m going to do my best to march forwards with my eyes looking straight ahead at 2017.
View of 2017
What do I see then?
In 2017, I see the CRTC as an institution that is trusted by Canadians.
They trust us to ensure that Canada maintains and develops a world-class communication system.
They trust us to defend their interests as citizens, as creators and as consumers.
I have seen numerous comments over the past four months referring to the Commission’s “new focus on consumers.” This is not entirely accurate. The Commission has always considered consumer issues. What is new is that I have called on the staff and my colleagues to renew their focus on consumers. But, more importantly, our work is not just about Canadians as consumers. The public interest is more complex than that binary analysis. We also have to consider Canadians as creators and citizens.
We can look at these three roles in a Venn diagram. On certain issues the roles may overlap; they’re not always clear-cut. But I find this a useful way to look at the strategic objectives we have set for ourselves.
Canadians at the centre
At one of our recent hearings, I read out a couple of comments that had been sent in by Canadians. And in future hearings I intend to continue doing that. So you might want to prepare for that...
It's important to listen to Canadians. I will be listening myself to find out what they think about the job we're doing. When it comes to accountability, I actually walk the talk. Social media provide all kinds of opportunities for Canadians to say what’s on their minds, and they’re not shy about giving us an earful. I spend a lot of time reading what they have to say. So, in the spirit of the questions I will be asking applicants, let me turn the table on myself.
Earlier this month we initiated a proceeding to establish a mandatory code for wireless contracts. It will set some standards for the relationship between the wireless industry and its customers. We invited Canadians to help us determine the contents of this code. The Globe and Mail ran a story that drew almost 250 online comments.
Here's one of them from Tom1011:
The CRTC has realized that they have a political problem and need to do better P/R. This means pretending to listen to the public.
So, you hold consultations and inevitably you get a bunch of valuable input and a bunch of garbage. You then sift through the garbage and find some random person who is saying what you wanted all along and you highlight that.
In the end, it will be money and power that really calls the shots.
Here's a comment by TheBluesMan:
Face it, most people do not trust the CRTC to act in the consumer interest. Paternalistic and industry-focused is the general impression (whether it is true is not the point). As such, I do not expect them to do anything that actually helps the consumer. Would that it weren't so, but it is...
And one more, from Jon Q Public:
Here's a suggestion: Abolish the CRTC and bring in a consumer protection body.
As you can see, there is a little skepticism out there. We know we have some work to do to gain the trust of Canadians. Can we convince everyone to trust us? No, not everyone. But we can do better, and we will do better—to earn their trust, every day, in every action and in every decision.
Focus on Canadians
So what actions have we taken, and will we continue to take, to rebuild their trust?
First, we are putting Canadians right at the centre of all our work.
Canadian families have a significant investment in the communications system. They spend an average of $2,100 a year on communications services. That's the sixth largest family expense. It's just about what they spend on health care.
Those Canadian consumers are important. But when I speak of consumers, I’m not just thinking of individuals. Canadian businesses of all sizes rely on the communications system to serve their customers and to help their employees work more productively.
Residential and business consumers have many options in today’s increasingly competitive marketplace. But how do they know which services best meet their needs? Consumers, whether individuals or businesses, must be empowered and informed so they can get the very best of what the system has to offer.
That's why we have created the new position of Chief Consumer Officer. I'm very pleased that Barbara Motzney, a seasoned public servant, has agreed to take the job. As the head of our Consumer Affairs and Strategic Planning sector, she has a strong team to back her up. Barbara will make sure that we examine all the issues before us through a consumer-focused lens.
Here's a good example of that consumer focus: the decision to establish a mandatory wireless code.
The Commissioner for Complaints for Telecommunications Services received about 8,000 complaints about wireless services during its last fiscal year and up to the present. That's over 60% of all the complaints it received.
Many cellphone users have expressed frustration about the confusing legalistic language of their contracts, which makes it hard to figure out what rights and options they actually have. We will be looking at the clarity and content of those contracts. We've invited comments on what the code should say, which providers should be bound by it, and how it should be enforced and evaluated.
We will soon be hosting an online consultation to encourage broader discussion on this issue. A public hearing will take place early next year.
Once the code is in place, service providers will have to clarify the contractual terms they are offering their customers, who will then be in a better position to make informed choices. This is the kind of market intervention we can provide to encourage healthy competition, and that benefits consumers.
Choice of providers and platforms
We are also determined to ensure that all Canadians enjoy a maximum of choice of services. This means there must be healthy competition among multiple service providers everywhere, not just in the more populated parts of the country.
Last year we reconfirmed our decision to open up competition in the markets of the small incumbent telephone companies. We also opened local phone service to competition in the operating territory of Northwestel, which is mainly in the Far North.
In addition, we directed Northwestel to file a plan to modernize its aging infrastructure. We will soon be reviewing that plan, which proposes extended and enhanced services to Northerners through wireless and high-speed Internet. We will also be reviewing Northwestel’s regulatory framework.
These steps will give Canadians access to competing products and services from both large and small providers.
Transparency in costing
To foster competition in telecom services, we require that the large incumbent telephone and cable companies provide essential services to their competitors on a wholesale basis. The rates we set are based on costing data filed with the CRTC by the incumbents, much of it on a confidential basis.
We have questioned the need for so much to be confidential. Last Friday, we issued new guidelines that will lead to more costing data being made available for public review and scrutiny. Once it’s out in the open, it can be tested and challenged, which will make it much easier for us to set fair and reasonable rates, and will give all parties stronger grounds for trust in the result. This should cut down on the review-and-vary proceedings, which in the past have delayed access by Canadians to competitive services.
Regulation is the exception
I should point out that much of the time our best regulatory action is not to regulate. In fact, regulation is the exception rather than the rule. Last year all retail telecom services brought in about $40 billion in revenue. Of that amount, 93% derives from deregulated retail services.
Over the past few years, we have refrained from regulating in cases where we believe that market forces are sufficient to produce the desired benefits for consumers. We want service providers to have full flexibility to respond to market conditions and provide Canadians with a choice of innovative services.
Even the best and most trusted regulator is a poor substitute for a fair and properly functioning marketplace.
Canadians as citizens
So those are some of the ways we are supporting Canadians in their role as consumers. What are we doing for them as citizens?
Canadians also need access to news and information programming—including local news. It helps them participate fully in the democratic, economic, social and cultural life of their country, their region, their province and their neighbourhood. That programming needs to come from a wide variety of independent sources to ensure that we see the world from a multiplicity of viewpoints.
Providing news and information is an important obligation for a broadcaster, and that is something the Commission can influence, through our licensing decisions and regulatory policies. We will be very conscious of that obligation next month, when we hold a public hearing to renew the television and radio licences of CBC/Radio-Canada.
Our communication system needs to be available to all. We want to make sure that the millions of Canadians with disabilities have the best possible access to all communications services. We have set standards for broadcasting features like closed captioning and described video. On the telecom side, we will be looking into video relay service and the accessibility features of cellphones.
There are also millions of Canadians who experience communication challenges because of their geographical isolation. In sheer size, Canada is the second-largest country in the world, but in population we're thirty-fifth.
Our communication system gives us the power to overcome the distances between us. That power means the most to the people who live in rural, remote or Northern areas.
If they are going to be able to participate fully in the digital economy, we can't let them lag behind in their access to broadband Internet service. Last year, we set a target for broadband speeds all across the country. We expect that by 2015 all Canadians will have access to minimum speeds of 5 megabits per second (Mbps) for downloads and 1 Mbps for uploads.
Safety and security
Protecting the safety and security of our citizens is a key function of our communication system. We'll monitor the deployment of the public alert system that gives warning of emergencies.
We'll also be reviewing the regulatory framework for the next-generation 911 services. And we've received the report on a trial that enabled 911 operators to communicate by text message with Canadians with hearing and speech impairments. We're always looking for ways to improve access, and there will be a decision on this in the new year.
Another intervention is the National Do Not Call List. Unwanted telemarketing calls have been annoying Canadians for years. Canadian citizens have the right to privacy, which means not being bothered by unauthorized telemarketing calls during their evening meal.
We are using all of our available tools to ensure that people who register their numbers on the List will see those calls substantially reduced. We're doing inspections of telemarketing firms. We can issue warnings and citations to violators. We can have their numbers disconnected. We can also impose—and have imposed—monetary penalties in the millions of dollars on violators.
In addition, we are providing information to Canadians, through our website and by giving seminars, so they can be on guard against deceptive telemarketing practices.
Unwanted calls are a global problem. This month, after a joint investigation with the American Federal Trade Commission and the Australian Communications and Media Authority, we took action against two companies based in India for breaking the rules. One of them will have to pay a penalty of nearly half a million dollars. We've put foreign-based telemarketers on notice that when they're calling Canadians, they have to play by Canadian rules.
Citizens expect their privacy to be respected when they're at their computers. And the plague of spam is more dangerous than just the clutter of junk mail in your inbox. Malware can infect your system and cause all kinds of harm including the theft of your identity.
Canada has new anti-spam legislation and we will begin to enforce it as soon as it comes into force. We have finalized our regulations, and we are publishing a series of information bulletins to help Canadian businesses prepare.
Canadians as creators
I'd now like to turn to Canadians as creators.
A world-class communications system also needs a world-class mix of content that can touch the heart, delight the mind and seduce the imagination. Canada has tremendous resources of creative talent: performers, writers, musicians, designers, producers, directors and experts in all the production crafts. We expect broadcasters to take full advantage of their contributions to the entertainment and cultural programming that helps to give us—and the rest of the world—a sense of who we are.
I use the word "creator" in the very broadest sense. Obviously it includes everybody involved in the creation, production and promotion of Canadian content.
But it also includes the broadcasters and distributors. They're the ones who showcase the content that Canadians can access. They contribute to the funds that support Canadian content production.
I also regard as creators those who build our telecommunications infrastructure, those who market the innovative services that we increasingly depend on, and those who work in the field of digital media, with all their potential for highlighting Canadian programming.
The CRTC and the industry
Some members of the Canadian communication business sector who are in the audience may be asking: “What about us?”
It is not the Commission that provides Canadians with the various telecom and broadcasting services that they want; it is the industry. It is you that creates and delivers services to Canadians through the purpose and drive of entrepreneurs, employees and shareholders.
We need successful companies large and small, national and local, competing in the marketplace. We have confidence in the business sector. For the most part we will get out of your way. However, we won't hesitate to intervene when there's market failure or a need to protect Canadians. But we are well aware that companies should be in the business of meeting the needs of Canadians. They have a strong incentive to continually improve what they offer to the public. They ignore the wishes of Canadians at their own peril.
Now, not every problem needs to be solved by government regulation or intervention. Canada is experiencing a wave of cellphone robberies, and we believe there are steps that could be taken by the industry to help get these crimes under control.
In one Toronto police division, 85% of street robberies have targeted cellphones or other electronics. During the past school year, at least 15 students at one high school were mugged for their phones. Some of them were beaten.
This is a national problem. Right now, if somebody steals your cellphone or tablet, they can have it reactivated by another carrier and use it as their own. Does this make any sense?
We have asked the industry to tell us how they plan to deny access to thieves. If we can make it harder to reactivate a stolen mobile device, the incentive to steal yours should be sharply reduced. This is a matter of corporate social responsibility. Sometimes, businessmen and businesswomen have to give back, to do the right thing.
But, if the industry can't come up with a satisfactory solution, we are prepared to take whatever regulatory action is necessary to protect the interests of Canadians.
In a healthy competitive environment it's essential to have effective ways of settling competitive disputes. If the parties can't reach a resolution on their own, we're ready to help through mediation or arbitration.
This, too, is about building trust. Early intervention can often be effective in resolving disputes or stalled negotiations. Our expert staff can provide assistance or general advice through informal discussions, which can serve as guidance for the parties and lead to a decrease in the number of formal applications for dispute resolution.
Of course, sometimes disputes are not easily resolved and it is inevitable that parties will turn to us. It's important for everyone that we help to settle these disputes expeditiously and fairly, and keeping in mind the welfare of the system as a whole. In our vertical integration policy, for example, we ensured that Canadian consumers are not taken hostage during broadcasting disputes. Broadcasters must continue to provide their television services and distributors must continue to offer them to their customers.
Flexibility in packaging
In April, we provided dispute resolution for a group of independent distributors who were at odds with a major provider of programming services. The distributors wanted more flexibility in assembling packages that included the provider's services, while the provider stressed its own need to maintain stable revenues.
In our decision, we noted that consumers increasingly expect to be in control of what they watch. It makes sense that consumers and the distributors who serve them should have more flexibility in packaging choices. While we acknowledged the value of predictable revenues to the programming services, we decided that the days of guaranteed wholesale rates are over. Programming services cannot expect to remain completely insulated from the growing demand for greater choice by Canadians.
Lowering costs for the industry
As you know, the operations of the CRTC are not for the most part financed by Parliamentary appropriations, but by the industry, through the annual fees paid by our licensees in broadcasting and telecommunications. We are challenging ourselves, as an institution, to be more cost-effective. We have set a goal of reducing our operating budget by at least 5% over the next three years. This will consequently reduce the burden of fees that the industry has to pay.
Canadians and CRTC proceedings
I began by looking ahead to the year 2017. Being an optimist, I foresee that by then the CRTC will have earned greater trust of Canadians. But we won't earn that trust only by ensuring that Canadians get the services and protections that I've been talking about. We also have to ensure that Canadians become more involved in our decision-making process.
A few weeks ago I appeared before a Parliamentary committee. I told them that we cannot serve the public interest unless the public takes part in our work. We're going to be more welcoming in our public proceedings and public hearings.
I don't think our proceedings should be attended only by people who are paid to be there in their official capacity. Let's level the playing field. Next month we'll be holding a licence renewal hearing for CBC/Radio-Canada, and we've offered evening sessions to make it easier for Canadians to come and share their views. The sessions will be set up in a less formal way in order to encourage a more open dialogue.
At those hearings, we'll also use audio-visual technologies to allow people to take part from other locations, including official language minority communities. By the way, these minority communities deserve to get the best possible programming services in their own language. That is a matter of citizenship.
We continue to engage the public in online consultations on our website. This will facilitate a broader nationwide discussion. It enriches our public record and helps us make more informed decisions.
And speaking of our website ...
I've been travelling around the country meeting with people at our regional offices, and with various groups that are interested in our work. I learned from the people I met that our website is rather hard to love. A lot of it is organized as an archive of our proceedings and decisions and so on, each item with its cryptic identifying number. It doesn't give up its information very easily. I have heard it described as “impenetrable.” In fact, some very sophisticated companies have to rely on a designated wizard on their staff who knows how to navigate around our site.
Well, of course, this won't do. Our website is our main gateway for interaction with Canadians across the country, so we're planning a major redesign. We've listened to users' comments, and we're going to make it intuitive and easy to navigate. Visitors will be able to find the information they need to know to make decisions; they'll find the tools that will enable them to take action.
Planning and reporting
With my colleagues at the Commission, I will be doing my best to see that by 2017 we'll have helped to shape a world-class communications system with Canadians at the centre of it.
The program of work that I've laid out for you today supports our overarching objective: To ensure that Canadians have access to a world-class communication system. We recently published a three-year plan, in which we organized our activities around three pillars:
Create, which ensures that Canadians have access to compelling and diverse creative content.
Connect, which ensures that Canadians can connect to innovative communications services at reasonable prices, and
Protect, which enhances the safety and interests of Canadians.
We will be reporting on our progress in each of these areas in our annual Departmental Performance Report and setting the course for the next year in our Report on Plans and Priorities. We will also be updating our three-year plan at least once a year.
I am a former Assistant Secretary at the Treasury Board Secretariat. Don’t be surprised to learn that I take these documents seriously. Planning and reporting is good management.
So what will the world of Canadian communication look like five years from now?
There's a lot that can happen that's beyond our control. Significant macroeconomic events may shock us: maybe another meltdown, maybe a strong recovery. Who knows? Hyperconnectivity and technological innovation will continue to bring whatever they bring. Who knows? I’m not here to make predictions about things beyond my control. But I’m confident that our regulatory framework can continue to adapt to whatever changes come along.
Across all of our operations, we will be committed to management excellence within the Commission. We're taking measures to ensure that our decisions are grounded in the values and ethics of Canada's public service, that we are responsible stewards of public funds and that we are accountable to Canadians. We are independent of the industry and we make our decisions in the light of the mandate that has been entrusted to us by Parliament.
In 2017, I envision a CRTC that is viewed as a trusted enabler in its mission to ensure that Canadians have access to a world-class communication system.
I see Canadians firmly placed at the heart of their communication system.
I see an empowered consumer making informed choices in a fair and competitive marketplace.
I see citizens better informed and better protected by the communication system.
I see creators that “wow” their neighbours and the world.
And I see an industry that has realized that fulfilling its social responsibilities not only benefits Canadians, but that it also benefits shareholders.
One closing thought about what I see in 2017:
I see that from time to time radios and TVs will be turned off. Smartphones, tablets and the latest digital wonder will be powered off. Co-workers will share a noontime sandwich on a park bench. Busy families will gather around for the evening meal and talk about what happened that day. Mothers will comfort daughters over a hot cup of tea when their boyfriends break up with them. And neighbours will take a pause raking the autumn leaves to banter about the new hockey season.
And we will see that a simple conversation is still the best communication system, as it has been since our ancestors first walked on this planet, since we first became human beings. I hope to see you all in 2017 so we can talk about it again.
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