Communications Monitoring Report 2016: Executive Summary

Acknowledgement

The Commission wishes to thank all the entities that completed the CRTC Data Collection forms, without which this report would not have been possible. The Commission would also like to acknowledge the assistance provided by Innovation, Science and Economic Development Canada in the analysis of broadband deployment; Statistics Canada for the various supplementary data used in this report; Numeris for audience measures; NLogic for the Media Technology Monitor (MTM); and Mediastats.

Interested parties are welcome to provide comments for improvements or additions to future editions of the report. You can send your comments to the attention of the Secretary General, CRTC, Ottawa, K1A 0N2.

Chairman’s message

I am pleased to present the 2016 Communications Monitoring Report, which provides a comprehensive view of the Canadian communication sector.

It is clear that Canadians are shifting towards digital platforms and mobile technologies. In 2015, Internet data consumption grew by almost 40% while data traffic over mobile wireless networks increased by 44%.

Subscriptions to landline telephones continue to decrease as mobile ownership grows. Canadians across the country depend increasingly on wireless technologies in their daily lives and wireless services now account for 51% of all retail telecommunications revenues.

To better reflect evolving technologies and shifting consumption habits, improved indicators have been added to this year’s report. For example, the broadband measurement data now includes usage data for video calling and live streaming applications. Also, to better analyze patterns from a geographical perspective, provincial and regional breakdowns have been added throughout the different sections of the report.

Both the broadcasting and telecommunication sectors are at important crossroads that are determining their futures. The CRTC undertook many important proceedings in recent years and has put in place measures to ensure our communication system adapts to the digital world and that Canadians can participate in the unfolding digital economy.

This report is an important tool to evaluate where we’ve been and to inform our choices moving forward. We continue our ongoing efforts to consult with Canadians on these important topics that have great impacts on their daily lives. We are proud to work on behalf of the public interest and to put Canadians at the centre of their world-class communications system.

Jean-Pierre Blais, Chairman and CEO

Executive Summary

The Communications Monitoring Report (CMR) offers a comprehensive view of the communications services sector in Canada. Specifically, it provides Canadians, industry and stakeholders with meaningful information to help them better understand the communications industry and participate in the CRTC’s proceedings.

  1. Key trends in the communications industry
    • Overall, communications industry revenues reached $65.7 billion in 2015, up from $64.1 billion in 2014. The revenue growth rate of 2.5% between 2014 and 2015 is slightly above the five-year average growth of 2.1%. Revenue increases for mobile and Internet services were offset by decreases in conventional television and home telephone service revenues.
    • In 2015, telecommunications service revenues represented 73% of overall communications service revenues. Total telecommunications service revenues reached $47.8 billion, and grew by 4.1% since 2014, while broadcasting service revenues decreased to $17.9 billion, a 1.6% drop from 2014.
    • The wireless service market sector represents more than half (51%) of all retail telecommunications service revenues. The wireless service market sector is the largest single retail telecommunications service sector, and has grown more than any other sector since 2008.
    • Specialty services reported program & production expenses of $2.0 billion in 2015, up by $107.6 million (5.7%) from 2014. Specialty services’ program and production expenses were composed of $54.9 million in Production Expenditures; $434.2 million in Non-Canadian Programming Expenditures; and $1.5 billion in Canadian Programming Expenditures (CPE).
    • Revenues for cable and IPTV companies continued on their upward trend and totaled $6.6 billion in 2015. This represented an increase of $113.5 million (1.7%) since 2014 and of $702.6 million (11.9%) since 2011. By contrast, the revenues of satellite companies have been on a downward trend since 2012, recording the largest losses over the past two years. They generated revenues of $2.2 billion in 2015, down 5.2% from 2014.
    • The five largest companies accounted for 82% of overall communications revenues in 2015, relatively unchanged from 2014.
    • Average monthly household spending on communications services increased from $212 in 2013 to $215 in 2014. The largest monthly spending increase was on mobile services, from $79 in 2013 to $83 in 2014. Most of Canadians’ spending on communications services went to mobile wireless services (38%), followed by home television services (26%), Internet services (20%), and home telephone services (16%).
    • Younger Canadians spend more than three times the amount on mobile wireless services than other Canadians. Canadians under 30 years of age spend the most on monthly mobile wireless services ($114.42), while the lowest spenders, Canadians aged 65 years and older, spend $33.50 a month on mobile services.
  2. Device ownership and data consumption are increasingly popular among Canadians
    • The migration towards wireless services continues, as more Canadian households subscribed exclusively to mobile wireless services (23.7%) than to exclusively wireline (i.e. landline) telephone services (13.6%). Similarly, more Canadian households also reported subscribing to mobile telephone services (85.6%) than to landline telephone services (75.5%).
    • Canadians also continued to move towards broadband mobile services. Mobile broadband service subscribers continued to post strong gains, with over 22 million subscriptions to mobile broadband services in 2015, compared to 19.3 million in 2014, and 13.2 million in 2011.
    • The number of wireless service subscribers increased to nearly 30 million in 2015. Subscriber growth increased 3.4% in 2015, compared to 1.5% in 2014.
    • Wireless and Internet data usage is growing. Wireless data usage increased 44% from 2014 to 2015, while fixed Internet data usage increased nearly 40% for the same period. Approximately 70% of wireless data subscribers have plans that provide for at least 1 GB of data usage per month.
    • In 2015, service contracts that exceeded 2 years accounted for only 14% of all contract lengths, compared to 33% in 2014, and 56% in 2013.
    • Almost three-quarters (73%) of Canadians aged 18 and over owned a smartphone in 2015. This represents an increase of 7% over 2014 and an increase of 36% since 2011.
    • LTE coverage reaches over 97% of the population, while HSPA+ is available to over 99% of the population.
    • Tablet ownership continued to increase, as more than half (52%) of Canadians owned a tablet in 2015. In 2014, 49% of Canadians 18 years of age and older reported owning a tablet, compared to 10% in 2011.
    • More than 80% of Canadian households have access to broadband service speeds of at least 50 Mbps.
    • Residential high-speed Internet service subscribers’ data download usage increased 40% from 2014, and over 50%, on average, from 2010 to 2015. 
  3. Canadians continue to watch TV
    • Internet TV viewing continued to increase in 2015. Weekly users of 18 years of age and older watched 5.8 hours of Internet TV on a weekly basis, compared to 1.5 hours in 2008.
    • Traditional TV viewing time remained relatively stable, decreasing by only 0.2 hours from 2014 to 2015. Canadians (aged 2 and over) watched, on average, 27.2 hours of traditional television per week during the 2014-2015 broadcast year, compared to 27.4 hours in 2013-2014, and 28.5 hours in 2010-2011.
    • Younger Canadians watched significantly less traditional television than other Canadians. On average, Canadians 18 to 34 years of age watched less than half the number of hours of traditional television (19.7) as Canadians 65 years of age and older (42.0).
    • IPTV service revenues continued to soar. IPTV service providers posted revenues of approximately $1.6 billion in 2015, up $273 million or 21% from 2014.
  4. The use of streaming music services continues to grow
    • Canadians’ use of streaming music services is growing. In 2015, 55% of Canadians streamed music videos on YouTube, 23% streamed AM/FM radio online, 20% streamed personalized online music, and 22% listened to podcasts.
    • In 2015, 16% of Canadians 18 years of age and older subscribed to satellite radio services. This figure is unchanged from 2014.
    • Private commercial radio continued to experience slight decreases. Commercial radio stations reported a slight decrease in revenues, from $1.61 billion in 2014 to $1.60 billion in 2015.

Revisions to the Communications Monitoring Report

November 2016

February 2017

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