moved that Bill S-242, An Act to amend the Radiocommunication Act, be read the second time and referred to a committee.
Madam Speaker, access to high-speed Internet on our phones, tablets or computers has become not just a want but a need and a necessity to participate in today's economy, to go to school, to be educated, to communicate or, even as we saw this summer, for public safety.
The Internet, which was a luxury when I was a kid, has now transformed into a public utility. Nary a function in today's society can be completed without it, yet 40% of rural Canada is not connected to high-speed Internet. Almost 60% of our first nations communities are not connected to high-speed Internet. Especially troublesome is that those in rural areas who are connected find it inadequate and expensive.
In a 2021 poll conducted by the Canadian Internet Registration Authority, 68% of people said that the organization they communicate most with online is their bank. A strong Internet connection may also be a factor in determining someone's health care, as 28% of Canadians consulted a doctor virtually in 2021. As this nation faces a shortage of doctors and health care practitioners, that number is only going higher.
There are also simpler conveniences that come with reliable Internet, such as food and grocery delivery, car sharing, social media and online booking portals. Farmers these days now have equipment with software that can only be updated online using the Internet.
Rural Canadians suffer most of all as the world goes more digital and they are stuck in the stone age. Why does this matter? Well, it matters because Canada is rural. Of the 3,700 municipalities in Canada, only 94 are urban or have over 100,000 in population. That means 97% of Canadian municipalities are rural.
Even in my home riding of Bay of Quinte, only a three-hour drive southwest of Ottawa, with Belleville, Prince Edward County and Quinte West, when travelling east to west and north to south, we often lose cell coverage. A lot of my residents do not have reliable high-speed Internet, and we are a three-hour drive from over 10 million people in a part of this country that should be considered urban and have reliable and cheap high-speed Internet.
The answer to those problems is to have more competition with more companies competing, and especially to have more Canadian companies competing and filling in the gaps when it comes to technology and spectrum. We must get more rural Canadians connected to the Internet and get more cellphone towers in Canada. The government's role is to ensure that the rules and regulations in place benefit rural Canada as much as they do urban Canada.
This bill is for rural Canada to ensure that when Canada gives a public utility resource like spectrum or spectrum licensing to a company, the company uses the spectrum to connect rural parts of this country and its over seven million people to high-speed Internet. The bill is entitled “use it or lose it”, and it will mean that if a telco buys spectrum intended to service a geographic region in Canada and within three years does not service 50% of that geographic area, the minister has legislative options to ensure that another company will.
I would like to personally thank Senator Patterson from the great Nunavut and his incredible staff, who have already passed this bill and shepherded it through the Senate. When discussing this bill, the senator revealed that this is his last year in the Senate. He actually turned 75 on almost the last day of the year that he can serve as a senator. He told me that if his generation is going to be remembered for anything, it will be the last one that remembers the world before the Internet. Can members imagine that? With this bill, Senator Patterson will be remembered for protecting this public utility for all of rural Canada.
The senator talked to me about the importance of this bill in the north, in the Northwest Territories, in Nunavut and in the Yukon. When it comes to the Internet, we are either five years ahead or five years behind. In rural Canada, we are certainly five years behind.
In the north, Northwest Territories Premier Caroline Cochrane, during a recent wildfire when phone and Internet lines were out, stressed that they had been asking for upgrades for decades, with no response. She said, “It angered me that we have been pleading and begging to have the same infrastructure that people in the south take for granted. Not extra, just basic infrastructure.”
P.E.I. resident Julie Lauren pays $161 per month for her home Internet service. Just for context, that is more than eight times what Australians pay. She lives in Bonshaw, P.E.I., a rural community just 30 minutes outside of Charlottetown. To have high-speed Internet at home, Lauren says that the only company she found that provides reliable service in her area is Starlink, a United States-based satellite Internet provider operated by the American company SpaceX. Most Canadians either cannot afford Internet or cannot get it because it has not rolled out yet.
Worse, how many times in the past have telcos abused the Internet spectrum, a public utility, as their own real estate and asset and profited from it? There are many examples of this very thing having happened. In 2008, after a competitive auction that lasted 331 rounds, Quebecor Media and Videotron Ltd. shelled out $96.4 million for the exclusive rights to a block of wireless airwaves in Toronto, outside of its own market of Quebec. However, the telco never built a wireless network in Canada's most populous city, and in June 2017 sold the unused licences to Rogers Communications for $184.2 million, netting an $87.8-million profit. A month later, Videotron earned an even larger windfall of $243.1 million by selling a handful of spectrum licences to western Canadian telecom company Shaw Communications Inc. In 2013, after scrapping its on again, off again plans to launch wireless services, Shaw sold 18 licences to Rogers for $350 million, nearly twice the $189.5 million it bought them for in 2008.
The message could not be clearer. Spectrum is a public utility, a public good. The government owns it and leases it to companies with the idea that they will use it. Spectrum should not be flipped like a piece of real estate; it should be developed. It should be given to companies to develop, especially in rural Canada so it can get the high-speed Internet it needs.
Although the government says it can do just that by law, there has been very little done about it. This bill would give the minister powers to do something about it. The minister's new powers would include repealing licences that do not meet the geographic deployment conditions. Right now they are met only by population. A lot of the time what will happen to spectrum licences if the licence holder fulfills the population conditions, which in tiers two to four include an urban component, so, for example, if a licensee fulfills the Toronto component but not the northern King region or Vaughan component, is that it can still hold on to that licence even though those rural users do not have Internet. This would make sure it is geographic, that 50% of the geographic area must be met, not just the urban area. It would include consent to an agreement to transfer the licence to a new provider if the original owner has partially deployed service.
Therefore, there would be a provision to use it or share it, so it would not be as cruel for those who are actively trying to deploy spectrum. It would give the minister the power to make a decision to work with that provider as long as it is working with the ministry and the minister. It would allow a spectrum licence to be shared among two or more companies to deliver the service through an assigned geographic area, which is not just use it or lose it but, if need be, use it or share it, which I think is very innovative.
These amendments came from the Senate. I would like to congratulate the senators on the many important amendments to the bill. There were many great improvements to its original form. One of the amendments was to ensure that those buying tier one to tier four licences would not be able to meet deployment conditions by simply deploying to the urban areas with those large geographic tiers, but would also be required to provide service to smaller rural and remote areas nestled within, in order to meet the obligations under this legislation. We are trying to work with those providers.
It also laid the foundation for other amendments focusing on the use-it-or-share-it regime, which would allow the minister to make the decision to share parts of the spectrum with companies that could fulfill the obligations of the spectrum rollout. In addition, it would provide ministerial flexibility to either outright revoke the licence or reallocate tier five areas, which are rural, within the licence, to other providers who are already able and ready to service the underserviced areas. A lot of those were independent service providers, like a company called Storm, which is actively working on that.
The amendments also include a provision that would clarify the intent to ensure that licence holders cannot sell the licence up to and including three years minus a day, in an effort to avoid penalties for not complying with licence conditions. We would be giving the minister the power also to ensure that companies, on the 299th day prior to the 300 days the government has to revoke this, are complying. We would be giving the power to the minister, which is very important.
Another amendment would require the minister to start a competitive bidding process within 60 days not only of the revocation of a spectrum licence but also where the licence holder has voluntarily surrendered the licence as a result of not being able to meet its licensing obligations.
A further amendment addressed the concerns over the ability of smaller proponents, small companies, to raise the required capital to participate in the competitive bidding process, giving the minister the flexibility to use competitive bidding or other reallocation processes such as a first-come, first-served model when a licence is revoked or surrendered. Again, we have many small businesses that want to participate in this licence process. Let us give the minister the power to select those smaller companies, especially when it comes to rural Canada and the north.
Not all companies are bad, and spectrum auctioning is a necessary process where there is much demand and little supply like in urban Canada, but in rural Canada there is less supply, and this bill is awfully needed to fix that. Therefore, this bill would be a small start in the spectrum policy review in Canada, especially in rural Canada.
Senator Patterson noticed the importance of this bill in raising awareness of the major problem of connectivity including in indigenous communities, and the impact this plays on Canada's reconciliation process, especially as it pertains to enhancing the language and culture of those in remote communities. The senator also made many comments close to my heart on how the government should develop incentives and policies that foster competition and facilitate the entry of Canadian companies into the competitive market.
Canadians have had bad or worse connectivity in rural and remote areas in Canada. The really bad news is that most of Canada is rural and that 40% of rural Canadians do not even have access to high-speed Internet. That number is almost 60% for our first nations peoples. This is at a time when Canadians need fast, reliable Internet and cellphone coverage for their economic well-being, for their kids' education and perhaps, most important, for their safety.
This bill would ensure that those companies that win spectrum auctions actually use the spectrum they are buying in rural areas of Canada that need it. This is, with no small effect, to work on ensuring that the Canadian government and its minister of industry have a role to play in ensuring that the spectrum licences in this public utility purchased by companies are being put towards providing good, fast, reliable Internet for Canadians, or that a use-it-or-lose-it provision would ensure that, at the very least, the asset owned by the Canadian public is not just speculative for companies trying to earn another buck.
I want to thank Senator Patterson of Nunavut for putting forward this very important bill, a very timely one for when he retires. It is my hope that we in this place can support the work he has done in the Senate and this great first step to address rural connectivity in Canada.