Competition Bureau to 'shine a light' on internet industry with market study

Lights on an internet switch are lit up as with users in an office in Ottawa, on February 10, 2011. Canada???s competition watchdog is inviting public comment about broadband internet providers, including whether there are lessons the can be learned from how other countries manage and regulate their markets. It???s seeking initial submissions by Aug. 31 and aims to publish a final report next year.THE CANADIAN PRESS/Adrian Wyld

TORONTO - The federal competition watchdog says he wants to "shine a light" on Canada's broadband internet providers with the public's comments on a market that is predominantly served by traditional phone and cable companies.

“There are few products more vital to Canada’s economic future than broadband. We want to shine a light on potential competitive issues in a sector at the heart of our daily lives,” Commissioner of Competition John Pecman said in a statement Thursday.

The Competition Bureau said there are more than 550 companies offering an alternative to traditional telephone and cable companies, but 2016 data showed that only 13 per cent of Canada's retail internet subscriptions were with the alternatives.

The bureau says it's exploring ways to make the broadband internet sector more competitive, including a change to regulations, easier switches between providers and more informed consumer choice.

Representatives of two Canadian consumer advocacy groups said they hoped that the bureau's study will lead to lower prices.

OpenMedia's Katy Anderson added that she would like the bureau to also look at high wireless data prices, which affect how much people pay for accessing the internet through mobile devices.

"Having the Competition Bureau come in and look at (the) broadband internet market is great news for Canadians . . . but I'd love, love, love for to see them include wireless in this," Anderson said in a phone interview from Calgary.

"Because we know people are using their cellphones more and more and using more data on them, and the CRTC's monitoring report — that comes out every fall — tells us that."

John Lawford, of the Public Interest Advocacy Centre in Ottawa, said in an email that the market study is well-timed and very necessary.

He said many consumers "have problems with affordability of service and are stymied in using the internet's full potential by high prices and low data caps.

"It will be helpful to see whether the Competition Bureau can highlight the flaws in the market that allow this state of affairs to continue," Lawford said.

The bureau is seeking initial submissions by Aug. 31 and aims to publish a final report next year.

Among Canada's biggest internet service providers are BCE Inc.'s Bell Canada, Rogers Communications Inc., Telus Corp, Quebecor's Videotron, and Shaw Communications Inc.

The independent internet service provider generally must piggyback their traffic over one of the large cable or telephone networks, which charge the smaller ISPs a wholesale rate.

Among Canada's better-known independent ISPs are Eastlink, Xplornet, Primus, TekSavvy and Yak.

Companies in this story: (TSX:BCE, TSX:RCI.B, TSX:T, TSX:QBR.B, TSX:SJR.B)


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