March 14, 2017
Tomorrow is World Consumer Rights Day 2017, Building a Digital World Consumers Can Trust. Organized by Consumers International, of which PIAC is a member, this year’s WCRD theme is consumer digital rights, including one of four key digital issues—“access and choice” to high-speed internet. Broadband access, however, is almost impossible to discuss without addressing the affordability of broadband internet. At PIAC, we ask, “How do we build a digital world that is affordable for everyone?”
The digital world has become an integral and ever-growing part of our everyday lives. Many of us now find jobs on the internet, housing, school, make medical appointments, and – since it is that time of year in Canada – even file our taxes online. Innovation, Science and Economic Development Minister Navdeep Bains has said:
Today, the digital economy is the economy. There is not a single industry that digital technologies don’t touch anymore. […] Canada must do more to give people the skills and experience they need to compete in a global and digital world. In particular, we need to give every Canadian the opportunity to get online. No one should be left behind.¹
Are governments and policy makers in Canada and the rest of the world ensuring everyone can get online? PIAC believes much more can and must be done, especially to ensure low-income families – those who could benefit most from being online – can affordably access broadband.
Broadband adoption can be affected by a number of factors, including geographic access to broadband infrastructure, digital literacy, privacy and security concerns, and personal choice. However, cost has consistently been a key barrier to adoption and one for which Canada has largely fallen short of finding a solution yet.
According to a national telephone survey commissioned by PIAC in 2015, only 74% of Canadians with annual household incomes under $20,000, and 78% of Canadians with annual incomes between $20,000 and $30,000, had internet service at home. Meanwhile, 99% of Canadians with annual household incomes of $100,000 or more had home internet service. When asked why survey respondents did not have home internet, cost was the second most cited reason after a professed lack of interest—almost one third (30%) of respondents said cost was a reason why they did not have home internet service. Only about 5% of respondents said there was no high-speed internet service available where they lived. This means low-income Canadians in both urban and rural areas are not going online.
However, there is evidence that those low-income Canadians who can access internet service value it greatly. A separate survey commissioned by PIAC with low-income individuals indicates that respondents perceive home internet access (77%) to be equally important as health care, and more important than all other items listed except food (91%) and housing (88%). Television was viewed as an important service to over half the respondents (54%), just behind clothing. Meanwhile landline phones and mobile phones were cited as almost equally important to each other, with 46% of respondents indicating traditional telephone service is important, compared to 44% who indicated mobile phone service was important.
Figure 1. PIAC Survey of Low-Income Canadians Who Use the Internet (2015)
PIAC’s 2016 report, No Consumer Left Behind Part II², found low-income Canadians struggle to afford their communications services (including phone, internet and TV).
- About one-half of low-income Canadians had to trade off other household goods or services in order to pay their communications bills—almost 1 in 5 (17%) indicated they went without other essential goods, such as food, medicine or clothing, in order to pay a communications bill.
- About 20% of low-income subscribers struggled to pay off their communications bills in the past year, having to make partial payments; suspend or disconnect their service; commit to a payment plan; or be referred to debt collectors.
- More than 1 in 10 respondents (11%) ultimately cancelled a communications service because of the high cost.
What does this mean? This means many low-income families need to sacrifice other household goods, including at times food and medicine, or struggle in order to pay for communications services. Based on PIAC’s report, this means those communications services are not affordable for low-income individuals. This existing problem no longer requires talk, but action; there needs to be a policy solution to ensure low-income households can have more control over their communications expenditures. The Government of Canada, the Canadian Radio-television and Telecommunications Commission (CRTC), and other telecommunications policy makers must act in order to ensure there is affordable broadband today.
In the CRTC’s hearing on basic telecommunications services one year ago, the Affordable Access Coalition, including PIAC, advocated for an Affordability Funding Mechanism which would provide a subsidy discount for low-income users of telecom services. In its final policy³, the CRTC decided not to address affordability for low-income households at all, and instead asked the Canadian federal government to add this issue to its forthcoming Innovation Agenda. At the moment, therefore, there is no national solution to ensure low-income families can get online at home and no guarantee one is forthcoming. While some telecom providers are offering limited home internet packages to small groups of low-income consumers, Canada needs a national affordability plan to ensure all Canadian consumers can participate in the digital world. We must demand that policy makers stop passing the buck.
Affordable broadband will not only be a challenge in Canada but for all low-income consumers wishing to go online around the world. It is a challenge all governments and policy makers must recognize and urgently address.
Universal digital participation is key to innovation and to building a digital world consumers can trust. For World Consumer Rights Day 2017, we believe Canada needs to ensure there is affordable broadband internet for all.