House of Commons zeroes in on false advertising of internet speeds and impact on rural Canada

Yesterday, the House of Commons Standing Committee on Industry and Technology (INDU) met with representatives of the Commission for Complaints for Telecom‑television (CCTS) and OpenMedia to discuss the new proposed Bill C-288.

The bill seeks to amend the Telecommunications Act to require Canadian carriers to provide details about the fixed broadband services that they offer, to deter false advertising. 

As part of the enactment, the CRTC is also required to hold public hearings to inform its decisions on how carriers are to fulfill this obligation.

According to the CCTS, a national organization which helps customers resolve complaints pertaining to retail internet, wireless, TV, and local phone services, quality of service characterises the majority of complaints raised by Internet customers.

“In these complaints, customers told us they weren’t getting the speeds they thought they contracted for, or that they did not understand that the speeds displayed in their plans were the maximum speeds that might be made available to them,” said CCTS assistant commissioner, Josée Thibault.

Furthermore, the CCTS revealed that the large providers account for about 80 per cent of the complaints. 

“Bill C-288 is not a controversial piece of legislation; we can all agree that it serves to empower everyday people, support their right to high quality connectivity, and protect them from shady business practices by big telecom – improvements to the status quo that will benefit every person in this room and people in Canada at large,” said Erin Knight, from non-profit, OpenMedia.

A committee member pointed out that a number of telecommunication companies wrote to his office, stating that the bill is “unnecessary” and “unworkable”, adding that the wireless and internet code binds them to provide customers with information in plain and easy to understand language.

But Bill C-288 should not pose a problem to telcos that believe they are not indulging in any false advertising, said Knight. “If, according to a telecom company, there’s nothing wrong with their average network performance, then they really have nothing to fear from a bill that makes that network performance data transparent and publicly available.”

Plus, the bill has nothing to do with wireless services, said another witness, but is rather about fixed networks. He added that the CRTC explicitly excluded restrictions against misleading advertisement of service quality levels in the development of its 2019 internet code, and this bill will potentially mitigate what can be viewed as an error in developing the internet code.

Though required by the CRTC to participate in CCTS, the largest service providers are also very sensitive to the number of complaints reported publicly. Hence, the bill will further push the disincentives to not resolving those problems, Howard Maker, the Commissioner and chief executive officer of CCTS pointed out. And it will be a financial disincentive, as service providers are required to pay for each customer complaint that comes to the CCTS.

Furthermore, witnesses argued that ensuring transparent and accurate information about broadband services is key to closing the digital divide in rural and remote Canada.

While high speed internet underperformance is irritating for many and still a huge problem, for lower speed internet subscribers, getting, for instance, two megabits per second instead of the advertised 15 is debilitating, said Knight.

The plans offered to rural subscribers tend to be at lower speeds because of the technological differences and weakness of investment incentives, added Reza Rajabiun, competition policy and telecom strategy expert.

False advertising in rural areas with lower speed services reduces the investor take-up rate in fibre deployment projects, Rajabiun explained, undermining the incentives to deliver higher quality networks. When investors are able to showcase the quality of their products, they get the revenue they need to sustain and grow their business, especially when demand grows and the capacity to deliver becomes constrained.

Witnesses also argued that this bill would bolster the CRTC’s new policy direction to ensure competition and consumer rights, but said that it does not go far enough in terms of “enforcement, contractual accountability of suppliers, and remedies for consumers who end up not receiving what they are paying for.”

Consumers suspecting that they are not getting what they are paying for are advised by the witnesses to contact their service providers for troubleshooting policies and tools. If they are unable to sort it out, they can file a complaint with the CCTS.

The CCTS would look at the difference between the cost of advertised speeds versus what the user is getting, and require the service provider to compensate them for the difference. It can also provide additional compensation of up to C$5000 to consumers, beyond the crediting of the billed amount, said Thibault.

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Ashee Pamma
Ashee Pamma
Ashee is a writer for ITWC. She completed her degree in Communication and Media Studies at Carleton University in Ottawa. She hopes to become a columnist after further studies in Journalism. You can email her at [email protected]

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