Canadian policymakers tend to overlook vitality of telecom for businesses: report

Policy makers tend to overlook importance of telecom industry

Despite strong discussions on competitiveness and consumer protection, policymakers tend to overlook how “vital” Canada’s telecom sector is “to the health of all Canadian businesses,” according to a public policy paper.

The paper, titled The Economics of Telecommunications in Canada: A Backgrounder, indicates that the sector annually generates over $50 billion in gross revenue, “with a bit over half coming from sales to household consumers and just under half have contributed by sales to the business sector,” and policy debaters may not have grasped this fact.

The report does note that the telecom debate tends to be more on prices and services paid by households and holding the Big Three accountable.

In 2013, the telecom industry produced $54.9 billion CAD in economic activity in the production of new goods and services. It also added that consumers have been increasingly using telecom services at a significant rate “particularly in the case of wireless services.”

Of the $54.9 billion, well over half ($31.2 billion) represents value added to the economy “through the use of capital and labour as factors of production,” while $23.7 billion represents upstream activity.

According to the report, industries like financial investment services, real estate, computer systems design, municipal government services, physician offices, among others are increasingly spending nearly $800 million on mobile telecommunications services and fixed telecom services (except internet access).

The report indicates that revenue in the telecom sector has increased in the past decade and that looking at values from the past five years, the telecom sector has contributed to billions in products and services.

“The services provided by the telecom sector are not only important for Canadian households, but are also critical for every other Canadian industry,” the report said.

Source: The Economics of Telecommunications in Canada: A Backgrounder