This report is not the full or final definition of Canada's policies on the Information Highway. It is only one stage in a threestage process the Government has initiated for defining these policies. This first stage is the Commission's response to a broad range of questions on which the Government has asked us to collect and focus facts and opinions, adding our own relevant advice. The second stage will be the report, later this summer, of the Information Highway Advisory Council, a 30-member, widely representative group whose mission includes considering this report in the framework of its much broader mandate. The final stage will be publication (scheduled for later this year) of the Government's own official policy, based on both of these reports and its own consideration of the issues.
Fair, effective and sustainable competition in communications facilities and services is key to the creation of wealth and ideas in the information economy. The Commission is proposing mechanisms to remove barriers to competition resulting from the dominant position of telephone and cable companies, as well as safeguards to ensure service providers have non-discriminatory access to various distribution systems. The aim is to increase choice, diversity and innovation not only by licensing or authorizing new distribution undertakings or programming services, but by also allowing more flexibility in how services are packaged and distributed.
A more competitive model must also build on our past achievements if we want to ensure the continued availability of Canadian voices and ideas on our communications systems. Entry should be managed in a manner that contributes to the Canadian broadcasting system and the development of quality programming, as prescribed by the Broadcasting Act. All broadcasting undertakings should make equitable and appropriate contributions to the production and distribution of Canadian culturalcontent products and services. Cooperation between governments and shared use of infrastructure by distributors will also be necessary in order to offer affordable access to the information highway in all regions of the country.
Fair and sustainable competition can best be attained by the creation of alternative networks for delivering services to subscribers. The Commission fully supports the principle of interoperability and interconnection among networks. It also proposes that measures be devised to ensure that all telephone and cable subscribers have the freedom to connect the inside wire to the systems of whichever distributors they choose. Standards, including those that would support access by the disabled, should be developed through cooperation and negotiation, subject to the broad direction of Industry Canada.
The Commission would be prepared to issue cable television licences to telephone companies as soon as mechanisms are in place to give effect to competition in the local telephone business. It has already initiated, or plans to conduct, a number of proceedings to resolve various issues surrounding local telephone competition, including: the rates, terms and conditions for co-location, unbundling and interconnection; number portability; and rate restructuring. Applications to distribute programming by any other potential distributors will be considered without delay.
The Commission also supports increased competition in programming. Video-on-demand services, in particular, should be eligible for licensing as soon as non-preferential video-dial-tone tariffs are filed and approved.
While favouring increased competition, the Commission emphasizes the necessity of safeguards to prevent anti-competitive practices and to guarantee content providers fair and equitable access to all distribution systems. For example, cable distributors should not be authorized to operate discretionary programming services before there is sufficient channel capacity on their networks and before comprehensive access rules are established. In addition, any activities of cable operators and telephone companies in programming services should be carried out through structurally separate affiliates that satisfy ownership and control requirements.
While technology and market forces will shape the broad direction and timing of competition, the Commission intends to manage the transition to the information highway with a strong bias toward ensuring the earliest possible competition.
The challenge is to manage this transition to the new environment in such a way as not to lose the central values on which Canada and our broadcasting system have been built. Given the proximity of the world's most prolific exporter of popular culture and mass media, framers of our legislation have held to the primary importance of maintaining a distinctively Canadian broadcasting system that offers Canadians programming of high standard and one that, in its totality, reinforces the sovereignty of our country and our own cultural identity.
While much of the emerging interactive, multimedia universe need not be licensed or regulated, clear guidelines as to how programming and distribution services in the new information environment might best contribute to Canadian cultural objectives must be articulated now. To this end, the Commission is proposing the following:
Affordable public access to the information highway is a key concern for all Canadians, particularly those residing in the North and other remote areas. The highway's ability to fulfill its promised contributions to the advancement of health and education, as well as greater community expression, is also a source of concern.
The goal of universal access to the information highway can be realized through various means, including market forces, subsidies and cooperation. The Commission believes that there should be access points within each community from which Canadians could dial up various information highway services at minimal or no charge. Decisions on funding and priorities for infrastructure development on the information highway should be made by governments.
The high costs involved for applications such as distance learning and telemedicine could jeopardize some of the most promising social benefits of the information highway. The Commission considers that, in certain circumstances, preferential telecommunications tariffs for education and health services may be desirable and not anti-competitive. It intends to seek comment on proposed criteria to allow implementation of this proposal.
Finally, Canadians throughout the country want windows on their own communities, as well as on the world. The Commission therefore considers that all broadcasting distributors, in addition to cable operators, should make appropriate contributions to outlets for community expression. It will expect potential distributors to come forward with innovative proposals for providing community expression.