Digital economy strategy finalized and ready for release, sources say

The federal government has finalized its long-awaited digital economy strategy and could release the policy as early as next month, sources familiar with the government’s plans said. Three people contacted by The Wire Report this month confirmed a formal digital economy plan has been finalized after more than four years of preparation. They said the plan is ready for release, most likely by this spring, if not sooner. Though the sources could not confirm the contents of the finalized strategy, they said it would likely tie together a number of digital issues the government has focused on in recent years — such as copyright reform, intellectual property reform and increased wireless competition — and could include other issues, such as broadband connectivity and digital privacy. The strategy, one source said, will focus on ensuring that Canadians and Canadian businesses are “embracing” digital opportunities. Members of the information and communications industries have awaited a formal digital economy strategy since mid-2009, when then-industry minister Tony Clement said Canadians could expect to see “movement” on some segments of the policy later that year. Since then, the government has held multiple consultations on the file, including a public consultation in 2010, and meetings with provincial ministers in 2012. Clement said in late 2010 that the Conservative government would release its official strategy the following spring. Those plans seemed to fall by the wayside when Clement was moved off of the industry portfolio following the May 2011 election. Instead, the government announced preliminary details of the strategy in the budget released in June 2011, which focused primarily on digital skills development and businesses’ adoption of new technologies. Clement’s successor, Christian Paradis, said in fall 2011 that the strategy remained a “high priority” for the government, and in June 2012 he said the government was conducting “final consultations” before releasing the strategy “by the end of the year.” Current Industry Minister James Moore told The Wire Report in December that the digital economy strategy would be a “front-burner issue” in early 2014. He said the government considers new anti-spam regulations it introduced that month to be part of the digital strategy. Sources contacted for this story said the formalized digital economy strategy could touch on issues relating to online commerce, and the need for more of Canada’s small and medium-sized businesses to adopt modern information-communications technologies. It could also touch on topics relating to ownership and control of Canadian telecommunications, one of the sources said. The government passed amendments to the federal Telecommunications Act in 2012 that removed foreign ownership restrictions on small telecommunications providers with less than 10 per cent national market share. Large telcos Telus Corp. and BCE Inc. have since said the government should remove foreign ownership restrictions for all providers, while Edward Rogers, deputy chairman of Rogers Communications Inc., said at a Whistler, B.C. conference last week that he believes it would be a mistake to allow foreign players to gain control of Canada’s largest telecommunications companies. Industry players hope that a formal digital economy strategy would provide a roadmap toward making Canada’s digital economy more competitive. In a report released in November, the Information Technology Association of Canada (ITAC) said the government’s digital economy initiatives should focus on reducing Canadian small and medium businesses’ “lag” in adopting digital technologies. “ITAC’s view is that it is this lag in adoption by Canada’s SMBs that needs to be addressed,” the organization said. “Government should now focus on the broad, transformative goal of driving technology adoption across sectors of the economy, especially adoption of online and other digital tools by SMBs.” ITAC said in its report that the national Internet economy accounted for three per cent of Canada’s gross domestic product (GDP) in 2010, compared to an average of 4.7 per cent in the United States and an average of 4.1 per cent across the G20 countries. “At the current rate, by 2016 this gap will grow and Canada will be at 3.6% while the G20 average will be at 5.3% and US at 5.4%,” the group said, citing a 2012 report by business strategy advisers The Boston Consulting Group. Three sources familiar with the government’s plans said the digital economy strategy is unlikely to include significant new spending measures, with two of those sources pointing to the government’s desire to balance the budget as a primary consideration. One source said they would be “shocked if there was any new spending or anything that reduced revenues” in the strategy. During its 2010 consultation, Industry Canada sought comments on five broad issues of discussion, including “Growing the Information and Communications Technology Industry," and “Capacity to Innovate Using Digital Technologies.” The other topics the department identified were “Building a World-Class Digital Infrastructure,” “Digital Media: Creating Canada’s Digital Content Advantage,” and “Building Digital Skills for Tomorrow.” Since then, the government has rolled out or completed several initiatives that relate to digital economy issues, including loosening the foreign investment restrictions on small telecom providers, passing copyright reform legislation, introducing anti-spam regulations and providing funding for rural broadband connections through the 2009 Broadband Canada initiative. Industry Canada also launched this month an auction of coveted 700 MHz airwaves — which mobile providers are expected to use to improve mobile broadband capacity — and said it will launch another auction of 2500 MHz airwaves in April 2014. Moore's office declined to comment for this story Thursday. — With reporting by Nicholas Kyonka at nkyonka@thewirereport.ca and editing by Anja Karadeglija at akarad@thewirereport.ca

Digital economy strategy finalized and ready for release, sources say

News | 01/30/2014 9:52 pm EST

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