Canadians hungrier for Internet access than TV for first time, says CRTC
Canadians spent more money on Internet access than television subscriptions for the first time last year as the demand for data exploded and the desire for traditional TV packages waned, says a report from the federal telecom regulator.
Retail Internet revenue topped $9.2 billion in 2015, a 10 per cent jump that made it the fastest growing communications service in Canada, according to the second part of the 2016 Communications Monitoring Report released by the Canadian Radio-television and Telecommunications Commission on Wednesday.
The success of the Internet segment, driven largely by data-hungry consumers who used 40 per cent more data last year, comes as cable, satellite and IPTV providers’ revenue dipped for the first time in a decade to $8.9 billion. The upheaval reflects the tectonic shift in how Canadians access media — and it’s a trend that CRTC chairman Jean-Pierre Blais expects will continue.
“Our report illustrates how online and wireless services are becoming critical to Canadians’ day-to-day lives,” Blais said. “The explosive growth in data consumption clearly demonstrates that Canadians are relying more and more on streaming and real-time communication applications to consume content and communicate with the world.”
The findings come a day after the CRTC released statistics revealing a stagnant broadcasting industry. Although 78 per cent of households still have TV subscriptions and radio revenues were relatively flat, advertising is falling for conventional stations and people are cutting the cord.
It’s a different story in telecom, which posted solid growth in wireless and fixed Internet, even though 800,000 cut their landlines last year. Nearly 30 million Canadians have wireless subscriptions — an increase of about one million since 2014 — putting wireless in 86 per cent of households compared to 76 per cent for landlines. Of these, 73 per cent have smartphones.
Data usage increased 44 per cent among wireless users who want to stream on the go. (Faster network speeds and better smartphones make this easier than ever.) Threequarters (74 per cent) of subscribers bought wireless data plans in 2015, compared with two-thirds (67 per cent) in 2014.
The retail wireless industry continued to be the juggernaut for the entire communications sector, accounting for $22.5 million of the total $65.4 billion in revenue.
Nearly a quarter of households (24 per cent) have only wireless phones; only 14 per cent of households rely solely on landlines.
Internet is also spreading to more Canadians in rural and northern areas. Internet with speeds of more than five megabits per second (MBps) is now available to 98 per cent of Canadians, up from 95 per cent in 2014.
But most Canadians are paying for far faster plans.
Subscriptions to plans with speeds of 50 MBps or higher doubled to 16 per cent in the past year.
And they’re paying for more data. More than two-thirds of residential high-speed Internet subscribers have plans with more than 100 gigabytes (GB) of data per month, with the average user downloading 93 GB per month.
Driven by spending on wireless and Internet, total household spending on communications, including broadcasting, increased by 1.4 per cent to $214.75 per month in 2014.
Canadians younger than 30 spent the most on wireless services, at an average of $114.42 per month, compared with $33.50 spent by those older than 65.
Data will be in the hot seat at a CRTC hearing next week on differential pricing, the practice of charging different amounts for different types of Internet traffic. Most major providers are fighting for the right to do so as data becomes more crucial to their business, but consumer advocates say it’s anti-competitive since it could give providers the opportunity to favour content.