Regulating content on the Internet: A new technological perspective

Part I: The Changing Landscape

This section outlines the changes in Internet use since 1999 and the context in which any attempt to regulate content would need to be implemented.

Increased Internet Penetration

Since 1999, Internet penetration has rapidly approached the penetration of television and telephony in industrialized nations. Internet-enabled devices, including personal and vehicular devices and home appliances with Internet connectivity, are becoming commonplace. In some countries, such as Korea and Japan for instance, 100 megabit or 1 gigabit connections to the home are increasingly becoming the norm, and even in Canada and the United States, which have begun to lag a number of other countries in the bandwidth available to users, some new sub-divisions are beginning to be built with fibre-to-the-home 1 gigabit connections.

Current data indicate that there are 22 million Internet users in Canada, an increase of 73.2% since 2000.⁹

Canada is 21^st in the world in terms penetration rate of Internet use at 65.9% and 18th in the world in terms of total Internet users. Although Canada's penetration rates are relatively high Canada's actual user base is small, accounting for only 2% of all the users in the world. China, for example, with only a 16% penetration rate in 2007, has now surpassed the number of Internet users in the US, according to Beijing consulting and research firm BDA, which estimates that as of March 2008 China has as many as 228.5 million Internet users compared with 217.1 million in the US.¹⁰

Top 25 countries with the highest internet penetration rate

#	Country or Region	Penetration (%  Population)	Internet Users Latest Data	Population	Source and Date of Latest Data
1	Norway	88.0 %	4,074,100	4,627,926	ITU — Sept/07
2	Netherlands	87.8 %	14,544,400	16,570,613	ITU — Sept/07
3	Iceland	85.4 %	258,000	301,931	ITU — Sept/06
4	New Zealand	77.7 %	3,200,000	4,115,771	ITU — Sept/05
5	Sweden	77.3 %	6,981,200	9,031,088	ITU — Sept/07
6	Antigua & Barbuda	76.3 %	53,000	69,481	ITU — Dec/07
7	Australia	75.9 %	15,504,532	20,434,176	Nielsen//NR — Dec/07
8	Portugal	73.1 %	7,782,760	10,642,836	IWS — Mar/06
9	United States	71.7 %	215,935,529	301,139,947	Nielsen//NR — Dec/07
10	Faroe Islands	71.6 %	34,000	47,511	ITU — Sept/07
11	Korea, South	71.2 %	34,910,000	49,044,790	ITU — Dec/07
12	Luxembourg	70.6 %	339,000	480,222	ITU — Aug/07
13	Hong Kong	69.9 %	5,230,351	7,554,661	Nielsen//NR — Sept/07
14	Falkland Islands	69.4 %	1,900	2,736	CIA — Dec/02
15	Switzerland	69.2 %	5,230,351	7,554,661	Nielsen//NR — Sept/07
16	Denmark	68.8 %	3,762,500	5,468,120	ITU — Sept/05
17	Japan	68.7 %	87,540,000	127,433,494	ITU — Sept/07
18	Taiwan	67.4 %	15,400,000	22,858,872	TWNIC — June/07
19	Greenland	67.4 %	38,000	56,344	ITU — Dec/05
20	United Kingdom	66.4 %	40,362,842	60,776,238	Nielsen//NR — Nov/07
21	Canada	65.9 %	22,000,000	33,390,141	ITU — Mar/07
22	Germany	64.6 %	53,240,128	82,400,996	Nielsen//NR — Dec/07
23	Leichtenstein	64.2 %	22,000	34,247	ITU — Mar/07
24	Bermuda	63.5 %	42,000	66,163	ITU — March/07
25	Finland	62.7 %	3,286,000	5,238,460	ITU — Sept/05

Increase in Internet Traffic

Since 1999, the volume of data traffic has grown exponentially. In 2007, an average of 3.7 exabytes of data per month was transferred over the global Internet.¹¹ Canadians accounted for approximately 74 petabytes of those monthly data transfers.¹²

Greater Variety of Internet Connected Devices

The devices that Canadians are using to access the Internet are also changing. While the majority of Canadians are still accessing the Internet via desktop or laptop computers, an increasing number are accessing the Internet through other devices, such as mobile phones, PDAs, game consoles, and set top boxes. Canadians are using their mobile phones to engage in text and photo messaging, e-mail and Web browsing Use of mobile phones for Web browsing, however, has been fairly limited to date, arguably due to extremely high data transfer costs on mobile networks in Canada. Game consoles are also used to access the Internet, but primarily to support multiplayer games, not for Web browsing. Canadian video gamer players have shown little interest in using the consoles to browse the Web, perhaps because game controllers make very bad interface devices for Web browsing or because game consoles are usually attached to television sets which (at least until the advent of HD television sets) have been very poor display devices for text. For similar reasons, set top boxes have not been widely used in Canada for Web browsing. However, they are becoming more important as a means to obtain IPTV (Internet Protocol TV) services.

Mobile Messaging and Internet Use by Mobile Phone
Users in Select Countries Worldwide, October 2007 (% of respondents)

	Text Messaging	Photo Messaging	Access Internet via Network	E-Mail*
*Note: Ages 18–64; excludes SMS Source: Office of Communications (Ofcom) — UK, "The International Communications Market 2007" conducted by Synovate, December 12, 2007
Canada	40%	2%	7%	7%
France	82%	33%	15%	12%
Germany	87%	32%	7%	8%
Italy	77%	40%	19%	16%
Japan	17%	7%	20%	57%
UK	81%	33%	16%	10%
US	44%	10%	11%	9%

Canadians are Spending More Time and Doing More Online

Not only are more Canadians using the Internet than eight years ago, each person is spending significantly more time, on average, connected to the Internet and is doing more while online. Looking only at the Web component of Internet use, in December of 2000, the average user spent 25 minutes per day on the Web, and visited 18 pages. Seven years later, the average user spent 84 minutes per day on the Web and visited 137 pages.¹³ The following chart compares changes in Canadians' Web surfing behaviour between December 2000 and December 2007.

Comparison of changes in Canadians' Web surfing behaviour between December 2000 and December 2007

Total Unique Visitors (000)
December–2000	December–2007	% Change
12,723	23,784	87 %
Total Minutes (MM)
December–2000	December–2007	% Change
9,586	60,071	527 %
Total Pages Viewed (MM)
December–2000	December–2007	% Change
7,043	97,575	1285 %

Source: comScore Canada

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⁹ Miniwatts Marketing Group, 2008.

¹⁰ http://www.bdaconnect.com/WebUI/pressInfo.aspx?id=200704260844565402&idIndex=813&child=1]

¹¹ Cisco Systems Inc., Global IP Traffic Forecast and Methodology 2006-2011

¹² Based on Cisco report that 3.7 exabytes of data were transferred monthly over the global Internet, and figures from internetworldstats.com that indicate that Canadians account for 2% of the users in the world. While download speeds in some countries (such as Japan) are much higher than in Canada, in many developing countries with larger numbers of users average download speeds are lower. For the purpose of this calculation, the researchers assume data use by Canadians is average on a world scale.

¹³ ComScore Canada