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Canada's information and communications technology (ICT) industries-including telecommunications services, cable and computer services-tend to be among our most innovative. Convergence of these technologies is producing hybrid products that were in science fiction novels only a few years ago. Even traditional communications industries, such as radio and television, are transforming to meet the demands of a connected nation.

By 2003, more than 64% of Canadian households regularly used the Internet from any location, such as home, work, school or a public library. This represents a 5% increase from the previous year and more than double the level in 1997. Canada also has one of the highest rates of broadband Internet use worldwide.

Of those surfing from home in 2003, 65% had a high-speed connection, up from 56% a year earlier. An estimated 3.2 million Canadian households shopped online, generating $3 billion in orders. People with higher levels of education, employment and income are more likely to be connected to the Internet.

Business Internet use continues to grow

Chart: Internet use from home, by region, 2003In business, firms in service industries are more likely to adopt e-commerce and information and communications technologies (ICTs) than those in primary or secondary industries. Though public sector firms continue to use ICTs the most, there has been an overall rise in personal computer, Internet and e-mail use in private sector businesses as well. From 2000 to 2004, the proportion of private firms using e-mail grew from 60% to 77%, and those using the Internet widened from 63% to 82%.

Our corporate web presence is also growing: 79% of large companies and 32% of small businesses had their own websites. By 2004, 72% of Canadian firms had adopted broadband Internet access as well, accounting for about 97% of the value of online sales in Canada.  

Virtually all Canadian elementary and secondary schools had computers and were connected to the Internet during the 2003/2004 school year. More than one million computers were available to students and teachers, and 90% were connected to the Internet. There were about five students to every school computer, and 5.5 students for each computer connected to the Internet.

One of the biggest concerns of school administrators is the aging of this computer equipment, as well as the ongoing maintenance costs as computing systems become increasingly sophisticated.

ICT's effect on society

Chart: ICT use by enterprisesThere is little doubt that information and communications technologies are important tools for many Canadians. Vast amounts of information are stored only a few clicks away, transmission of information is quick and regardless of distance, families and friends can communicate almost instantly at minimal cost.

Some Internet users have found, however, that they spend less time socializing with friends and family. In 2000, 14% of users spent more than 15 hours per week online. Although they were much more likely to reduce time spent sleeping (27%) and television viewing time (53%) to find the necessary hours to surf the Internet, a significant proportion stated that they cut down on visiting or talking with family (14%) and friends (13%).

Nevertheless, it seems that Internet users are not distancing themselves from society, but that they are plugged in differently from non-users. Our sense of community may be increasingly based on shared interests, rather than geographic proximity. In 2000, more than 3% of users devoted more time to visiting or talking with family and almost 5% spent more time with friends because they now had an Internet connection. In 1998, Internet users also reported about 72 more minutes of contact with people outside the household than previously reported, suggesting that Internet users may talk less face to face with their families but chat more online with other people.

By 2003, 4 out of 10 Canadians aged 16 to 25 used computers at home for an average of at least one hour per day. Computer use declined with age, with a particularly sharp drop after age 55. Like the United States, Canada has a relatively high proportion of heavy computer users compared with many other countries.

Only 3 out of 10 people in Canada who had not used computers stated they were interested in starting to use one in the following year. This has significant consequences, because people with the lowest skills, who potentially stand to benefit most from the opportunities created by new technologies, are not using them. This is particularly the case with the Internet, where potential benefits include access to health and government services, employment information, shopping and other services.

An influential ICT sector

Chart: Gross domestic product for the information and communications technologies (ICT) sectorIn 2004, the ICT sector contributed $58.1 billion to Canada's gross domestic product (GDP), accounting for nearly 6% of total GDP. This was a substantial increase from the previous year, when the sector's contribution to GDP stood at $55.7 billion. From 2000 to 2004, ICT sector GDP grew by a modest 5.3%, with much of this growth occurring in the last year.

During the same period, research and development (R&D) investment by the ICT sector totalled nearly $29 billion. Although annual R&D expenditures dropped in 2002 and 2004, investment in R&D by the ICT sector accounted for more than one-third of total private sector R&D expenditures in 2004.

The ICT sector was a major source of new jobs from1997 to 2000. At its peak, ICT sector employment accounted for 4.2% of economy-wide employment. The sector suffered a major setback in 2001, as a saturated communications and telecom equipment manufacturing market could no longer be sustained. This led to increased layoffs and a shrinking ICT sector work force. Employment in the ICT sector began to expand again in 2004 and 2005, particularly in the ICT services of computer systems design and telecommunications.