Last week, the Canadian Radio-Television Telecommunications Commission (CRTC) kicked off a series of public hearings as part of a proceeding to examine its existing framework for wholesale high-speed access (HSA), inviting interventions from large telcos, and smaller competitors, as well as advocacy groups.
The proceeding, launched last year, saw a series of developments, including an interim mandate last November forcing large cable and telephone companies in Ontario and Quebec – Bell and Telus – to share their fibre-to-the-home (FTTH) networks with competitors in order to increase competition.
The Commission deemed that competition had decreased the most in these two provinces, but suggested that this mandate could be expanded to other provinces and be made permanent.
Bell, as a result, rolled back a number of investments and blamed the CRTC for major headcount cuts, Robert Malcolmson, executive vice‑president and chief legal and regulatory officer at Bell Canada, affirmed during the hearing.
“The Commission’s view that there would be – and I quote: ‘minimal risk’ regarding investments in fibre by accelerating wholesale FTTP (fibre-to-the-premises) was dead wrong. The question in this final phase of the proceeding is whether the Commission will double down, or pause and consider how investment incentives can be restored while maintaining the vigorous price competition that is so clearly occurring in the marketplace.”
The company also proposed a number of conditions if the CRTC were to mandate wholesale internet access, including only mandating speeds of up to 1.5Gbps and that fibre-to-the-premises (FTTP) access would only apply to a location five years after the network was deployed there. These measures, Bell argued, would help reduce the negative impact on investment.
Telus also claimed that if the CRTC imposes a wholesale mandate, it should be narrowly tailored, for instance, to exempt rural and remote areas as well as high-cost buried fibre. A wholesale mandate, it added, should not be available to cable companies to access in their own serving territories, as this will result over time in the consolidation of a single physical network, creating vulnerabilities during natural disasters, technical failures and more.
Rogers, additionally, warned the CRTC to not distort competition and undermine investment with “excessive wholesale mandates.”
“The best way to ensure affordable, high‑quality services for Canadian consumers and businesses, and sustain the digital infrastructure that Canada needs to remain competitive with its global peers is through minimally intrusive regulation and compensatory rates,” noted Dean Shaikh, senior vice president, regulatory affairs, Rogers.
Smaller competitors like Xplore, on the other hand, deploring decreased competition, backed the CRTC’s wholesale rules.
“A competitive telecommunications ecosystem in rural Canada needs facilities‑based providers with scale, to offer meaningful and sustainable alternatives,” said Cindy Wallace, regulatory counsel, Xplore. “ The wholesale fibre framework can and should encourage this outcome.”
Others like Eastlink, Cogeco, and Beanfield have asked that Rogers, Bell, and Telus be excluded from accessing the wholesale access regime, the risk being that the mandate be inadvertently flipped on its head and that the Big Three use their dominance, along with flanker brands, acquired wholesale providers, and bundling strategies, to squeeze out regional carriers and independent ISPs.
Finally, advocacy groups like the Competition Bureau and the Public Interest Advocacy Centre (PIAC), intervened, lambasting the large telcos and supporting the CRTC’s wholesale access rules.
“The Commission has a mandate to achieve the telecommunications policy objectives and not to return monopoly rent to incumbents,” said John Lawford, executive director and general counsel, PIAC. “The incumbents are bullying the Commission into using their overheated definition of investment as a trump card that always wins, and they just must be told no.”
The public hearings concluded Friday, and the CRTC reminded intervenors that the deadline to submit the requested additional information is Mar. 1, 2023.
