Canadian telecom regulator begins review of fixed-line services

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Canada’s federal telecommunications regulator initiated the final policy review late last month as it attempts to implement a balance to allow consumers to gain access to new Internet and wireless services at an affordable rate while also abiding by federal regulations.

The purpose of holding the hearing was to determine if the major cable and telephone corporations should be mandated to share “last mile” wiring. This type of wiring, which is widespread due to enhanced fiber-optic connections, gives consumers higher volumes of streaming online video and making video calls over the Internet. It also delivers services to the doors of customers who happen to subscribe to smaller rivals.

Jean-Pierre Blais, chair of the Canadian Radio-television and Telecommunications Commission (CRTC), said that he wants consumers to have greater choice in telecom competition. The hearing was also meant to conclude if smaller players should have improved access to these lines to help boost competition.

“We will consider the current state of deployment of fiber-optic facilities, the economic and social impacts of this technology and the required network investments,” Blais said in a statement. “This will help us decide, for instance, whether independent Internet service providers should have mandated access to these facilities.”

The major companies – Rogers, Bell Canada, Telus, Shaw and Quebecor – have argued that they should be permitted to have full control over these high-speed fiber-optic lines in order to recoup their investments in these networks that are quite expensive to construct. If these corporations fail to regain these costs then it could prompt them to refrain from investing across the country, said one Bell Canada Enterprises (BCE) executive.

“We are not suggesting that mandated access will immediately grind investment to a halt in every location in Canada, but it is a question of balance and it will have an impact,” argued Mirko Bibic, chief legal and regulatory officer for BCE. “What we’re saying is a mandated access rule will affect the pace of deployment and the breadth of deployment.

Currently, there are approximately 500 smaller Internet service providers (ISPs) in Canada, but the five aforementioned names control between 75 and 90 percent of revenues generated from residential customers nationwide.

In his opening remarks, Blais noted that the hearing will further cover the proposal of deregulating the wholesale telecom services, which has gained favor among many of the parties involved. One idea has been to eliminate the copper network and transition entirely to fiber-optic networks that could diminish costs for telecom firms.

The CRTC has held two other hearings this year: one to examine wholesale roaming rates for mobile devices, and the other to find out how television channels should be bundled on cable and satellite services.

What’s transpiring in the Great White North is quite similar to what is being discussed in the U.S. by the Federal Communications Commission (FCC). As per the request of President Barack Obama and his net neutrality scheme, the FCC is considering regulating ISPs akin to telephone companies.

The Obama administration argued that doing so would produce a level playing field and incite heightened competition in markets dominated by one single provider. Critics note, however, it could stifle innovation and establish a bureaucracy on the Internet that would hurt the customer in terms of costs and services.

Photo of CRTC chief Jean-Pierre Blais via Radio Canada

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Andrew Moran

Andrew Moran is a full-time professional writer and journalist, who covers the areas of business, economics and personal finance. He has contributed to Benzinga, Capital Liberty News, Career Addict, Money Morning and PFHub.
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