CRTC snubs incumbents with new regulations

In an attempt to level the telecommunications landscape, the federal government changed the rules governing Canada’s phone companies.

The Canadian Radio-television Telecommunications Commission (CRTC) on May 30 announced new regulations in the name of greater competition – read: more choice of telephone service providers for enterprises.

“The new pricing rules for local phone service rates will balance more fairly the interests of the main stakeholders – customers…competitors, and incumbent telephone companies,” said David Colville, CRTC vice-chair, telecommunications in a May 30 statement.

The CRTC gave competitive local exchange carriers (CLECs) such as AT&T Canada a bit of a break. CLECs have long complained that they pay too much money to access the networks owned by incumbent local exchange carriers (ILECs) such as Bell Canada and Telus Corp., and the CRTC seems to have agreed.

“The Commission has reduced the rates the incumbent telephone companies charge their competitors for certain services,” the CRTC said, adding that ILECs would have to adhere to a carrier-class service level agreement with the CLECs.

Some of the CRTC’s decisions might make certain Canadian phone companies bristle. For example, the incumbents cannot raise their prices for residential phone service, the CRTC said. Bell et al. had asked to be allowed to charge more in the residential space to offset infrastructure improvement costs.

Bell and Telus also cannot raise rates for payphone service. “These rates will be frozen until the Commission holds a policy proceeding to look at the issues related to payphone service in Canada,” the CRTC said.

Business customers might see an increase in the price of local telephone service, although the CRTC said any increase would match the rate of inflation.

But the CRTC also said it “reduced the regulatory burden by eliminating a number of reporting requirements” for the ILECS. The Commission also has “given them more pricing flexibility where sufficient competition exists, and provided appropriate compensation for Commission-imposed revenue reductions from services used by competitors.

For more information on the CRTC’s decision, see the Commission’s Web site,