Bell Canada is yet again under fire from smaller competitors with accusations of unfair business practices.
Dave Jarrett, vice-president of regulatory affairs and carrier relations for Optel Communications Corp. in Toronto, alleged Bell has been signing up small business customers to Bell’s Local Link service without their knowledge.
The one- to 15-line Centrex service was offered either on a monthly basis or, for a one-year contract, customers could save $2 per month on the lines. An automatic renewal feature extends the contract unless the customer informs Bell they wish to terminate, according to Jarrett.
“Bell’s proposal (to the CRTC) was that to keep prices low, they wouldn’t require customers to do a formal contract to get on the one year period. They would make the agreement (verbally) and then send them some kind of a package confirming that they were on a contract. We objected to the whole process, as did quite a few other of Bell’s competitors, saying that it smacks of negative optioning,” said Jarrett.
The CRTC approved Bell’s tariff process for Local Link in early 1999.
As Optel tried to win customers during the year, it found that some Local Link customers were on year-long contracts with Bell without being aware of it.
“As part of the process of switching them we request their equipment record from Bell… We get the equipment record and lo and behold it shows this customer is under contract. So we call them back and tell them if they switch to us it will cost them a big penalty with Bell because they’re on a contract… and customers by the hundreds are saying, ‘You’ve got to be kidding. I never signed a contract, I never agreed to a contract. This is all news to me,'” Jarrett explained.
Optel created a form letter for customers to sign and send back to Optel, which the CLEC then turned over to the CRTC in a formal complaint. The letter stated that the customer had not agreed to the Bell contract they now appeared to be on. At the original filing, Optel had 68 such customer letters, and has since submitted over 80 more.
Bell has responded to Optel’s CRTC complaint with the explanation that the company was not doing anything that wasn’t outlined in the CRTC-approved tariff for Local Link.
“We clearly indicated that we would not be filing a contract for customers. There were two options: they can pay the monthly rate just as you do for regular phone service, or there would be a 12-month contract option which had a lower rate, and that would be explained to customers obviously at the time of a contract with them and we would provide the terms and conditions upon the customer’s subscription to the service” by mail, explained Larry Cavan, directory of regulatory matters for Bell Canada in Hull, Que.
“The Commission approved the filing in that matter, and that’s how we’ve been conducting our business.”
Cavan said when Bell looked at some of the particular customers Optel indicated as not knowing they were on contract, they were able to find the specific contact person at the customer company who had in fact ordered the service. Furthermore, he said the monthly bill would have clearly stated that the customer was on a year-long contract.
“Maybe the issue is that in some of these organizations, people that are empowered to handle phone service and who normally deal with Bell are making these decisions without fully informing the other people in the organization. That’s just speculation,” said Cavan.
“We don’t just go around switching customers without their approval. Anybody who is on the one year plan is on it because they ordered it from us, and they were made aware what the options were.”
Optel’s Jarrett said his company has been dissatisfied with Bell’s response. “In effect, they called our 68 customers liars,” he said.
Neither side could speculate on when or how the CRTC might rule.
Norigen Communications Inc. has also filed a complaint with the CRTC, although its matter is more a point of clarification on a previous ruling than an accusation of aggression.
“We would agree with Optel on the premise that Bell is getting aggressive with putting people on contracts and they’re using other means of locking customers up, but that has nothing to do with our particular issue,” said Charles Farrugia, senior vice-president of marketing for Norigen in Toronto.
Norigen’s complaint concerns new buildings where building owners have not yet assumed responsibility for the internal wiring and Norigen wants to set up its equipment in the basement to allow fast connections to potential new customers.
The issue of wiring was already dealt with in a previous CRTC ruling, but Norigen believes “the commission missed one situation where the building owner had not taken over the wiring yet, and the building owner was not allowing us to put our box in… and our only option was to use the Bell wiring,” Farrugia said
But Bell will not allow Norigen to use its wiring, insisting that CLECs deal with building owners.
“The Commission and Bell were under the assumption that all building owners would take over the wiring and it wouldn’t take that long to happen. What we’re seeing in Canada is that’s not happening as fast as everyone would like,” said Farrugia.
“We’re not asking for anything that hasn’t already been agreed to. We’re just saying if the wiring hasn’t been taken over, Bell has to do it.”