CRTC ramps up probe on roaming rates

The Canadian Radio-television and Telecommunications Commission (CRTC) has launched a deeper investigation on wholesale wireless roaming rates in the country with the goal of determining in the country’s big three wireless carriers are charging excessive rates to smaller providers for use of their networks.

Based on information obtained by the CRTC, some of the large providers are charging or proposing to charge, their smaller Canadian competitors significantly higher wholesale roaming rates than those charged to U.S.-based wireless companies, a statement from the telecom regulator said. Higher wholesale rates can impact the retail rates that smaller companies charge their customers.

“We are concerned that some wireless companies may be making it unfairly difficult for Canadian providers that do not operate a national network to compete in the marketplace,” said Jean-Pierre Blais, CRTC chairman.

Large wireless companies like Rogers Communications, Bell Canada and Telus Corp. provide services to their customers on their own networks within specific geographic areas. Smaller wireless providers, like Wind Mobile, Mobilicity and Videotron must rely on the networks of other companies when their customers travel outside their network coverage area. This is commonly referred to as roaming. These arrangements enable Canadians to continue using their wireless devices to make calls, send text messages and use data when travelling.

Blais also said if the CRTC finds that larger carriers are levying higher fees and restrictive terms and conditions on their smaller competitors in order for them to be able to use the networks of the incumbent providers, the CRTC will “act to rectify the situation.”

This is the strongest statement yet from the CRTC on the contentious issue of roaming rates since the Progressive Conservative government promised to reduce roaming rates during its Throne Speech where it highlighted that Canadians pay some of the highest wireless rates in the developed world.

The government said it will take steps to cut the cost mobile subscribers pay for roaming on networks within Canada. While this could mean savings for mobile users making with a Bell phone who roams on a Rogers network within the country or a Wind Mobile phone who roams on a Telus network, it still exposes users to hefty roaming bill for roaming outside Canada.

One Toronto-based wireless operator said wireless providers, Bell, Telus and Rogers have advanced wireless networks but they are not willing to resell their services wholesale to small operators.

This lack of unlimited high-speed broadband at a reasonable price is blocking innovation and is responsible for the slow adoption of gigabit Internet access in Canada, said Elliot Noss, chief executive officer of internet service provider and telecommunications company Tucows Inc. of Toronto.

Tucows owns the mobile virtual network operator (MVNO) Ting which is successful in the U.S. market but does not operate in Canada because of this situation. MVNOs do not own spectrum or network infrastructure, instead they purchase network access at wholesale prices from existing operators and resell it to customer at retail prices.

Earlier this year, the CRTC began a fact-finding exercise regarding the rates, terms and conditions associated with wholesale wireless roaming arrangements in Canada.

In August 2013, the CRTC asked wireless service providers to provide information, such as their roaming arrangements with other Canadian and U.S.-based wireless companies. In October 2013, the CRTC created a Wireless Task Force to further analyze this data.

The CRTC is seeking comments and possible solutions to the roaming issue should it find that large wireless service providers are placing their smaller competitors at an unfair disadvantage. The CRTC said the comments must be submitted by January 29, 2014.

In early 2014, the CRTC will launch a second proceeding to further examine the state of the mobile wireless services market, the sustainability of competition in the Canadian wireless market, and what regulatory measures may be required if the CRTC were to find the market is not sufficiently competitive.



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Nestor E. Arellano
Nestor E. Arellano
Toronto-based journalist specializing in technology and business news. Blogs and tweets on the latest tech trends and gadgets.

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