Industry Minister Maxime Bernier went a long way towardsclearing up a murky picture when he told the audience at The 2006Canadian Telecom Summit last month that the CanadianRadio-television and Telecommunications Commission (CRTC) shouldregulate the telecom market only when absolutely necessary. WhileBernier’s message was welcome, the challenge now will be for thegovernment to follow through on its plans.
Until Bernier’s speech there had been questions surrounding howmuch regulation the CRTC would enforce.
In March, a government-appointed Telecommunications PolicyReview Panel recommended the Telecommunications Act be changed to”promote reliance on market forces to the maximum extentpossible.”
But in April the CRTC issued a decision stating that fullderegulation in specific markets could only occur once competitorshad won 25 per cent market share.
It looks now like the government will follow the review panel’srecommendations, which should be good news for Canadian businesses.CRTC regulations are currently forcing incumbent carriers to chargemore for some services than the carriers would like to charge. Theregulations also slow the deployment of services by forcing theincumbent carriers to go through the often lengthy CRTC approvalprocess.
The only good thing that can be said for regulation is that ithas allowed competitive providers to get into the market and offeralternatives to the incumbent carriers. Cable companies likeRogers, Shaw and Videotron have made solid headway in the consumermarket and can use their consumer revenues to help drive the launchof business services. Regulation made sense while these competitivecarriers were getting their telecom businesses off the ground, butnow with at least some of the competitors are well established,it’s time to back off.
Hopefully the government will follow through on its telecompolicy statements quickly and reshape the CRTC’s regulatoryframework before the CRTC completely stifles innovation in theCanadian telecom market.