CRTC finds proposed wholesale high-speed access rates unreasonable
October 6, 2016 – Ottawa-Gatineau – Canadian Radio-television and Telecommunications Commission
The Canadian Radio-television and Telecommunications Commission (CRTC) is setting revised interim rates for the existing wholesale high-speed access services that the large cable and telephone companies charge competitors.
The CRTC had directed the large companies to file new tariffs for these aggregated wholesale high-speed access services after it launched a proceeding to examine issues associated with these rates. The CRTC was not expecting deviation from the established costing principles and methodologies in the context of the current proceeding.
After analyzing the tariff applications, the CRTC is of the view that the rates proposed by certain of the large companies were not just and reasonable and had to be revised downwards. The CRTC is very concerned that certain large companies have not conducted their cost studies in accordance with well-established costing principles and methodologies.
In light of this finding, the CRTC is setting revised interim rates that better reflect costs that are just and reasonable.
- To foster competition in the broadband Internet market, large companies must grant competitors access to their networks at rates, terms and conditions that are set by the CRTC.
- Wholesale high-speed access services are used by competitors to provide Internet services, as well as television and telephone services, to Canadians.
- In 2016, the CRTC held informational costing sessions for the industry to reinforce their knowledge of the established costing principles and methodologies that are generally used in cost studies.
- The CRTC has set revised interim rates for the large companies for wholesale high-speed access services as the rates they had proposed were not just and reasonable.
- The CRTC has reduced the proposed transport component rate for a number of companies by up to 89%. Additionally, proposed access component rates of certain companies were reduced by up to 39%.
- The large companies who had submitted rates are Bell Canada, Cogeco, MTS, Rogers Communications, SaskTel, Shaw, TELUS and Vidéotron.
- The CRTC will continue its in-depth analysis of the various Tariff Notices in order to set final rates.
- The CRTC intends to issue requests for information as a next step in the process. All parties will have the opportunity to comment on the Tariff Notices in order to assist in ensuring that the final rates are just and reasonable.
“Competitors that provide retail Internet services to Canadians using wholesale high-speed services must have access to these services at just and reasonable prices. The fact that these large companies did not respect accepted costing principles and methodologies is very disturbing. What’s even more concerning is the fact that Canadians’ access to a choice of broadband Internet services would have been at stake had we not revised these rates. As always, we strive to create a dynamic competitive telecommunications market for Canadians.”
- Jean-Pierre Blais, CRTC Chairman and CEO
- Telecom Order CRTC 2016-396 - Tariff notice applications concerning aggregated wholesale high speed access services - Revised interim rates
- Telecom Notice of Consultation CRTC 2015-225 - Review of costing inputs and application process for wholesale high-speed access services
- Telecom Decision CRTC 2016-117 - Review of costing inputs and the application process for wholesale high-speed access services
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