The opinions expressed in this editorial are those of the author and do not necessarily reflect those of Decima Reports. The current CRTC price cap hearings show quite clearly the delicate balance the commission must strike when deciding telephone rates (see story in this issue). As the proceedings began in Hull, a wave of provincial politicians paraded before the panel denouncing the ILECs’ request for a rate increase. Some even took the commission to task for holding hearings in one spot, rather than moving around to different regions of the country. At the same time, CLECs are lobbying for a facilities-based carrier rate, which they maintain would be more beneficial to their bottom line. ILECs, for their part, characterize such a tariff as a subsidy to the competitors and would prefer to see the current regime continue. Add to the mix the consumers groups seeking relief for low income Canadians and you have a situation that would addle Solomon. The commissioners must walk a fine line trying to satisfy all parties. Those least aware of the state of telephony have taken the major role in the hearings. The testimony of the politicians and the general public displayed a breathtaking lack of understanding. But a demagogic campaign against the regulator can only hurt the CRTC. At the proceedings, Bell used the analogy of the auto industry to defend itself. A century ago, dozens of companies were building cars. That has now narrowed to the big three North American firms and foreign competitors. The failures of Cannect and Norigen, the ILEC implied, should not mean that AT&T Canada and Call-Net cannot thrive. But even the CRTC’s recent report on competition shows how heavily deregulation has favoured the incumbents. The new entrants are struggling to make a toehold in the market. Note as well that the CLECs referred to in the study are all still operating. The defunct companies do not appear, thus skewing the final numbers. The uncertainty in the competitive market is a vital issue for the commission. The final decision will have to carefully balance the needs of all stakeholders in the Canadian telephone system.