CRTC must take the lead in promoting telecom competition, Rock states

Industry minister Allan Rock spoke to the Canadian Wireless Telecommunications Association Awards dinner in Ottawa on March 26. It was at that ceremony that he announced the dismissal of AT&T Canada’s appeal of the price cap decision (NL Update, Mar. 31/03). An edited version of his speech appears here. These are interesting times for the telecommunications sector. Over the past few years, it has become clear that the Canadian telecommunications landscape, formerly dominated by regional wireline monopolies, is more than ever witnessing new competition in new forms and involving non-traditional players. We know that it’s impossible to predict what or who will be the greatest source of competition in the future: new players, new technology, or both? But we also know that in order for us to prepare to compete in the future, we must modernize our regulations and our policies to promote competition today. A dynamic, a healthy and an innovative teleAcommunications industry requires keen competition. Here as elsewhere, competition stirs innovation, encourages risktaking and expands opportunity. The government of Canada is committed to real and genuine competition in the telecommunications sector. For more than a decade, we have steadily moved away from a monopoly model toward greater competition. We’ve taken this path because we believe competition through stimulating investments in facilities and services is the best means of protecting the public interest. Simply put, competition means better service, more choice and lower prices for Canadians. The experience of the past decade bears this logic out. Today, our telecommunications services are world class. In terms of access and affordability, our services rate very favourably to other industrialized nations. We owe universal access to decades of sound regulation and investment, but we owe our lower prices in large part to competition. Certainly the reduction in the cost of long-distance phone calls won’t be lost on anyone. Before the introduction of competition, it was not uncommon for Canadians to pay a dollar a minute for long-distance calls. Today, the typical long-distance call costs less than 10 cents a minute. For all of these reasons, it’s clear that the government, as custodian of the public interest, has a big stake in ensuring that the competitive environment remains strong and that investment remains high. In this regard, I must tell you that recent trends in the competitive environment are not encouraging. Recent CRTC analysis shows that competition is dropping off in the long-distance market. In the local market, it’s virtually non-existent. Meanwhile, new intrants are struggling. Twelve companies have disappeared in the past several years. Those competitors left standing have to go to extraordinary lengths to stay alive. These facts lead to a simple conclusion: Canada’s competitive telecommunications environment is not what it could be, and certainly from where we stand, not what it should be. In upholding the decision, the government hopes and expects that the CRTC will continue to show its commitment to maintaining pro-competition momentum. We hope that the Commission will look at some specific areas where difficulties have been encountered. And I’ll mention just two by way of example: the issue of regulatory lag, where a competitor might present a concern with respect to pricing and have to wait an extended period until the end of the proceeding for disposition. We hope that the CRTC will consider appropriate cases, resorting to interim dispositions to provide relief for the competitor from what could be an extended period of waiting before the regulatory process is completed. In terms of a second item, local competition is virtually non-existent in all but our largest cities. We would like to see the CRTC consider what additional measures it can take to promote competition beyond those major urban centres, so that all Canadians can enjoy the benefits of healthy competition. In the final analysis, accessible, affordable, high-quality telecommunications services are essential in an open society and in a knowledge-based economy. Rest assured that, in the months and years ahead, the Government of Canada will closely monitor the evolution of competition to ensure that it does not deteriorate. Such monitoring is crucial in order to protect the public interest.

CRTC must take the lead in promoting telecom competition, Rock states

News | April 7, 2003

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