A battle between incumbent telcos and two resellers is brewing over newly established rules pertaining to local calling areas (LCA) that allow the ILECs to recoup revenue from lost long distance revenue. The two resellers say they should be afforded the same benefits as incumbents, but the ILECs charge these smaller players are only trying to get a piece of the pie. West Coast Teltech Ltd. and A&A Call Link Telesolutions Ltd. filed a review and vary (R&V) application late last month seeking to overturn two CRTC rulings regarding the LCA framework (NL Update, July 7/03). They argue that the commission’s plan for reimbursing lost revenue should include companies that provide flat-rate regional calling services (also called "single hop resale" services). Both West Coast and A&A fall into that category. The CRTC originally set a new framework for LCAs in Telecom Decision 2002-56 (NL, Sept. 23/02). The move was necessitated by the amalgamation of suburbs into larger communities in several parts of the country. A few months later, a three-year term for foregone toll revenue by carriers was established in Telecom Decision 2003-27 (NL, May 20/03). But the telcos point out that resellers claimed for years that they were not providing toll service. The change of opinion coincided conveniently with economic advantage, one ILEC alleges. "The applicants cannot have it both ways - having their services classified as local services when that was in their financial interest, and now asking that their services be considered a toll service because this is now to their benefit," Willie Grieve, VP public policy & regulatory affairs for Telus Corp., writes. One of the catalysts for the LCA decision was the need for the City of Ottawa to expand its calling area following amalgamation. The city, which is nearing an agreement with Bell Canada over foregone revenues, wants the R&V dismissed. "The applicants equate a loss of revenues derived from services that may be seen as substitutes for toll services in particular situations with ‘foregone toll revenues’ as that phrase is used in the impugned decisions," Anthony Keenleyside of McCarthy Tétrault, acting on behalf of the city, responds to the CRTC. "Ottawa submits that it was never the intention of the commission to render such an open-ended decision." But another reseller, this one located in the national capital, questions whose side the city is on. Distributel Communications Ltd. did not participate in the proceedings that led to Decision 2003-27 because it believed the matter of compensation for single hop resellers was outside the purview of the process. "Why would Ottawa say that Bell Canada and other large players should get compensated for their lost revenues, but that smaller players like Distributel, H.M. Net and Selectcom should just suffer their losses?" Distributel president Mel Cohen writes in a July 17 submission . "Distributel’s main Ontario office is in Ottawa. Is this really the desire of our local politicians?" Another intervention comes from a group in rural British Columbia. The Tatlayoko Think Tank Ltd. took part in earlier proceedings. It is not happy with the final verdict. "The TTT Ltd. et. al. submits that the process for creating expanded LCAs under the new framework removes a cost from the telcos and offloads it onto local government," director John Kerr writes. "Many in BC preceive a disregard by the federal government and its agencies for the needs of rural/remote areas in Western Canada. Unfortunately the federal government’s offloading costs onto local government is just the sort of action which gives credibility to the spectre of increased Western alienation." West Coast and A&A were scheduled to file reply comments by late last week.