Microcell and RipNET call for independent manager of deferral account money

Microcell Telecommunications Inc. and RipNET Ltd. are calling on Canada’s telecommunications regulator to create an independent body to manage and disperse money in the incumbent telcos’ deferral accounts. The two companies made the suggestion following the CRTC’s call for proposals on how the money - collected from Canadians on local telephone bills as a result of overpayments in the wake of the commission’s price cap ruling - could be put to better use (Telecom Public Notice 2004-1). Microcell suggests that the funds could be put into a "competitively neutral national subsidy program" to expand the deployment of broadband Internet access into unserved and under-served regions of the country. The wireless operator also writes that funding broadband deployments by the ILECs exclusively would fail the competitive neutrality test and therefore be unacceptable. Under its proposal, Microcell says that "eligibility must be open on a non-discriminatory basis to projects involving all types of Internet access providers employing all types of broadband technologies (terrestrial fibre, terrestrial wireless, digital subscriber line, satellite or other). Furthermore, decision making authority for selecting winning projects must be independent of any one access provider or class of providers." Microcell further says the "program" should be closely linked to Industry Canada’s Broadband for Rural and Northern Development (BRAND) and National Satellite Initiative (NSI) programs. "Specifically, the responsibility for drafting and submitting proposals should lie with ‘community champions’, acting independently to assess which access provider and which access technology best satisfy the broadband requirements of their particular communities. The responsibility for selecting winning proposals should also lie with an independent body. In fact, it may be desirable to solicit direct participation of the BRAND national selection committee for this purpose." RipNET, a Brockville ON-based ISP and recent 2300/3500 MHz spectrum auction winner (RoW Auction, Feb. 17/04), agrees with Microcell that the deferral account funds should be administered by an independent agency. It suggests the agency could "establish criteria for eligibility for deferral account monies; invite proposals from companies that would like to build the facilities needed to serve low-density rural and remote communities; and select the companies that would receive subsidies from the deferral account monies." It also suggests that with adjustments to the BRAND program or other provincial funding mechanisms, these programs could be the appropriate vehicles for the delivery of this program. "The commission’s objective should be to find an appropriate body to administer the deferral account monies that has the facilities and experience to maximize the amount of funding that actually goes towards the building of facilities and minimal amounts are needed for the administration of the program," the company writes. While Microcell believes the program should be open to all parties, RipNET believes it to be in the public interest to restrict eligibility for the money to non-incumbent telcos. "RipNET submits that to restrict access to deferral account monies to non-ILECs or aspiring CLECs would be in the public interest in that it would benefit the communities that would be provided with high-speed connectivity while at the same time promote the development of facilities-based competition in local telephony." The Brockville company, which has submitted an application with the CRTC to become a CLEC, has built a wireless network providing high-speed connectivity to residents of rural township Leeds Grenville. RipNET states that this would not have been possible without assistance from the Ontario government. "… even after the Ontario government had agreed to subsidize up to 43% of the cost of our project, it was extremely difficult for RipNET to convince lenders to provide the balance of the financing we required." For more on this issue, refer to the May 26 issue of Report on Wireless affiliate publication Network Letter.

Microcell and RipNET call for independent manager of deferral account money

News | June 1, 2004

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