Bell VoIP pricing petition bigger than request for differential provincial pricing

Canadian telecommunications competitors are expectedly divided in their opinions of whether incumbent local exchange carrier, Bell Canada, should be able to price its Voice over Internet Protocol services differently in Ontario and Quebec. This division helps illustrate the potential complexity of the decision for the CRTC, and furthers the argument that most of the competitors agreed on: the current expedited process being pursued by the Commission is not a sufficient way to handle a decision of this magnitude. Following outcry from competitors to have a full proceeding on the matter and not an expedited process as contemplated by the commission, the CRTC extended the comment period by two weeks. Initial comments are now due September 28 with Bell having an opportunity to submit replies by September 30. "The abbreviated scope and procedural time frames do not give the parties sufficient opportunity to comment meaningfully on the myriad of issues raised by Bell’s filings in respect of the Bell Digital Voice service and the Bell Digital Voice Lite service," writes MTS Allstream Inc. in its comments to the CRTC. In its application calling for different price ranges between Ontario and Quebec for its VoIP services, Bell noted that its competition, primarily cablecos, will price their services differently between the two provinces and that other ILECs currently price services with respect to provincial boundaries. Bell submitted that "offering only one price across all of these cable company serving territories places Bell Canada’s access dependent VoIP service at a significant disadvantage." The strongest support of Bell’s application came from TELUS Communications Inc., another ILEC, who supported many of Bell’s original contentions. TELUS supports the application for pricing flexibility "because Bell’s current competitors (the large cablecos) already have such flexibility, and because to do so would be consistent with the provincial-based rating governing other ILECs." The company adds that approving Bell’s request "will extend the benefits of competition to consumers and uphold the Commission’s policy of allowing for increased reliance on market forces." Not all of the competitors agree that the approval of the Bell proposal would be in keeping with the aim of the commission. "The prohibition against rate de-averaging within a band is expressly aimed at preventing targeted pricing," comments Quebecor. "It would constitute a major policy change to permit rate de-averaging for Bell Digital Voice, especially given that the sole purpose identified by Bell for such rate de-averaging would be to permit it to engage in targeted pricing." Cogeco Cable Inc. presents another argument against the Bell application, urging the commission to ensure Bell couldn’t price its Internet telephony service so low as to keep competitors out of the local market. The cableco adds there is sufficient flexibility within the current regulatory framework to allow Bell to meet the local competition from emerging VoIP service providers. However, the company wasn’t wholly against the proposal. "Cogeco acknowledges that all other ILECs are currently able to offer telecommunications services at rates which reflect provincial boundaries and, consequently, does not object that similar treatment is allowed to Bell on an interim basis with respect to the provision of ‘a VoIP service’." Indeed, in light of how many ways the Bell application could be dealt with, Cogeco recommends that any decision departing from the CRTC’s "prohibition against de-averaging within a band, should only be examined in the context of a specific proceeding, following a suitable Public Notice to that effect." This stance was taken by most of the commenting competitors, none more so than MTS Allstream. In fact, the submission by MTS dealt exclusively with treatment of the application by the commission, and did not comment in support of or against Bell’s requests. "The outcome of the already approved (albeit interim) tariff applications regarding the Bell Digital Voice service have been to provide Bell with the ability to side-step a number of competitive safeguards that are applicable to local voice service," says MTS regarding how the application has been treated so far. MTS, along with Quebecor, Cogeco and Primus Telecommunications Canada Inc., called for the CRTC to cancel the expedited process currently being used to deal with the application, and to let all interested parties contribute comprehensive comments that would help the commission arrive at its decision. Beyond that, Quebecor suggests a solution to be used until a formal decision is reached: "There would be no harm to Bell if the Commission were to approve uniform rates in Ontario and Quebec, consider the issue of rate de-averaging on a more reasonable procedural basis and then make a decision to either permit or prohibit rate de-averaging. Bell would be able introduce its services at reasonable, presumably competitive rates, and would only have to wait to see if it could also introduce targeted price reductions. This approach would surely be preferable, from a procedural and public policy perspective, than the current expedited approach."

Bell VoIP pricing petition bigger than request for differential provincial pricing

News | 09/29/2005 4:00 am EDT

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