IT component of business telecom, an issue the CRTC is thinking about: French

Systems integrators are going to play an increasingly significant role in the business telecommunications competitive landscape because they can offer an integrated package of IT and communications services. The country’s largest incumbent telephone company has raised this issue with the CRTC in a September 2005 Part VII application requesting changes to the way Type 2 or mixed customer specific arrangements (CSAs) are treated. Network Letter recently asked the CRTC’s vice-chair of telecommunications Richard French about this and other issues. Network Letter: There has been a lot of talk about the significance of systems integrators in the business market, and you recently made comments at TeleManagement Live about the CRTC visiting the IT component of enterprise contracts. Richard French: Well I think it’s the reverse. The CRTC has got to ask itself what its role is in a $175 million contract the local service component of which is vanishlingly small. It’s the reciprocal inference that ought to be drawn, and by the way, there’s no determination on that. It’s just that when a supplier comes to you and says, "Listen, I’m competing with EDS, and Accenture and XYZ Company and I’m the only one that has to fuss and fume about the regulatory approval of my bundled services because I happen to have local services in it. It’s put me at a disadvantage." Frankly at that level it’s very hard to argue otherwise. So, the question is, is the cost of that disadvantage outweighed by the benefit of continuing to regulate that part of those contracts. As I say, the issue is not before the commission in a formal way, but it’s an issue that has been conveyed to the commission as one we’re going to have to think about. NL: In the CRTC’s monitoring report, it showed that competition in the business market is taking hold. RF: There’s progress but not as much as we’d like to see. NL: Judging by the numbers, the out-of-territory ILEC operations are taking a fair bit of market share. We used to think competition meant more competitors, but now it seems competition stems from expanded incumbents. Is that a concern for the commission? RF: You know where we are now, we’ll take it anywhere we can get it. I think our view would be that an alternative supplier, whatever his corporate antecedence or background, is an offer in the marketplace that some customers would like to avail themselves of. At the end of the day, principally that’s what we were about and I don’t think we’re in the business of saying that a customer that migrates to an out-of-territory ILEC is somehow a lesser public policy consideration than a customer who migrates to a reseller or to a CLEC or to whatever. NL: So can we no longer look forward to a greater number of competitors? Is that notion gone? RF: No. I think that’s very much a technological question that’s very interesting and provocative, and it’s part of the forbearance discussion as well. There are players out there that’ll tell you that facilities-based competition is not working and they, those players, are the only hope. There are those who say resale is silly and you’ve really got to concentrate on facilities. Then there are those who say, "Well, I want more than just coax and copper. Who else is going to come into my residence or in my business place?" I think all those things are up for discussion. And of course there’s the question, is wireless delivery going to turn out to be a third route to the premises or not? I think that’s a very interesting, important technological and commercial development and I don’t think we’re going to have an answer to it – based on the evidence so far – for another four or five years. NL: There are new technologies coming down the pipe that might be deployed in trials next year that blur the lines between networks: users will be able to roam from a wired network to a wireless network or from a wireline telco network to a cable plant, for example. Some of those networks are regulated and some aren’t. What kinds of issues does that situation pose for the commission, if any, in terms of regulating services? RF: Well I guess the issue is how we can tailor our regulation where its benefits outweigh its costs such that it’s technologically neutral and we don’t interfere with the rollout of new technologies that can be advantageous to users. That’s sort of my basic principle. NL: Technological neutrality: is it going to continue to be a main premise or main theme of the commission in the future? RF: Well, I have to be honest with you and say technological neutrality to a degree is in the eye of the observer. It means different things to different people. What it means to me is the commission’s regulations should not inhibit the rollout of new technology.

IT component of business telecom, an issue the CRTC is thinking about: French

News | 12/08/2005 5:00 am EST

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