CRTC Wants its $15 Million Stick Back

Commission would walk softly with ability to fine The CRTC’s telecom vice-chair wants a fining bill reintroduced into the House of Commons. Bill C-73 died on the order table when the previous Parliamentary session was prorogued last November. Making comments to a daily newspaper, Richard French said he’s hopeful the new Stephen Harper-led Conservative government will reintroduce the bill. Under the bill, the CRTC could levy fines of up to $15 million against carriers that violate telecom rules. Many have suggested in the past that part of the commission’s trouble dealing with telcos that break regulations has been its inability to levy fines. CCTA RIPAfter 50 years of serving broadcasting interests in the country and more recently defending the "new entrant" mantra of the cable operators into telephony, the Canadian Cable Telecommunications Association (CCTA) has shut its doors. The decision, announced on February 10, was made after deliberation among its remaining members. While known primarily as the common voice representing the broadcasting activities of the country’s cable companies at the CRTC, the CCTA’s most recent efforts in telecommunications certainly had an impact on the shape of the industry’s competitive landscape. Michael Hennessey, president and CEO of the CCTA, said in a recent interview that the transformation of cable companies into "media and communications conglomerates" played a major role in the dissolution of the association. "We’ve been telling people, we’re a regulatory lobby group, and increasingly we’re in a world where consumers have really become the regulators. So, it’s more an issue of differences in approaches in marketing and different emphases on different lines of business," he said. Many had predicted the demise of the association after Shaw Communications Inc. pulled out last year. Vidéotron ltée hasn’t been a member of the CCTA for a number of years. Others, however, are puzzled. The cable companies have plenty in common, especially concerning voice services. All of the big cablecos – Shaw, Rogers Communications Inc., Cogeco Inc. and Vidéotron – are fighting to ensure the local residential market remains competitive. Pundits will blame any number of things for the CCTA’s demise, but as Hennessey said, "Convergence is changing the world." CRTC Decision Costs Vidéotron $13 MillionThe CRTC has ruled in Telecom Decision 2006-7 that Vidéotron ltée doesn’t have the right to receive compensation "for revenues lost as a result of the introduction of competitor digital network and competitor digital network access (CDNA) services." The Quebec-based cable company and wholesale network access provider filed a Part VII application last July seeking financial compensation resulting from the implementation of the CDNA regime. It claimed in its application that since the incumbent telephone companies are allowed to draw down on their deferral account lost revenue resulting from mandated digital network access prices, other facilities-based wholesale providers should be afforded the same right. The commission disagreed. Dennis Béland, director of regulatory affairs for telecom with Quebecor Media, owner of Vidéotron, said the commission mandated the ILECs to radically reduce their wholesale DNA prices to competitors, and since "we provide a lot of services to these very same competitors that buy the services from the ILECs," it only stands to reason that Vidéotron should be allowed to do the same thing. The company estimated that if allowed to draw down on the deferral account as the ILECs do, it would receive a windfall of approximately $13.2 million over a three-year period. " hammered us and we were hopeful that the commission would at least recognize the inconsistency of that regime with facilities-based competition, but clearly they weren’t of that view," Béland says. Northwestel Under ReviewThe regulatory regime governing the country’s far north incumbent telephone company Northwestel is under CRTC review. Launched January 17, the review will look at a number of issues including price regulation and supplemental funding. The CRTC is expected to closely examine the company’s current rate-base/ rate-of-return regulatory treatment and whether this model should be replaced by a price-regulation approach. If a move to a price-based approach is adopted Northwestel would still be required to provide reliable and affordable services, but it would have a "reasonable opportunity to earn a fair return" as well, said Anne Kennedy, the carrier’s director of public affairs. The introduction of local competition will also be on the agenda.

CRTC Wants its $15 Million Stick Back

News | 03/01/2006 5:00 am EST

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