No FTTP wholesale without CRTC action: PIAC

GATINEAU, Que. — Three consumer groups opened the second week of the CRTC hearing into wholesale wireline connections by telling the regulator to expand its wholesale access regulations to fibre-to-the-premises (FTTP) networks, while one of Canada’s biggest telecom companies demanded just the opposite. The Public Interest Advocacy Centre (PIAC) and the Consumers’ Association of Canada (CAC) cooperated on a submission and presentation, and they, along with OpenMedia, told the CRTC on Monday that wholesale access helps consumers, while Telus Corp. asked the regulator to remove these access rules once and for all. Ted Woodhead, Telus' senior vice-president of regulatory affairs, told the hearing that the CRTC should no longer compel companies to share their network facilities with third parties because they are not essential services and no one incumbent has dominance over the market. Instead of focusing on the competitiveness of the market for wholesale services, Woodhead said, the CRTC should instead be concerned with competition at the consumer level. “If the market is performing well, there is no principled or practical justification for intervention at the wholesale level,” he said. He pointed to the Competition Bureau’s analysis, which found no single company had “market power” in residential Internet access. Woodhead was echoing the comments of Rogers Communications Inc. and other infrastructure owners in the CRTC’s wholesale wireline hearing process that have asked the regulator to curtail its power over third-party Internet access (TPIA) on their networks. In its filing with the commission, Rogers suggested a move to end mandated wholesale Internet access. Rogers is scheduled to present on Tuesday. Woodhead, responding to question from CRTC commissioner Tom Pentefountas, said third-party providers would be welcome to keep using Telus’ connections in a world without mandated wholesale access; they would just have to pay for it. “They would have access to the same services that they have access to today,” he said. “One way or the other, either by commercial negotiation or whatever you leave tariff, we would reach commercial agreements with them.” The CRTC is considering the merit in opening up FTTP networks to third parties. Woodhead said in a world without wholesale regulation, it is unlikely his company would sell access to such networks unless it found a "compelling value proposition" for doing so. Jean-Francois Leger, a lawyer representing PIAC and the CAC, said Monday that it's clear the CRTC needs to act if it expects infrastructure owners to sell access to FTTP lines. “The incumbent carriers have made it perfectly clear in this proceeding that independent ISPs cannot expect wholesale access to FTTP or their highest speeds in the absence of a commission directive,” he said. On Friday, representatives from Manitoba Telecom Services Inc. suggested the CRTC could act as a “backstop” for certain disputes around access, even if the regulator relies on commercial negotiation to set rates. Woodhead rejected that idea, calling it a “red herring” because companies already have the right to apply to the CRTC based on issues such as undue preference. “Arbitration, people think it’s the panacea of all evils,” he said. “I’m not sure that it is. And I’m not sure that it necessarily uses your resources in the most efficient manner.” Woodhead said his company would be deterred from investing in FTTP by wholesale regulation, as companies such as Cogeco Cable Inc., BCE Inc. and Rogers have suggested in this CRTC review. Responding to a question about whether or not such investment was inevitable, Woodhead said that the higher speeds possible with fibre connections are not presently an issue for the company. “It’s categorically false that we have to do FTTP to compete with cable,” he said. “We compete with cable very well with a 50 profile, and in fact we are taking customers.” Cynthia Khoo, a community-engagement officer with OpenMedia, told the hearing that, contrary to assertions by Telus and others, mandating wholesale access on FTTP connections would actually provide an incentive to invest, as it would increase competition. “The incumbents all claim that they really want to deploy fibre,” she said. “Yet they’ve had free licence to do so since at least 2009, and FTTP today makes up only two per cent of broadband subscriptions in Canada.” She said the infrastructure owners have “ample incentives” to roll out fibre, and that any risk of deterring investment is a “calculated risk” that is worth taking considering the benefits for the Canadian consumer. “We would much rather be in a position of having to apologize to incumbents for making them mis-prioritize their revenue streams than having to apologize to Canadians for throwing under the bus the independent ISPs they’ve come to rely on,” she said. —With reporting by Peter Henderson at phenderson@thewirereport.ca and editing by Derek Abma at dabma@thewirereport.ca CORRECTION: Cynthia Khoo was incorrectly identified as a lawyer in a previous version of this story.

No FTTP wholesale without CRTC action: PIAC

News | 12/01/2014 9:49 pm EST

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