Big in­ter­net com­pa­nies stall rate-cut

Bell, Rogers and oth­ers win in­terim court rul­ing block­ing CRTC or­der

The Peterborough Examiner - - BUSINESS - JOSH RU­BIN

In­de­pen­dent in­ter­net ser­vice providers say they’re frus­trated by an in­terim court rul­ing that puts a hold on a CRTC de­ci­sion order­ing Canada’s big­gest telecom­mu­ni­ca­tions com­pa­nies to pro­vide smaller ri­vals with ac­cess to their networks at lower whole­sale rates.

Six of Canada’s largest in­ter­net ser­vice providers, in­clud­ing Bell Canada and Rogers, asked the court on Sept. 13 to over­rule the Au­gust de­ci­sion by the Cana­dian Ra­dio-tele­vi­sion and Telecom­mu­ni­ca­tions Com­mis­sion.

The phone and ca­ble com­pa­nies ar­gue the CRTC ex­ceeded its pow­ers and made er­rors when it de­cided they had over­charged Canada’s small- to mid-sized in­ter­net ser­vice providers un­der in­terim whole­sale rates set in 2016.

Jus­tice Yves de Mon­tigny de­cided late Fri­day that the CRTC’s new whole­sale rates will be sus­pended while the case is be­fore the Fed­eral Court of Ap­peal.

The judge also said if the large in­ter­net ser­vices providers lose their ap­peal, they will be on the hook to re­pay over­charges col­lected from their whole­sale cus­tomers since March 2016.

The head of the Cana­dian Net­work Oper­a­tors Con­sor­tium, which rep­re­sents sev­eral smaller in­ter­net ser­vice providers, was frus­trated by the stay.

“Af­ter three and a half years and thou­sands of pages of doc­u­ments, and speak­ing to peo­ple from the in­dus­try, the CRTC de­cided that Cana­di­ans were pay­ing too much for their broad­band,” said Matt Stein, pres­i­dent and chair of CNOC, as well as CEO of Distribu­tel.

“Now the in­cum­bents are de­lay­ing things fur­ther. I’m dis­ap­pointed by this rul­ing, but not sur­prised.”

Stein ex­pects a rul­ing on whether or not to is­sue a full stay of the CRTC de­ci­sion could come by the end of Oc­to­ber.

“The im­pact of an in­terim stay will be min­i­mal,” said Stein.

Janet Lo, vice-pres­i­dent of con­sumer le­gal af­fairs at TekSavvy, said the com­pany would be keep­ing lower-priced plans — an­nounced in the wake of the CRTC rul­ing — in place for now.

“We’re dis­ap­pointed that the big in­cum­bents con­tinue to dis­pute what is a very con­sid­ered, stud­ied CRTC de­ci­sion to cor­rect in­flated whole­sale rates down to more rea­son­able lev­els,” said Lo.

“Cana­di­ans can’t keep wait­ing for com­pe­ti­tion to de­liver lower prices.”

In its sub­mis­sion to the court, Bell es­ti­mated its share of retroac­tive pay­ments or­dered by the CRTC would be about $100 mil­lion.

A sep­a­rate fil­ing on be­half of six ca­ble com­pa­nies es­ti­mated their share would be $225 mil­lion.

In agree­ing to the tem­po­rary stay of the CRTC’s or­der, Mon­tigny writes that the smaller ISPs do not dis­pute the se­ri­ous­ness of the is­sues raised in the ap­peal.

“I am also sat­is­fied that the im­ple­men­ta­tion of the CRTC or­der could re­sult in a per­ma­nent mar­ket dis­tor­tion which could be ex­tremely dif­fi­cult to rem­edy af­ter­wards,” Mon­tigny writes.

He con­cludes that the “bal­ance of con­ve­nience favours the sta­tus quo” un­til the ap­peal is heard but stip­u­lates that the large ISPs must “pro­vide an un­der­tak­ing” to pay dam­ages if their ap­peals are dis­missed.


The CRTC had or­dered in­ter­net ser­vice providers to pro­vide smaller ri­vals with ac­cess to their networks at lower whole­sale rates.

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