The regulator has been urged not to rely on carrier negotiations for roaming rates
By Ahmad Hathout
OTTAWA – The CRTC has dismissed an application by Globalive that sought a commission review of wholesale roaming rates in general and a roaming agreement between Rogers and Videotron in particular, citing an existing application before the regulator addressing similar issues.
Globalive filed the Part 1 application late last month, which requested the CRTC make interim the current wholesale roaming rates, require the national carriers to file updated studies supporting new rates, and to open an investigation into Rogers’s proposed roaming agreement with Videotron as a condition of the former buying Shaw.
But the regulator said in a letter last week that the commission is already seized by the first two issues in another Part 1 application filed in May 2022 by Eastlink, Cogeco, Videotron and Xplore, which requested that the regulator make the current national carrier rates interim, conduct a comprehensive review of the wholesale roaming rates, and implement a mechanism to drive down wholesale roaming rates on an annual basis.
“Globalive’s requests for interim rates and for cost studies and revised rates to be filed by the national wireless carriers are thus already being examined by the Commission as part of the wireless competitors’ application, which raises these same issues,” the CRTC said in the April 11 letter.
“Examining a duplicative application is an inefficient use of time and resources, not only for the Commission but also for all interested parties that may intervene,” the letter added.
The commission said Globalive would be better served filing an intervention in the existing Part 1 application on the matter.
However, it noted that because its request to examine the Rogers-Videotron roaming deal is unique to the existing Part 1, it said the investment firm can submit a separate application addressing that one issue. The firm has asked for an investigation to see if the rates to be given to Videotron constitutes an undue preference.
Cartt has reached out to Globalive about whether it will refile. It will update this story if it hears back.
How should wholesale roaming rates be set?
The CRTC set a new comment date of April 14 for additional submissions in the first Part 1 application. In it, the regulator asked parties whether it should allow commercial negotiations to set roaming rates and seamless handoff with the option for final offer arbitration at the commission. This rate-setting approach has been adopted by the commission for its mobile virtual network operator regime.
Trade association the Competitive Network Operators of Canada, the Public Interest Advocacy Centre and telecom Ecotel all urged the commission not to adopt this regime.
CNOC said it is “strongly opposed” to the use of such negotiations because it “suffers from profound disadvantages that greatly outweigh any perceived benefits” of this approach. “Incumbent market power leads to a radical inequality of bargaining power between the incumbents and their wholesale roaming customers,” CNOC said. “This significant disparity of bargaining power will predictably result in inflated rates that, by definition, are not just and reasonable.”
Instead, the association representing independent telecoms said the CRTC should conduct a cost study and set the rates itself.
This approach is supported by Ecotel, which said the current roaming rates are outdated and require a review, citing 2019 rates that it said are “already 25% to 40% too expensive.”
Moreover, the Quebec company said it has failed to enter into agreements with the large carriers despite numerous attempts.
“ECOTEL is of the view that Incumbents have no incentive to collaborate and facilitate the entry of new players competing with them,” it said in its submission. “Bilateral roaming agreement is difficult if not possible for smaller players, and often it is difficult to just get answers from Incumbents or move the file forward. As a result, ECOTEL believes that relying on market forces is not possible today.”
PIAC argued that commercial negotiations are “inherently unbalanced” because the incumbent carriers dominate the market and therefore smaller providers have “no choice but to enter into agreements” that are not “commercially reasonable.”
“The Commission should set and maintain cost-based tariffed rates as the only rates available to wholesale roaming customers,” PIAC said. “Aside from periodic tariff reviews, rate renegotiations should not be necessary if the National Wireless Carriers’ tariffs are set fairly and based on forward-looking cost studies that account for the underlying cost savings from ongoing advancements in network capacity and technology.”
In their submission last June, the large telecoms – including Bell, Telus and Cogeco – said commercial negotiations are the best mechanism to determine wholesale roaming rates, in part because of an alleged lack of evidence that those rates are no longer just and reasonable and an interest from other carriers to enter those discussions.
In a separate matter, the CRTC said last month that it is studying the increasing international roaming rates of the large carriers, following a letter from Innovation Minister Francois-Philippe Champagne urging the commission to investigate the matter.
Photo of Globalive Chairman Anthony Lacavera
