OTTAWA-GATINEAU – Canada’s largest telephone companies must rebate $310.8 million to their urban home telephone customers plus bring broadband Internet to 287 rural and remote communities across the country, the CRTC said Tuesday.
Widely referred to as the deferral accounts decision, the CRTC has ordered that the initiatives be funded using the deferral accounts of Bell Canada, Bell Aliant, Telus and MTS Allstream, which, as of May 31, 2010, held $770 million (including interest). Of this amount, $310.8 million will be rebated to customers, while $421.9 million will be spent on broadband services in communities across five provinces by 2014. The Commission said that $35 million has already been allocated to accessibility initiatives, and that the remaining balance will go toward the administrative costs of the consumer rebate.
"Today’s announcement is a positive solution for Canadian consumers," said CRTC chairman Konrad von Finckenstein, in a statement. "Subscribers of the major telephone companies in urban areas will enjoy a rebate on their home telephone service. And residents in hundreds of rural communities will soon be able to take advantage of the many social and economic benefits broadband Internet access provides."
Over the next four years, broadband Internet service will be rolled out to communities where it is currently not available at speeds comparable to urban areas, and fast enough to link residents to telehealth services and bring about business and educational opportunities. Click here for the list of communities.
After collectively investing $421.9 million to expand their networks, Bell Canada and Bell Aliant will connect 112 communities in Ontario and Quebec; Telus will connect 159 communities in British Columbia, Alberta and Quebec; and MTS Allstream will connect 16 communities in Manitoba. The Commission previously approved SaskTel’s proposal to spend all of the approximately $1.5 million in its deferral account on accessibility initiatives.
The CRTC has ordered the companies to rebate the remaining funds to their existing customers residing in urban areas within the next six months. Rebates will range from approximately $25 to $90 per subscriber.
In addition, the Commission said that the telcos are already investing $35 million from their deferral accounts in initiatives designed to make telecommunications services more accessible to Canadians living with disabilities.
"The question of how the funds in the deferral accounts should be allocated was hotly debated”, von Finckenstein continued. “Our decision to rebate consumers was contested all the way to the Supreme Court of Canada. We are pleased that the Court confirmed our jurisdiction in this matter, clearing the way for the distribution of the funds."
In 2002, the CRTC mandated that Bell Canada, Bell Aliant, MTS Allstream, SaskTel and Telus create deferral accounts as a way to encourage competition in the local telephone market. Instead of reducing rates for local telephone service in urban areas, the companies were instructed to place surplus funds collected from urban consumers into the deferral accounts.
