The regulator now moves to challenges against final wholesale decision
By Ahmad Hathout
The CRTC said large provider access to the aggregated last-mile fibre facilities of mainly Bell but also Telus in Ontario and Quebec have proven to increase consumer choice and competition between internet service providers, rejecting a cabinet recommendation to impose a ban on Rogers, Bell and Telus (Big 3) from accessing those facilities.
The commission’s relatively short decision hinged largely on what it said was a lack of evidence that such access would hinder network investment as well as evidence showing that Telus is now offering gigabit internet plans in the two provinces utilizing Bell’s last-mile facilities.
“The evidence in this proceeding shows that more than a dozen providers, including one of the Large Incumbents and its affiliates, used the Temporary Service to offer new retail fibre Internet service plans in Ontario and Quebec. This brought observable benefits to Canadians,” the commission said in the decision.
“The record did not demonstrate that there has been a negative impact on investment that can be attributed to the Large Incumbents’ use of the Temporary Service,” it added. “The Temporary Service was in effect for only a short period of time, during which Incumbents lost a limited number of customers across a variety of competitors.”
The Competitive Network Operators of Canada (CNOC), which represents smaller providers and wholesalers, wanted a ban on Big 3 access to the wholesale internet regime broadly because it will negatively impact smaller providers who would have to compete against deeper-pocketed rivals. In fact, it launched a public campaign to rally Canadians for the ban.
In a statement Monday, CNOC said it is optimistic regulators will facilitate more competition but that now is the time to act.
“The CRTC must listen to Canadians, and act to create the conditions for a competitive marketplace,” Paul Andersen, CNOC president and chair, said in the statement. “Deferring a decision on this today, hurts competition tomorrow. The CRTC must move quickly to close this loophole, so that Canadians can have more choice and affordable options for internet services.”
In early December, CNOC along with SaskTel, Eastlink and Cogeco filed a petition to cabinet on a precautionary basis asking it to vary the CRTC’s wholesale framework decision from August 2024 in case the regulator decides not to ban the three largest ISPs from accessing the regime.
“We are disappointed that the CRTC continues to delay its final decision on the future of the Canadian wholesale regime,:” Cogeco said in a statement on social media. “The evidence on record is already indisputable: the Big 3 carriers should not be eligible to use mandated wholesale access services, anywhere in Canada. At a time of growing economic uncertainty, Canada cannot afford inaction on policies that directly impact competition and consumer choice. Now more than ever, we need swift and decisive measures to ensure that regional players, like Cogeco, can continue providing Canadians with more choice and better services. The Commission must act more quickly in closing this loophole.”
Telus, the only one of the Big 3 that supports wholesale access by the large players, had asked the Federal Court to quash the cabinet recommendation because of allegations that cabinet allegedly held dozens of closed-door meetings between various parties adverse to it without providing an opportunity to respond. The Vancouver-based telecom also launched a campaign in November to gather public support for its position.
“This decision marks a significant step toward fostering greater competition, affordability, and innovation for millions of Canadians,” Telus said in a statement Monday, commending the CRTC and saying the decision will help expand Telus’s “reach, accelerate innovation, and support national goals of affordability and universal access to high-speed internet.”
“The overwhelming public support behind this decision, evidenced by TELUS’s #DemandMoreInternetChoice petition that has so far garnered over 228,000 signatures on the way to a million, demonstrates Canadians’ desire for fair competition and their shared commitment to affordable, high-quality connectivity,” the statement added. “We are grateful for this groundswell of support, which highlights the importance of policies that prioritize Canadians’ best interests.”
In a statement, a Rogers spokesperson said: “Although we’re disappointed the CRTC isn’t taking immediate steps to address the current unequal treatment of incumbent exclusions, the focus on long-term investment and competition is encouraging. Canadians deserve a framework that supports facilities-based investment in next-generation networks and does not artificially favour any one group of competitors.”
The CRTC interim decision came in November 2023, when it determined that Bell and Telus must provide bundled middle- and last-mile fibre facilities to wholesalers to boost competition in Ontario and Quebec. The commission, by this point, still had months before it made a final decision on the wholesale internet regime broadly, which includes older technologies.
In the meantime, in February, Bell asked cabinet to force the CRTC to reconsider the interim decision on the basis of its negative impact on network investment.
Before cabinet could release its decision in November, the CRTC determined in August that the Big 3 can still access the wholesale regime, but only outside of their operating territory. It also reaffirmed that only the legacy telcos – Bell, Telus, and SaskTel – will need to open up their aggregated last-mile fibre facilities to competitors. However, it gave the telcos a five-year access moratorium for new builds so they could recoup their investments. Rogers has argued that the CRTC should apply a similar moratorium for its own builds, on which it spends billions of dollars for multi-gigabit speeds.
The cabinet decision launched a series of review-and-vary applications against the final decision, as it gave providers a requisite reason – the change in circumstances – that gave justification for the applications.
As such, Rogers and CNOC, Eastlink and Cogeco filed applications to the CRTC asking it to ban the Big 3 from accessing the wholesale internet regime completely, regardless of technology and geography. TekSavvy filed its own application urging the CRTC to not allow the commission’s five-year access protection for Bell and Telus for new builds inside their operating territories, and also asking for a specific timeline on when the cable companies’ last-mile fibre builds will be subject to the aggregated access regime.
The commission consolidated those applications to deal with them at once.
“It is important for the Commission to consider possible longer-term impacts of Large Incumbent use of wholesale HSA services on investment and competition,” the CRTC said in Monday’s decision. “Given that the Temporary Service was replaced by the Final Service, these impacts are appropriately addressed in the Consolidated R&V Proceeding. The Commission will make this assessment in the context of the Final Decision, which includes measures to promote investment and competition.”
The CRTC said it expects to make a decision on those applications by this summer.
Photo via Infrastructure Canada
