One month after the federal government asked the CRTC to review its VoIP decision, three major cablecos have voiced their support for the regulatory body’s original decision last year.
Cogeco Cable Inc., Quebecor Media Inc., on behalf of its subsidiary Videotron Ltd., and Rogers Communications Inc., have filed a joint submission with the CRTC reinforcing their support for the May 2005 CRTC decision to regulate VoIP services.
“By guarding against anti-competitive behaviour at this time, the VoIP decision has stimulated more investment and innovation in the local telephone market to the benefit of all Canadians,” the companies stated in a press release issued on Monday.
Last month, the Governor in Council (GIC) under the Hon. Maxime Bernier, Minister of Industry, called on the CRTC to reconsider its decision following subsequent appeals from incumbents and competitive local exchange carriers. These include a joint appeal from Aliant Telecom Inc., Bell Canada, SaskTel, Telebec and Telus Communications Inc. Separate appeals were filed by the Province of Saskatchewan, the Coalition for Competitive Telecommunications, The Vancouver Board of Trade and the Communications, Energy and Paperworkers Union of Canada.
Iain Grant, an analyst with the SeaBoard Group in Montreal, who has over 20 years of experience in the technology industry, said Rogers isn’t concerned that Bell is going to steal its customers.
“Rogers is concerned more that Bell is going to be fighting back tooth and claw when Rogers tries to seduce Bell customers,” said Grant. “If you look to Montreal, Videotron has shown the way. Our forecasts show Videotron will close 2006 with over 370,000 customers from zero a year ago.”
The CRTC’s original decision was to regulate VoIP similar to other types of phone services available in Canada. The ruling was based on the fact that incumbent telephone companies like Bell Canada and Telus control over 92 per cent of the local residential market and therefore require economic regulation.
Grant said Bell just wants to be treated the same was as Rogers. “Bell’s saying, ‘We’ve lost enough share now that Rogers is a bona fide competitor to us in the Toronto market. Why are our hands tied behind our backs?’” he said.
Likewise, another telecom analyst, Jon Arnold of J Arnold & Associates, said incumbents Bell and Telus want to be able to compete for a piece of the VoIP market without restrictions.
“The winners will be Telus and Bell,” said Arnold. “They want to see a more open market where they can compete on a level playing field.”
The GIC, under the Telecommunications Act, which recently underwent review by a government-appointed panel, has the authority to change or annul any CRTC telecommunications decision or refer it back for reconsideration. In March, the Telecommunications Policy Review Panel, which was appointed by the former PMO in April 2005, called for decreased regulation in the telecommunications market but pointed out the CRTC has a role in upholding safety and resolving disputes.
The Panel’s report has paved the way for the new Cabinet to “let markets do what markets do best,” said Grant.
“All of that suggests the CRTC would be wise if they value their continuing role, that if they don’t want to tweak the government’s nose anymore, make sure they reconsider. And probably come down the other way,” he said.
Similarly, Arnold said the feds’ push towards deregulating the market is to be expected.
“The bottom line is it’s inevitable that they’re going to have to liberalize the market more and more,” he said. “This is just another step in that direction.”
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