BCE is urging the Canadian Radio-television and Telecommunications Commission (CRTC) to put in place conditions, such as caps on allowable speeds and access restrictions, if it decides to allow small internet service providers to use their competitors’ fiber optic networks to offer services to their customers.
Representatives of Bell Canada’s parent company appeared before the federal telecommunications regulator on Wednesday as part of its consultations on competition in internet services.
This appearance came less than a week after Bell placed heavy responsibility on the CRTC when it announced 9% cuts to its workforce and said it was considering further reducing its investments in its fiber optic network.
Bell’s head of legal and regulatory affairs, Robert Malcolmson, told CRTC commissioners that their calculation that granting temporary wholesale high-speed internet access would not result in spending cuts was “completely wrong.” “.
“The question is whether the council will plow ahead or pause to consider how investment incentives can be restored while maintaining vigorous price competition, which clearly exists in the market today,” he said. argues Mr. Malcolmson.
In an interim ruling issued in November, the CRTC temporarily required Bell and Telus to provide competitors with access to their fiber-to-the-home networks in Quebec and Ontario within six months.
Bell responded by reducing its network spending by $1.1 billion by 2025, including a reduction of at least $500 million starting this year. The company maintains that this rule, which it is appealing, reduces the profitability of its investments.
The CRTC made this decision in order to stimulate competition for internet services. The review it is currently conducting aims to determine whether it should make this decision permanent and, if so, whether it should apply it to other provinces.
Conditions demanded
Some small businesses have asked the CRTC to expand wholesale access rules to help them fill gaps in service offerings. Earlier this week, the New Brunswick company Xplore argued that such a decision would allow it to be more competitive in remote regions.
Bell’s Malcolmson countered Wednesday that prioritizing resale over investment “will harm network expansion and competition.”
The company nevertheless proposed several conditions to help mitigate the potential disadvantages for companies like Bell if the CRTC extends the wholesale access regime.
This includes only allowing the resale of internet speeds of up to 1.5 gigabytes per second, reflecting the maximum speeds available on cable networks, to help preserve “the competitive advantage resulting from building ‘a faster network’.
The company also proposed that smaller players could sell their internet services in a particular location using another company’s network only five years after it was built, to “provide a minimum window to recoup some of our investment before to cede our network to our competitors.”
Malcolmson said it’s important that network-building companies remain motivated to invest in their own networks, otherwise they too will focus on reselling. He confirmed that Bell had already begun to modify its approach in anticipation of the CRTC’s directions.
“We actually started reselling internet access on cable networks under the Bell brand as part of our existing network,” he said.
“While we are in the early stages at this time, we are prepared to further reduce (fiber optic) deployment and reluctantly move to reselling Telus cable and fiber if regulatory conditions require it. »
Telus awaits the verdict
We are now halfway through the hearings being held this week before the CRTC on this issue. In total, more than 20 groups must parade before the commissioners.
Appearing earlier Wednesday, Telus said it will not decide whether to adjust its network spending plans until after the federal regulator makes its decision.
Unlike Bell, the company did not reduce its investments in its network following the interim decision issued in November.
“The implementation of final wholesale rates will ultimately determine how we invest our money,” said Telus Senior Vice-President and Corporate Controller Matthew Murray.
Telus Consumer Solutions President Zainul Mawji added that establishing an unrestricted framework for wholesale high-speed access services would be a “very brutal” outcome that would deter large companies from expanding their network in new regions.
“Maybe not right away, but over time, it’s certain that operators who have been there for a long time would reduce, diversify their investments and start exploiting each other’s networks,” she said. advance.
“Remote areas would be most affected. We have some of the best coverage in Canada for both fiber optic and wireless access across a large portion of the country. There are still places to be given access, but it is expensive. »
Telus has almost finished building its fiber optic network in Quebec, but it still has a lot of work to do in Alberta and British Columbia.
“We would like to continue to do this and finish connecting these communities, but that requires ensuring that we have a framework, and if necessary tariffs, that would allow us to recover those costs and get a return on investment,” Mr. Murray emphasized.