CRTC tries to encourage competition through digital network access ruling

The Canadian Radio-television and Telecommunications Commission (CRTC) released a decision on Competitor Digital Network services (CDN), which outlined the terms and conditions, as well as the rates for these services in order to foster facilities-based competition and to eliminate any competitive

disadvantage. As with past decisions, the CRTC strove to strike a balance between the interests of competitors, incumbent telephone companies and the users of the services.

The CRTC determined that with this decision (Telecom Decision CRTC 2005-6) competitors would generally pay lower rates than they have been. The goal was to ensure that competitors would be able to expand their reach and customer base.

The CRTC determined the incumbents would get fair compensation for the use of their facilities, and the anticipated growth in competition flowing from this decision would benefit consumers by providing greater choice.

The incumbent telephone companies said the commission’s objective in this process should be to provide more certainty as to the viability of their investments in digital facilities, to minimize regulatory risk and to encourage competitors to invest in their own facilities.

On the other hand, competitors argued that they continue to face significant barriers to network expansion, including funding and rights-of-way.

The CRTC considered that the size of the competitor’s customer base made it difficult for the competitor to recover DNA-equivalent facility construction costs, determining that the argument of self-supply would not apply in this case.

While competitors still rely heavily on incumbents’ facilities, decision such as this one furthers the objectives for greater facilities-based competition.

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Jim Love, Chief Content Officer, IT World Canada

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