Telecom study says CRTC should keep on regulating

While the regulatory future of voice-over-IP in Canada is far from certain, a study published Tuesday by research firm Lemay-Yates Associates suggests that 12-year-old legislation should be the underpinning to handle the technology.


113-page report, called “The State of Telecom Policy Framework in Canada,” was sponsored by MTS-Allstream and compiled from research and analysis of various legislative and regulatory filings both here and abroad. It says that Canada is more advanced than the U.S. and Europe in terms of the way it regulates VoIP technology. The 1993 Telecommunications Act, it says, was forward-looking enough to anticipate the evolution of technology in the telephony market, including cellular and Internet.

“There’s no reason why the existing policy platform can’t support (VoIP) and move us forward in that realm as well,” said Rob Yates, co-president of the Montreal-based firm.

The Telecom Act is sufficient to handle the development of VoIP, said MTS-Allstream’s executive vice-president government and regulatory affairs, Chris Peirce, since it focuses on service levels rather than technology.

Thus far, the CRTC has upheld this perspective. In April of last year, the body delivered a preliminary report saying that VoIP would be regulated no differently from any other type of phone service.

In September, Bell Canada called on the CRTC to review VoIP again and allow open competition in the VoIP market. A decision from the commission is expected in the spring of this year.

Yates argued that if the CRTC were to reverse its position, Bell would have an unfair advantage in the VoIP market, given its dominance in the basic phone service market. Bell already has a built-up subscriber base, he said, making it difficult for other players in the market to establish a foothold — unlike the cellular market where no single provider started with a competitive advantage.

Bell Canada could not be reached for comment at press time.

The CRTC is currently caught “between a rock and a hard place,” said Gartner Canada telecommunications analyst Elroy Jopling.

“It’s kind of funny to hear Bell Canada be concerned about a level playing field when it’s an unlevel playing field for the last 100 years. But . . . you don’t want to shackle the investment of Bell Canada (and) Telus in new technologies and VoIP,” he said.

The best situation for Canada might be somewhere between the U.S. laissez-faire approach to the regulation of VoIP and the CRTC’s current status quo of regulating phone service rather than the technology that provides it, Jopling said.

Bell will want to protect its interests in VoIP, he said, particularly when other players in the market are making significant inroads. On Monday, for example, Quebec company Videotron became Canada’s first cable provider to offer residential VoIP phone service. And when Rogers Cable enters the phone market later this year, it will be “an astoundingly formidable player,” said Elroy, since it is capable of packaging television, phone, broadband and cellular service.

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