CRTC sets final wholesale rates for access to high-speed broadband networks

CRTC logo on wall

The CRTC has set the final wholesale rates that large providers can charge for access to their high-speed broadband networks to “facilitate greater competition.”

In the telecom order, the Canadian Radio-television and Telecommunications Commission (CRTC) indicated that the final rates are lower than interim wholesale rates implemented in 2016, which were also set to foster competition at the time.

“The monthly capacity rates are 15 percent to 43 percent lower than the interim rates,” the CRTC said in the new decision. “As for the access rates, they are three percent to 77 percent lower than the interim rates.”

In 2016, the CRTC cut proposed rates for network access by up to 39 percent and reduced the rate for the transport of internet data by up to 89 percent.

The CRTC said it made adjustments to certain proposed rates, “including the monthly access rates per end-user, the 100Mbps increment monthly rate, and certain service charges.”

It also noted that the final rates “will be applied retroactively.”

It is worth noting though that the decision was made for only one regime and does not address the need for fibre wholesale rates. The CRTC said that the disaggregated decision is “forthcoming.”

Wholesale rates are paid by competitors — like TekSavvy or Distributel — which then get access to high-speed networks of larger telecommunications companies like Bell, Rogers, Telus and Shaw.

Rates are set so that incumbents can charge for this access after the CRTC reviews information regarding how much it costs to operate networks.

“As the demand for faster broadband speeds grows, we are putting measures in place to ensure Canada’s internet market remains dynamic,” CRTC chairman Ian Scott said in the release. “The final rates we set today will foster increased choice at more affordable prices while encouraging a more robust and competitive market place.

MobileSyrup has reached out to telecommunications carriers for comment and will update this article with more detail.

A Shaw spokesperson declined to comment on the order.

A Bell spokesperson said the carrier was “assessing the impact of the decision and our next steps.”

Consumer advocacy group OpenMedia said in a press release that the decision is good and “much overdue.”

It’s no secret that Canadians have been paying too much for their Internet for way too long, and today’s decision is proof that Big Telecom has been holding the market hostage, gouging smaller providers for years. But these new rates bring us one step closer to seeing more affordable Internet available through a wider choice of providers,” said OpenMedia’s executive director Laura Tribe. “While today’s decision still does not does not address the outstanding need for fibre wholesale rates that Canadians have been waiting to gain access to since the CRTC’s 2015 decision, hopefully, this paves the way for more affordable rates to come.”

TekSavvy’s vice-president of regulatory and carrier affairs, Andy Kaplan-Myrth, said the decision was “one important step toward a fair framework for wholesale-based competition.”

Kaplan-Myrth indicated that the company continues to fight for fibre-to-the-home services and create a level playing field.

Vmedia’s George Burger said that the decision was positive but that “so much depends on the disaggregated decision, which the commission has said is forthcoming.”

“Whatever immediate financial benefits are to be gained by this decision, we are very mindful of the projected costs we will have to finance to be able to obtain access to fibre-to-the-premises facilities,” Burger said. “One thing is certain, consumers will now be able to look forward to a robust competitive market in internet service that will assure them of getting this crucial service at affordable prices.”

Matt Stein, CEO of Distributel, also said that this decision was great for Canadian consumers.

“By correcting the wholesale rates and lowering them to a fair and reasonable level, the CRTC is opening the door for the industry to innovate, and offer great services at fair prices,” Stein said. “Canadians benefit from decisions like this one, and we applaud the CRTC for taking such dramatic steps.”

A Telus spokesperson said that the carrier was still reviewing the decision “and assessing potential impacts to our business.”

Source: CRTC

Update 15/08/19: The article has been updated with comments from carriers.