ARCHIVED -  Telecom Public Notice CRTC 1992-30

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Ottawa, 14 May 1992
Telecom Public Notice CRTC 92-30
Reference: Tariff Notice 4321
The Commission has received an application from Bell Canada (Bell), dated 1 April 1992, for approval of tariff revisions providing for the introduction of Neighbourhood Calling Plan (NCP).
NCP is intended to address the needs of customers who do not qualify for extended local calling under the Extended Area Service (EAS) criteria. The criteria for the provision of EAS between two exchanges were established in Bell Canada - Revised Criteria for Extended Area Service, Telecom Decision CRTC 88-15, 29 September 1988. In order to receive EAS under those criteria:
(1) a minimum of 60% of customers in an exchange must make calls to customers in the other exchange at least once a month (i.e., there must be a community of interest between the exchanges);
(2) the distance between the exchanges' rate centres (normally the main switching centres in the exchanges) must not exceed 40 miles; and
(3) a simple majority (51%) of customers whose basic local rates would be increased must vote in favour of the new service.
NCP would allow customers in contiguous local exchanges to telephone one another without incurring long distance charges, provided that the rate centres of the exchanges are no more than 40 miles apart. Bell states that implementation of its proposal would result in approximately 635 NCP links, serving customers in 534 exchanges. Bell estimates that it would take approximately four years to provide these links, beginning in 1993.
Bell also estimates that, taking into account both cost and revenue factors (including lost long distance revenues), full implementation of NCP would result in a Net Present Value of negative $50.5 million over a ten year period. In order to recover the associated incremental costs and revenue losses, Bell is proposing increases in its weighting factors. Weighting factors are used in rate group calculations to determine the local rates paid by customers in extended local calling areas. The Commission notes that Bell's proposed tariff pages do not distinguish between the weighting factors that would apply for EAS and NCP.
Bell proposes to increase the weighting factors in two phases: (1) on 1 July 1993 or six months after the beginning of the program, the factor for the 1-10 mileage band would increase from 1.1 to 1.2, and (2) on 1 July 1995, the factor for the 1-10 mileage band would increase from 1.2 to 1.3, while the factor for the 11-15 mileage band would increase from 1.6 to 1.7. The company estimates that, of the 534 exchanges that would receive additional local calling due to NCP, 223 would upgroup immediately.
Bell estimates that, in exchanges that would upgroup immediately, local monthly rates would rise from between $0.30 and $2.40 for residence customers, and from between $2.10 and $13.20 for business customers.
In support of its application, Bell has submitted an economic evaluation study for which it has claimed confidentiality. An abridged version has been provided for the public record.
The Commission has addressed interrogatories to Bell with respect to its application. The company has been directed to respond to these interrogatories by 11 June 1992.
The application may be examined at any of Bell's business offices or at the offices of the CRTC, Room 201, Central Building, Les Terrasses de la Chaudière, 1 Promenade du Portage, Hull, Quebec, or Complex Guy-Favreau, East Tower, 200 René-Lévesque Blvd. West, Room 602, Montréal, Quebec. A copy of Bell's application and of its responses to the Commission's interrogatories may be obtained by any interested person upon request directed to the company at the address shown below.
If you wish to comment on the application, please write to Mr. Allan J. Darling, Secretary General, CRTC, Ottawa, Ontario, K1A 0N2, by 13 July 1992. A copy of your letter should be sent to Mr. B.A. Courtois, Vice-President (Law & Regulatory Affairs), Bell Canada, 105 Hôtel-de-ville Street, 6th Floor, Hull, Quebec, J8X 4H7.
Allan J. Darling
Secretary General
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