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Telecom Order
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Ottawa, 9 September 1994
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Telecom Order CRTC 94-1054
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IN THE MATTER OF an application by Maritime Tel & Tel Limited (MT&T) under Tariff Notice 470 dated 15 July 1994, for approval of revisions to the company's General Tariff reflecting the restructuring of its Centrex Service.
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WHEREAS the proposed restructuring eliminates the distinction between a Single Wire Centre and Multiple Wire Centre as a basis for the rating of Centrex Service and introduces Exchange Centrex and Provincial Centrex;
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WHEREAS Exchange Centrex provides service in one or more wire-centres within an exchange and Provincial Centrex provides service in more than one exchange within Nova Scotia;
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WHEREAS the company indicated that it is installing in its Centrex switches Centrex Feature Networking which can provide common features to Centrex locals located in different exchanges;
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WHEREAS MT&T provided, as an attachment to the application, an economic analysis study for Centrex Feature Networking;
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WHEREAS the company stated, among other things, that the proposed restructuring of Centrex would result in the service being more competitively priced while optimizing revenues and contribution from this service;
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WHEREAS the company stated that resellers have entered the local service market competing directly with MT&T for business customers;
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WHEREAS the company stated that the proposed restructuring will prevent substantial migration from Small Business Service with the resulting revenue and contribution loss;
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WHEREAS the company stated that the proposed added value and re-pricing of Large Centrex Service will reduce the migration to other forms of access and removal of lines;
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WHEREAS the Commission regards Centrex Service as a competitive alternative to PBX equipment used in conjunction with network access truck services;
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WHEREAS it is the Commission's general policy that rates for competitive Services should be set to maximize contribution;
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WHEREAS the Commission noted in Maritime Telegraph and Telephone Company Limited - Revenue Requirement for 1994, Telecom Decision CRTC 94-9 (Decision 94-9), dated 29 April 1994, that based on demand and cost information provided in the record of that proceeding, it was of the view that the proposed rates contained in the Revenue Requirement application would not maximize contribution;
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WHEREAS, in Decision 94-9, the Commission directed the company to increase Centrex Business Service rates (excluding National Centrex Service) by 10% over the levels proposed by the company in the Revenue Requirement application;
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WHEREAS the company did not provide the net revenue impact resulting from the proposed restructuring or supporting information with respect to expected demand for its proposed Centrex Service rates relative to demand without the restructuring; and
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WHEREAS, while the Commission considers the restructuring of Centrex Service into Exchange Centrex and Provincial Centrex to be generally acceptable, the company has not adequately demonstrated the impact on contribution of the proposed rate levels -
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IT IS HEREBY ORDERED THAT:
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The proposed tariff revisions submitted by MT&T under Tariff Notice 470 are denied.
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Allan J. Darling
Secretary General
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