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Telecom Order
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Ottawa, 30 September 1994
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Telecom Order CRTC 94-1143
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IN THE MATTER OF an application by BC TEL under Tariff Notice 3051 dated 9 March 1994, to transfer to customers the responsibility for installing, rearranging and moving (installing) single-line residence and business inside wire (IW) on the property owner's side of the demarcation point.
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WHEREAS BC TEL proposed conditions and hourly rates for installing IW of $60.00 for the first half-hour and $18.00 for each additional 15 minutes, with a one hour bill minimum;
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WHEREAS BC TEL also proposed rates for off-business hours of $32.00 per 15 minutes, with a bill minimum of two hours;
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WHEREAS the company proposed that customers be given the option of acquiring IW from BC TEL or alternative suppliers or of installing it themselves;
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WHEREAS BC TEL proposed to be responsible for maintenance of IW at no charge, no matter who supplied and installed it;
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WHEREAS five interveners supported the application, arguing that competition is both possible and desirable for IW installation;
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WHEREAS objections to the application came from B.C. Old Age Pensioners' Organization, Consumers' Association of Canada (B.C. Branch), Council of Senior Citizens' Association of B.C., Federated Anti-Poverty Groups of B.C., Senior Citizens' Association of B.C., West End Seniors' Network, and Local 1-217 IWA Seniors (collectively referred to as BCOAPO), Telecommunications Workers Union (TWU) and the Government of British Columbia (BCG);
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WHEREAS TWU requested disclosure of all supporting information filed by BC TEL, arguing that BC TEL's proposed introduction of competition to a monopoly situation negates the validity of its claim of confidentiality to protect itself from competitors' use of this information to develop market strategies;
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WHEREAS BC TEL replied that information such as revenue effects based on expected IW market share retention would assist competitors and cause it specific direct harm;
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WHEREAS the Commission is of the view that the fact that a federally regulated carrier, rather than some other entity, proposes the introduction of competition into a particular market should not serve to disqualify that carrier from making any claims of confidentiality;
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WHEREAS in BC TEL and Bell Canada - Transfer of Inside Wire to Premises Owners and Introduction of Lineguard Service, Telecom Decision CRTC 94-2, 2 February 1994 (Decision 94-2) the Commission found that there was evidence to support the conclusion that competition would arise in the IW installation market;
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WHEREAS, in this case, the information at issue is specific to IW installation service;
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WHEREAS the Commission is of the view, therefore, that the public interest in disclosure is outweighed by the specific direct harm that would result, and, accordingly, upholds the claim of confidentiality;
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WHEREAS TWU stated that BC TEL's proposals do not make clear who would own IW under varying circumstances, i.e. IW existing before approval (pre-existing), IW provided by BC TEL under the proposed tariffs, and IW obtained by the customer from an alternative provider;
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WHEREAS BCOAPO and TWU indicated that the proposal amounts to abandoning or transferring ownership and that the basis for BC TEL's proposed maintenance responsibility would be questionable;
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WHEREAS BC TEL replied that customers would own IW acquired after the Tariff Notice 3051 tariff effective date but it would still own pre-existing IW and stated its willingness, at the Commission's direction, to state explicitly in its tariffs that BC TEL continues to own pre-existing IW;
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WHEREAS BC TEL noted the finding in Decision 94-2 that authorizing subscribers to repair pre-existing IW (i.e. - BC TEL-owned) would require specific tariff revisions to this effect and stated its willingness to provide such revisions;
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WHEREAS, in Decision 94-2, the Commission found that it would be possible to transfer responsibility to customers for installation and maintenance without transferring ownership;
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WHEREAS the proposed tariffs explicitly state that BC TEL owns all wire, cable or other transmitting media up to the demarcation point, but are silent on ownership on the property owner's side of the demarcation point;
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WHEREAS the Commission considers that nothing is being proposed that would change the status of pre-existing IW beyond the demarcation point and that, consistent with the existing tariffs, it would continue to be owned by BC TEL;
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WHEREAS the Commission notes BC TEL's statement in response to interrogatory BC TEL(CRTC)12May94-3 IW that its assumption of responsibility for maintaining IW, whether provided by the company or someone else, means that it will repair and maintain IW at the customer's request;
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WHEREAS, in the Commission's view, this means that BC TEL's maintenance responsibility for IW may not be exercised without the customer's consent, but is of the view that it would be appropriate to include an explicit statement in the tariff to clarify that customers have the authority to choose from whom they want to obtain maintenance;
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WHEREAS TWU submitted that BC TEL's proposal provides the type of mixed ownership regime to which BC TEL had objected in the proceeding leading to Decision 94-2;
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WHEREAS BC TEL replied that, in this case, the mixed regime poses no problem because the company's acceptance of responsibility for maintenance and repair for all IW at no charge would eliminate any need for determining ownership;
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WHEREAS the Commission considers that BC TEL's proposal to provide no charge maintenance for all IW would avoid the previous problems with a mixed regime;
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WHEREAS BCOAPO submitted that approval of the application would not be in the public interest because customers would not obtain any benefits;
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WHEREAS BC TEL, in reply, listed benefits such as the creation of competitive opportunities for other suppliers, choice of suppliers for customers, and elimination of the subsidy on installing IW that is paid for by other customers;
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WHEREAS, in Decision 94-2, the Commission determined that viable competition in the provision of maintenance plans was unlikely, that approval of the telephone companies' filings would not provide additional benefits to customers and would therefore not be in the public interest;
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WHEREAS, by contrast, in Decision 94-2, the Commission found competition in IW installation to be likely, noted from the record of the proceeding that development of IW-related technologies and consequent demand for integrated wiring for home automation appears to be in the offing and concluded that successful expansion of integrated home wiring markets would require that customers be able to obtain IW from sources in addition to the telephone companies;
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WHEREAS, in the Commission's view, the evidence on the record of the current proceeding supports the same conclusions;
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WHEREAS, in light of the above, the Commission considers that, subject to the conditions set out below, approval of this application would be in the public interest;
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WHEREAS the Commission notes that the rates and conditions proposed for IW installation are the same as those currently approved for the installation of multi-line inside wire;
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WHEREAS the Commission considers that the proposed rates, which are non-recurring, are acceptable in a competitive environment;
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WHEREAS the Commission nevertheless considers that implementation of the new rates should be postponed for six months in order to provide competitors time to start establishing themselves in the market and to provide customers the opportunity to obtain IW installation, such as additional jacks, at current rates while becoming informed of the new regime;
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WHEREAS BCOAPO and TWU submitted that, with approval, BC TEL's costs would drop and revenues rise, so local rates should be reduced;
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WHEREAS TWU also suggested that contribution from long distance service revenues should drop to offset the increase in compensation received for installing IW;
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WHEREAS BC TEL submitted that current non-recurring charges for IW installation under the Multi-Element Plan are completely separate from monthly rates for local services;
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WHEREAS, concerning the issue of long distance revenue contribution, BC TEL noted that there is an annual contribution adjustment procedure which would take account of the effects of Tariff Notice 3051;
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WHEREAS the Commission notes that, for rating purposes, IW provision has been treated as a service separate from primary exchange service and is of the view that approval of this application should not provide a basis for starting to treat these two services as one for rating purposes;
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WHEREAS the Commission notes that the revenue effects of BC TEL's proposal would be taken into account in determining both the revenue requirement for the Utility segment of BC TEL in 1995 and the contribution adjustment, also in 1995;
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WHEREAS, in Review of Regulatory Framework, Telecom Decision CRTC 94-19, 16 September 1994, the Commission stated that IW, as a service component not currently assigned to Phase III terminal equipment categories, is excluded from forbearance with respect to terminal equipment at this time;
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WHEREAS BC TEL's proposed tariff revisions include a provision authorizing BC TEL to charge for the extra expense of repairing and maintaining alternatively provided IW that has not met BC TEL IW standards;
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WHEREAS BC TEL stated that its standards are set out in its Wiring Guide, which would be made publicly available upon approval of its application;
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WHEREAS, in evidence, BC TEL listed all the building code, electrical code, and Canadian Standards Association (CSA) telecommunications standards that underpin its Wiring Guide;
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WHEREAS BCG, in its intervention, submitted that standards should be in the tariff;
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WHEREAS BCG noted that CSA's Steering Committee on Telecommunications (SCOT) is to issue a standard for residence IW in the Fall of 1994 and argued that as national standards are and will be available, forcing everyone to comply with BC TEL's Wiring Guide is not appropriate;
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WHEREAS BCG also asked what the status would be of any pre-existing IW that does not conform to the Wiring Guide;
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WHEREAS BC TEL replied that all pre-existing IW it had installed would be treated as up to standard;
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WHEREAS, with regard to the Wiring Guide, BC TEL reiterated that it is compiled from industry and government standards that are in the public domain;
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WHEREAS BC TEL stated that the CSA/SCOT IW standard would be considered along with the other standards, for the Wiring Guide;
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WHEREAS BC TEL submitted that it would not be appropriate to include national standards in the tariff as it does not control them;
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WHEREAS the Commission's approach regarding standards has been to consider the issues of network protection and undue preference and unjust discrimination;
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WHEREAS in this case, no issue of network harm arises because IW is not network addressable;
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WHEREAS, on standards issues related to section 27(2) of the Telecommunications Act, the Commission stated, in Bell Canada - Introduction of Megalink Service, Telecom Decision CRTC 92-5, 3 April 1992 (Decision 92-5), that services must be free of proprietary specifications that would confer any undue preference;
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WHEREAS, in Decision 92-5, the Commission noted that the Megalink specification, while not conforming fully to a set of national standards, had nonetheless been publicly disclosed so as not to give rise to any issues of undue preference and, therefore, was acceptable for the Commission's purposes;
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WHEREAS the Commission notes that, as the Wiring Guide will be publicly available to customers and competitive providers alike, it is in the same position as the Decision 92-5 specification so that there is no issue of undue preference or unjust discrimination related to IW installation standards;
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WHEREAS the Commission considers that there is no purpose to be served by including standards in BC TEL's tariff, but that reference should be made in the tariff to the Wiring Guide as set out below; and
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WHEREAS the Commission considers that BC TEL, in its letter to customers, should advise of the Wiring Guide's existence and purpose, and how it can be obtained -
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IT IS ORDERED THAT:
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1. BC TEL's claim of confidentiality is upheld.
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2. The application is approved, subject to paragraphs 3, 4 and 5 below.
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3. BC TEL is to issue a letter to all single-line customers forthwith, describing to them both the new regime (including the effective date) and the Wiring Guide and informing them of how they can obtain the Wiring Guide.
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4. BC TEL is directed to issue revised tariff pages amended as follows:
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a) Into the paragraph of General Tariff Item 97A that precedes the words "Exceptions to the foregoing will occur", insert the words "by bringing it up to requirements set out in the Wiring Guide" immediately before the words "an extra charge...."
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b) To the same paragraph, add the following:
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i) Notwithstanding the foregoing, customers may, if they choose, maintain single-line inside wire on their premises, including inside wire furnished prior to the effective date of Telecom Order CRTC 94-1143.
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ii) The Company retains ownership of all single-line inside wire on the property owner's side of the demarcation point that it furnished prior to the effective date of Telecom Order CRTC
94-1143.
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iii) Customers may modify or re-arrange single-line inside wire furnished prior to the effective date of Telecom Order CRTC 94-1143. Where a customer selects the Company to make such modifications or re-arrangements, rates and conditions in Item 170 apply.
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5. The tariff pages issued pursuant to this Order are to be effective no earlier than six months following the issue date of the letter to customers, and any IW ordered up to the effective date of these tariffs is to be subject to currently approved rates and be treated as pre-existing IW.
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Allan J. Darling
Secretary General
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