ARCHIVED -  Telecom Order CRTC 97-591

 Telecom Order

 Ottawa, 1 May 1997

 Telecom Order CRTC 97-591

 Responsibility for Carrier Specific Costs for the Provision of Local Number Portability.

 File No.: 95-1159

1.  In Implementation of Regulatory Framework - Local Number Portability and Related Issues, Telecom Public Notice CRTC 95-48, 10 November 1995 (PN 95-48), the Commission established an industry committee now called the CRTC Interconnection Steering Committee (CISC) to address issues associated with local number portability (LNP) and to make recommendations to the Commission. Consensus was not achieved in the CISC on the responsibility for recovery of carrier specific costs for LNP and accordingly this issue was referred to the Commission for resolution.

2.  Comments were received from AT&T Canada Long Distance Services Company, Canadian Cable Television Association, Microcell Telecommunications Inc., Rogers Communications Inc. (Rogers), and Stentor Resource Centre Inc. (Stentor) representing BC TEL, Bell Canada, The Island Telephone Company Limited, Maritime Tel & Tel Limited, MTS NetCom Inc., The New Brunswick Telephone Company, Limited, NewTel Communications Inc. and TELUS Communications Inc. (collectively "the Stentor-member companies" or Stentor). In addition to the parties providing comments, reply comments were also received from Call-Net Enterprises Inc., Canadian Wireless Telecommunications Association, Clearnet Communications Inc. (Clearnet), and the Public Interest Advocacy Centre.

3.  The Stentor companies stated that they will have to bear a disproportionate amount of the cost of implementing LNP in the industry because of the large number of switches they have in their networks and because of the range of technologies and vintages of their switches while the new entrants would have few switches that would all be new and equipped with LNP capabilities from the outset.

4.  The Stentor-member companies stated that requiring them to pay all of their costs of implementing LNP in their networks would be inequitable and place them at a competitive disadvantage.

5.  Rogers, among others, agreed that the Stentor-member companies would bear a large cost but noted that the entrants would also have to equip their networks for LNP and that since the Stentor companies had many more subscribers than the new entrants, the cost per subscriber for the new entrants could be higher than the cost per subscriber for the Stentor-member companies, therefore they would not be at a competitive disadvantage.

6.  Other participants stated that the underlying facilities acquired to provide service portability would also be useful for other purposes including location portability.

7.  The Stentor-member companies stated that new entrants were the cause of the costs and that it would be unjust for their subscribers to bear the costs of services they would not use. Other participants stated that the cause of LNP is the government policy to encourage competition.

8.  Pursuant to Section 7(f) of the Telecommunications Act, it is a canadian telecommunications policy objective to foster increased reliance on market forces for the provision of telecommunications services.

9.  In Review of Regulatory Framework, Telecom Decision CRTC 94-19, 16 September 1994, the Commission found that increased local competition is in the public interest.

10.  In its report entitled, Competition and Culture on Canada's Information Highway, 19 May 1995, the Commission stated that solutions for LNP must be sought to facilitate competition.

11.  In the furtherance of the above, the Commission has determined that competition in the provision of local exchange services is in the public interest and that LNP is required for effective competition.

12.  In PN 95-48, the Commission considered that the most desirable interim solution to LNP is one that involves a database structure that could evolve into a long term arrangement.

13.  In Local Competition, Telecom Decision CRTC 97-8, 1 May 1997, the Commission adopted the principle that competitive local exchange carriers are not simply customers of the companies but are carriers equal in stature to the companies in the local exchange market.

14.  The Commission considers that the facilities required for LNP will be used by the Stentor-member companies to participate in the competitive local market and will also be useful for the companies in the provision of new services.

15.  In light of the foregoing, the Commission finds that it is appropriate that each carrier be responsible for the recovery of its own costs associated with the implementation of LNP.

16.  The Stentor-member companies stated that requiring new entrants to pay part of the costs would ensure that specific demands to implement LNP are rational and would confirm seriousness of intent.

17.  The Stentor-member companies stated that in order to permit testing of the level of interest in portability, to improve on the engineering and to make better investment decisions, a gradual roll-out of LNP should be considered. Other participants noted that the CISC indicated a consensus on the need for roll-out criteria.

18.  The Commission considers it essential that appropriate roll-out criteria are established to ensure that resources are used efficiently.

19.  The Commission will request the CISC to study the issue of roll-out criteria for LNP and make recommendations to the Commission no later than 18 July 1997.

20.  The Commission also recognizes that there is a need to determine the means by which the Stentor companies will recover their costs specific to LNP. The Commission will initiate a proceeding to address this issue shortly.

Allan J. Darling
Secretary General

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