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ARCHIVED -  Telecom Order CRTC 97-762

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Telecom Order

Ottawa, 5 June 1997
Telecom Order CRTC 97-762
On 2 April 1997, BC TEL filed an application under Tariff Notice 3608 (TN 3608), proposing a revision to its General Tariff providing for the introduction of a market trial for Calling Party Pays (CPP) service.
File No.: TN 3608
1. In its application, BC TEL stated that CPP would be implemented using Advanced Intelligent Network (AIN) technology in order to provide increased functionality to the Wireless Service Providers (WSPs), enable WSP customers to retain their existing numbers and to address concerns with respect to leakage and uncollectibles associated with similar services offered by other North American providers.
2. BC TEL proposed a call-carrying charge of $0.25 per minute payable by the WSPs and an Accounts Receivable Management (ARM) discount of 6.8%.
3. On 24 April 1997, Clearnet Communications Inc. (Clearnet) filed comments on the BC TEL proposal stating that the proposed call-carrying charge is unwarranted and excessive in light of the bottleneck nature of the proposed service offering.
4. Clearnet also stated that the rate structure associated with the ARM agreement is inconsistent with the Commission's determinations in Unbundled Rates to Provide Equal Access, Telecom Decision CRTC 97-6, 10 April 1997 (Decision 97-6) and noted that the ARM discount of 6.8% is substantively higher than the 3.5% ARM discount approved in Decision 97-6.
5. BC TEL filed reply comments on 5 May 1997 stating that CPP should be regarded in the same manner as an optional local service and noted that rates for optional local services have generally been required to maximize contribution. BC TEL submitted that CPP should be accorded the same opportunity to generate additional contribution that will serve to offset the company's Utility segment shortfall.
6. BC TEL also replied that the 3.5% ARM discount specified in Decision 97-6 reflects the cost associated with administering the agreement within the parameters of the particular services covered by that Decision. BC TEL stated that the proposed 6.8% ARM discount for CPP is designed to recover costs arising from bad debt, fraud and other non-payment of charges which the company expects from this particular service.
7. Clearnet submitted additional comments on 13 May 1997 in response to BC TEL's reply comments.
8. Clearnet noted that the proposed CPP service offering does not accord an optional service offering to BC TEL's wireline subscribers, but provides for the underlying transport, interconnection, billing and collection components which are required in the provision of a specific supplemental service offering to a given WSP's subscriber, and which may be described as essential facilities pursuant to Local Competition Telecom Decision CRTC 97-8, 1 May 1997 (Decision 97-8).
9. Clearnet further stated that the underlying components for the proposed CPP service offering are clearly within the monopoly control of BC TEL and cannot be economically or technically duplicated by a given WSP.
10. Clearnet submitted that, to the extent that the call-carrying charge provides for several underlying essential bottleneck functions for the provision of the proposed CPP service offering, the Commission should direct BC TEL to identify the underlying bottleneck components associated with the aggregate call-carrying charge and provide for an appropriate cost-based pricing methodology for each unbundled component.
11. On 14 May 1997, BC TEL submitted further reply comments and stated that the rulings of the Commission in Decision 97-8 relate specifically to the need for the incumbent local exchange carriers to provide essential facilities in order to accommodate the provision of alternative primary exchange services by new entrants and therefore have no direct bearing on TN 3608.
12. BC TEL submitted that the company has, for some time now, made available to WSPs the essential facilities needed by them in order to provide a fully functional service.
13. The Commission notes that this is the first service offering by BC TEL using AIN technology.
14. The Commission considers the CPP service offering to be a discretionary service. However, the Commission considers that some of the underlying AIN-based access components used to provide the CPP service offering are bottleneck components.
15. Based on the record of this proceeding, the Commission is of the view that the call-carrying charge of $0.25 per minute is appropriate. However, before disposing of TN 3608 on a final basis, the Commission requires that BC TEL file tariff revisions providing for unbundled AIN-based access components to allow alternate service providers to provide AIN service features similar to BC TEL's CPP service offering.
16. In light of the foregoing, the Commission orders that:
(a) the application filed by BC TEL under TN 3608 is approved on an interim basis; and
(b) BC TEL is required to file within 30 days proposed tariff revisions providing the underlying unbundled components for access by alternate service providers, for the purpose of providing AIN service features similar to BC TEL's CPP service offering.
Allan J. Darling
Secretary General
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