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By letter dated 25 August 1997, pursuant to section 62 of the Telecommunications Act, BC TEL filed an application to review and vary Telecom Order CRTC 97-1033 dated 24 July 1997 (Order 97-1033).
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1. In Order 97-1033, the Commission approved Westel Telecommunications Ltd.'s (Westel) application for contribution exemption on certain circuits which were designated as dedicated data circuits. The Commission made the exemption effective the date of installation, subject to Westel providing a revised affidavit within 30 days from the date of Order affirming that it offers only data service at its Kelowna point of presence.
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2. BC TEL submitted that, among other things, while the information presented in the proceeding leading to Order 97-1033 was sufficient to warrant an exemption from contribution on the basis of a data-only configuration, it was insufficient to warrant an exemption on the basis of a dedicated configuration. Accordingly, BC TEL requested that the Order be varied so as to make it clear that the exemption was granted on the basis that the circuits were data-only, and not dedicated. The effect of such a variance would be that contribution would be payable effective 1 January 1998 pursuant to Telecom Order CRTC 97-590 dated 1 May 1997 (Order 97-590). By contrast, an exemption based on a dedicated configuration would not lapse as of 1 January 1998.
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3. By letter dated 24 September 1997, Westel reiterated that the circuits in question were utilized on a dedicated basis. Westel submitted that BC TEL's request for a review and variance was without merit.
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4. By letter dated 6 October 1997, BC TEL submitted, among other things, that further evidence is required to support an exemption on the basis of dedicated services and that, in the absence of any further evidence being submitted, its application should be approved.
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5. By letter dated 21 October 1997, Commission staff issued two interrogatories requesting Westel to provide: (1) a new circuit schematic of circuit C6064 clearly showing all switches, terminal equipment, and transmission facilities used in the connection; and (2) a written submission describing why it considers the circuits and network in question to be dedicated to its one customer.
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6. By letter dated 5 November 1997, Westel provided a new schematic of circuit C6064. Westel stated that its customer is, in fact, an Internet Service Provider (ISP) and that a typical connection is a home user (with a modem and PC) to the Internet. Westel stated that the operation uses the same principle as BC TEL's Advanced Communications services.
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7. By letter dated 14 November 1997, BC TEL noted that for the first time Westel had identified its customer as an ISP. BC TEL submitted that given the Commission's ruling in Order 97-590 that it is inappropriate to extend the existing contribution scheme to ISPs at this time, the configuration in question will remain exempt from contribution after 1 January 1998. BC TEL further submitted that in view of this new information, the variance to Order 97-1033 which it proposed in its application of 25 August 1997 is now no longer relevant. BC TEL submitted that the treatment of the configuration in question after 1 January 1998 will likely be affected by the Commission's disposition of Telecom Public Notice CRTC 97-37, dated 3 November 1997 (PN 97-37). Accordingly, BC TEL submitted that, while Order 97-1033 should be modified to clarify that the exemption currently granted therein reflects a "data-only" joint-use configuration, the Order should also reflect that the continuation of that contribution exempt status will be subject to the Commission's findings in the proceeding initiated by PN 97-37.
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8. The Commission agrees with BC TEL that, based on Westel's clarification, BC TEL's application to vary Order 97-1033 is now no longer relevant. However, based on the information by Westel in this proceeding, the Commission hereby classifies that the exemption granted to Westel in Order 97-1033 is on the basis the circuits in question carry Internet traffic.
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9. Given that the proceeding initiated by Telecom Public Notice CRTC 97-37, 3 November 1997 (PN 97-37) is to consider the appropriateness of a lighter contribution exemption regime for ISPs and not to revisit the determination made in Order 97-590 that Internet traffic is not subject to contribution, the Commission disagrees with BC TEL that the exemption given to Westel in Order 97-1033 is subject to the determinations arising from the PN 97-37 proceeding.
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Laura M. Talbot-Allan
Secretary General
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This document is available in alternative format upon request.
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