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Ottawa, 31 July 1998
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Telecom Order CRTC 98-761
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On 14 August 1997, Stentor Resource Centre Inc. (Stentor) filed a proposal for the introduction of Local Number Portability - Access to Service Control Point (LNP-SCP) service on behalf of BC TEL, Bell Canada, The Island Telephone Company Limited (now called Island Telecom Inc.), Maritime Tel & Tel Limited, MTS Communications Inc., The New Brunswick Telephone Company (now called NBTel Inc.), Limited, and NewTel Communications Inc. On 17 December 1997, TELUS Communications Inc. (TCI) submitted its own proposal for this LNP-SCP access service.
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File Nos.: Stentor Tariff Notice (TN) 529 and TCI TN 990
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1.The tariff components proposed by Stentor and TCI include a system administration service (SAS) charge relating to service order work activity, a monthly service provider portability subscription fee (SPPSF) to provide the required maintenance enhancements and billing and data collection features, and a Location Routing Number (LRN) query charge based on each query request.
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2.Stentor submitted that the proposed LNP-SCP access rates are market-based, since a competitive multi-SCP environment is expected.
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3.The Stentor filing also includes proposed technical specifications for the message sets and capabilities to be used for the LNP requirements, as well as proposed non-disclosure and confidentiality interconnection draft agreements.
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4.The proposed rates and costs supporting TCI's proposed service are identical to those provided in Stentor's TN 529.
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5.In accordance with the procedures established by the Commission in its letter of 24 October 1997, comments were filed by Clearnet Communications Inc. (Clearnet), fONOROLA Inc. and Call-Net Enterprises Inc., on 5 December 1997, and by Microcell Telecommunications Inc. (Microcell), on 10 December 1997. Reply comments were filed by Stentor on 12 December 1997. As well, the above-mentioned intervening parties submitted earlier comments and reply comments in September and November of 1997. In the September round of comments, comments were also received from MetroNet Communications Corp.
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6.With respect to TCI TN 990, Clearnet filed comments on 19 January 1998. Reply comments were filed by TCI on 29 January 1998. In addition, Commission interrogatories were posed on 4 February 1998 in order to clarify certain costing assumptions and the inter-working relationship between Stentor's national LNP-SCP access tariff and TCI's proposed LNP-SCP access tariff.
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Stentor's Market Share Assumptions
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7.Stentor submitted that the costs and rates contained in its supporting economic study are based on the assumption that it will lose 50% of the LNP-SCP access market as self supply or recourse to SCP service providers other than the Stentor owner companies (SOCs) are or will very soon be available. Several interveners questioned Stentor's demand assumptions given the current lack of competitive providers of this service. Interveners also stated that competitive alternatives are not, and will not, be available in the near future.
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8.Based on the record of this proceeding, the Commission considers that Stentor's demand assumption, i.e., that the SOCs will have 50% of the non-Stentor traffic over the study period is reasonable and is consistent with the Commission's intentions of promoting a competitively or co-operatively provided LNP-SCP, as stated in its 25 October 1996 letter. Accordingly, the Commission accepts Stentor's proposed demand assumptions.
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9.In addition, the Commission notes that in a demand sensitivity where the SOCs are assumed to carry 100% of the non-Stentor traffic, only the monthly SPPSF rate element is affected, as resource cost studies were used to develop the costs for both the SAS charge and the per query rate.
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Stentor's Proposed SAS Charge
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10.Stentor's proposed tariff includes an up-front SAS charge of $135,000 to recover the costs of setting up the interface between the competitive service provider's CCS7 network and the SCP.
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11.Stentor's proposed SAS costs primarily relate to customer billing set-up and billing verification work and incremental carrier service group (CSG) activities related to issuing the bill, billing disputes and adjustments and collection of service charges. The charges also recover the costs for the initial engineering, operations and translations work to provision the initial CCS7 interconnection arrangement.
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12.Most interveners took issue with the SAS charge, submitting that the SOCs do not require any significant work beyond what is already required to implement CCS7 interconnection, that the charge is prohibitively high and will curb competitive entry and that it represents a barrier to competition.
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13.Stentor submitted that the SOCs will be incurring sizeable up-front costs during the establishment of LNP-SCP access, and the proposed application of this rate will partially alleviate the heavy resource investment costs associated with the front-end introduction of the LNP-SCP.
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14.The Commission notes that the majority of the SAS costs relate to the initial account set-up and verification activities and the ongoing work associated with billing queries and adjustments. The Commission finds it reasonable to expect that such activities would be incurred in setting up the LNP-SCP access service and considers Stentor's estimate of the SAS costs to be reasonable.
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15.The Commission, however, considers that the proposed up-front SAS charge of $135,000 represents a sizeable commitment for a service provider subscribing to LNP-SCP access service and agrees with interveners that this high up-front charge may discourage a service provider from switching to an alternative SCP provider, and may curb competitive entry.
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16.The Commission notes that in a rate sensitivity where the study period is increased from 5 years to 7 years, the SAS charge is reduced to $50,000, and the remainder of the SAS costs are included in the LRN query rate, the per query rate remains unchanged at $1.05 per 1 000 queries.
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17.The Commission is of the view that the adoption of a lower SAS charge of $50,000 and the recovery of the remaining SAS costs through use of the LRN query rate would represent a reasonable compromise between the SOCs' need to recover the sizeable up-front costs incurred to establish LNP-SCP access and the need to ensure that the high up-front commitment does not constitute a barrier to competitive entry.
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Stentor's Proposed Monthly SPPSF Rate
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18.Stentor's proposed tariff includes a monthly recurring SPPSF rate of $2,750 relating to the development of billing data collection, maintenance enhancements and system billing changes.
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19.This rate element is designed to recover the costs causal to the introduction of the LNP-SCP access service (i.e., offered to non-Stentor service providers), for which Stentor has proposed recovery on the basis of a monthly recurring rate, applicable to each non-Stentor service provider.
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20.Call-Net has taken issue with the SPPSF rate, questioning whether it would not be more appropriate to recover these one-time costs through a one-time charge given that the SPPSF activities will occur once, before LNP-SCP is launched, as the associated costs cover the planning development, implementation and testing of system billing changes.
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21.Unlike the up-front SAS costs which are specific to the setting-up activities of each competitive service provider, the Commission notes that the costs associated with this rate element are incurred as a result of the introduction of the service as a whole and are to be recovered on the basis of the service provider demand over the entire study period.
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22.The Commission notes that the proposed SPPSF rate assumes a 5-year study period. The Commission further notes that in response to a Commission interrogatory associated with a rate sensitivity involving an extended 7-year study period, the SPPSF rate under this sensitivity was lowered to $2,230.
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23.The Commission considers that at a rate of $2,000, there would be sufficient revenues to recover the service introduction costs and to provide an appropriate mark-up. The Commission is therefore of the view that the adoption of an SPPSF rate of $2,000 would be consistent with the objectives of cost recovery and of promoting competitive supply for this service.
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Stentor's Proposed LRN Query Rate
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24.Stentor's proposed tariff includes an LRN query rate of $0.00105 for each query request, or $1.05 per 1 000 queries, to recover the costs related to the use of Bellcore's LNP system, i.e., both hardware and software and associated maintenance, and the per-query network usage pertaining to the SOCs' STP-SCP links.
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25.The Commission considers that Stentor's proposed per query costs and assumptions provided in the supporting economic study and in response to interrogatories, are appropriate.
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26.As discussed earlier, the Commission considers that if the study period is extended to 7 years and the SAS charge is reduced to $50,000, the LRN query rate of $1.05 per 1 000 queries will allow for an appropriate recovery of the unrecovered SAS costs.
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27.The Commission also considers that the LRN query rate of $1.05 per 1 000 queries will promote the objective of competitive supply for this service and is appropriate. Accordingly, the Commission approves an LRN query rate of $1.05 per 1 000 queries.
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TCI's Proposed LNP-SCP Service
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28.As noted in paragraph 4, TCI's proposed rates for its LNP-SCP access service are based on Stentor's proposed rates and costs.
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29.The Commission finds TCI's responses to concerns over the inter-working relationship between Stentor's national LNP-SCP access tariff and TCI's proposed LNP-SCP access tariff, to be adequate.
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30.TCI has confirmed that its LNP-SCP access service, which provides identical functionality, is separate and distinct from Stentor's proposed offering. TCI submitted that the main difference between these two services is with respect to where the competitive service provider must obtain CCS7 access.
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31.TCI submitted that while Stentor's national LNP-SCP access service will offer all Canadian ported number data and will be available at all non-TCI Stentor gateways, TCI's LNP-SCP access service offers access to SCPs which will only contain ported number data relevant to exchanges in the 403 NPA (numbering plan area) and will only be available at TCI's gateway STP.
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32.The Commission notes that TCI has indicated that its database could be expanded to include LNP data for the whole country if there is sufficient customer interest, although the required expansion of the download and storage capacity of TCI's system would cause additional costs and may necessitate increases in the proposed rates.
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33.The Commission notes that TCI's LNP-SCP access service is optional in the sense that no carrier is compelled to subscribe to the service, regardless of CCS7 interconnection arrangements, and that potential customers have the option of self-supply or the use of other SCP providers, including the Stentor service.
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34.The Commission finds reasonable TCI's proposal to base its LNP-SCP access rates on Stentor's proposed LNP-SCP access rates.
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35.The Commission therefore approves TCI's proposed LNP-SCP tariff revisions, subject to the approved changes to Stentor's LNP-SCP access tariff, as specified in this Order.
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Alternate Serving Arrangements
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36.The proposed LNP-SCP access service proposed by Stentor and TCI is based on the Advanced Intelligent Network (AIN) protocol and implies that only AIN capable carriers can have access to the Stentor/TCI LNP-SCP.
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37.Microcell has requested that the LNP-SCP access service proposed by Stentor and TCI include an option for carriers that are not AIN capable.
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38.The Commission notes that Stentor's proposal for its AIN LNP-SCP service is based on serving arrangements generally supported by the Canadian telecommunications industry, i.e., based on switching vendors' implementation of the LNP trigger which follows the AIN 0.1 industry standard for LNP.
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39.The Commission further notes that Stentor has not refused to consider alternate arrangements employing the Intelligent Network (IN) protocol, as requested by Microcell. Stentor indicated that the incremental costs incurred to provide such alternate IN serving arrangements should be recovered from users of the service since the requested alternative represents a functionality that the SOCs would have no reason to deploy for themselves other than to meet the requirements of users such as Microcell.
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40.The Commission considers that these alternate service arrangements should be provided only when such requests are made.
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41.Accordingly, Stentor and TCI are directed to make available alternate arrangements employing the IN protocol when a request for such has been made. The SOCs will be allowed to recover the incremental costs incurred to provide the service.
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Confidentiality and Non-Disclosure Agreements
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42.The LNP-SCP access service proposed by Stentor includes draft interconnection confidentiality and non-disclosure agreements.
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43.Interveners requested that a number of changes be made to these agreements.
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44.The Commission notes that the interconnection confidentiality and non-disclosure agreements that Stentor has proposed are similar to agreements that the Commission has previously approved.
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45.In contrast, TCI has not attached a draft agreement but instead proposes to amend existing or future non-disclosure agreements with the interconnecting company to accommodate the specifics of this service.
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46.With respect to TCI's proposal, Clearnet claimed that TCI's proposed asymmetrical terms and conditions on interconnecting carriers are inappropriate in a co-carrier regime characterized by trunk-side and CCS7 interconnection arrangements and should be removed as the liability provisions included in the proposed LNP-SCP tariff are inherently accommodated in the rates.
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47.TCI submitted that its proposed provisions are required to protect TCI and its customers from potential consequences, including resultant financial implications, which could arise as a result of the provision by TCI of LNP-SCP access, and in addition to ensure that there are no impediments to TCI's continued efforts directed toward improvement and enhancement of TCI's network.
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48.The Commission notes that the issues regarding TCI's proposed terms and conditions pertaining to liability and indemnification will further be addressed in the proceeding established pursuant to Review of the Terms of Service and General Regulations of Telephone Companies with Respect to Services and Facilities Provided to Competitive Providers of Telecommunications Services, Telecom Public Notice CRTC
97-40, 1 December 1997 (PN 97-40).
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49.With the exception of the amendments set out below, the Commission is of the view that these agreements are generally appropriate. The Commission therefore approves the proposed interconnection confidentiality and non-disclosure agreements with the exception of the following amendments:
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(i) under section 4 page 5, Stentor is directed to include a clause that obliges it to inform the competitive local exchange carrier (CLEC) when and where it passes along confidential information to another company;
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(ii) under section 8 page 9, Stentor is directed to include a section that requires notification to be given when one party wishes to make a "change to procedures";
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(iii) under the Acknowledgement agreement at page 19, Stentor is directed to include a clause to indicate that the secondary incumbent local exchange carriers (ILEC) and/or its subsidiaries are required to maintain confidential information given to its primary ILEC under the same terms and conditions of confidentiality as the primary; and
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(iv) all references to "the customer" should be changed to "the competitive service provider".
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50.The Commission approves TCI's proposed terms and conditions pertaining to liability and indemnification on an interim basis, pending the decision on the related issues to be determined in the proceeding pursuant to PN 97-40.
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Miscellaneous Changes
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51.Certain interveners requested that a number of miscellaneous changes be made to the proposed LNP-SCP access tariffs. The outstanding items to be considered are (i) whether the term "AIN Interconnection" contained in the proposed tariffs should be replaced with "CCS7 Interconnection" and (ii) whether TCI's proposed tariffs should also recognize that non local exchange carriers (non-LECs) might be allowed to port numbers.
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52.The Commission accepts Stentor's position to not replace the proposed term "AIN Interconnection" with "CCS7 Interconnection", as it would provide competitors with an opportunity to interconnect a broad range of signalling message sets, including those unrelated to the operation of LNP.
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53.The Commission notes that the proposed rates have been established only with respect to LNP-SCP access.
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54.The Commission notes that TCI has proposed to delete references which assume that only LECs may port numbers, upon the filing of final tariff pages for its LNP-SCP access service. The Commission concludes that this issue has been resolved.
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55.With the exception of TCI's proposed terms and conditions pertaining to liability and indemnification, which are approved on an interim basis only, pending the Commission's decision on the related issues pursuant to PN 97-40, the Commission hereby approves Stentor's and TCI's proposed LNP-SCP access tariffs, subject to the changes specified in this Order.
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56.Stentor and TCI are directed to issue tariff pages forthwith reflecting the changes in this Order to the respective tariff revisions proposed by Stentor and TCI.
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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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