ARCHIVED - Telecom Order CRTC 2002-364

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Telecom Order CRTC 2002-364

Ottawa, 29 August 2002

Bell Canada
Reference: Tariff notice 6678

Additional individual residential line promotion


The Commission received an application by Bell Canada, dated 5 June 2002, to revise General Tariff item 70, Rates Schedules for Primary Exchange (Local) Service, in order to introduce a promotion for residential customers who subscribe to an additional individual line service from 15 July 2002 to 15 October 2002, inclusively. During this period, the company proposed to waive the service connection charge of $55.00 that is associated with the installation of an additional individual service line.


On 21 June 2002, Call-Net Enterprises Inc. (Call-Net) filed comments urging the Commission to deny the company's application on the grounds that such a promotion would be harmful to local competition. Call-Net argued that, because of customer inertia and the established position in the market of the incumbent local exchange carriers (ILECs), residential customers are reluctant to transfer a single individual line to a competitive local exchange carrier (CLEC). Call-Net submitted that residential customers who subscribe to the CLECs' local service are often only willing to subscribe for a second line.


Call-Net submitted that if the Commission is prepared to approve such promotions, it should consider waiving the loop service charge. Call-Net argued that any revenue foregone as a result of such a waiver could be easily compensated from the deferral account established in Regulatory framework for second price cap period, Telecom Decision CRTC 2002-34, 31 May 2002 (Decision 2002-34).


In reply comments filed on 5 July 2002, Bell Canada stated that the second line market is a very small subset of its total primary exchange service market. Bell Canada submitted that the second line market is also an incidental line of business for Sprint Canada.


Bell Canada added that its promotional offer would simply seek to stimulate demand for residential second lines. The company noted that, to the extent that second lines are an incidental line of business for CLECs, this promotion could serve to expand the addressable market for such CLECs.


The Commission considers Tariff Notice 6678 to be a legitimate promotion of limited duration. Further, on the basis of the arguments related to the size of the second line market presented in this proceeding, the Commission does not consider that this promotion could have a negative impact on Call-Net's market position.


The Commission notes that Call-Net's request for a waiver of service charges for unbundled local loops acquired from ILECs was rejected by the Commission in Decision 2002-34. In that decision, the Commission noted that the service charge for loop orders is unavoidable and causes the ILECs to incur various provisioning costs.


The Commission approves Bell Canada's application. The promotion is to be in effect for a three-month period commencing in 2002, at a date to be determined by the Company. Bell Canada is to issue tariff pages reflecting this decision.

Secretary General

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Date Modified: 2002-08-29

Date modified: