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Telecom Order CRTC 2003-450
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Ottawa, 7 November 2003
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Bell Canada
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Reference: Tariff Notices 6621 and 6621A
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Optical link arrangements
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1.
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The Commission received an application by Bell Canada, dated18 October 2001 and amended on 26 August 2003, to add item 121, Optical Link Arrangements, to its Access Services Tariff. The application proposed the introduction of optical Central Office (CO) link arrangements that would provide for transmission facilities from a Canadian carrier registered with the Commission or a Digital Subscriber Line Service Provider (DSLSP) co-located in CO building space to Bell Canada's fibre management system within the CO at OC-3 and OC-12 transmission speeds.
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2.
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In Competitor Digital Network Access service proceeding, Telecom Public Notice CRTC 2002-4, 9 August 2002 (the Competitor Digital Network Access (CDNA) proceeding), the Commission indicated that it would provide parties with an opportunity to comment on Tariff Notice 6621 in the context of the CDNA proceeding.
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3.
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In the Commission's staff letters dated 11 October 2002 and 20 March 2003, questions were posed to Bell Canada regarding its application. Bell Canada provided responses by letters dated 20 December 2002 and 30 April 2003, respectively.
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The application
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4.
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Bell Canada proposed a one-time service charge rate structure for the OC-3 and OC-12 optical CO link arrangements. The proposed rate incorporated Phase II costs plus a 25% mark-up. Bell Canada argued that this approach was consistent with the pricing principles for a Competitor Service, as defined in Price cap regulation and related issues, Telecom Decision CRTC 97-9, 1 May 1997, and with the tariff structure previously approved for the DS-1 and DS-3 CO link arrangements.
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5.
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In its amended filing, Bell Canada proposed to replace the one-time service charge rate structure for the OC-3 and OC-12 optical CO link arrangements with a monthly recurring rate. In addition, Bell Canada proposed to replace the one-time service charge rate structure for DS-1 and DS-3 CO link arrangements with a monthly recurring rate structure.
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6.
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In the response to interrogatory Bell(CRTC)20Mar03-3007 CDNA, Bell Canada provided updated cost studies in support of both a monthly recurring rate structure and a one-time service charge rate structure for optical CO link arrangements at OC-3 and OC-12 transmission speeds.
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Commission analysis and determination
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7.
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The Commission notes that there is currently an approved CDNA service for speeds of DS-0, DS-1, DS-3, OC-3 and OC-12. The Commission further notes that link arrangements for interconnecting Canadian carriers and DSLSPs are available for transmission speeds of DS-1 and DS-3.
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8.
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The Commission is of the view that Bell Canada's Optical Link Arrangements service is an important feature that would be used by competitors in conjunction with the existing OC-3 and OC-12 CDNA service. Accordingly, the Commission considers it appropriate to approve, on an interim basis, Bell Canada's introduction of the OC-3 and OC-12 optical CO link arrangements, so that Bell Canada may offer this service during the time the Commission requires to complete its examination of the application on a final basis in the context of the CDNA proceeding.
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9.
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The Commission notes that in Interconnection tariffs for carriers and telephone companies at a central office, Telecom Order CRTC 99-1201, 22 December 1999, it approved a one-time service charge rate structure for DS-1 and DS-3 CO link arrangements in item 120 of Bell Canada's Access Services Tariff.
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10.
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The Commission considers it appropriate that a one-time service charge rate structure be used, on an interim basis, with respect to the OC-3 and OC-12 optical CO link arrangements, consistent with the rate structure approved for DS-1 and DS-3 CO link arrangements.
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11.
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The Commission notes that in Tariff Notice 6621, Bell Canada proposed that the Optical Link Arrangements service be classified as a Competitor Service for rating purposes and, accordingly, applied a 25% mark-up on the associated Phase II costs. The Commission further notes that Bell Canadasubsequently reduced its proposed mark-up to 15%, in accordance with the principles established in Regulatory framework for second price cap period, Telecom Decision CRTC 2002-34, 30 May 2002 (Decision 2002-34).
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12.
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Consistent with the principles established in Decision 2002-34, the Commission considers it appropriate to adopt, on an interim basis, a one-time service charge rate that reflects a 15% mark-up on the revised one-time cost estimates filed by Bell Canada in response to interrogatory Bell(CRTC)20Mar03-3007 CDNA.
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13.
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In light of the above, the Commission approves on an interim basis the application as originally filed on 18 October 2001, subject to the following amendment: a one-time service charge rate of $2,736.00 shall apply for Optical Link Arrangements service at OC-3 and OC-12 transmission speeds. Accordingly, the Commission directs Bell Canada to issue tariff pages forthwith reflecting the determinations herein.
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14.
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The Commission notes that parties will have an opportunity to comment on Bell Canada Tariff Notice 6621, as amended by Tariff Notice 6621A, in the context of the ongoing CDNA proceeding. The Commission willadvise parties in the near future of the deadline for filing any such comments and reply comments.
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Secretary General
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This document is available in alternative format upon request and may also be examined at the following Internet site: http://www.crtc.gc.ca
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Date Modified: 2003-11-07