ARCHIVED - Telecom Commission Letter - 8678-C12-200605553

Letter

File Number:   8678-C12-200605553

Ottawa, 8 August 2006

By Electronic mail

Ms. Teresa Griffin-Muir
Vice President, Regulatory Affairs
MTS Allstream Inc.
45 O'Connor Street
Suite 1400
Ottawa, ON K1P 1A4

Email: iworkstation@allstream.com

Re: Review of price cap framework, Telecom Public Notice 2006-5

Dear Ms. Griffin-Muir:

Pursuant to the procedures set out in Review of price cap framework, Telecom Public Notice CRTC 2006-5, 9 May 2006, attached are interrogatories associated with this proceeding.

Responses to these interrogatories are to be filed with the Commission, and served on all the interested parties to this proceeding, by 6 September 2006.

Yours sincerely,

(Original signed by)

John Macri,
Director, Financial and Regulatory Affairs
Telecommunications

Attachment

cc: Bob Noakes, CRTC, 819-997-4429 bob.noakes @CRTC.gc.ca

Attachment

Services, Baskets and Pricing Constraints

1201            At paragraph iv) of its submission, MTS Allstream stated that, ''.the price cap regime for retail services for the next price cap period should be designed in a manner that promotes competition, protects consumers, facilitates increased reliance on market forces and reduces regulatory burden.''

a)    Indicate whether MTS Allstream's objectives of promoting competition and facilitating increased reliance on market forces are similar.   If not, explain why not.  

b)   Indicate whether MTS Allstream's objective of protecting consumers is different from the Companies ' Objective 1 (to render reliable and affordable services of high quality, accessible to both urban and rural area customers).   If yes, explain why.

c)    Indicate whether MTS Allstream's objective of reducing regulatory burden is different from the Companies ' Objective 3 (to adopt regulatory approaches, as necessary, that use measures that are efficient and proportionate to their purpose and that interfere with the operation of competitive market forces to the minimum extent necessary to meet the previous objectives).   If yes, explain why.

1202            A)    In response to interrogatory MTS Allstream(CRTC)06May23-203, the company states the following:

MTS Allstream, therefore, respectfully submits that the information sought by this interrogatory is not within the scope of this proceeding.

Refer to the third bullet in paragraph 22 of Review of price cap framework, Telecom Public Notice CRTC 2006-5, 9 May 2006 , which indicates that the issue of pricing constraints for baskets of services is within the scope of this proceeding.   Given that the Commission has not specifically excluded the issue of pricing constraints on competitor services, please provide MTS Allstream's view on:  

i)   the continued application of a pricing constraint equal to inflation less the productivity offset (I-X) to ILEC services assigned as Category I Competitor Services; and 

ii)    the application of a pricing constraint equal to I-X to all ILEC services assigned as Category II Competitor Services. 

B)       Refer to paragraph 44 of MTS Allstream's submission which states the following:

Since ILEC residence NAS growth has been and is expected to continue to decline year-over-year a reduction in the existing productivity offset of at least 60% is warranted.  

Discuss, with supporting rationale, whether MTS Allstream's proposal, as outlined above would also apply to any pricing constraint adopted in respect of the Competitor Services basket.  

Rate De-averaging

1301          In Forbearance from the regulation of retail local exchange services , Telecom Decision CRTC 2006-15, 6 April 2006, paragraph 488, the Commission indicated that it was ''.prepared to consider applications from an ILEC requesting the removal of the local winback rule in a relevant market when the applicant ILEC can demonstrate that it has lost 20 percent of its market share in that relevant market.''.

Provide MTS Allstream's view on a similar transitional measure with respect to the prohibition on rate de-averaging based on, among other things, a percent market share loss in that relevant market.   Identify, with supporting rationale, the percentage market share loss level to justify this transitional measure.