ARCHIVED - Telecom Commission Letter - 8661-B2-200602781

Letter

Ottawa, 16 August 2006

File No.: 8661-B2-200602781

BY E-MAIL

Sylvie Courtemanche
Director, Regulatory Affairs
TELUS Communications Company
6 Jules-A.-Brillant
Rimouski , Quebec
G5L 7E4
Sylvie.courtemanche@telus.com 

- and - 

Michel Gilbert
Director General, Regulatory Affairs   
Télébec
Regulatory Division
7151 Jean-Talon Street East
Anjou , Quebec
H1M 3N8
reglementa@telebec.qc.ca 

- and - 

Mirko Bibic
Head, Regulatory Affairs
Bell Canada
110 O'Connor Street , 14th Floor
Ottawa , Ontario
K1P 1H1
Bell.regulatory@bell.ca

Re:  Bell Canada's Part VII application concerning Competitor Digital Network Services in the territory of TELUS Communications Company in Quebec

On 16 March 2006 , the Commission received an application by Bell Canada pursuant to Part VII of the CRTC Telecommunications Rules of Procedure concerning Competitor Digital Network (CDN) services in the territory of TELUS Communications Company (TCC) in Quebec .

On 18 April 2006 , TCC filed a reply with the Commission, stating, among others things, that TCC and Télébec, société en commandite (Télébec) are governed by the same competition and price cap regulatory regime, and that the analysis process should be applicable to both Télébec and TCC.

On 28 April 2006 , Bell Canada filed a reply to TCC's reply, and on 29 April 2006 , Télébec filed a reply with the Commission.

Attached is a series of questions to which TCC and Télébec are asked to reply in detail, with supporting documentation, and to provide copies to the other parties, by 5 September 2006 .

The parties have until 14 September 2006 to file their comments on TCC's and Télébec's replies to the attached questions.

Where applicable, the parties have until 22 September 2006 to file their replies to the parties' comments.

Commission staff would also like to inform the parties that Tariff Notice 408 originally filed by TELUS Communications Inc. on 23 June 2005 will be addressed at the same time as the application by Bell Canada concerning CDN services in TCC's territory in Quebec . 

Sincerely,

"Original signed by S. Bédard"

Suzanne Bédard
Senior Manager, Tariffs
Telecommunications

Attach.

c.c.         Martin Brazeau, CRTC (819) 997-3498

ATTACHMENT

In Competitor Digital Network Services, Telecom Decision 2005-6, 3 February 2005 (Decision 2005-6), the Commission determined that the incumbent local exchange carriers (ILECs) had to create and provide Competitor Digital Network (CDN) services.   Decision 2005-6 identified the CDN services as having the following components:

•  access facilities for D S-0, DS-1, DS-3, OC-3 and OC-12 transmission speeds, including links ;

•  intra-exchange facilities for DS-0, DS-1, DS-3, OC-3 and OC-12 transmission speeds ;

•  metropolitan inter-exchange facilities between each core metropolitan exchange in the Company's territory and each exchange in which it provides Extended Area Service (EAS);

•  channelization facilities at the relevant wire centre to each competitor that has not co-located at a wire centre, regardless of whether the competitor self-supplies channelization facilities at the customer's premises ;

•  copper and optical co-location link facilities for D S-0, DS-1, DS-3, OC-3 and OC-12 transmission speeds ;

•  Other CO connecting link facilities.

Questions   -   To Télébec and TELUS-Québec

 •  Digital services provided

Referring to the CDN Services listed above, please provide a list of the services that the Company offers to its customers in its Quebec territory that have the same, similar or equivalent functionalities.

For each of the services listed in response to the above question, please provide:

the name of the service;

a description of the service;

to which of the CND services listed above does the service offer the same, similar or equivalent functionalities;

whether or not the service is tariffed, providing the tariff item where appropriate;

if the service is not tariffed, the reasons why.

 •  Revenues per service

•  For each of the services listed in response to Question 1, please provide in a table similar to the one shown below the Company's revenues for the year 2005, per rate band and per exchange.

•  For each of the services listed in response to Question 1, please provide in a table similar to the one shown below the Company's revenues for the year 2005 from each of its 25 largest customers subscribing to the service, expressed (1) in dollars and (2) as a percentage of the Company's total revenues for the service in question, and listing the customers in descending order, beginning with the customer that generated the highest revenues for the service in 2005.                 

For each of the services identified in response to Question 2.b), if the total revenues listed do not represent at least 80% of the Company's total revenues for the service in question, please provide the revenues and the names of the other customers driving this percentage to 80% for the service in question.

•  Competitive supply

•  For each of the services listed in response to Question 1, please state whether or not and if yes, to what point, there are alternative sources of supply for the service, including acquisition from third parties, in the Company's territory in Quebec .                                   

•  For each of the services listed in response to Question 1, please provide, with supporting rationale, the Company's opinion as to what factors impact the decisions of competitors to i) self-supply, or ii) use alternate sources of supply, including the Company's.

•  For each of the services listed in response to Question 1, please identify and describe in detail any differences, with respect to the response in Quebec 3.b), based on whether or not the competitor is co-located.

•  For each of the services listed in response to Question 1, please state to what point the differences identified in response to Question 3.c) vary based on wire centre, exchange or rate band.   If they differ, provide the company's opinion as to the reasons for these differences.

•  For each of the services listed in response to Question 1, and providing examples as illustration, please provide the Company's estimate of what it costs or would cost competitors to self-supply or use alternate sources of supply, compared with the rates that the Company in Quebec charges for its services.

•  For each of the services listed in response to Question 1, please comment on the extent of the differences in the costs provided in response to Question 3.e) between the wire centres, the exchanges and the rate bands.   Where applicable, please provide the Company's opinion as to the reasons for these differences.

 •  Competition on intra- and inter-exchange routes

Please describe, with supporting rationale, the degree of competition the Company in Quebec faces for the supply of digital facilities on the intra- and inter-exchange routes, giving the name of the company or companies offering land-based alternatives to the Company's services and the routes on which these alternatives are available.

 •  Co-location of competitors

In a table similar to the one below, please provide the most up-to-date information the Company has on its co-located competitors.

 •  Supply alternatives

For each of the services listed in response to Question 1, please provide, in a table similar to the one below, to the best of the Company's knowledge, the name(s) of the competitor(s) offering services with the same, similar or equivalent functionalities.

Questions   -   To TELUS-Québec

 •  Financial impact

In paragraph 23 of its reply to Bell Canada 's request, TCC stated that its recent estimates as to the financial impact of the introduction of CND services clearly show that TCC will sustain significant losses.   TCC further indicated that it seriously doubts that the recurring amount in its deferral account will be sufficient to offset the loss of revenue resulting from the introduction of CND services.   As a result, TCC is of the view that if its concerns prove founded, the Commission should give it the same flexibility it gave to Saskatchewan Telecommunications in paragraph 567 of Decision 2005-6, i.e., that the CDN service rates are to apply only to new competitor demand.

 TCC is asked to provide, with supporting rationale, data on the financial impact that would result from the introduction of CND services in its Quebec territory.

 •  Scope of Decision 2005-6

In its reply to Bell Canada 's request, TCC argued that in its Quebec territory, it was not subject to Decision 2005-6 and that consequently, it could not be required to offer CND services on the basis of that Decision.

TCC is asked to demonstrate, with supporting rationale, why TCC, in its Quebec territory, should not be subject to the regulatory regime established for CND services for other ILECs in Decision 2005-6.

•  Terms and conditions

In the event that TCC was required to offer CND services in its Quebec territory, TCC is asked to comment on whether or not the terms and conditions for TCC's rates in Alberta and British Columbia should apply.

Questions   -   To Télébec

10.   Télébec is also asked to provide, with supporting rationale, data on the financial impact that would result from the introduction of CND services in its territory.

11.   Télébec is also asked to demonstrate, with supporting rationale, why it should not be subject to the regulatory regime established for CND services for other ILECs in Decision 2005-6.

12.   In the event that Télébec was required to offer CDN services, Télébec is asked to comment on whether or not the terms and conditions for Bell Canada 's rates should apply.