ARCHIVED - Telecom Commission Letter - 8661-N1-200708704

Letter

Ottawa, 24 July 2007

File No. 8661-N1-200708704

By E-mail

Dallas Yeulett
Manager, Regulatory Affairs
Northwestel Inc.
P.O. Box 2727
Whitehorse, YT
Y1A 4Y4

regulatoryaffairs@nwtel.ca

Dear Mr.Yeulett:

Re: Part VII Application requesting revisions to Northwestel's Inc. (Northwestel) Residence Primary Exchange Service costing for the purpose of calculating the H1- band subsidy for Northwestel as established in Telecom Decision CRTC 2007-5

On 4 June 2007, the Commission received a Part VII application by Northwestel.

To assist the Commission to dispose of this application by the fourth quarter 2007, Northwestel is requested to provide responses to the attached questions in the Attachment by 27 August 2007.

Yours sincerely,

'Original signed by Y. Davidson'

Yvan Davidson
Senior Manager
Competitor Services and Costing

cc: B.Natraj (Nat Natraj 819-953-5081)

Attachment

1. In paragraph 14 of Northwestel's submission dated 4 June 2007, it is stated that "operating expense cash flows were originally developed as company averages by examining the Company's accounting systems for costs relevant to providing primary exchange services (PES), determining the allocations to PES and then determining unit costs". In paragraph 16 of its submission, Northwestel also stated that for this application, "the company performed detailed studies of each operating expense cash flow to determine the proportion of operating expenses causal to Whitehorse and Yellowknife (Band D), and all other communities (Band H1)".
   
   For Band H1 (if available) or for total company, for each major operating expense cash flow included in the above-noted study, provide the allocations used for each of   residence PES, Business PES, and non-PES (Internet, toll, and local calling features), explaining the methodologies and assumptions used to determine each allocation.
   
   
2. With respect to the operating expense cash flows included in the company's 4 June 2007 study:

   a)   Indicate whether the company receives revenues from tariffed rates other than the monthly recurring PES rate such as one-time charges associated with order processing, line connection, premises visit and premises work that would be used to recover any of the expense cash flows included in the above-noted study; if so, identify these expense cash flows and provide a revised study for Band H1 that excludes such expenses or alternatively reduces these expenses by the associated one-time charges.

   b)   For Band H1, provide the revenues received from the one-time residential charges identified in part a) above for each of the years 2005 and 2006, as expressed on a total dollars basis and on a monthly per NAS basis.

3. Refer to line entitled "NAS related systems investment software" in Attachment 7A of the company's submission dated 4 June 2007 .

For each of the years 2006 to 2010, provide a breakdown of the total software costs into major resource component, describing each component. For each of the major resource components, provide the assumed percentage of the company's total costs assigned to residential PES, with supporting rationale