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Ottawa, 26 June 2009

File No.: 8663-C12-200909658

BY E- MAIL

Distribution

Subject: Local Competition in SILEC territories

Dear Madams and Sirs;

The Commission has received local competition implementation plans from certain small incumbent local exchange carriers (SILECs) submitted in response to requests for local competition made by competitive local exchange carriers (CLECs): TELUS Communications Company (TCC), Bragg Communications Inc. carrying on business as Eastlink (Eastlink), and Shaw Telecom Inc. (Shaw). The SILECs that received requests from TCC are Téléphone Guèvremont inc., La compagnie de téléphone de Lambton inc., Le téléphone de St-Éphrem, La compagnie de téléphone de St-Victor inc., Cooptel, Téléphone Milot inc., Sogetel inc., and La compagnie de téléphone Upton inc. Bruce Telecom, Mornington Communications Co-operative Limited (Mornington) and Tuckersmith Communications Co-operative Limited received requests from Eastlink. KMTS received a request from Shaw.

The Commission also received comments from Cogeco Cable Inc. regarding the local competition plans submitted by the SILECs that were the object of TCC's requests for local competition.

The Commission has also received requests from Rogers Wireless Inc. for the provision of wireless number portability (WNP) in the SILEC territories of Amtelecom Inc., Bruce Telecom, City West Telephone Corporation, and KMTS.

The companies are required to provide responses to the attached questions by date + 5 weeks. The questions are divided into the following three groups of respondents: SILECs, competitive local exchange carriers (CLECs), and wireless service providers (WSPs).

Comments on the responses are to be filed by (date + 7 weeks) and reply comments by (date + 9 weeks).

Where a document is to be filed or served by a specific date, the document must be actually received, not merely sent, by that date.

Documents filed with the Commission by parties in relation to this proceeding will be placed on the public record, unless the party filing the document asserts a claim of confidentiality at the time of such filing.

Any claim for confidentiality made in connection with a document filed with the Commission or requested by the Commission or any party shall be accompanied by the reasons thereof, and, where it is asserted that specific direct harm would be caused to the party claiming confidentiality, sufficient details shall be provided as to the nature and extent of such harm.

A party claiming confidentiality in connection with a document shall file with the Commission an abridged version of the document to be placed on the public record or reasons for objecting to the filing of an abridged version thereof.

Sincerely yours,

Original signed by Mario Bertrand for

Paul Godin

Director General

Competition, Costing & Tariffs

Communications

cc: ACTQ sdesy@actq.qc.ca

SATAT sbray@deloitte.ca

OTA jonathan.holmes@ota.on.ca

CWTA documentcontrol@cwta.ca

Comgate Telemanagement Ltd choquette@comgate.com

Questions addressed to SILECs

In responding to these questions, provide supporting rationale and any available supporting evidence (e.g. financial statements).

1. Provide a map of your incumbent serving territory that identifies the lower and higher population density area, and explain what the company considers to be a “lower” and “higher” population density area. In addition, identify the percentage of (i) residence and (ii) business network access services (NAS) that are in the lower population density areas of your serving territory.

2. Assume that the Commission approves the introduction of local competition in your serving territory and an exogenous adjustment that would allow the company to recover its implementation and ongoing costs for local competition and local number portability (LNP):

a. Assume that the company decides to exercise the pricing flexibility provided by the exogenous factor by increasing its local service rates to fully recover the implementation and ongoing costs for local competition and LNP. Discuss, with supporting rationale, the impact that implementing such rate increases would have on the company's competitive position and its financial viability over the long term;

b. Assume that the company decides to absorb its implementation and ongoing costs for local competition and LNP. Discuss, with supporting rationale, the impact that this action would have on the company's competitive position and its financial viability over the long term;

c. If it would not be feasible for the company to fully recover the above-noted costs through local service rate increases, indicate, with consideration to the company's competitive position and financial viability, the maximum portion of the costs that the company could recover through local service rate increases;

d. Assume that the company recovers the portion of costs indicated in response to 2(c) and absorbs the remaining implementation and ongoing costs for local competition and LNP. Discuss, with supporting rationale, the impact that this action would have on the company's competitive position and its financial viability over the long term.

3. Assume that the Commission has approved the introduction of local competition in your serving territory but required competitors to pay for a portion (for example, 50%) of your company's implementation and ongoing costs for local competition and LNP. As a result, the Commission would approve a smaller exogenous factor that would allow the company to recover the remaining implementation and ongoing costs for local competition and LNP:

a. Assume that your company decides to exercise the pricing flexibility provided by the exogenous factor by increasing its local service rates such that it would fully recover the remaining costs. Discuss, with supporting rationale, the impact that implementing such rate increases would have on the company's competitive position and its financial viability over the long term;

b. Assume that your company decides to absorb the remaining implementation and ongoing costs for local competition and LNP. Discuss, with supporting rationale, the impact that this action would have on the company's competitive position and its financial viability over the long term.

4. Assume that the Commission has approved the introduction of local competition in your serving territory but required competitors to pay for all of your implementation and ongoing costs for local competition and LNP. Discuss, with supporting rationale, the impact that this action would have on the company's competitive position and its financial viability over the long term.

5. Assume that the Commission has approved the introduction of local competition in your serving territory without mandating the implementation of LNP. Discuss, with supporting rationale, the modifications, if any that this would have on your responses to questions 2 to 4.

6. Assume that the Commission has approved the introduction of local competition in your serving territory:

a. Provide, with supporting rationale, the maximum market share loss which the company considers it could viably sustain. Elaborate on the impact that this loss on market share would have on the company's costs and revenues from all sources. State any assumptions you made;

b. Provide the company's views on what is going to happen to the availability of telephone services to the customers in its serving territory – in particular those in the lower density areas - in the event that the CLEC 's market share exceeds the sustainable level identified in your response to a. above.

7. Provide the company's views on alternatives to the company and/or the CLEC and/or WSP paying the implementation and ongoing costs of local competition and LNP and wireless number portability, including any existing or new regulatory mechanism that could be applied.

8. Confirm whether the company can provide, or will be able to provide in the near future the following services: high-speed Internet access, television service, and wireless telephone service.

ONLY to SILECs that have received a request for WNP

1. If it were determined that local competition should not be implemented in your serving territory, provide a discussion on whether the Commission should still require the implementation of wireless number portability?

Questions addressed to CLECs

1. For each of the SILEC territories that the company intends to enter:

a. Provide an estimate of the number of residential and business local access lines [1] that the company will be capable of serving at the time of competitive entry. If this information is not available, provide the total estimated number of residential dwellings and the total estimated number of businesses that the company will be capable of serving;

b. Identify whether the company has any plan to expand its current footprint/coverage or otherwise build new facilities. Discuss any barriers that the company would face in order to serve customers in lower population density areas of the relevant SILEC serving territory;

c. Provide, separately, the estimated number of residence and business local access lines (or proxy for local access lines as set out in 1a. above) that the company expects to capture from the time of competitive entry to:

i. 1 year after

ii. 3 years after

iii. 5 years after

2. Assume that the Commission requires, as a condition of entry, that CLECs pay a portion or all of the SILEC's costs related to local competition and local number portability (LNP). For each SILEC territory the company plans to enter:

a. Indicate whether the company would still pursue the introduction of local service;

b. Comment on whether it would be appropriate for subsequent entrants to pay a portion of the SILEC's related to the implementation and ongoing costs of local competition and LNP. If yes, on what basis should these costs be apportioned and over what period of time from the date of initial entry should subsequent entrants be liable for such apportionment.

3. Provide the company's views on alternatives to the company and/or the SILEC and/or WSP paying the implementation and ongoing costs of local competition and LNP, and wireless number portability, including any existing or new regulatory mechanism that could be applied.

4. For each SILEC territory your company presently plans to enter, would your company consider providing local service should the Commission not mandate the implementation of LNP?

5. Assume that the company's market share is such that the SILEC finds itself unable to continue operations under current regulations, provide your views on what approach the Commission should take in order to ensure the continued availability of telephone services to the customers in the SILEC's serving territory – in particular those in the lower population density areas.

Questions addressed to WSPs

1. For each of the SILECs' territories where the company is requesting wireless number portability, provide a map of wireless coverage where the company can provide reliable service. Provide an estimate of the number or percentage of the SILEC's subscribers that the company can reliably serve.

2. Assume that the Commission requires that WSPs pay a portion or all of the SILEC's costs related to the implementation of WNP. For each SILEC territory for which the company has made a request for WNP:

a. Indicate whether the company would still maintain that request;

b. Comment on whether it would be appropriate for subsequent WSPs making use of WNP in the SILEC territory to pay a portion of the SILEC's costs related to the implementation of wireless number portability. If yes, on what basis should these costs be apportioned and over what period of time from the date of initial implementation should subsequent WSPs be liable for such apportionment.

3. Provide the company's views on alternatives to the SILEC and/or the company paying the costs of implementing wireless number portability, including any existing or new regulatory mechanism that could be applied.

[1] Local access lines are measured by Network Access Service (NAS). For this purpose, NAS is defined as a wireline connection from a customer location to the service provider's office.

Distribution List

TELUS Communications regulatory.affairs@telus.com

Bragg Communications inc. carrying on business as Eastlink Regulatory.Matters@corp.eastlink.ca

Shaw Telecom Inc. Regulatory@sjrb.ca

KMTS sgander@kmts.biz

Téléphone Guèvremont inc. gcordeau@maskatel.qc.ca

La compagnie de Téléphone de Lambton inc. nantel@tellambton.net

Le téléphone de St-Éphrem telstep@telstep.net

La compagnie de téléphone de St-Victor inc. telvic@telvic.net

Cooptel pallard@cooptel.qc.ca

Téléphone Milot inc. paul.frappier@telmilot.com

Sogetel inc. alain.duhaime@sogetel.com