ARCHIVED -  Letter

Ottawa, 16 April 2012

File No.:  8740-C6-201116476

BY EMAIL

Mr. Michel Messier
Director, Regulatory Affairs, Telecommunications
Cogeco Cable Inc.
5 Place Ville Marie, bureau 1700
Montréal, Québec
H3B 0B3
telecom.regulatory@cogeco.com

Re:  Tariff Notice 36 – Proposed service charge for network capacity changes

Dear Sir:

The Commission received an application by Cogeco Cable Inc. (Cogeco) dated 19 December 2011, in which the company proposed changes to their Third Party Internet Access (TPIA) tariff (Tariff CRTC 26400).

Commission staff has reviewed the information on the record to date, and in light of its analysis, has determined the need for further information.  To address this requirement, additional interrogatories are provided in the attachment.

Accordingly, the filing dates are as follows:

Cogeco is to file responses to Commission staff interrogatories by 2 May 2012.

All parties may submit comments on the additional information provided in the interrogatory responses by 7 May 2012.

Cogeco is to file replies to the additional comments by 11 May 2012.

Copies of the documents should also be sent to Nat Natraj (nat.natraj@crtc.gc.ca).

Sincerely yours,

Original signed by

Yvan Davidson
Director, Costing and Competitive Services
Telecommunications

Attach.

cc:  Chris Seidl, chris.seidl@crtc.gc.ca
Lynne Fancy, lynne.fancy@crtc.gc.ca
Tom Vilmansen, tom.vilmansen@crtc.gc.ca
Yvan Davidson, yvan.davidson@crtc.gc.ca
Parties to Telecom Notice of Consultation 2011-77

Parties to Telecom Notice of Consultation 2011-77

pkgdonovan2@gmail.com;  regulatory@vianet.ca;  lefebvre@rogers.com;  constantly@rogers.com;  lainwired@gmail.com;  jim-johnston@cogeco.ca;  tracy.cant@ontera.ca;  linda_maljan@gov.nt.ca;  kevanst.john@gmail.com;  Regulatory@sjrb.ca;  tom.copeland@caip.ca ;  lisagoetz@globalive.com;  vince.valentini@tdsecurities.com;  crtcubb@douville.org;  douglas216@shaw.ca;  cataylor@cyberus.ca;  jkolyn@ikano.com;  angusoliver320@gmail.com;  bcampbell@skywaywest.com;  martina.emard@lethbridgecollege.ca;  babramson@mccarthy.ca;  regulatory@telnetcommunications.com;  bell.regulatory@bell.ca ;  regulatory@bell.aliant.ca;  regulatory@execulink.com;  jcarter@surenet.net;  mike.manvell@switchworks.com;  ghariton@sympatico.ca;  ctacit@tacitlaw.com;  crtcmail@gmail.com;  scott@beamdog.com;  mmallani@yahoo.ca;  d.olafson@shaw.ca;  wally@ciaccess.com;  jared.mcateer@istockphoto.com;  thepga@gmail.com;  dirkalgera@gmail.com;  tfarrelly@bryston.ca;  al@purepages.ca;  rubenstein.mark@gmail.com;  jamiea@storm.ca;  glenrfarrell@gmail.com;  dr.wilson@wilson-research.ca;  jacqueslee917@gmail.com;  catherine.middleton@ryerson.ca;  apilon@acninc.com;  deschec@ircm.qc.ca;  jebouchard@phdvideo.com;  ian_fraser@nomorecrtcspam.ca;   spaesani@gmail.com;  dmckeown@viewcom.ca;  peterdasilva@yahoo.ca;  abriggs@cogeco.ca;  rwadsworth@sandvine.com;  document.control@sasktel.com;  sidneirohr@hotmail.com;  ivan@vibrantprints.ca;  jae@c-art.com;  rem00126@hotmail.com;  cmich@rogers.com;  tzaritsa1000@hotmail.com;  chad.cunningham@cwct.ca;  renaonlinenow@gmail.com;  tisrael@cippic.ca;  jfleger@jflegerlaw.com;  andyb@teksavvy.com;  samsonmi@tlb.sympatico.ca;  andre.labrie@mcccf.gouv.qc.ca;  regulatory@primustel.ca;  amanevich@heenan.ca;  brian@colenet.ca;  Regulatory.Matters@corp.eastlink.ca;  adena.dinn@calliougroup.com;  anlakenews@gmail.com;  regulatory@bcba.ca;  satkepa@rogers.com;  lukejwohlgemut@hotmail.com;  Smartyjones@sympatico.ca;  ricka@zing-net.ca;  kirsten.embree@fmc-law.com;  hemond@consommateur.qc.ca;  grayden@graydenlaing.com;  john.temprile@vivosonic.com;  yuandme@gmail.com;  broxx@shaw.ca;  syscool77@hotmail.com;  dougheale@yahoo.ca;  duarte@aetoronto.ca;  eric.leclerc@iaah.ca;  jroots@cad.ca;  jonathan.holmes@ota.on.ca;  mike@mikeaudet.com;  mena_samuel@hotmail.com;  iworkstation@mtsallstream.com;  dennis@iplink.net;  rob.olenick@tbaytel.com ;  shannonbgroves@yahoo.com;  t_wardman@hotmail.com;  jfmezei@vaxination.ca;  scott@zip.ca;  ml.auer@sympatico.ca;  cbachalo@juniper.net;  mdrobac@netflix.com;  andrewoca@gmail.com;  hannon@rogers.com;  hijbji@gmail.com;  blackwell@giganomics.ca;  erik.waddell@ic.gc.ca;  david.watt@rci.rogers.com;  regulatory.affairs@telus.com;  Andreea.Todoran@ic.gc.ca;  cjprudham@barrettxplore.com;  regulatory@teksavvy.com;  crtc@mhgoldberg.com;  piac@piac.ca;  telecom.regulatory@cogeco.com;  regaffairs@quebecor.com;  regulatory@distributel.ca;  marc@teksavvy.com;  munly@worldbroadbandfoundation.org;  henault_claude@hotmail.com; regulatory@cnoc.ca;

Attachment

Interrogatories to Cogeco

Proposed Capacity Change Service Charge

1. Refer to the table provided in Cogeco(CRTC)6Jan12-1 a), where the company provided the time estimates associated with each sub-activity required to complete a Third Party Internet Access (TPIA) capacity change service order for the initial interface. 

Using the format of the attached Table (see below), for each sub-activity with a proposed time estimate greater than or equal to 15 minutes:

a. Provide a further breakdown of the sub-activity into tasks such that the time estimate for no task exceeds 15 minutes in duration. Further describe each task indicating whether the task is manual or automated, and if automated, identify the systems used.

b. For each of the tasks identified in response to part a. above, provide the time estimate with supporting rationale, identifying any circumstances that would lead to a significant deviation from standard time frames.

c. For each task identified in response to part a. above, provide the expected % occurrence rate, with supporting rationale.

2. Refer to table provided in Cogeco(CRTC)23Feb12-1 d), where the company provided the time estimates associated with each sub-activity required to complete a TPIA capacity change service order for an additional interface on the same router. 

Using the format of the attached Table (see below), for each sub-activity with a proposed time estimate greater than or equal to 15 minutes:

a. Provide a further breakdown of the sub-activity into tasks such that the time estimate for no task exceeds 15 minutes in duration. Further describe each task indicating whether the task is manual or automated, and if automated, identify the systems used.

b. For each of the tasks identified in response to part a. above, provide the time estimate with supporting rationale, identifying any circumstances that would lead to a significant deviation from standard time frames.

c. For each of the time estimates provided in response to part b. above, explain whether the task could be eliminated or reduced as a result of the economies of scale (i.e. multiple interfaces per order) with supporting rationale.

d. For each task identified in response to part a. above, provide the expected % occurrence rate, with supporting rationale.

3. Refer to Cogeco(CRTC)23Feb12-1 d) where the company submitted that in instances where a Cogeco TPIA customer has multiple interfaces on the same router at a given Point of Interconnection (POI), the cost associated with capacity increments on the 2nd or additional interfaces will be lower than the cost of the initial interface order due to economies of scale.

a. Assume that at a single POI, there are two routers and two interfaces on each router and an Internet Service Provider (ISP) requires 100 Mbps additional capacity at each of the four interfaces in the same order.  Provide the service charge that would be applicable for each of the following interfaces:

i. Router 1 Interface 1
ii. Router 1 Interface 2
iii. Router 2 Interface 1
iv. Router 2 Interface 2

b.If the applicable service charges are the same for interfaces i & iii and ii & iv above, explain, with supporting rationale, whether cost efficiencies related to economies of scale would occur on the interfaces of Router 2. If not, explain why not.

c. If in part b. above, cost efficiencies occur on the interfaces of Router 2, using the format of attached Table (see below), and the level of detail for the time estimates outlined in questions 1. and 2. above, provide revised time estimates that incorporate the cost efficiencies associated with multiple interface orders involving multiple routers.  The response should describe all changes in costing assumptions with supporting rationale.

4. For the year 2013, provide the company’s forecast of the number of capacity change service order requests from ISPs associated with the aggregated TPIA service and the associated annual revenues.

5. Assume that the Capacity Change Service Charge costs are recovered using a two-tiered rate structure comprising of  the following two rate elements (i) a rate per order that recovers all order-driven costs and (ii) a rate per interface that recovers all interface-driven costs.

a. Using the format of the attached Table (see below) and the level of detail for the time estimates outlined in questions 1. and 2. above, provide:

i. the cost information per order that includes all order-driven tasks, (i.e. tasks that do not vary with the number of interfaces, such as certain CSG tasks) incurred as a result of the capacity change order request at a given POI, and provide the supporting rationale for all tasks included.

ii. the cost information per interface that includes all interface-driven tasks, (i.e. tasks that vary directly with the number of interfaces, such as certain network engineering and network operations tasks) incurred as a result of the capacity change order request at a given POI,with supporting rationale for all tasks included.

b. Comment on how the time estimates provided in response to questions 1. and 2. above have been incorporated in the costs provided in parts a. i. and a. ii. above, with supporting rationale.

c. Provide a proposed rate per order and a proposed rate per interface that are based on the costs provided in parts a. i. and a. ii. above.  Also, comment on the appropriateness of this rating approach in recovering the service order costs caused by the order and costs caused by the number of interfaces in the order.

6. Provide the following based on the most current information available and specifying the vintage of the information:

a. The average number of interfaces per ISP using aggregated POIs.
b. The average number of routers per ISP using aggregated POIs.

This information is to be placed on the public record.

7. With respect to an ISP order for aggregated TPIA capacity change, provide the following information based on the most current projections:

a. The expected average number of interfaces per order.
b. The expected average number of interfaces per router.
c. The expected average number of routers per order (if not available, alternatively, provide the estimated percentage of time an additional interface is expected to be on a different router).

The response should also provide all supporting assumptions with rationale and should explain how ISP load balancing requirements would influence the expected average number of interfaces per order.

This above information is to be placed on the public record.

8. Refer to Cogeco(CRTC)23Feb12-6 b) where the company stated that applying proration related to multiple orders placed and executed within the period between billing cycles will be administratively taxing on Cogeco CSG staff to maintain and correlate.

Provide the company’s best estimate of the additional time and associated costs that would be required by the CSG staff to maintain and correlate such orders. Also, provide the expected percentage occurrence rate of such occurrences, with supporting rationale. Further, provide the company’s views on including such costs into the study and permitting such multiple orders to be placed and executed within the period between billing cycles.

9. Refer to Cogeco(CRTC)23Feb12-2. Provide the sequence of activities and elapsed time frames for each activity leading to the three-week interval to process a capacity modification request, and the minimum and average time that the company expects to process a capacity modification order, with supporting rationale.

Proposed Line Card (Interface) Service

10. Refer to Cogeco(CRTC)23Feb12-5 where the company submitted that it has included a provision of 50% of the cost of the line card (interface) and processor for spares in the event of failure.

a. For each of one GE interface port and ten GE interface port line cards, provide the level (i.e. %) of spares the company maintains for itself, with supporting rationale.   

b. Explain whether the company shares its line cards to provision both the company’s retail end-users and the ISP end-users. If not, explain why not, with supporting rationale.

c. Using the format of Revised Table 1 and 2 in the response to Cogeco(CRTC)23Feb12-5, provide revised proposed costs and rates, for each of the following level of spares for line card and processor: i) 10% level of spares and ii) % level of spares provided in response to part a. above

Proposed IP Address Block Service Charge

11. Refer to tables in Cogeco(CRTC)23 Feb12-4 b) where the company provided time estimates associated with each sub-activity required to complete additions and move/segmentations for IP address blocks in Ontario and Quebec.

a. Using the format of the attached Table (see below), for each of Ontario and Quebec, for each sub-activity with a proposed time estimate greater than or equal to 15 minutes:

i. Provide a further breakdown of the sub-activity into tasks such that the time estimate for no task exceeds 15 minutes in duration. Further describe each task indicating whether the task is manual or automated, and if automated, identify the systems used.

ii. For each of the tasks identified in response to part i. above, provide the time estimate with supporting rationale, identifying any circumstances that would lead to a significant deviation from standard time frames.

iii. For each of the time estimates provided in response to part ii. above, explain whether the task could be eliminated or reduced as a result of the economies of scale (i.e. multiple CMTS per order) with supporting rationale.

iv. For each task identified in response to part i. above, provide the expected % occurrence rate, with supporting rationale.

b. Further to response to part a. above, provide proposed revised tariff page(s) that includes a separate tariff for the IP address block change service.

c. Explain if the IP Block configuration costs and activities are recovered completely or partially through the existing POI Configuration or POI entrance rates (CRTC 26 400). If yes, identify which rate recovers these costs and identify the associated activities and costs included in the cost study that led to this existing rate; further provide the necessary adjustments to the existing rate to ensure that IP Block configuration costs are not double recovered.

Date modified:

2012-04-16