ARCHIVED - Telecom Decision CRTC 2013-184
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Ottawa, 11 April 2013
NorthernTel, Limited Partnership – Implementation of local competition for Bragg Communications Inc., operating as EastLink
File number: 8663-N51-201216268
In this decision, the Commission approves NorthernTel’s implementation plan for local competition in the Opasatika exchange, which was filed in response to a formal signed expression of interest from EastLink.
Background
1. In Telecom Decision 2006-14, the Commission, among other things, set out the framework for local competition implementation in the territories of the small incumbent local exchange carriers (small ILECs), including directives that the small ILECs must follow when submitting their implementation plans.
2. The Commission reviewed this framework and determined, in Telecom Regulatory Policy 2011-291, that local competition should continue to be introduced in the territories of all the small ILECs based on the existing framework, subject to the modifications set out in that decision.
3. In Telecom Decision 2007-93, the Commission approved NorthernTel, Limited Partnership’s (NorthernTel) local competition implementation plan for ExaTEL Inc. and Ontera, including start-up and ongoing costs related to local competition implementation. Since that time, local competition has been implemented in 10 exchanges within NorthernTel’s territory, and various providers are currently offering competitive local exchange services.
NorthernTel’s proposed local competition implementation plan
4. The Commission received a local competition implementation plan, dated 21 December 2012, from NorthernTel. The proposed plan was filed in response to a formal signed expression of interest from Bragg Communications Inc., operating as EastLink (EastLink), which indicated that it wished to interconnect with NorthernTel to provide local services as a competitive local exchange carrier (CLEC) within the Opasatika exchange. As part of its filing, NorthernTel provided its estimated total costs associated with its proposed implementation.
5. The Commission received comments regarding NorthernTel’s proposed implementation plan from EastLink. The public record of this proceeding, which closed on 7 February 2013, is available on the Commission’s website at www.crtc.gc.ca under “Public Proceedings” or by using the file number provided above.
Should the Commission approve NorthernTel’s proposed local competition implementation plan for EastLink?
6. NorthernTel indicated that there were technical limitations associated with implementing local competition in the Opasatika exchange. Specifically, NorthernTel indicated that the switch serving that exchange had limited capabilities, and was only scheduled for upgrade in the 2017 time frame.
7. Given the competitive request, however, NorthernTel proposed an interim solution that would allow EastLink to enter the market in a timely fashion, subject to certain service limitations. Among these limitations, NorthernTel indicated that EastLink would be responsible for providing call transit to X-1-1 services (e.g. 2-1-1, 4-1-1, and 9-1-1), and that a customer ported-out from NorthernTel to EastLink, or ported-in from EastLink to NorthernTel, would be required to change phone numbers. The company also identified administrative aspects associated with the interim solution, which were established in conjunction with EastLink, which deviated from standard practices as they are associated with manual processes that are subject to lengthier delays. Finally, NorthernTel submitted that the interim solution could only be offered in the context of a single competitor operating in the Opasatika exchange, given the technical and administrative limitations.
8. In addition, NorthernTel proposed a permanent solution by accelerating its implementation of new switching equipment within the exchange by May 2013, which would then allow the company to provide EastLink with the same services and standards that exist within the other exchanges where it previously implemented local competition.
9. EastLink agreed with NorthernTel’s interim and permanent solutions, and indicated that the proposed plan would allow it to begin offering service within a reasonable time frame. As a result, EastLink requested that the Commission approve NorthernTel’s proposed implementation plan.
10. NorthernTel provided estimates of the start-up and ongoing costs associated with implementing its proposed interim and permanent solutions for local competition. However, the company specified that it was not applying, at this time, for approval of cost recovery measures, but indicated that it may file a cost recovery plan with the Commission once its final costs are known.
11. The Commission notes that NorthernTel and EastLink have agreed on the finalized elements of the local competition implementation plan.
12. The Commission notes that, pursuant to the identified service limitations, NorthernTel will not be in a position to offer local number portability (LNP) while the interim solution is in effect. The Commission considers, however, the interim solution proposed by NorthernTel to be appropriate, given the circumstances, as it would allow for an efficient and timely implementation of local competition in a previously uncontested exchange. The Commission reminds EastLink that, with the exception of LNP-related obligations, it will be responsible for meeting the remainder of its CLEC obligations, including, in particular, those associated with 9-1-1 and Message Relay services, during the interim solution period.
13. With respect to the NorthernTel’s permanent solution, the Commission notes that there were no additional competitor services or unresolved implementation issues associated with EastLink’s plan to operate as a competitor in the Opasatika exchange. The Commission also notes that NorthernTel anticipates that all work associated with the implementation of the permanent solution will be completed in the second quarter of 2013. The Commission therefore considers the implementation plan associated with the permanent solution to be appropriate.
14. The Commission recognizes that there are costs associated with NorthernTel’s proposed implementation plan. However, in light of the fact that NorthernTel has not applied for the recovery of its costs along with its local competition implementation plan, the Commission does not consider it necessary to review those costs at this time. Should NorthernTel file an application for cost recovery at a later time, the Commission will review the costs submitted in the context of such an application.
15. In light of the above, the Commission approves NorthernTel’s proposed implementation plan, with the exception of the associated costs which may be subsequently reviewed. NorthernTel is to advise the Commission once the implementation of its permanent solution is finalized and EastLink is able to start offering its standard, LNP-enabled, local voice service.
Policy Direction
16. The Commission considers that its approval of NorthernTel’s local competition implementation plan allows customers in the affected exchange to benefit from competition in the local services market by allowing them to choose from the services, options, and prices offered by different service providers. As a result, the Commission considers that its determinations in this decision will advance the policy objectives set out in paragraphs 7(b), 7(f), and 7(h) of the Telecommunications Act (the Act).1
17. The Commission also considers that its approval will allow customers in the affected exchange to benefit from local competition in a timely fashion, while allowing NorthernTel to complete the steps required to implement local competition on a more standard basis.
18. In light of the above, the Commission considers that its determinations are consistent with the Policy Direction2 requirements that the Commission should (i) rely on market forces to the maximum extent feasible as the means of achieving the policy objectives noted above, and (ii) when relying on regulation, 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 policy objectives.
Secretary General
Related documents
- Obligation to serve and other matters, Telecom Regulatory Policy CRTC 2011-291, 3 May 2011, as amended by Telecom Regulatory Policy CRTC 2011-291-1, 12 May 2011
- Implementation of local competition in NorthernTel, Limited Partnership’s serving territory - ExaTEL Inc. and Ontera, Telecom Decision CRTC 2007-93, 28 September 2007, as amended by Telecom Decision CRTC 2007-93-1, 1 November 2007
- Revised regulatory framework for the small incumbent local exchange carriers, Telecom Decision CRTC 2006-14, 29 March 2006
Footnotes:
[1] The cited policy objectives of the Act are
7(b) to render reliable and affordable telecommunications services of high quality accessible to Canadians in both urban and rural areas in all regions of Canada;
7(f) to foster increased reliance on market forces for the provision of telecommunications services and to ensure that regulation, where required, is efficient and effective; and
7(h) to respond to the economic and social requirements of users of telecommunications services.
[2] Order Issuing a Direction to the CRTC on Implementing the Canadian Telecommunications Policy Objectives, P.C. 2006-1534, 14 December 2006
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