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Ottawa, 12 August 2013

Our Reference: 8633-T66-201310812

By email

Mr. Ted Woodhead
Senior Vice-President, Federal Government & Regulatory Affairs
TELUS Communications Company
8-215 Slater Street
Ottawa, Ontario K1P 0A6

Re: Application by TELUS for Clarification regarding the Wireless Code

Dear Mr. Woodhead,

This is in reference to the application by TELUS Communications Company (TELUS) for clarification of certain elements of Telecom Regulatory Policy 2013-271 (the Wireless Code or the Code).

Commission staff has reviewed TELUS’ application and determined that additional information is required. Accordingly, TELUS is to its file responses to the request for additional information attached to this letter by 19 August 2013, copying all parties. In light of this request, Commission staff considers that interveners could benefit from additional time in order to comment on TELUS’ application. The deadline to submit comments is therefore extended to 26 August 2013. Reply comments will be due no later than 3 September 2013.

As set out in Broadcasting and Telecom Information Bulletin 2010-961, TELUS may designate certain information as confidential. TELUS must provide an abridged version of the document involved, accompanied by a detailed rationale to explain why the disclosure of the information is not in the public interest.

All submissions are to be made in accordance with the Canadian Radio-television and Telecommunications Commission Rules of Practice and Procedure, SOR/2010-277.

Yours sincerely,

{original signed by}

Steven Harroun
Acting Director General, Strategic Policy

cc: Neil Barratt, CRTC; distribution list

Distribution List;;;;;;;;;;;;;;;

Appendix – Request for Information

1. Describe the current approach taken by TELUS and Koodo with respect to device subsidies, and clearly explain any differences. Indicate whether this approach has changed based on the determinations set out in the Code.

2. Refer to paragraph 7 of TELUS’ application. Please elaborate on TELUS’ statement that “in some cases, the customer pays a monthly tab charge.”

3. Please clarify the relationship between the wireless services and the repayment of the device subsidy. In TELUS’ view, does this constitute one or two contracts? Please explain, with supporting rationale.

4. In paragraph 11 of your application, TELUS requests that the Commission:

“permit early cancellation fee reductions to be made in unequal amounts, provided that each monthly early cancellation fee reduction is at least equal to the amount based on a 24 month straight line amortization.”

In paragraph 14 of application 2013-1082-0, Rogers submitted the following:

“Rogers therefore seeks confirmation from the Commission that using a percentage amount to represent the amount by which the early cancellation fee will decrease each month is acceptable.”

Would Rogers’ proposal also address the issue described in TELUS’ application? Please comment on this alternative, including any possible consequences for TELUS’ business model and its customers.

5. Refer to paragraph 17 of TELUS’ application:

“In this case, the customer has not repaid $50 of the original $150 tab balance, and is nonetheless able to obtain a new $100 device subsidy that will also be repaid over time. In this situation, while the customer’s tab balance would be $150, section G.2(ii)(a) of the Code requires that any device subsidy be calculated as “the retail price of the device minus the amount that the customer paid for the device when the contract was agreed to.” As a result, it appears to TELUS that the Code requires that only $100 can be used as the value of the new device subsidy, rather than the full $150 tab amount that includes the $50 that was not yet repaid on the customer’s original tab. Therefore, the Code language restricts the ability of a wireless service provider to allow a customer to upgrade a device prior to full repayment of the initial tab amount.”

In paragraph 18, TELUS requests:

“a clarification that if a customer upgrades to a new device and takes advantage of any device subsidy, TELUS would be not be required to compel its customer to repay the full existing tab balance before “topping up” the balance with a new subsidy”

In light of the above:

a. Confirm that the issue described arises only in the case of early device upgrades.
b. Confirm that TELUS is requesting an interpretation of the Code, rather than an amendment to the definition of “device subsidy”.
c. Clarify the impact of requiring the repayment of the existing tab. Given the increased subsidy that could be provided, how would the result be different for the consumer? For the service provider?
d. Comment on the impact of TELUS’ request on the 24-month amortization of the initial subsidy. Would the relief requested result in subsidies being amortized over more than 24 months?
e. Commission staff notes that where it is unclear how the terms of the Code are to be applied, the Code is to be interpreted in favour of the consumer. Please comment on how TELUS’ proposal in light of this requirement.

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