Telecom Commission Letter Addressed to Distribution List

Ottawa, 7 July 2016

Our reference:  8640-B2-201602326

By Email

Distribution List

RE:  Bell Canada – Forbearance from the regulation of wireless access services – Request for information

Dear Sir/Madam:

The Commission received a Part 1 application, dated 6 April 2016, from Bell Canada,  pursuant to sections 34(1) and 34(2) of the Telecommunications Act (the Act), requesting that the Commission refrain from exercising its powers and performing its duties under sections 24, 25, 27, 29, and 31 of the Act in relation to the extended area service transport and local transit services provided by Bell Canada (including the former Bell Aliant Regional Communications, Limited Partnership, or Bell Aliant), Télébec, Société en commandite (Télébec), and NorthernTel Limited Partnership (NorthernTel), in Ontario, Quebec, and Atlantic Canada (collectively, the Companies).

The Commission received interventions from Allstream; Bragg Communications Inc., carrying on business as Eastlink (Eastlink); the Canadian Network Operators Consortium Inc. (CNOC; the Public Interest Advocacy Centre (PIAC); Rogers Communications Canada Inc. (RCCI); TELUS Communications Company (TCC); and WIND Mobile Corp. (WIND).

Pursuant to paragraph 28(1)(a) of the Canadian Radio-television and Telecommunications Commission Rules of Practice and Procedure, the Commission may require a party to provide information, particulars or documents that it considers necessary to enable the Commission to reach a full and satisfactory understanding of the subject matter of the proceeding.

Bell Canada, Allstream, CNOC, Eastlink, RCCI, TCC, and WIND are requested to provide comprehensive answers, including any supporting information, to the attached questions.

Parties are to file their responses to the attached request for information with the Commission, serving a copy on all other parties, by 9 September 2016.

Any party may file interventions on the responses to the requests for information with the Commission, and serve copies on all other parties by 19 September 2016. Any party may file reply comments with the Commission, and serve copies on all other parties by 29 September 2016.

As set out in section 39 of the Telecommunications Act and in Broadcasting and Telecom Information Bulletin CRTC 2010-961, Procedures for filing confidential information and requesting its disclosure in Commission proceedings, persons may designate certain information as confidential.  A person designating information as confidential must provide a detailed explanation on why the designated information is confidential and why its disclosure would not be in the public interest, including why the specific direct harm that would be likely to result from the disclosure would outweigh the public interest in disclosure. Furthermore, a person designating information as confidential must either file an abridged version of the document omitting only the information designated as confidential or provide reasons why an abridged version cannot be filed.

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.

Yours sincerely

Original signed by

Sheehan Carter
A/Director, Competition and Emergency Services Policy
Telecommunications Sector

c.c.      Laurie Ventura, CRTC, (819) 819-997-4589, laurie.ventura@crtc.gc.ca
Mory Fodé Fofana, CRTC, (819) 639-8109, moryfode.fofana@crtc.gc.ca

Attach. (2)

Distribution List
Allstream, David Peaker, regulatory@allstream.com;
Bell Canada, Phillippe Gauvin, bell.regulatory@bell.ca
CNOC, William Sandiford, regulatory@cnoc.ca
Eastlink, Natalie MacDonald, Regulatory.matters@corp.eastlink.ca
PIAC, Geoff White, gwhite@piac.ca; John Lawford, jlawford@piac.ca; Cynthia Khoo, ckhoo@piac.ca
RCCI, Howard Slawner, rwi_gr@rci.rogers.com
TCC, Stephen Schmidt, regulatory.affairs@telus.com
WIND, Edward Antecol, eantecol@windmobile.ca

Questions for Bell Canada

I. Definition

For the purposes of this request for information, the following definitions apply:

  1. The Operating Territories ‒ means the incumbent operating territory of Bell Canada (including the former Bell Aliant) in Ontario, Quebec, New Brunswick, Nova Scotia, Prince Edward Island, Newfoundland and Labrador, as well as the operating territories of Télébec and NorthernTel;
  2. Relevant Period ‒ means annually, for the period between 1 January 2011 and 1 June 2016.
  3. Services ‒ means extended area service (EAS) transport and local transit (LT) services.

II. Questions

  1. Using the following table in Excel format, for each of the Companies and for the Relevant Period,
    1. identify each instance where a customer of the company in question has terminated an existing EAS transport contract in an LIR, and
    2. indicate the annual dollar value of each terminated contract as of the last full year before the contract was terminated.
      Former EAS transport customer Year Name of LIR Dollar value
             
             
             
             
  2. Using the following table in Excel format, for each of the Companies and for the Relevant Period,
    1. identify each instance where a customer of the company in question has terminated an existing local transit contract in an LIR, and
    2. indicate the annual dollar value of each terminated contract as of the last full year before the contract was terminated.
      Former local transit customer Year Name of LIR Dollar value
             
             
             
             
  3. In its reply comments, paragraph 50, Bell Canada states that: “…revenues for the Services continue to decline every year – even 12 years after the LIR interconnection regime came into effect.” Figures 5 to 8 of the application provide Bell Canada’s annual revenues for EAS transport and local transit services for Ontario, Quebec, and Atlantic Canada.
    1. For each LIR, for the Relevant Period, and for each of the Companies, provide total revenues by EAS transport customer. Provide the information in Excel format using the following table.
      EAS Transport customer Year Name of LIR Dollar Value
             
             
             
             
    2. For each LIR, for the Relevant Period, and for each of the Companies, provide total revenues by local transit service customer. Provide the information in Excel format using the following table.
      Local transit customer Year Name of LIR Dollar Value
             
             
             
             
  4. Table 1 of the attachment to the application lists all CLECs operating in all local interconnection regions (LIRs) within the Operating Territories.
    1. Provide these lists in Excel format.
  5. Paragraph 51 of the application states:

    In response to an increase in the price of local transit, a CLEC has various options at its disposal. A CLEC can directly connect with the other required CLEC, or indirectly connect via a negotiated agreement with a LEC that has already established, or could establish, local network interconnection arrangements with the required CLEC. These connections can be implemented unilaterally or on a shared-cost interconnection with a Bill and Keep compensation model. These alternatives have become easier to implement given the development, and increased use, of carrier hotels and Internet Protocol (IP)-based technologies.

    1. Provide additional information to demonstrate the extent of use of carrier hotels in the Operating Territories.
  6. In Telecom Decision 2008-17, the Commission stated the following:

    101. The Commission considers that it would be unreasonable to expect CLECs to establish a presence in an ILEC exchange or LIR if they do not intend to offer local exchange services to end-customers in that exchange or LIR. The Commission also considers that it is unlikely that all the LECs in a given exchange or LIR would have enough end-customers to justify interconnecting with each other. The Commission further considers that the ILECs' EAS transport and transiting services provide efficient interconnection solutions for competitors.
    102. Accordingly, the Commission determines that services that allow for the interchange of local traffic between LECs within the same exchange or LIR, and to exchanges within the EAS area of the originating exchange or an exchange within a LIR, are to be classified as interconnection services. The Commission also determines that local, toll, and CCS7 transiting services are to be classified as interconnection services.

    1. Explain, for each of EAS transport and local transit services, how your application addresses the Commission’s finding that these services provide efficient interconnection solutions for competitors.
    2. Given the above policy statements and determinations, and considering that sections 40 and 42 of the Telecommunications Act provide the Commission with the ability to mandate interconnection arrangements, explain, with justification, whether and what impact the interconnection status of these services should have on
      1. a decision to no longer mandate the provision of the services, and
      2. the scope of forbearance that may be provided for by the Commission as a result of this proceeding.
  7. Explain, with rationale, what you would consider to be an appropriate transition period if the Commission were to remove the obligation to provide EAS transport and/or local transit service.

Questions for each of Allstream, CNOC, Eastlink, RCCI, TCC, and WIND

I. Definition

For the purposes of this request for information, the following definition applies:

  1. Services ‒ means extended area service (EAS) transport and local transit services.

II. Questions

Local transit service

  1. In paragraph 54 of the application, Bell Canada states the following:

    For CLECs that choose not to self supply, there is now an integrated mesh of CLEC network interconnections that provides a wealth of alternatives for terminating local calls to another CLEC. This means that the hypothetical monopolist would need to control local transit service as well as all methods of LEC local interconnection in order to profitably sustain a significant price increase. Therefore, the relevant product market consists of local network interconnection arrangements for CLECs.

    1. Provide your view, with supporting rationale, on whether you consider that the use of such an “integrated mesh of CLEC network interconnections” would offer viable alternatives to Bell Canada’s local transit service. Rationale should include cost, network, and traffic efficiency considerations.
  2. Paragraph 51 of Bell Canada’s application states:

    In response to an increase in the price of local transit, a CLEC has various options at its disposal. A CLEC can directly connect with the other required CLEC, or indirectly connect via a negotiated agreement with a LEC that has already established, or could establish, local network interconnection arrangements with the required CLEC. These connections can be implemented unilaterally or on a shared-cost interconnection with a Bill and Keep compensation model. These alternatives have become easier to implement given the development, and increased use, of carrier hotels and Internet Protocol (IP)-based technologies.

    1. Provide your view, with supporting rationale, on whether carrier hotels and IP-based technologies provide viable substitutes to local transit service. Rationale should include cost, network, and traffic efficiency considerations.

EAS transport and local transit services

  1. In paragraph 97 of the application, Bell Canada states:

    If the CLEC does not wish to connect with the ILEC (or CLEC) in the adjacent LIR then it could terminate its traffic to the ILEC's (or CLEC's) end customers in the required exchange by using the ILEC's switching and aggregation service at the access tandem level. Switching and aggregation may be more cost effective to the CLEC wishing to terminate small traffic volumes in an adjacent LIR than using the Services.

    1. Provide your view, with supporting rationale, on whether an ILEC’s switching and aggregation service constitutes a viable substitute for each of the Services. Rationale should include cost, network, and traffic efficiency considerations.
  2. In its comments on Bell Canada’s application, at paragraph 2(c), WIND states that "Wholesale long distance termination services are available as a substitute for EAS termination services where traffic volumes to EAS exchanges do not support CLEC expansion to a neighboring LIR."
    1. Provide your view, with supporting rationale, on whether the use of the wholesale long distance termination services constitutes a viable substitute to EAS termination. Include cost, geographic limits, traffic, and network efficiency considerations in the response.
  3. Paragraph 6 of RCCI’s comments states that “…Some CLECs, due to size or technology, are simply not capable of providing the necessary level of interconnection or simply refuse to do so…”
    1. Provide your view, with supporting rationale, about how the size or technology of a CLEC could affect its ability to provide, on a wholesale basis, interconnection services as an alternative to the Services?
  4. Has your company or have members of your organization purchased EAS transport and/or local transit capacity from Bell Canada in the last five years? If the subscription capacity changed over this period, provide the rationale for why it changed.
  5. Identify those LIRs where you are interconnected directly with other CLECs, and identify the CLECs in question.
  6. If you are interconnected directly to a CLEC in a LIR, and through this CLEC you are indirectly connected to other CLECs, identify those additional CLECs.

    Explain, with rationale, what you would consider to be an appropriate transition period if the Commission were to remove the obligation to provide EAS transport and/or local transit service.

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