Telecom - Secretary General Letter addressed to the Distribution List
Ottawa, 20 April 2023
Our reference: 1011-NOC2023-0056
BY EMAIL
Distribution List
Subject: Review of the wholesale high-speed access service framework, Telecom Notice of Consultation CRTC 2023-56 – Shaw Cablesystems G.P. - Filing of cost studies for FTTP access – Commission Decision
In Telecom Notice of Consultation CRTC 2023-56 (the Notice), the Commission stated its preliminary view that that the provision of fibre-to-the-premises (FTTP) facilities over aggregated high-speed access (HSA) services should be mandated on a temporary and expedited basis, at least until the conclusion of the proceeding. The Commission directed incumbent carriers to file tariffs and associated Phase II cost studies, with supporting rationale, for FTTP access facilities over aggregated wholesale HSA services.
Following the issuance of the Notice, a number of incumbents made requests to extend various filing deadlines, including notably the deadlines for filling revised proposed tariffs and accompanying cost studies.
On 22 March 2023, the Commission received a procedural request from Shaw Cablesystems G.P. (Shaw) in connection with its obligation to file, by 24 April 2023: tariff applications; proposed rates; and, supporting Phase II cost studies and Study Reports for FTTP access over aggregated wholesale HSA services. In its procedural request, Shaw requested the following relief:
- Permission to exclude Shaw’s legacy FTTP facilities from its tariff application and cost study; and
- An extension until at least 24 August 2023 to file its tariff application and cost study for Shaw’s FTTP facilities over aggregated wholesale HSA service.
While Commission staff rejected the incumbents’ requests for extensions to the various filing deadlines by way of a staff letter dated 27 March 2023, the staff letter also indicated that outstanding procedural requests, including those made by Shaw, would be dealt with separately.
TELUS Communications Inc. (TCI), Competitive Network Operators of Canada (CNOC), Bragg Communications Incorporated, carrying on business as Eastlink (Eastlink), Cogeco Communications Inc. (Cogeco), and Rogers Communications Canada Inc. (RCCI) filed responses related to Shaw’s request.
In support of its request to exclude its legacy FTTP facilities, Shaw indicated that the company’s deployment of FTTP facilities was in a transitional state and that the number of premises passed by its legacy FTTP facilities was extremely limited.
Shaw argued that there are significant differences between its two types of FTTP facilities and there is minimal overlap in the architecture and costing for these distinct facilities and, absent the Commission’s permission to exclude Shaw’s legacy FTTP services, Shaw will be required to concurrently design and cost two separate wholesale FTTP services.
Shaw further argued that requiring a separate tariff application and cost study for the legacy FTTP service would be unproductive as it is doubtful that competitors would expend time and resources onboarding to this service, given the limited footprint of the company’s legacy FTTP facilities and the company’s stated FTTP deployment plans.
In support of its extension request, Shaw argued that the deadline to file the material requested by the Commission is more burdensome for it than for other wholesale HSA service providers, given the nascent and transitional state of its FTTP deployments and the fact that it needs to design and cost a new wholesale FTTP service from the ground-up.
Shaw further argued that denying its requested extension would further perpetuate the regulatory asymmetry between Shaw and other carriers under the wholesale HSA regime, contrary to section 13 of the Policy DirectionFootnote1 and the Commission’s objectives in the Notice.
Shaw submitted that the proposed extension would serve the public interest and would not delay the Commission in reaching relevant policy determinations in the expedited FTTP process, since the tariff application and cost study are not integral to the broad policy assessment that will inform the Commission’s decision. Nor would it delay competitors’ access to Shaw’s FTTP service over aggregated HSA service, if mandated. It would, however, ensure that the process yields reliable cost studies that support the establishment of just and reasonable rates for these services.
Positions of parties
Cogeco, Eastlink and RCCI acknowledged Shaw’s request for extension but did not specifically address it. They agreed that extensions of timelines were required for all incumbent carriers and either supported the initial extension request submitted by Bell Canada or requested alternative extension dates.
TCI did not agree with Shaw’s justification for exclusion of certain of its FTTP facilities, arguing that the Commission’s obligations should be consistent across incumbent carriers.
CNOC submitted that Shaw’s procedural request to exclude its legacy FTTP facilities from its tariff application and cost study is unacceptable and should be denied as it seeks to exempt Shaw from the requirement to provide cost studies and tariffs for certain FTTP deployments.
Commission determination
With respect to Shaw’s request to exclude its legacy FTTP facilities, the Commission considers that, given the status of the company’s deployment of its legacy FTTP facilities and its transition to new FTTP facilities, it is unlikely that competitors would make use of Shaw’s legacy FTTP facilities.
Moreover, the Commission considers that Shaw’s request to exclude its existing legacy FTTP facilities from its tariff application and cost study is consistent with the Phase II costing principles. As outlined in the ILEC Regulatory Economic Studies Manual, capital expenditures included in a regulatory economic study are to reflect the growth technology, i.e., the technology the company will deploy going forward.
In light of the above, the Commission grants Shaw’s request to exclude its legacy FTTP facilities from its tariff application and cost study.
As mentioned above, by way of letter dated 27 March 2023, Commission staff rejected the various requests for extensions to different deadlines. While the Commission is not of the practice of revisiting staff conclusions on procedural matters unless requested to do so, its consideration of Shaw’s request to exclude certain FTTP facilities from its tariff and cost studies, including both the factual matrix underpinning the request and the arguments proffered in support of it, has caused it to revisit Shaw’s extension requests. The two requests are interrelated and distinguish Shaw’s extension request from those made by other entities.
The Commission notes that the filing of tariff applications supported by relevant cost studies are a necessary component of the regulatory work that needs to be done before Shaw can offer a wholesale FTTP service. While it is in the public interest that the filings be made in a timely manner, it is equally important that the regulatory filings of Shaw be complete and supported by sufficient evidence.
Accordingly, in assessing Shaw’s request, the Commission considers that it is necessary to strike an appropriate balance between timeliness and the need for a suitable evidentiary basis to support Shaw’s regulatory filing.
The Commission considers that gathering and validating the necessary costing information required for conducting a Phase II cost study on a new growth technology, an issue only identified by Shaw thus far in this proceeding, may take several months. As such, maintaining the existing deadline of 24 April 2023 for a tariff application and cost study would likely result in an unreliable cost study and service rate and would not be in the public interest.
Accordingly, the Commission is of the view that an extension to the filing date for the tariff application and cost study for Shaw’s FTTP service would be appropriate, and that the timeframe proposed by Shaw is reasonable.
In light of the above, the Commission approves Shaw’s request to exclude its legacy FTTP facilities from its tariff application and cost study and further approves an extension to 24 August 2023 to file the tariff application and cost study for Shaw’s FTTP service.
Sincerely,
Original signed by
Claude Doucet
Secretary General
Distribution list
Bell Canada, bell.regulatory@bell.ca
Cogeco, telecom.regulatory@cogeco.com
Eastlink, regulatory.matters@corp.eastlink.ca
RCCI, regulatory@rci.rogers.com
SaskTel, document.control@sasktel.com
Shaw, Regulatory@sjrb.ca
TCI, regulatory.affairs@telus.com
Videotron, regaffairs@quebecor.com
CNOC, regulatory@cnoc.ca
TekSavvy, regulatory@teksavvy.ca
Coextro, skhandor@coextro.com
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