Telecom - Secretary General Letter addressed to the Distribution list
Ottawa, 8 April 2024
Reference: 8622-T117-202306919
BY EMAIL
Distribution list
Re: Part 1 Application by TekSavvy Solutions Inc. to address Cogeco’s activities to decommission or remove coaxial facilities
Dear Andy Kaplan-Myrth and Paul Beaudry:
We are following up on TekSavvy Solutions Inc.’s (TekSavvy) application, dated 22 December 2023, which raised concerns about Cogeco Communications Inc.’s (Cogeco) plan to replace its legacy coaxial-based last-mile access facilities with fibre-to-the-premises facilities (FTTP) at two buildings in Ontario (the Sites). The replacement is scheduled for 1 May 2024.
The planned replacement would result in TekSavvy’s customers being disconnected from TekSavvy’s Internet services. This is because TekSavvy’s customers access Internet services over Cogeco’s coaxial-based facilities. FTTP facilities are currently not available for competitors like TekSavvy to use under the Commission’s wholesale high speed access (HSA) framework.
To avoid the disconnection, TekSavvy asked the Commission to issue an expedited interim order requiring Cogeco to maintain its wholesale HSA services at the Sites until either:
- the Commission issues a decision for final relief in the current application at issue; or
- the Commission issues a decision in the proceeding initiated by Telecom Notice of Consultation 2023-56 (NoC 2023-56), granting competitors access to Cogeco’s FTTP facilities.
TekSavvy also asked that the Commission initiate a new proceeding that would consider more broadly issues related to wholesale decommissioning and network upgrade practices.
Cogeco requested that the Commission summarily dismiss this application claiming that disaggregated FTTP access to Cogeco’s facilities is available at the Sites and that TekSavvy therefore had the ability to compete in this area. Cogeco also claimed that consideration of this application would be inappropriate and duplicative because (i) the issue of decommissioning and network upgrade practices is already being considered by the Commission in NoC 2023-56, and (ii) the Commission previously indicated that various wholesale HSA-related matters may be delayed or deferred until that proceeding is concluded.
We are writing to inform you of the Commission’s decision in this matter.
As you are aware, the Commission launched NoC 2023-56 in March 2023 to improve Internet services competition in Canada. While some of the issues raised by TekSavvy in its application are currently being considered in that proceeding, this does not form a basis to summarily dismiss TekSavvy’s application, given that customers are at risk of being disconnected.
With respect to the availability of disaggregated FTTP access as an alternative for TekSavvy to continue serving customers at the Sites, the Commission considers that this is disputed and therefore unclear based on the record. However, even if it were available, given the work that would be involved, it is unlikely that customers could be transitioned to a disaggregated FTTP service prior to 1 May 2024. Moreover, as noted in Telecom Decision 2023-53, the Commission has found that disaggregated wholesale HSA services have limited viability as a competitive option. For these reasons, the Commission denies Cogeco’s request to dismiss the application.
Regarding TekSavvy’s request for interim relief, the Commission finds that TekSavvy’s application meets the test for relief, as set out in RJR-MacDonald Inc. v. Canada (Attorney General) [1994] 1 S.C.R. 311, and grants its request for an interim order. The Commission therefore directs Cogeco to maintain competitor access to all premises at the Sites, until the Commission issues its final determination on this application, using one of the three methods proposed by TekSavvy in its application. Please see Appendix 1 below for additional reasons.
The Commission recognizes that the decommissioning of Cogeco's existing facilities may be based on circumstances outside its control and that Cogeco has a responsibility to respond to the needs of its customers. While the Commission encourages and supports investment in high-quality networks, ultimately, we have to consider the impact that the decommissioning of these facilities would have on consumer choice and on competitors.
The Commission notes that the other requests made by TekSavvy in its application, including that the Commission launch a proceeding to examine the decommissioning practices of incumbents, overlap with issues being considered in NoC 2023-56. The Commission finds that it would be premature and inefficient to consider these issues while that proceeding is ongoing. As a result, the Commission suspends its consideration of the other issues raised in TekSavvy’s application until a decision is issued in NoC 2023-56.
If you have any questions regarding these matters, please do not hesitate to contact Philippe Kent, Director of Telecommunications Services Policy, at philippe.kent@crtc.gc.ca or at 819-953-4057.
Sincerely,
Original signed by
Marc Morin
Secretary General
Attach (1) - Appendix 1
Appendix 1
Interim relief - Commission Analysis and Determinations
Is there a serious issue to be determined?
TekSavvy submitted that the Commission has previously found that the threshold for finding that there is a serious issue to be determined is low. TekSavvy argued that all that is required to establish that there is a serious question to be determined is that the application is neither frivolous nor vexatious.
In TekSavvy’s view, Cogeco is planning to remove coaxial access facilities connected to addresses where TekSavvy serves end users and replace it with FTTP services that Cogeco does not make available to competitors. TekSavvy argued that it and other competitors could lose access to new and existing customers in a manner that might constitute undue preference and that this was sufficient to demonstrate that the issues raised were not frivolous or vexatious.
Cogeco argued that as the issues raised by TekSavvy were previously considered in the proceeding leading to Telecom Regulatory Policy 2015-326 and are currently under consideration in the Notice of Consultation 2023-56 (NoC 2023-56) proceeding. Cogeco submitted that that this showed that there was no serious issue to be tried in this application. Cogeco also argued that addressing these issues in this application would be duplicative and prejudicial to the outcome of the NoC 2023-56 proceeding.
Rogers Communications Inc. (Rogers) argued that TekSavvy had not provided evidence to establish that the areas served by HSA were rapidly shrinking, and in any event, Rogers felt that the temporary FTTP mandate established by Telecom Decision 2023-358 would address any gaps in the availability of wholesale HSA. Rogers suggested that these facts undermined TekSavvy’s position both on whether there was a serious issue to be tried and whether there was irreparable harm.
Commission’s analysis and determinations
If an application is not clearly frivolous, it will generally meet the first interim relief criterion: that there is a serious issue to be determined. The party seeking interim relief is not required to demonstrate that their argument is persuasive or strong, but only that there is a legitimate question being asked.
TekSavvy’s application raises serious questions about whether Cogeco has granted itself an undue preference and the impact of the particular actions in question on competition and consumer choice.
With respect to concerns raised by Cogeco and Rogers regarding potential overlap with the NoC 2023-56 proceeding, the Commission considers that these concerns are more relevant to the final relief sought by TekSavvy in the application rather than the issue of whether Cogeco has granted itself an undue preference. Any concerns with respect to overlap between TekSavvy’s request for final relief and the NoC 2023-56 proceeding can be addressed by the Commission using its powers under section 60 of the Telecommunications Act.
In light of the above, the Commission considers that TekSavvy has met the first criterion of the test.
Will the party seeking the interim relief incur irreparable harm if the relief is not granted?
TekSavvy argued that in the absence of interim relief, it would suffer damage that could not be adequately compensated by final relief; namely, that it will lose existing customers, will be unable to compete for new customers at the Sites, and will suffer damage to its market position. According to TekSavvy, it is impossible to estimate or calculate the impact of that injury after the fact.
TekSavvy noted that the Commission has previously found that characterizing harm as irreparable does not require an analysis of the magnitude of the harm, but rather of the nature of the harm. TekSavvy further argued that the Commission had recognized a potential loss in subscribers as an irreparable harm.
Cogeco argued that the impact of the network change on TekSavvy could not constitute irreparable harm given that access would only be potentially lost at two locations in all of Ontario and that TekSavvy could mitigate that harm by requesting access to Cogeco’s disaggregated FTTP wholesale service.
Commission’s analysis and determinations
The second criterion requires that the party requesting interim relief demonstrate that it will suffer irreparable harm if its request is not granted. Irreparable harm requires analysis of the nature of the harm, rather than its magnitude. Harm is also more likely to be irreparable where there is an unquantifiable loss that the applicant may not be able to recover, or that a final order may not be able to redress.
The Commission considers that if TekSavvy were to lose wholesale access to the Sites while the Commission is examining the application, TekSavvy would suffer direct harm because its subscribers in the Sites would lose service.
The loss of service by its subscribers in the Sites would cause irreparable harm to TekSavvy: those customers could decide to change providers given that they no longer have access to TekSavvy’s services. Even if TekSavvy were to re-establish service to the Sites, those customers and other potential customers could question the reliability of the service offered by TekSavvy and choose not to return.
Accordingly, the Commission is of the view that TekSavvy would very likely incur irreparable harm if interim relief were not granted and considers that TekSavvy has met the second criterion of the test.
Does the balance of convenience favour granting the requested relief?
TekSavvy argued that the balance of convenience favours granting the requested relief because the continued availability of competitive broadband based services is in the public interest and is consistent with the Commission's previous findings mandating wholesale access to network access facilities.
TekSavvy further argued that the interim relief requested would pose little inconvenience to Cogeco as it would still be able to continue with its planned upgrade to its network and would merely have to ensure that competitors still had access to the Sites.
TekSavvy submitted that the public interest in maintaining competition at the Sites outweighed any impact of the requested interim relief on Cogeco.
Cogeco argued that while, in its view, TekSavvy would suffer no harm as it could access Cogeco’s new facilities via disaggregated HSA, Cogeco would suffer harm if it is either required to maintain its existing facilities, against the wishes of the property owners, or if it were forced to provide aggregated FTTP access to TekSavvy customers.
Rogers argued that there are very real costs to the relief proposed by TekSavvy, namely delayed and inefficient network deployment, increased costs because of delayed removal, public inconvenience, as well as increased costs for operation and maintenance of legacy infrastructure. In Rogers’ view, the relief sought by TekSavvy ignores all of these important public interests. Rogers further argued that granting TekSavvy’s proposed relief would further exacerbate what in Rogers’ view was the longstanding regulatory asymmetry between the incumbent local exchange carriers and cable carriers. Rogers submitted that relief that is not in the public interest does not satisfy the balance of convenience.
Finally, Rogers submitted that in a recent Commission letter dealing with its Part 1 Application seeking immediate and final orders directing Bell Canada (Bell) and its affiliates and TELUS Communications Inc. (TCI) to process requests to attach small cells to their poles in accordance with their approved support structure tariffs, the Commission had rejected Rogers’ request for interim relief on the basis that interim relief granting access to tariffed services would not be easily reversible and that issues regarding access remained to be resolved. Rogers argued that the same conclusions should be applied in the case of TekSavvy’s request for interim relief.
Commission’s analysis and determinations
The third criterion requires an assessment to be made as to which of the parties would suffer greater harm from granting or refusing to grant interim relief pending the final determination of the issues. In addition, the assessment at this stage takes into account the public interest, and any party may raise arguments regarding harm caused to the public interest.
The Commission has concluded that TekSavvy would very likely incur irreparable harm if interim relief is not granted. As such, the presumption is that the balance of convenience favours the granting of interim relief, and special circumstances would be required to rebut this presumption. The Commission considers that no such circumstances exist in the present case.
With respect to Cogeco and Rogers’ arguments regarding impacts on network deployment, the Commission notes that providing interim relief in this case does not prevent Cogeco from upgrading its network or offering all of its current or planned services to its customers.
With respect to Cogeco’s arguments regarding TekSavvy’s ability to mitigate the irreparable harm it will suffer by using disaggregated HSA, the Commission considers, as noted above, that the record does not show that the necessary disaggregated Points Of Interconnection (POIs) have been built or that they could be built and TekSavvy transitioned to those POIs before 1 May 2024.
With respect to Rogers’ arguments regarding the denial of its request for interim relief on the attachment of small cells, the Commission notes that there are a number of differences between that situation and this one. In the Rogers situation, the Commission noted that even without access to Bell and TCI’s support structures to deploy small cells, Rogers had been able to deploy a sizeable national network. By contrast, in the absence of interim relief in this file, TekSavvy will lose access to its customers in the Sites on 1 May 2024. Further, the Commission found, in the Rogers situation, that granting the requested interim relief had the potential to upset the existing competitive situation, whereas granting TekSavvy interim relief in this case serves, in the Commission’s view, to maintain the competitive balance pending the final determination on this application.
Accordingly, the Commission considers that the balance of convenience favours granting the interim relief, and that the application meets the third criterion of the test.
Distribution list
TekSavvy Regulatory regulatory@teksavvy.ca
Rachel Harrison rharrison@teksavvy.ca
Cogeco Regulatory mtl.telecomregulatory@cogeco.com
Bell Canada Regulatory bell.regulatory@bell.ca
Eastlink Regulatory Regulatory.Matters@corp.eastlink.ca
Rogers Regulatory regulatory@rci.rogers.com
Shaw Regulatory regulatory@sjrb.ca
TELUS Regulatory regulatory.affairs@telus.com
Vidéotron Regulatory melanie.cardin@quebecor.com
John Lawford, PIAC, jlawford@piac.ca
CNOC, regulatory@cnoc.ca
Fibernetics, regulatory@fibrenetics.ca
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