Not Just Roaming: CRTC Hearings on Wireless

The CRTC has wrapped up its hearings on wireless policy. This was the second round of the of three major CRTC policy hearings this fall (the other two are Let’s Talk TV, in which the public hearings have concluded, and Wholesale Access to Wireline Facilities, which are due to commence later in November). The hearings are ground-breaking in that the Commission as so far forborne from regulating wireless (cellular) services in general, and it first intervened to protect wireless customers from burdensome contract terms.

In the present hearings, the focus was on the intercarrier aspects of wireless networks, namely, wholesale roaming rates, tower sharing, and wireless resale.

As one could expect, the major incumbents (Bell, Telus, Rogers) exalted the current state of competition in wireless services, defended their roaming pricing, called for mandatory forbearance of wireless services, and couldn’t understand why anyone would complain about their response to tower-sharing requests.

The minor players, such as Eastlink, called for wholesale roaming pricing, more effective oversight of tower-sharing and other disputes arising between the smaller operators and the large incumbents.

Both the major and minor wireless carriers opposed wholesale access for resale purposes.

broadcasting lawyer ottawaIt is evident that, if there is to be effective facilities-based competition in wireless services, more has to be done by the regulator to ensure that there is a levelling of the playing field between the major and smaller wireless carriers. Industry Canada does not have the tools to regulate the business practices of its spectrum licensees: this is a job uniquely suited to the CRTC. Some rule making and effective enforcement activity is necessary to bring some minor dash of fairness to the wireless marketplace and, perhaps, provide some measure of relief for consumers.

Wholesale access to wireless services for resale purposes remains contentious and opposed by facilities-based carriers of all stripes. While the majors argue that three rather than four carriers will produce effective competition, they simultaneously assert that any competitor should have to build out from scratch any competing network and be weaned from roaming and tower-sharing arrangements as soon as is humanly possible.

Meanwhile, the new entrants, envying the huge margins of the majors, seek to get in on the feasting, and do not want to hear of resale operators cutting into their prospective margins.

That no one has been able to come up with the financing to launch a fourth national wireless carrier speaks volumes about the risk the financial markets perceive in greater facilities-based competition in wireless services.

All of which suggests that choice and reasonable and flexible rate packages are only likely to come to consumers through resale competition based on wholesale access to the wireless networks of the incumbents. Let’s hope the CRTC gets this right the first time around.

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