SaskTel points to elements of competition present in the province

SaskTel took exception with comments from Access Communications to the proceeding reconsidering the VoIP decision. The following is an edited excerpt from those comments. The commission noted in Decision 2005-28 that the ILECs are the dominant providers of local exchange services in Canada , based on market share; but reaffirmed its conclusion in Telecom Decision CRTC 94-19 that market share is not always determinative of market power. Furthermore, in SaskTel’s view there is very little evidence that benefits that accompany the companies’s dominant position in the local exchange market extend to the provision of local VoIP services. SaskTel submits that there is ample evidence of a competitive local VoIP marketplace in Canada, including the identification of more than 100 local VoIP service providers operating in Canada. Many of these service providers make their services available to Saskatchewan residents in competition with SaskTel’s own local VoIP services; and several offer services incorporating NPA 306 telephone numbers. It is SaskTel’s submission that the presence of such a variety of service providers and the availability of such diverse service offerings demonstrates that there are no barriers to entry into the market for VoIP local services. SaskTel objects strongly to the allegation that it has in someway thwarted competitive entry in the local telephone services market or any other telecommunications market in Saskatchewan. SaskTel notes that Access enjoys a very strong position in the provision of broadband access services in its operating territory; and that these are the basic building blocks for VoIP. In 1998, the government of Saskatchewan established the terms and conditions for competitive entry in the local service market. SaskTel has respected its responsibilities established by the government, and has done nothing to discourage competitive entry. Access alleges that its entry as a provider of local telephony services is dissuaded by the substantial capital investments that must be made to bring the competitor’s network to the quality of that of the ILEC. But, the evidence does not support Access’ allegation. In fact, these investments by cable companies made in their networks have been with the objective of putting in place the ability to deliver a range of advanced services including HDTV and broadband services. Granted, such investments are not insignificant; but once in place these networks are perfectly suited for the provision of VoIP telephony services, in addition to their principal goal of providing digital broadcast transmission, HDTV and other higher bandwidth broadband services. The costs and the risks of the cable companies’ investments can not be attributed solely to the provision of VoIP services. The incremental costs incurred by the cable companies to add voice telephony to their broadband facilities have not been significant when contrasted with the investments required by SaskTel to convert its current TDM access, distribution and transport networks to IP-compatible facilities. SaskTel notes that Access has provided high-speed Internet services to its customers for a number of years. Nothing would have prevented it from entering the local VoIP services market by providing its customers with an access-independent service alternative pending the upgrades they deem to be necessary for the provision of its VoIP service. In fact, this is exactly what SaskTel and as well as some cable companies smaller than Access operations have done.

SaskTel points to elements of competition present in the province

News | June 22, 2006

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