Competition Bureau advocacy could help telecom sector: experts

Canada’s largest telecom providers need not necessarily fear a Competition Bureau initiative to do more advocacy work focused on increasing competition in the telecom sector, industry insiders and former competition commissioners said. In a release Thursday, the Competition Bureau said Canadians, through a September consultation, have identified telecommunications as one area for the bureau to focus its advocacy efforts aimed at increasing competition. The bureau, which did not release further information about Canadians’ particular concerns about the telecom industry, also did not say what specifically it could do to advocate for increased competition in the industry. Sheridan Scott, a partner with Bennett Jones LLP and a former competition commissioner, said future bureau advocacy work that targets increased competition in telecommunications won’t necessarily harm Canada’s largest telecom providers. “I wouldn’t say they should necessarily be worried,” Scott said of the large telecom providers in a telephone interview Monday. “In fact, in some instances they may welcome it and work with the bureau to make sure the bureau understands as much as possible — how they see their sector working and what they see as the barriers in their sector.” Unlike its work enforcing competition law, Scott said, the Competition Bureau’s advocacy work is based on the bureau’s own direction and not a reaction to things such as mergers or new industry dynamics. The fact that industry players don’t yet know what types of advocacy work the bureau will do — or the aspects of the industry it will focus on — makes it all the more difficult to forecast what type of impact that work could have, she said. “I think it’s important when you select the types of initiatives that you want to undertake that you go in there thinking about things like measurable results, the likelihood of having some impact,” she said. “You could advocate forever and ever in certain areas and you’re never going to see any results.” In its release, the bureau highlighted its submission to the CRTC’s consultation on the development of its wireless code of conduct as one example of the advocacy work it has undertaken in recent years. The release noted that current commissioner, John Pecman, has said he wants more advocacy work that includes “regulatory interventions and enhanced collaboration and communication with stakeholders.” “The impact of advocacy cannot be overstated,” bureau spokesman Phil Norris said in an emailed statement Monday. “Indeed, advocacy can have as much — and in some cases more — impact than enforcement in ensuring competition in the marketplace.” In addition to regulatory interventions and stakeholder conversations, the bureau can also launch studies to examine specific aspects of the telecom industry to see if there are steps regulators or the government can take to increase competition or remove barriers to entry, said Melanie Aitken, another former competition commissioner who now works at Bennett Jones. The bureau could also undertake a study of competition in telecoms more broadly, Aitken said, or of a specific area of Canadian telecommunications, such as the wireless industry. Debate about the appropriate level of competition in the wireless industry peaked this year as incumbent providers BCE Inc., Rogers Communications Inc. and Telus Corp. launched public campaigns against some of Industry Canada’s rules for an upcoming auction of coveted wireless airwaves. Those rules, and others promoted by Industry Canada this year, are aimed at supporting the government’s objective of having four wireless carriers to compete in each region of the country. Aitken said the bureau could launch a policy paper that examines the state of competition in the wireless sector in an effort to contribute to that debate. “They can start a conversation by issuing a paper, and they can go out and talk about their findings,” she said. “The difficulty would be that they won’t be given any more money to do it.” Aitken noted that the bureau’s budget doesn’t provide specific funding for advocacy initiatives. Any dollar it spends on advocacy, she said, is one less dollar it has for enforcing competition. Norris, the bureau’s spokesman, said the advocacy work will not impact its financial ability to carry out its enforcement objectives. “While we have begun to increase our involvement in advocacy, we are doing this in a very targeted way, where we can maximize value, and we are doing this without ceding an inch where enforcement is concerned,” he said in an email. Another hurdle that could prevent the bureau from undertaking a comprehensive study of industry competition, Scott said, is its inability to order companies to turn over confidential information. Unlike the CRTC, she noted, the Competition Bureau doesn’t have the authority to compel companies to release information as part of a study. Without the inside information, she said, the bureau could be left with an impartial picture of the factors that are impacting competition in the industry. “To really look at the telecom sector and really understand it … I think that’s a difficult task,” Scott said. Lawson Hunter, counsel at Stikeman Elliott and another former head of the federal Competition Bureau, said in a telephone interview that the bureau has a long history of intervening in CRTC hearings, particularly during the 1980s and ‘90s when it was advocating to deregulate aspects of the telecom industry. Hunter said he could see the bureau getting involved in more CRTC hearings in the future concerning the regulation of the telecom and broadcast sectors, such as an upcoming review of wholesale services policy or the consultation on the future of the Canadian broadcasting industry. Large telecom providers, he added, could benefit from bureau interventions in CRTC policies, since the bureau typically advocates for deregulation and an increased reliance on market forces. “That’s their mandate. They believe in the market; they don’t believe that governments know best,” he said. Ted Woodhead, senior vice-president of regulatory and government affairs at Telus, said in an interview that he believes the competition bureau should be taking part in more regulatory consultations going forward, and that expects regulators will respect the bureau’s opinion and findings. “They are a competition law expert and a certain amount of weight comes from that,” he noted. Telus, he said, supports the bureau’s efforts to get more involved in advocating for increased competition in general. “They support competitive markets, they focus on ensuring consumers gets the benefits of competition, and I think that that’s all very good,” he said. “We believe fervently in competitive markets. We embrace competition.” — With reporting by Nicholas Kyonka at nkyonka@thewirereport.ca and editing by Derek Abma at dabma@thewirereport.ca

Competition Bureau advocacy could help telecom sector: experts

News | December 9, 2013

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