CNOC asks for CRTC action on growing wholesale wireline ‘service gaps’

As large Internet Service Providers (ISPs) push on with the build of fibre-to-the-home (FTTH) networks, small providers say they are encountering an increasing number of areas where they have no access to wholesale Internet service from telcos. Such service gaps are “becoming increasingly large and prevalent,” the Canadian Network Operators Consortium (CNOC) said in a Part 1 application dated Thursday, in which it asked the regulator to provide expedited wholesale access to fibre-to-the-premises (FTTP) facilities. The service gaps exist in newly developed areas where the only facilities are FTTP, locations with FTTP where the incumbent has removed legacy facilities, and areas where the alternative to FTTP is legacy facilities, which only allow speeds of up to about 6-7Mbps. “Wherever Wholesale Service Gaps exist, Competitors are foreclosed from offering competitive retail high-speed Internet services and Incumbents enjoy significant market power flowing from what are essentially localized monopolies over their high-speed access facilities and corresponding ability to offer retail high-speed Internet services over those facilities,” CNOC wrote. The financial damage from such gaps, which can be found in residential and business areas and in both urban and suburban areas, “can last for years,” it said. While the CRTC mandated wholesale access to FTTP facilities in July 2015, it decided that would only take effect once its new disaggregated wholesale regime is implemented. Under the existing aggregated wholesale regime, which applies only to speeds up to 100 Mbps, access to FTTP is not included. The CRTC said at the time that it expected the disaggregated regime to be in place by 2016. However, it wasn’t until September 2016 that the CTRC released an implementation plan. TekSavvy Solutions Inc. chief regulatory officer Bram Abramson told the Wire Report at the time that it would be another year until companies could begin serving customers under the regime. In the meantime, telcos have been rolling out FTTH across the country in a process Moody’s Investors Services recently said is leading to an “investment race.” In its application, CNOC noted that the process of implementing the disaggregated regime outside of Ontario and Quebec has still not begun. CNOC asked the CRTC for expedited transitional access to FTTP facilities. “Wholesale HSA Service Gaps allow Incumbents, without any meaningful competitive effort, to acquire and lock-in customers for years via fixed term service agreements that include early termination fees,” it said in the Part 1 application. “It is therefore critical to prevent these wholesale service gaps, and resulting long-term harm to competition, from manifesting.” CNOC said a service gap exists even if the small providers have the option of buying wholesale service from a cable company in the area, writing that competitors “in these situations are often faced with prohibitively high costs of switching wholesale service platforms that prevent them from being able to provide service to customers that represent important business opportunities.” It asked for access to FTTP facilities on a transitional basis with no speed cap in areas where service gaps exist, with rates “applicable to equivalent service speeds available over FTTN facilities.” CNOC noted that since the CRTC first mandated access to FTTH networks in 2015, “the market for retail Internet services has been in a constant state of flux driven by end-user demand for increasingly higher-speeds in excess of 100 Mbps that are necessary to power a full suite of next generation application including, for example, 4k video streaming.” — With reporting by Anja Karadeglija at akarad@thewirereport.ca and editing by Charelle Evelyn at cevelyn@thewirereport.ca

CNOC asks for CRTC action on growing wholesale wireline ‘service gaps’

News | March 30, 2017

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CNOC asks for CRTC action on growing wholesale wireline ‘service gaps’

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