Bell rate increases for Primus would hurt low-income consumers: interventions

A BCE Inc. price increase on the unbundled local loop (ULL) service it sells to Fusion Connect Inc.'s Primus will have an undue impact on low-income customers who rely on the service, according to several interveners in a Part 1 application on the rate increases, which is currently before the CRTC. In a Dec. 29 intervention to the proceeding supporting Primus' request, the Competitive Network Operators of Canada (CNOC) argued that "Primus’ situation highlights how premature forbearance of what will remain an essential service can lead to market foreclosure by an incumbent," and argues that the regulator has data that many lower income households rely on the type of landlines serviced by ULLs. "It also appears that many of Primus’ business customers, already struggling due to the COVID-19 pandemic, rely on Primus’ services to carry on their businesses," CNOC wrote. In December, Ontario-based Primus had filed a Part 1 application with the regulator seeking expedited interim relief for rate increases for unbundled local loops (ULLs), which the ISP said in the application were "exorbitant… unreasonable, unjustified, and punitive in nature." The application also asks the regulator to pause the rate increases for 12 months in order to allow Primus to migrate its customers off ULL technology. The Public Interest Advocacy Centre, in its own intervention, argued that while Primus' request fails to meet the "irreparable harm" stipulation of the test needed to grant an injunction, the regulator should effectively grant the relief because of the possible impact on low-income consumers. "PIAC believes that the present forbearance regime(s) and remaining shreds of wholesale regulation is inadequate to protect the interests of Canadian consumers, and in particular, those with affordability issues," PIAC wrote. The Internet Society's Canada Chapter (ISCC) wrote in its own Dec. 29 intervention that the increases would hurt Canadian consumers. "While ULLs may be used to provide legacy services such as lower-speed Internet and traditional telephone service, these services continue to be vitally important to many Canadians," the ISCC wrote, and pointed to data from the CRTC's Communications Monitoring Report which they said showed that "Canadians in low-income households predominantly rely on traditional telephone service" as their only phone service. "These Canadians should not have the affordable connectivity they currently enjoy taken away simply because Bell has decided to abuse its power as an incumbent," the ISCC wrote. "These rate increases," Primus wrote in its Part 1, and which the telecom said are between 82.9 per cent and 427.2 per cent, "cannot simply be absorbed by Primus, a fact that Bell is fully aware of." In the filing, Primus concedes that Bell has the right to change pricing for unregulated services like ULLs, but contends that the particular rate increases by Bell "are clearly designed to be discriminatory and to subject Primus to undue and unreasonable disadvantage in the marketplace," and thus violate Section 27 of the Telecommunications Act. "The high-handed nature of Bell's actions is exacerbated by the fact that Bell has chosen to impose these excessive rate increases, the costs of which have long been recovered by it, during an ongoing pandemic when connectivity is vitally important," Primus added. In an email to The Wire Report, Primus confirmed that the rate increases had indeed come into effect on the first day of the year, after the expiration of an agreement for ULLs dating back to December 2016. On Dec. 14, the day of Primus' Part 1 filing, Bell notified the company of a second planned rate change scheduled for Jan. 13. That second rate change, Bell wrote in its reply to the proceeding, contains a condition related to Primus "maintain a certain volume of ULLs with Bell," though Bell redacted the exact terms of the condition in its submission on the proceeding. "The Second Price Change Notice is thus an alternative pricing structure rather than an increase," Bell wrote. In a statement emailed to The Wire Report, Primus executive vice-president and general counsel James Prenetta Jr. referred to the change as an increase. "Bell is proceeding with an additional rate increase on January 13th, absent a Commission decision on interim relief. Primus has urged the Commission to rule on that request prior to January 13 and remains hopeful the Commission will do so," Prenetta Jr. said in the email. The commission required Primus to file a response, if it was to do so, by Monday. As of press time, the reply was not yet posted to the CRTC website. — Reporting by Michael Lee-Murphy at mleemurphy@thewirereport.ca and editing by Anja Karadeglija at akarad@thewirereport.ca

Bell rate increases for Primus would hurt low-income consumers: interventions

News | January 5, 2021

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Bell rate increases for Primus would hurt low-income consumers: interventions

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