TekSavvy raising home internet plan fees

TekSavvy Solutions Inc. is hiking fees for some customers of its residential internet service by a few dollars per month, which it says is a consequence of the CRTC’s decision to revert the rates for wholesale-based internet service providers to interim levels from 2016. In a notice sent to subscribers this week, TekSavvy said it invested in new network links and added capacity to meet demand before the CRTC “stunned consumer groups and industry observers when it ruled in Big Telecom’s favour and scrapped its own final 2019 wholesale rates decision.” In its May decision referred to by TekSavvy, the commission reversed course on a 2019 decision to dramatically slash rates the incumbent telecom companies were allowed to charge independent internet service providers (ISPs). “That final 2019 rate decision would have lowered internet prices for millions of Canadians,” the company said. “In light of this CRTC decision to maintain high wholesale rates and in order to continue providing you with the responsive and reliable service that you have come to expect, TekSavvy is making changes to monthly service plans.” Customers with home internet plans over (not including) 15 Mbps delivered using wholesale services will see an increase of three dollars per month on their bills. The increase went into effect Tuesday afternoon for new customers, while existing customers will see the increase on their first bill on or after Oct. 1. The increase does not apply to residential services on TekSavvy’s own fibre-to-the-home or fixed wireless facilities. “To be clear, we do not want to institute this increase and would much rather lower prices, as we have done in the past,” TekSavvy’s vice president of insight and engagement Peter Nowak said in a blog post Wednesday. “But we have been left with no choice thanks to recent reversals by a regulator that is now clearly siding with and padding the profits of Big Telecom – the CRTC.” TekSavvy has been working to dispute the CRTC’s decision to revert the rates, first by filing a formal petition to cabinet asking the government to overturn the decision and remove CRTC chair Ian Scott, and later asking the Federal Court of Appeal for permission to appeal the decision around the end of June. In its notice of motion, TekSavvy asserted the CRTC’s decision to revert the rates “breached TekSavvy’s legitimate expectation that the CRTC would conduct a full review and assessment of the rates based on costing inputs and costing methodologies of all interested parties, including TekSavvy,” among other arguments. “As a strong proponent of transparency and doing what is right for our customers, we will continue fighting for competition and fair wholesale pricing for telecommunication services in Canada,” TekSavvy said in the notice to customers Tuesday. “To say that this reversal has been a blow to competition would be an understatement,” Nowak said. “Many other indie ISPs have raised prices as a result. TekSavvy cancelled its wireless ambitions and pulled out of this summer’s spectrum auction. Fibre expansion plans have been scaled back.” Competition Network Operators of Canada (CNOC) executive director and Distributel Ltd. CEO Matt Stein told The Wire Report Wednesday he’s heard anecdotally that some CNOC members have had to raise fees due to the decision, while others had surcharges in place they were hoping to remove when the 2019 rates were upheld only to realize when the CRTC “flip-flopped” they had to keep them in place. “I don’t think it’s rare or uncommon at this point. Pretty much right across the industry people either raised rates, announced they would raise rates, or had already raised rates,” Stein said. Stein expects the three-dollar-a-month increase by TekSavvy to be in the same neighbourhood as other companies and said the rising cost of business “continues to be compounded by the lack of any rate relief whatsoever from this decision.” CNOC, which represents a number of wholesale-based internet providers, filed a petition of its own to the Governor in Council related to the rates decision in mid-July in which it argues that in deciding to make permanent the interim rates established in 2016 and tossing the lower rates outlined in the 2019 decision, the CRTC “compromised the foundation for broadband competition and affordability in Canada.” The petition, which was joined by another from Ottawa-area internet service provider National Capital FreeNet Inc. Wednesday, argues the CRTC’s decision “is the latest product of a Commission that has fallen out of touch with the needs of Canadians,” linking it to the commission’s rejection of a broad-based mobile virtual network operator (MVNO) mandate and an ongoing proceeding on disaggregated wholesale internet access. “ISPs felt that they were doing the good work of the CRTC for years, for many years. We know, as ISPs, that we are here to bring balance to the market power of the incumbents,” Stein said Wednesday. Also Wednesday, NDP leader Jagmeet Singh said his party would lower cell phone and internet bills, saving the average family $1,000 -- making a type of party promise Stein said is old news. “It’s great to hear that the NDP is firmly behind the affordability crisis. But I’d remind you that in 2019 the NDP, the Conservatives, the Liberals, everybody agreed that home internet prices and cell phone bills were way too high. Here we are again, two years later.” “When you think about it, the two biggest ways the CRTC -- an instrument of this government -- could have addressed that, would have been number one: on mobile phones, enabling an MVNO regime,” Stein said. “The CRTC decided to effectively not do that. And then, on internet rates, to not only not go ahead with the internet rates ‘final’ decision in 2019, but to instead choose to do nothing at all is really quite shocking.” - Reporting by Hannah Daley at hdaley@thewirereport.ca and editing by Michael Lee-Murphy at mleemurphy@thewirereport.ca

TekSavvy raising home internet plan fees

News | August 25, 2021

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TekSavvy raising home internet plan fees

News | August 25, 2021

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