CRTC releases long-awaited MVNO terms and conditions

The CRTC has unveiled its long-awaited terms and conditions of service allowing mobile virtual network operators (MVNOs) to operate in Canada. In a Wednesday morning release, the commission described its framework as “enhancing the ability of regional wireless providers to offer more competition and choice to Canadians”, as incumbent providers will be obliged to sell access to their networks to smaller telecommunications companies, provided that they meet certain criteria. In the announcement, the CRTC declared that large wireless providers such as BCE Inc., Rogers Communications Inc., and Telus Corp. are required to immediately begin accepting requests for access to their networks and should enter into “good faith” negotiations with interested regional wireless providers to agree on wholesale rates. The CRTC will act as an arbitrator in such negotiations where necessary. Rogers, Telus and Bell all told the Wire Report that they were still reviewing the decision and its implications. At least one potential MVNO expressed approval for the CRTC’s guidelines. In a statement to the Wire Report, Quebecor Inc. CEO Pierre Karl Péladeau described it as a positive for consumers, indicating that Videotron would seek access to incumbents’ networks as soon as possible. “This decision reaffirms the CRTC’s and the government’s commitment to creating more competition and choice in the wireless market for the benefit of Canadians.” According to the new terms and conditions, once tariffs are settled upon between an incumbent and a supplier, the incumbent will be required to make its service available to the MVNO within 30 days. The CRTC also determined that these access rates should be open to renegotiation at least once every two years. The new framework imposes various requirements on both incumbents and regional wireless providers wishing to operate as MVNOs. To be eligible to access incumbents’ networks, wireless providers must have a home public mobile network somewhere in Canada, and they must be actively offering commercial mobile wireless services to retail customers. The CRTC also notes that a regional carrier must be operating its own network and serving retail customers somewhere in Canada. There is no geographic adjacency requirement. This means (for example) that a regional carrier operating in Alberta would be able to purchase network access to operate as an MVNO in New Brunswick. Meanwhile, incumbents will be obliged to give MVNOs access to all current and future GSM networks, including 5G and any new generation that may later come into service. Incumbents will also be required to implement a seamless hand-off functionality between their networks and the home networks of the regional carriers they are selling access to, meaning that wireless users on the MVNO can move between the networks without any loss in network access. The CRTC also issued a number of more specific directives to individual incumbents, instructing them to amend certain parts of their tariffs, such as provisions that would have allowed incumbents to suspend their service to an MVNO without sufficient justification. Incumbents are also blocked from demanding compensation from regional carriers that inaccurately predict their own network traffic, nor can they impose minimum spectrum holding requirements on those regional carriers (although regional carriers are still required to have some spectrum holdings in order to operate as MVNOs). The CRTC’s MVNO framework has been in the regulatory pipeline for a long time, with companies expressing concerns about the commission’s slow movement earlier this year, and Xplore Inc. even closing down its Xplore Mobile brand in August 2022, citing uncertainty caused by such delays. This is the CRTC’s first major update to its plans for allowing MVNOs to operate in Canada since April 2021, when it announced that it would pursue a limited MVNO model, in which the incumbents would be required to sell access to their mobile networks, but only to companies that already have their own spectrum rights — predominantly regional service providers — and only for a mandate of seven years. Those regional providers will also be required to commit to investing in their own networks. That decision drew praise from incumbents for promoting facilities-based competition, and was criticized by organizations such as the Competitive Network Operators of Canada (CNOC) for being overly narrow and freezing out competition. The newly-announced framework is drawing similar criticism: CNOC executive director Geoff White criticized the framework for its highly limiting rules in a statement to the Wire Report. “The regime is doomed to fail Canadians, who are rightfully upset with their wireless bills…It is still a very restrictive regime that really only applies to regional carriers with pre-existing wireless networks,” White said. “To make things worse, the rates for access are to be negotiated between the parties. That process is long and drawn out and there’s no incentive on the part of the big 3 to negotiate reasonable rates.” However, White acknowledged that some parts of the CRTC’s framework would be beneficial to smaller carriers, as long as they’re eligible to serve as MVNOs, including the commission’s requirements that incumbents establish seamless hand-off systems, and that they eliminate “anti-competitive terms” from their proposed tariffs. – Reporting by Tim Forster, and editing by Jenna Cocullo at jcocullo@thewirereport.ca. Correction: A previous version of this story incorrectly stated that a regional wireless providers should only operate MVNOs as an extension of their original coverage area. This story has been updated to reflect the necessary changes.

CRTC releases long-awaited MVNO terms and conditions

News | October 19, 2022

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CRTC releases long-awaited MVNO terms and conditions

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