PIAC says administrative monetary penalties appropriate in City Wide dispute over Eastlink service outage response

The Public Interest Advocacy Centre (PIAC) and the Competitive Network Operators of Canada (CNOC) are contending that Bragg Communications Inc.’s Eastlink's conduct after its July 2023 outage fell short of reasonable conduct under the CRTC’s policies, with the former emphasizing a potential need for Administrative Monetary Penalties (AMP). City Wide Communications Inc., along with Frontier Networks Inc., and Purple Cow Internet Inc. filed a Part 1 application against Eastlink last month, alleging negligence and seeking compensation for a widespread network outage that occurred in July. The outage, caused by Eastlink's billing system error, disconnected all third-party internet access (TPIA) customers for approximately 24 hours, leaving tens of thousands of Canadians without telecom services, including internet access, IPTV, VoIP services, and the ability to call 911 over VoIP. The competitors are requesting a thorough investigation, potential compensation in accordance with Eastlink's TPIA tariff, and significant administrative monetary penalties. The competitors further highlight Eastlink's alleged anti-competitive provisions in its TPIA Agreement, restricting TPIA customers from using Eastlink's trademarks or mentioning the company without express written consent which they say is a violation of the Charter of Rights and Freedom. They argue that these restrictions hindered their ability to communicate effectively with customers, calling for a correction in the regulatory approach. The competitors claim economic fallout, including additional labor costs, increased customer disconnections, costs to mitigate reputational harm, and deferred business plans. Despite Eastlink offering a credit equivalent to one day's worth of TPIA charges, the competitors deem it inadequate and seek a comprehensive examination by the CRTC. PIAC, in its intervention submitted on Dec. 15, raised concerns about Eastlink's alleged negligence, citing the company's inadequate response to initial outage complaints by failing to adhere to outage reporting policies and the potential violation of regulatory obligations. PIAC highlights Eastlink's disregard for its TPIA disconnection protocol and its failure to test the updated billing system, which was a key factor in the service disruption. “The fact is, the effect of the outage was only on competitive services. This should place a burden on the upstream provider to prioritize restoration of service to wholesale customers. To the extent that this burden was not met, such a preference becomes real and may well be undue, especially given the potential economic harm to TPIA customers due to the lack of confidence of those retail customers in their provider, but occasioned wholly by Eastlink,” PIAC wrote. Furthermore, PIAC suggests that Eastlink's failure to report the outage promptly could be construed as a deliberate or negligent preference, potentially justifying administrative monetary penalties (AMPs). The group recommends a fulsome inquiry to determine the extent of Eastlink's responsibility and the appropriate sum of AMPs. “Based on the evidence submitted in the application, Eastlink’s recovery and messaging efforts to date – or lack thereof – may not be sufficient in providing an accurate accounting of the situation to impacted consumers. That, combined with the tariff provisions against citing Eastlink as the blameworthy party, consumers’ perception of TPIA-based competitors may have suffered unduly. This only works to Eastlink’s advantage, especially if consumers are also aware that Eastlink’s retail customers did not lose service in the same serving areas. If this situation is found to exist, then an AMP may be justified,” PIAC argued. In response to the incident, PIAC advocated for an updated public statement from Eastlink and an order allowing TPIA-based providers to inform their customers about Eastlink's role in the outage. The advocacy group insists that such measures are essential to rebuild public confidence in wholesale-based competitors. In response to the applicants’ argument concerning the ban on communication, CNOC suggested that the commission could resolve the issue without invoking the Charter. Referring to its powers under the Telecommunications Act, CNOC argued that the Commission could prohibit telecommunication service providers, like Eastlink, from blocking communication. The tariff language blocking such communication, according to CNOC, is unjustly discriminatory and unduly preferential to Eastlink and should be removed. The organization also supported the applicants’ call for compensation. “Reliability is a pillar of a word-class telecommunications system. If Canadians are to have access to such a system, then the commission must take steps to ensure service outages like the Rogers blackout, and the Eastlink blackout detailed by the applicants, are fully investigated, and that retail customers and wholesale customers are sufficiently compensated,” CNOC wrote in a Dec. 15 intervention. CNOC also noted that it had backed the introduction of a notification and reporting regime for major outages on Canadian carriers' networks, as outlined in the commission’s consultation regarding network outages. The applicants' case highlights Eastlink's alleged failure to comply with the interim outage reporting and notice regime, in effect since March, CNOC said. “Eastlink owes a duty of care to its TPIA customers, and its conduct clearly fell short of that standard. As a result, Eastlink’s TPIA customers and their retail customers (not Eastlink’s retail customers) end-users sustained significant damages. A good faith effort by Eastlink once it became aware of the issue could have helped mitigate the situation,” CNOC wrote. – Reporting by Jenna Cocullo at jcocullo@thewirereport.ca and editing by Paul Park at ppark@thewirereport.ca

PIAC says administrative monetary penalties appropriate in City Wide dispute over Eastlink service outage response

News | December 18, 2023

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PIAC says administrative monetary penalties appropriate in City Wide dispute over Eastlink service outage response

News | December 18, 2023

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