TORONTO – Independent competitors will be permitted by the CRTC to sell the fiber networks of major telephone companies in Ontario and Quebec, as an effort to renew diminishing competition in Canada’s two largest provinces for Internet services.Thank you for reading this post, don't forget to subscribe!
At the Canadian Telecom Summit in Toronto on Monday, the national telecommunications regulator declared the interim decision during an ongoing assessment of third-party access to fiber networks, with the intention of reducing prices for customers.
The decision is a partial ruling in a review initiated by the CRTC in March, examining the means by which smaller rivals compensate major telecommunications companies for network access. At that time, the Commission also revealed a 10 percent reduction in some wholesale Internet rates.
The review, which has received over 300 interventions, encompasses a prompt examination of whether larger carriers should grant smaller competitors access to their fiber-to-the-home networks.
In Ontario and Quebec, where independent Internet providers currently serve 47 percent fewer customers than two years ago, the CRTC stated that its review discovered significant competitive declines.
“At the same time, numerous rivals have been acquired by larger internet providers, which has left many Canadians with fewer options for high-speed internet services,” stated CRTC Chair Vicki Etrides in a speech to conference participants on Monday.
“The CRTC is promptly taking action to help stabilize the markets.”
The decision mandates that major telephone companies, namely BCE Inc. and Telus Corp., grant competitors access to their fiber-to-the-home networks within six months. It is stated that the delay will provide companies with time to prepare their networks and develop information technology and billing systems.
The CRTC also outlined interim rates that smaller competitors will be charged for network access, in order to support both competition and continued investment in high-quality networks.
The regulator stated that the move aims to stabilize the market in areas where it would significantly affect consumer choice and affordability, aligning with Industry Minister François-Philippe Champagne’s directive to the CRTC earlier this year to enhance consumer rights.
Last week, BCE Inc. Chief Executive Mirko Bibic cautioned that if the regulator’s decision in the review favors smaller players over larger companies, it would result in Bell slowing down its fiber construction plans.
“It’s as simple as that,” Bibic informed analysts during the company’s third-quarter earnings report.
“That would be regrettable because, when we introduce fiber into the community, we actually enhance competition…the customer receives improved service, better value, and lower prices, which is typically the discourse we have with regulations.”
The regulator stated that a comprehensive review is currently underway, with the next public hearing scheduled for February 12, 2024.
No decision has been reached yet on whether a similar action will impact internet services in other provinces.
Companies in this story: (TSX:BCE, TSX:T)
This report by The Canadian Press was first published Nov. 6, 2023.
Sammy Hoods, The Canadian Press