Canada Regulates ILEC VOIP Pricing

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Canada Regulates ILEC VOIP Pricing

The Canadian telecommunications regulatory agency ruled last Thursday that the country's ILECs must get regulatory approval on pricing for VOIP products. But the VOIP offerings of the country's startups, CLECs, and cable companies are immune (see Rogers Picks Sigma for VOIP and MetaSwitch Lands Canadian Deals).

The Canadian Radio-television and Telecommunications Commission (CRTC) ruled that VOIP is more like a telephone service than a data service and must be regulated as such.

The ruling comes as Canada's VOIP market is getting its legs, and it may have serious impact on which industry and which companies take an early lead in the competition for users (see Nortel Comments on VOIP).

In its ruling the commission sought to prevent Canada's ILECs from forcing smaller players out of the market by selling VOIP service at bargain basement prices (see VOIP for Life?). The ILECs hold a strong position in the Canadian marketplace, controlling 97 percent of the country's wireline telephone business.

The commission also rejected forbearance requests from BCE Inc. (Bell Canada) and Telus Corp. The two said they will immediately appeal the CRTC's decision.

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Jack Decker
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