Telecom Update (Canada) #479, April 29, 2005

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479: April 29, 2005

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** Big Week at the CRTC ** Tariff Decisions to Be Fast-Tracked ** Telco Promotions Okayed, With Conditions ** Debate Begins on Local Service Deregulation ** CRTC Backs Off Floor Price Changes ** Government Amends Do-Not-Call Bill ** Telus-TWU War Escalates ** Telus Wants Quality Reports Revised ** Ottawa Opens New Spectrum ** CRTC Reduces RFP Value ** AT&T Names New Exec for Canada ** Shift Provides VoIP on SuperNet ** Rogers Launches Corporate 'Push' Email ** Entourage Quebec Techs Accept Contract ** Nortel to Buy U.S. Government Supplier ** Aliant Sales Edge Up ** Rogers Wireless Sales Soar

BIG WEEK AT THE CRTC: The Canadian Radio-television and Telecommunications Commission issued a flurry of important decisions and notices this week.

TARIFF DECISIONS TO BE FAST-TRACKED: CRTC Circular 2005-6 announces procedures to reduce the time required to rule on retail tariff filings by the major incumbent telcos. The Commission says that within ten days of a filing it will reject the application, or give it interim approval, or begin a process aiming, in most cases, at a decision within 45 business days of the filing.

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** The new procedures are similar to those proposed by Bell Canada last November (see Telecom Update #457) except that there is no provision for automatic approvals.

** The Commission has re-introduced the service standards for tariff applications it put in place three years ago but subsequently suspended. (See Telecom Update #346)

TELCO PROMOTIONS OKAYED, WITH CONDITIONS: CRTC Telecom Decision 2005-25 lifts the 2003 moratorium on promotions for incumbent telcos' local services. Promotional rates must cover costs and must be available to all customers in a given rate band, not just competitors' customers. A promotion can last only six months, and must not lock customers in past that period.

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DEBATE BEGINS ON LOCAL SERVICE DEREGULATION: CRTC Telecom Public Notice 2005-2 opens a proceeding to determine criteria for deregulating the incumbent telcos' retail local services. Various filings will take place between May and September, followed by a public consultation on September 26-29. A decision is expected in spring 2006. To comment, notify the Commission by May 4.

** Aliant's April 2004 application for local service forbearance (see Telecom Update #428) will be dealt with in this proceeding.

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CRTC BACKS OFF FLOOR PRICE CHANGES: CRTC Telecom Decision 2005-27 eliminates many of the changes to floor prices for incumbent telco services that were initially proposed by the Commission in 2003 (see Telecom Update #405). In particular, the rules are based on Phase II costing, not retail rates. The new rules are not retroactive and will not affect existing customer contracts.

** Rates for standalone or bundled services must include the tariffed rates for any "essential/near-essential" services provided to competitors, and for any residential local services included in a bundle. The lowest term or volume rate must cover costs. Targeted pricing that would de- average rates within a given rate band is not permitted.

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GOVERNMENT AMENDS DO-NOT-CALL BILL: The federal government has introduced amendments to its bill to set up a national do-not-call registry for telemarketers. The changes would exempt calls to established customers and clients, and from charities where certain conditions are met. They would also allow consumers to accept calls from charities while blocking commercial telemarketing.

** The amendments would also require a review of the Do-Not- Call List after five years.

TELUS-TWU WAR ESCALATES: Both the Canada Industrial Relations Board and the Federal Court of Appeal have refused to issue orders blocking Telus from implementing "lockout" measures against the Telecommunications Workers Union. The telco put the measures into effect on Monday. (See Telecom Update #478)

** The TWU says it will charge Telus with violating collective bargaining laws and regulations, for emailing details of a proposed contract directly to employees. The union says the email is misleading because it omitted the "enormous concessions" employees would have to accept under Telus's offer.

** The union also issued a statement denying Telus's "outrageous allegation" that some company facilities have been sabotaged.

TELUS WANTS QUALITY REPORTS REVISED: As we reported in Telecom Update #474, major telcos must this year give credits to subscribers for substandard service dating back to 2002. As a result, Telus has now asked the CRTC to adjust its service quality reports for July-December

2003, to omit the impact of near-simultaneous events that were out of its control -- forest fires, major flooding, and a serious cable cut in Vancouver.

OTTAWA OPENS NEW SPECTRUM: Industry Canada has opened new spectrum in the 5 GHz range, and improved existing frequency bands to meet increasing demand for broadband wireless.

** A new government paper on Spectrum Utilization Policy for Licence Exempt Wireless LANs in the 5 GHz Range is available now at
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CRTC REDUCES RFP VALUE: The CRTC has amended its RFP for legal/economic assistance with the local forbearance proceeding to indicate that it now expects to pay between $250,000 and $500,000 for the work, half the original estimate. (See Telecom Update #478)

AT&T NAMES NEW EXEC FOR CANADA: AT&T Corporation has named John V. Slamecka as Vice-President, AT&T Business Services for Canada, the Caribbean and the Latin American Region, replacing Penny Shaffer. He is based in Coral Gables, Florida.

SHIFT PROVIDES VoIP ON SUPERNET: Shift Networks, a Calgary- based small-business VoIP supplier, and Strategic Information Systems, an IT supplier to aboriginal communities, have agreed to jointly provide hosted IP telephone service over Alberta SuperNet.

ROGERS LAUNCHES CORPORATE 'PUSH' EMAIL: Rogers Wireless's new MyMail service delivers "push" email, calendar, and contacts to business customers on a range of wireless devices, using the Visto Enterprise Server.

ENTOURAGE QUEBEC TECHS ACCEPT CONTRACT: Entourage installation and repair technicians in Quebec have voted to accept a new four-year contract with their employer, now a subsidiary of Bell Canada. 1,400 Ontario employees remain on strike.

NORTEL TO BUY U.S. GOVERNMENT SUPPLIER: Nortel Networks has agreed to buy PEC Solutions for US$448 million. Last year PEC, a Virginia-based integrator that sells mainly to the U.S. government, had a profit of $16 million on revenue of $203 million.

ALIANT SALES EDGE UP: Aliant reports first-quarter revenues of $524 million, 1.9% up from the same period last year. Local and long distance revenue fell to 50% of the total from 55%. Wireless sales rose 15%. Aliant's net income of $43.6 million was down 4.5% from last year.

ROGERS WIRELESS SALES SOAR: Rogers Wireless revenues reached $875 million in the first quarter, 48% higher than a year ago. Revenues from the former Microcell made up three-fifths of the gain. Rogers says that data services will likely account for 10% of wireless revenues by year-end. Net income: $47 million.

** Revenue from Rogers' cable operations increased 7%. Rogers Communications had sales of $1.58 billion (up 25%) and a net loss of $46 million (down from $78 million).


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