CRTC expanding competitor access to big fibre networks, but too soon to know price impact

Canada's telecommunications regulator is expanding a decision that allows smaller internet providers to use rivals' fibre networks to offer their services to customers, but it's too soon to say whether the move will lead to lower prices for Canadians.

Starting in February, large telephone companies that own fibre internet networks — like Bell Canada and Telus — must give competitors access to their networks for a fee, the CRTC says.

The decision builds upon a ruling late last year that temporarily required Bell and Telus to provide competitors with access to their fibre-to-the-home networks only in Ontario and Quebec within six months.

The CRTC's decision was meant to stimulate competition for internet services, as it said at the time its review could potentially make that direction permanent and apply it to other provinces.

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Bell responded by reducing its network spending by $1.1 billion by 2025, saying the ruling diminished the business case for it to invest.

The CRTC says its latest decision applies only to existing networks, and any new fibre built by the large telecoms will be made available to competitors in five years, in order to give Bell and Telus "an opportunity to more quickly make a return on their investments."

More competition generally leads to better prices for consumers, but it's unclear what uptake will be on the expanded access because companies don't yet know how much the access fee will cost.

The CRTC says it will set new rates by the end of the year; existing rates in Ontario and Quebec will remain in place for the time being.

Andy Kaplan-Myrth, vice-president of regulatory and carrier affairs at TekSavvy, an Ontario-based independent internet service provider, told CBC News that the decision has been a long time coming.

The company, which offers service in most regions of Canada, will decide if it will use the fibre networks once rates set at the end of the year, Kaplan-Myrth said.

He noted that TekSavvy entered the Ontario and Quebec markets last year under the new regulatory framework but that fees were still far too high for the company's liking.

This time around, "if they don't get the rates right, it will be a failure," Kaplan-Myrth said.

Tuesday's ruling "builds on an effective decision that the CRTC put in place last year on an interim basis that has helped companies like TekSavvy survive," said Dwayne Winseck, a professor at Carleton University's School of Journalism and Communication.

He noted that in 2021, the CRTC reinstated higher access rates that had previously been done away with. Companies like Ebox, VMedia, Comwave and Distributel were hit hard, and hundreds of thousands of their subscribers lost their choices in the market, Winseck said.

"The idea that you're going to have competitive [internet service providers] building up their own infrastructure to connect all Canadian homes, that ain't going to happen. It's not desirable, it's not economic," he added.

"So if we want to have competition, what we have to do is allow for this kind of open networks approach that will allow the independents to interconnect the equipment that they do have and provide services to the customers they do serve."

A spokesperson for the Canadian Telecommunications Association, which represents the country's major telecoms, declined to comment.