Reliance on market forces is clearly more desirable than complex overregulation, but for market forces to be effective, we need rivalrous behaviour that's real. This does not mean duopolies. It means a diversity of service providers, as we see in the long-distance market.
Deregulation does not lead to lower consumer prices, competition does. Deregulation prior to effective competition will have the opposite effect.
I joined the telecom sector about 28 years ago. Throughout those years, the CRTC has conducted an orderly dismantling of the telephone companies' monopolies with great success. One of their decisions--that resale of telephone company service was in the public interest--was the inspiration for Distributel. I started that long-distance company 18 years ago on the principle of resale of Bell services.
Since then, we have invested millions of dollars in equipment and facilities. Most importantly, over 200,000 customers, 95% of them consumers, take advantage of our innovative offerings.
For the past two years, Distributel has been developing an Internet-based telephone service. Here's a flyer for that service. On the left panel is the Internet-based telephone service. On the right is our resale-based high-speed Internet service, and in the middle is a bundle of the two.
Here's what will happen to these offerings if we lose our wholesale DSL tariffs. We would love not having to depend on other carriers' wholesale tariffs. But what are the alternatives? Co-location in the telephone companies' central offices is costly and slow and even then does not reach access to consumers served by remote equipment.
We had hoped that wireless might be the alternative. In January 2005 we bid millions of dollars in Industry Canada's auction for the 3.5 gigahertz spectrum. In region after region we bid to the highest level that we thought economical, only to have our highest bids trumped by Bell Canada. So for now, to stay in this business, we need good cost-based wholesale tariffs.
On Monday you heard praise for the CRTC's success in deregulating the long-distance market. Why, then, is it being overruled in the local-services market? The minister's policy directive, a triumph for the large telcos, will surely be disruptive. Just last Friday, Bell Canada used it as the basis for an application to repeal three of the CRTC's latest orders concerning wholesale Internet services.
Though we frequently disagree with CRTC decisions, the process leading up to them has always been fair and transparent. Please use your influence over the government and its industry minister to retreat from premature regulation. Let the CRTC continue to introduce competition, then deregulation, for the ultimate benefit of Canadian businesses and consumers.