Good afternoon. I am the vice-president of regulatory affairs at MTS Allstream.
MTS is the incumbent telephone company in Manitoba. We offer an array of telecommunications services, including high-speed Internet and IPTV services. Outside of Manitoba we are the leading competitor to Bell and Telus, offering state-of-the-art business services throughout the country.
I'd like to thank the committee for this opportunity to appear before you today to discuss the CRTC's UBB decision.
The CRTC's approval of Bell's proposed usage-based billing for wholesale DSL services further erodes the mandated availability and pricing of wholesale services. As the availability of economically priced wholesale services erodes, so too does consumer choice and the innovation that robust competition delivers.
The CRTC has allowed what amounts to regulator-sanctioned retail price fixing with the UBB decision. The CRTC has done so on the basis of misinformation and misconceptions.
The first misconception is that wholesale UBB is necessary to protect the integrity of the Bell network. The second is that UBB is competitively neutral and transparent because Bell allegedly applies a usage cap on its retail customers' traffic and charges these customers for usage in excess of a cap.
Bell has offered no evidence demonstrating that its network is congested and would fail if steps were not taken, economic or otherwise, to control traffic on its network. Nor did Bell offer any evidence that demonstrated that the traffic of competing ISPs' customers was the cause of any congestion problems. Indeed, the CRTC has acknowledged that there is no cost-based rationale for the manner in which it is allowing Bell to implement wholesale UBB charges.
Moreover, congestion in a telecommunications network is specific to both time and location. No properly provisioned telecommunications network is congested everywhere at all times. Yet the application of usage caps and usage-based billing by Bell on competing ISPs' customers' traffic is applied everywhere and irrespective of the time.
These caps and usage-based charges are sanctioned by the CRTC even though competitor ISPs, when purchasing wholesale DSL service from Bell, purchase not only access to a customer's premises, or the last mile, but also capacity over Bell's network to transmit the traffic generated by all of their customers, or the middle mile.
Having leased and paid for capacity, the ISP should have the right and responsibility to manage its own customers' traffic. By approving wholesale UBB, the CRTC has allowed Bell not only to decide how much capacity a competitor's customer is entitled to, but to charge that ISP for any usage by individual customers in excess of a cap that Bell arbitrarily imposes. This cap is imposed irrespective of whether the ISP has exceeded the overall network capacity it has purchased from Bell.
In effect, Bell is allowed to charge the ISP multiple times for the same capacity. In fact, we demonstrated to the CRTC that a competitive ISP could purchase far more capacity than its end-user customers use in aggregate and still end up paying substantial UBB charges because some of the competitor's customers exceed a completely arbitrary cap.
Through the imposition of a cap and usage charges, Bell will be allowed to dictate the structure and level of retail Internet pricing. In the best case, competitor ISPs will be forced to mirror Bell's pricing. However, today Bell's retail Internet pricing is no longer regulated and the CRTC has neither the oversight nor the visibility to this pricing.
Do I still have time?