Mandating co-location would be a barrier to competition: CNOC

An application by BCE Inc. asking the CRTC not to require the implementation of meet-me points through which smaller companies could connect to the telco’s network, if granted, would harm competition, small ISPs are arguing. “Bell’s application is an attempt to slow competition that would also generate an unnecessary windfall for Bell at the expense of competitors and consumers,” the Canadian Network Operators Consortium (CNOC) said in a Jan. 23 intervention. In December, Bell filed a review and vary request with the CRTC asking it to eliminate the requirement for incumbent telcos to “implement an outside meet-me point of interconnection in addition to co-location,” imposed as part of the CRTC’s implementation plan for its disaggregated wholesale regime. Bell had also asked for a stay of that requirement, which the CRTC denied on Dec. 22. The company argued that offering a meet-me point — that is, building a point to which small Internet Service Providers (ISP) could connect outside the telco’s central office, instead of co-location, or physically connecting inside the central office building — would incur additional risks and drive up costs for the company. CNOC responded Monday that “co-location is a clear barrier to competition. Meet-me solutions are vastly more cost-effective than co-location.” The organization, which represents small ISPs, said that Bell’s reasoning that outside meet-me points are vulnerable to environmental risks like bad weather and wildlife is a “strange argument,” given that “all of the outside plant that feeds into and out of the is equally exposed to these environmental factors.” The organization also took issue with Bell’s argument that the telco would have to be involved in resolving any problems with a meet-me point, unlike with the co-location model. “In practice, whether interconnection occurs via outside meet-me point or in the , a joint effort is almost always required to conduct troubleshooting,” CNOC said. “Finally, even if troubleshooting in a co-location scenario was simpler than in a meet-me point situation in certain cases as claimed by Bell, the frequency of occurrences requiring troubleshooting is reasonably low and the much lower cost of meet-me point interconnection relative to co-location more than justified the assumption of this additional risk.” Granting Bell’s request would “impose substantial costs on ISPs that would then be passed on to end-users,” it said, arguing that Bell’s estimates of co-location don’t represent the real costs in the experience of its members. While Bell had said start-up costs could be as low as $8,356 and monthly recurring costs between $505 and $1,050, CNOC responded that “in the vast majority of cases, entry costs associated with any of the co-location options can exceed $50,000 and sometimes reach over $100,000, with perpetual monthly recurring costs ranging between $1,000 and $2,500.” The high cost of co-location has “historically limited” the presence of small ISPs at Bell central offices, it said, noting that costs of connecting to the network of cablecos Rogers Communications Inc., Cogeco Inc. and Quebecor Inc.’s Videotron is only about 10 per cent of “co-location at the high-end of the cost scale.” It added that according to its members’ experiences, deploying infrastructure to a meet-me point can typically be done in one to three months, in comparison to an average of six to 10 months for co-location. “The substantial extra costs involved in co-location are not necessary to ensure reliable and effective interconnection, but impose a significant additional cost burden on competitors,” CNOC said. “Whereas interconnection at a meet-me point is relatively simple and less costly, mandating co-location would act to slow the rollout of competitor networks and ensure an unnecessary income transfer from competitors to Bell in perpetuity.” Access to meet-me points will have a “profound impact” on whether wholesale services can meet the CRTC’s goals of “developing a more robust telecommunications system through additional competitor investment in alternate transport facilities and supporting the sustainability of competitive service offerings,” it argued. Fellow incumbent telco Telus Corp. filed an intervention in support of Bell Monday, stating that it had reviewed its own co-location costs and that they were “even lower than those found by Bell in its survey,” with a “median implementation cost of $15,056 and an average implementation cost of $17,217.” It added that co-location costs could also drop with the implementation of the CRTC’s new wholesale regime. There are more technical difficulties around monitoring and maintaining meet-me points than co-location, which “allows for a safe, controlled environment with clear delineation for fault locating and repair that can be done by a wider range of technicians, without the need for specialized safety equipment,” Telus added. — With reporting by Anja Karadeglija at akarad@thewirereport.ca and editing by Charelle Evelyn at cevelyn@thewirereport.ca

Mandating co-location would be a barrier to competition: CNOC

News | January 24, 2017

Unlock all the Canadian telecom, broadcasting and digital media news you need.

FREE TRIAL

SUBSCRIBE

Inside The Wire Report

Information

Hill Times Publishing

Get in Touch With Us

Mandating co-location would be a barrier to competition: CNOC

News | January 24, 2017

Unlock all the Canadian telecom, broadcasting and digital media news you need.

FREE TRIAL

SUBSCRIBE

Related Stories

Bell Canada to offer service in eastern Ontario ILEC’s footprint

CRTC tells Iristel to pay overdue fees to Bell, Northwestel or risk losing service

Bell files for injunction over Rogers, Warner Bros. deal

Indigenous communities to buy Northwestel for up to $1B

Reuse & Permissions

Inside The Wire Report

Information

Hill Times Publishing

Get in Touch With Us