CRTC orders Bell subsidiary to upgrade routers in Quebec

BCE Inc. subsidiary Cablevision du Nord has to finish upgrading its routers in the Abitibi-Témiscamingue of Quebec -- at its own expense -- by Sept. 1 to accommodate a higher capacity of users, as per a Tuesday decision from the CRTC. The order is the result of a November 2020 application by Quebecor Media Inc., on behalf of Videotron, requesting an expedited decision on the cost of upgrading routers at the Val-d’Or and Rouyn-Noranda points of interconnection providing Cablevision’s third-party internet access (TPIA) service. According to the CRTC’s decision, Cablevision issued Videotron a design and costing report for upgrading the capacity of its routers and concluded that Videotron’s request required “unusual expenses.” However, Videotron disputed that and called it a “normal expense incurred to meet the growing demand for its TPIA service.” Videotron also argued that the expense is already largely offset by the substantial additional revenue that Cablevision receives as basic monthly usage charges and monthly capacity charges, though Cablevision refused to pay for upgrading the routers unless Videotron agreed to pay the required additional expenses, the decision said. The CRTC has now determined that Cablevision cannot charge Videotron for the costs of upgrading its routers at its points of interconnection. In its determinations, the CRTC said “router costs are generally included in monthly access and capacity charges. This is a basic principle that is reflected in the cost studies submitted to the Commission for wholesale TPIA service tariffs.” “The Commission also notes that an increase in the number of accesses and in consumption brings additional revenue related to access and capacity for the TPIA service provider. In the long run, this offsets any additional costs associated with equipment upgrades that support the additional capacity,” it said. Videotron has been in dispute with Cablevision for a while. In September, the company accused Cablevision of “manoeuvring for months to unduly delay Videotron’s arrival” by delaying access to its infrastructure in the region. Bell then responded to say the delay was a “direct consequence of Videotron’s errors” in forecasting the number of subscribers that would need third-party internet access, and that Videotron had increased its forecast tenfold. In its French-language reply, Videotron said that it did “substantially” increase the capacity it wanted to buy from Cablevision, though the specific numbers were redacted from the document. In its decision Tuesday, the commission noted that Videotron requested a quick ruling as its application marked the fourth time in 16 months that it has filed a Part 1 over Cablevision’s regulatory obligations with respect to its TPIA service. The CRTC said Videotron wanted the commission to force Cablevision to complete the router upgrades by Feb. 15, 2021, and directed it not to charge Videotron for the upgrades, except for the basic monthly usage charges and monthly capacity charges. That’s in addition to an administrative monetary penalty it requested, “that is high enough to stop Cablevision’s repeated delay tactics towards Videotron,” the decision said. The CRTC said that “although Cablevision should have upgraded its routers, the Commission does not consider Cablevision to have acted in bad faith.” “On the contrary, the dispute between the parties raised issues that had yet to be the subject of a decision by the Commission,” it said, adding that it does not believe imposing a penalty would serve the objective of having Cablevision abide by the tariff. Also on Tuesday, the CRTC denied an application by Cablevision asking for the destandardization of its 50/5 profile for its TPIA customers because it considers the application to be “premature.” The company had argued that it no longer needed to offer that profile to its TPIA customers as it no longer offers the service to its own retail customers, but the commission found that it did not provide enough evidence to explain the need to destandardize it. It also found that higher profile speeds offered by Cablevision, specifically the 125/20 and 250/20 profiles, were not comparable alternatives as they come at a much higher price. “In practice, Cablevision’s destandardization of the 50/5 profile would mean that new customers wishing to subscribe to an intermediate profile comparable to the speed that was previously offered would have to choose a profile that is much lower (the 15/1.5 profile) or much higher (the 125/20 or 250/20 profiles) than they need,” the CRTC said. Additionally, the commission -- which declined to impose a penalty on Cablevision as requested by intervenors in this matter -- said the loss of that profile could have a negative impact on competitors in cases where this profile represents the majority of their sales. In its intervention, filed among others from the Competitive Network Operators of Canada and EBOX Inc., Videotron “expressed its concern that Cablevision’s attempt to destandardize the 50/5 profile is an attempt to restrict Videotron’s entrance into the market in Abitibi-Témiscamingue, Quebec,” the commission said in its decision. “In fact, this speed profile is sufficient to support Helix, Videotron’s new Internet protocol television service, at a competitive price. Videotron argued that the destandardization of the 50/5 profile would harm Cablevision’s and Videotron’s customers, and that the impact would be the greatest on Videotron’s customers,” according to the decision. For its part, EBOX claimed that destandardizing the 50/5 profile “would impede competition by allowing Cablevision to maintain its monopoly and reduce the affordability of the TPIA service in the region.” - Reporting by Hannah Daley at hdaley@thewirereport.ca and editing by Jenna Cocullo at jcocullo@thewirereport.ca

CRTC orders Bell subsidiary to upgrade routers in Quebec

News | June 1, 2021

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CRTC orders Bell subsidiary to upgrade routers in Quebec

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