Beanfield accuses Rogers of breaking MDU access rules with bulk agreements

Beanfield Technologies Inc. has called out Rogers Communications Inc. over its bulk agreement practices in multiple dwelling units (MDUs), urging the CRTC to prohibit ISPs from entering into such deals with building developers and owners, according to a Part 1 application posted on Tuesday. Bulk agreements are multi-year deals cut between a telecommunications service provider and building developer or condominium corporation, granting the company the right to service all units in the building. Usually the provider offers an upfront payment or preferential rates, issuing one bill to the building’s owner, who then charges the occupants through their rent or condo fees. Beanfield repeated past arguments that these agreements are anticompetitive, and points the finger at Rogers for allegedly holding the majority of the deals in Toronto. Throughout its application, the Toronto-based ISP claims bulk agreements eliminate consumer choice, grant undue preference, and go against the CRTC’s MDU access condition, which mandates all local exchange carriers have access to their end-users. Beanfield notes that these deals are often first executed with building developers, then get passed onto the condo corporation after it takes over ownership. However, this agreement assumption by the corporation is usually done before occupancy or board elections, the company states, which means not only are residents automatically enrolled, but they inherit a decision that has already been made for them. Beanfield supported its application with a list of 37 buildings it claims have active bulk agreements initially executed with developers of Toronto MDUs between 2017 and 2022. It states that, of those identified, 29 MDUs are with Rogers, while the remaining eight are with BCE Inc. This would amount to over 13,000 individual units being bulk-served by Rogers, which Beanfield said it believes is “just the tip of the iceberg.” In July 2021, when stating its decision not to mandate access to incumbent fibre in-building wires (IBW) in MDUs, the CRTC said that there were not enough access-related issues occurring to justify further regulatory measures. Beanfield argues that has changed. “Beanfield is aware of 54 planned/in progress MDU developments in the GTA, representing almost 40,000 units with nine different developers, that appear to be already locked into bulk agreements,” it wrote, estimating that is almost half of all new MDU developments in the area. Beanfield says it got a hold of a bulk agreement between Rogers and Liberty Residences Limited Partnership, for a building located at 19 Western Battery Road. On the surface, it appears to comply with the MDU access condition, says Beanfield, stating that “the access rights granted to Rogers are non-exclusive and non-preferential.” “It is only in reviewing the companion marketing and service agreements that the extent of preferential treatment and exclusivity becomes apparent,” wrote Beanfield. These subsequent agreements grant Rogers “‘exclusive right and license’ to specified on-site marketing activities,” claims the telco, adding that they also prohibit the owner from endorsing any competitive products or services, and require them to keep other ISPs from conducting any on-site marketing initiatives. The bulk service agreement, to be assumed by the condo corporation from the developer, has an initial six-year term, extendable by a further four years if not otherwise terminated, writes Beanfield. These terms would not circumvent the MDU access condition if an “extremely narrow definition of the word ‘access,’” were assumed, says Beanfield. It accuses Rogers of only interpreting it to mean physical access, rather than taking any broader context into account. “Nothing in the Rogers sample agreement package prevents another service provider from obtaining physical access and seeking to provide services on a direct subscriber pay basis,” it writes, “what the Rogers bulk arrangements do is eliminate any practical means by which a competing provider can market, provide and monetize services to end-users ‘under reasonable terms and conditions.’” Beanfield says this should constitute a breach of the MDU access condition because although end-users retain a “theoretical legal right” to obtain other services, these agreements are entrenched at the developer level and “render this right meaningless.” “End-users are obliged to pay for Rogers bulk services whether they use them or not.” Beanfield argues that no new regulatory measures should be necessary, so long as the CRTC makes it clear that bulk agreements go against the MDU access condition. “These are no longer limited, isolated arrangements but part of a concerted strategy to ‘lock up’ the provision of communication services in new condominium builds; to bypass competition by creating monopoly MDU islands,” says Beanfield. The company concluded by comparing MDUs to small towns or neighbourhoods. “We do not allow the person who builds or governs a town to deny choice to residents, but with bulk agreements we are allowing it in MDUs. Such discrimination on the basis of the type of housing one lives in is clearly contrary to established policy and must be curtailed.” Rogers stated in a request for comment that its “agreements fully comply with the CRTC’s Multi-Dwelling Unit Access Framework.” It added that it is reviewing the application and will file a response by Oct. 26, the proceeding’s deadline. – Reporting by Phalen Tynes-MacDonald at jcocullo@thewirereport.ca and editing by Jenna Cocullo at jcocullo@thewirereport.ca.

Beanfield accuses Rogers of breaking MDU access rules with bulk agreements

News | September 26, 2023

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Beanfield accuses Rogers of breaking MDU access rules with bulk agreements

News | September 26, 2023

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