I understand that small ISPs are upset with the CRTC. When the CRTC first released Telecom Order CRTC 2019-288 in August 2019, not only would wholesale rates be coming down dramatically, but there was to be a retroactive rebate of a third of a billion dollars paid to the ISPs. A windfall profit for the owners of the independent ISPs, estimated to exceed $325 million dollars. That’s 325,000,000 reasons for the little ISPs. They must have thought they won the lottery.
It was no wonder the facilities-based major internet companies used every available channel of appeal: to cabinet, the courts, and back to the CRTC itself. Cabinet agreed with the major companies, announcing in August 2020 that “Canada’s Future Depends on Connectivity”, signalling that the government was looking for the CRTC to make changes to its 2019 ruling.
On the basis of its review, the Governor in Council considers that the rates do not, in all instances, appropriately balance the policy objectives of the wholesale services framework and is concerned that these rates may undermine investment in high-quality networks, particularly in rural and remote areas.
Sure enough, the CRTC found that it had indeed made numerous errors in the 2019 ruling, and reversed itself in May 2021 with Telecom Decision CRTC 2021-188.
Ever since then, the independent ISPs have been waging war on the CRTC Chair, launching personal attacks calling for his removal, despite the decision being reached by the entire Commission. I described some of that populist revolt last summer.
The association of independent ISPs, CNOC, upped the ante yesterday by filing an application [pdf, 124 KB] seeking to have the Chair recused from virtually any telecom related file for the rest of his term.
It appears to be more of an appeal to the populace, than a serious legal filing, with mischaracterizations of a court decision and a misquote attributed to the CRTC Chair. In an interview in the Toronto Star earlier this week, the article says:
“I went for a beer with someone I have known for many years …. And it ended up he chose to address a broadcasting issue a little of what Bell might be doing in the future,” says Scott in the wide ranging, nearly hour-long interview.
The CRTC chair says the meeting between the two executives initially had nothing to do with business.
“However, because we talked about business he (Bibic) properly recorded this as required by the lobbyist registration,” says Scott. “It was in my agenda and left in my agenda. I didn’t hide the fact it took place.”
But the application filed by CNOC (at paragraph 22) cites this as: “Chairperson Scott’s admission to the Toronto Star—that he “went for a beer with
someone [he had] known for many years” to “address” matters within the CRTC’s jurisdiction”, changing the meaning of the so-called admission. The Toronto Star article does not say that he went for a beer to address matters within the CRTC’s jurisdiction. The article explicitly says that “the meeting between the two executives initially had nothing to do with business.”
The characterization of the meeting by CNOC is quite simply a dishonest representation of what is in the Toronto Star article. Paragraph 22 of CNOC’s application changes the meaning of the so-called “admission”.
As to the Chair’s so-called “personal preference for facilities-based competition”, it is actually a statement endorsing CRTC and government policy going back almost 30 years. For example, in Decision 92-12 (a personal favourite of mine), we read:
The Commission considers that resale can provide many benefits, but it is not a substitute for facilities-based entry. Facilities-based entry permits sustainable and more broadly-based competition, thereby increasing the benefits to be derived from competition. A facilities-based carrier has more control over its facilities costs. Since a reseller leases its underlying facilities and operates at the margin provided for in the price of leased facilities and services, a reseller is at risk wherever carriers can reduce these margins.
A preference for facilities-based competition should be a qualification to be Chair. It is not a defect.
As I wrote last summer, a retired Director General from Industry Canada has said “Calling for the firing of the Chair because one is not happy with a decision is totally inappropriate. What is the point of having an independent regulator if that regulator could be fired whenever a disaffected party could convince the government to do so? … Populism has no place in the administration of fair regulation.”
CNOC’s application is unfair and smacks of desperation.