On Friday, I wrote a rapid initial assessment of the CRTC’s VoIP reconsideration. The headline in the National Post read “CRTC defies Ottawa on VoIP – Rejects federal advice.” The story began:
The CRTC snubbed the advice of the federal government yesterday and surprised the telecom industry by standing by its controversial ruling on Internet telephony, or VoIP, potentially setting up a confrontation between the broadcast regulator and the government, analysts say.
I’ll be clear and say that I don’t see grounds for a confrontation.
Now that the weekend has passed, it is worthwhile reflecting a little further on the Decision. For the sake of simplifying the analysis, we’ll assume that Cabinet will accept the CRTC’s reconsideration.
We think that pragmatism will outweigh concerns that Paul Vieira raises in the National Post that the CRTC ignored the will of the government.
When the CRTC issued Telecom Decision CRTC 2006-53 on Friday, its reconsideration of how to regulate VoIP, it was responding to a directive:
to take into account the increase in demand for VoIP services and changes to the overall regulatory environment since the original decision was announced last year.
Was the CRTC really defying Cabinet, as the headline in the Post implied?
Let’s look beyond the Industry Canada press release issued at the time of the original Cabinet directive and look at parts of the preamble of the actual Cabinet direction. This can be found as an Appendix in the Public Notice that led to last Friday’s VoIP Reconsideration Decision.
- Whereas the Governor in Council notes that VoIP technology has transformed the nature and extent of competition in telecommunications markets;
- Whereas the Telecommunications Policy Review Panel has submitted its report to the Minister of Industry recommending reliance on market forces to the maximum extent feasible as the means of achieving the telecommunications policy objectives affirmed in section 7 of the Act;
- Whereas, on April 6, 2006, the Commission rendered Telecom Decision CRTC 2006-15, entitled Forbearance from the regulation of retail local exchange services which applies to VoIP services;
- Whereas the Governor in Council is currently examining Canada’s Telecommunications policy and regulatory framework taking into consideration the recommendations of the Telecommunications Policy Review Panel and is following closely the public discussion concerning Telecom Decision CRTC 2006-15;
As can be seen from these items, it was Cabinet that tied together the Local Forbearance Decision with the VoIP Reconsideration. In telecom regulatory terms, let’s call it an example of bundling.
We can argue endlessly about how one party might have ruled different or whether the CRTC reached the right outcome. We’ll comment further on those points in the coming days.
But to me, it doesn’t look like the CRTC defied nor snubbed the Cabinet directive. Indeed, the CRTC’s decision to review the local framework appears to have been following the deeper intent of Cabinet to examine the complete bundle of VoIP and local services forbearance.
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CRTC, Cabinet, Paul Vieira, Local Competition, forbearance, VoIP, Mark Goldberg