Appealing the deferral account

On August 31, the CRTC tried to get the final word on the deferral account.

As expected, Bell has filed an appeal – a review and vary application to ask the CRTC to reconsider its decision.

There are some interesting procedural points.

Bell has filed two separate appeals, each narrowly focussed. One of them looks at the majority ruling from the CRTC that insisted on selecting a specific technology (DSL); the other deals with the interest calculations on the massive balance of funds that the phone company has been holding.

The application regarding technology choice takes no issue with any of the fundamental policies that underpin the CRTC’s decision:

The Company takes no issue with the principle of least cost technology and the Commission’s determination (at paragraph 44) approving a drawdown of $306.3 million from Bell Canada’s deferral account for the expansion of broadband services to the approved 112 communities.

In terms of the DSL Technology Directive, the Company similarly takes no issue with the principle that the proposed retail and wholesale broadband service offerings to be made available in the approved communities must be comparable to those offered in urban areas. The point of disagreement here is solely with the Commission’s technology choice, rather than these service specifications.

As we asked in our September 1 write-up of the decisions, why wasn’t Bell given the same discretion of using its own choice of technologies, as long as it delivered a specified service within quality and pricing parameters?

The procedural aspects are interesting, both in splitting the two issues (technology choice and interest calculations) and in the manner in which the technology application is filed, as both an R&V as well as a new application. It is a new application because “it relies upon facts or circumstances which are different from those relied upon by the majority in issuing the DSL Technology Directive.”

But, Bell says that the DSL Technology Directive is also tainted by “doubt as to the correctness of the Commission’s decision to direct a DSL technology-based solution rather than provide the Companies with the flexibility to choose the technology that meets the Commission’s minimum service offering comparability characteristics.” 

The deferral account has become the song that never ends. With this latest twist, the affected communities will experience more delays in having broadband service deployed.

At some point, will the CRTC recognize that this program just didn’t work, despite all of the best intentions?

Maybe the best solution all around is to refund all of the money to the rate payers and let the competitive broadband marketplace fill in the rest. As I wrote last week, it is time to stimulate demand.