The federal cabinet has declined to overturn a ruling by Canada’s telecom regulator that forces the Big Three national wireless carriers and SaskTel to sell network access to eligible regional competitors.
The request to review the Canadian Radio-television and Telecommunications Commission’s decision came from Data on Tap Inc., a small Toronto-based telecom branded as dotmobile, which wanted the regulator to open up the country’s wireless networks to competitors without their own infrastructure. However, Ottawa said Thursday that such a move would punish regional competitors that have already invested in cellphone towers and wireless licenses.
Innovation, Science and Industry Minister François-Philippe Champagne said in a statement that cabinet “carefully considered the petition,” concluding that expanding network access to providers that don’t own spectrum and have not invested in building out wireless networks “would undermine the work of smaller regional providers that have already invested substantially to increase competition.”
In April 2021, after a lengthy review of Canada’s wireless market, the CRTC ruled that BCE Inc., Telus Corp., Rogers Communications Inc. and SaskTel must sell wireless network access to regional competitors who commit to building their own networks.
The goal was to allow regional carriers such as Quebecor’s Videotron and Bragg Communications Inc.’s Eastlink to generate revenue while they build out their own infrastructure. In order to gain access to the large telecoms’ networks, the regional carriers have to own spectrum in the relevant areas and build their own networks within seven years. (Spectrum refers to the airwaves used to transmit wireless signals.)
The CRTC stopped short of opening up national wireless networks to competitors without their own infrastructure, known in the industry as mobile virtual network operators, or MVNOs. That prompted dotmobile, an MVNO, to petition the federal cabinet to overturn the ruling. The company was seeking mandated network access for companies without their own networks or spectrum licenses, arguing that such a policy would promote greater competition in the sector and lead to more affordability for consumers.
Algis Akstinas, CEO of dotmobile, called Ottawa’s decision a win for the lobbyists working for the Big Three.
“For Canadians this means continuing inequity and discrimination in the form of punitively designed wireless service and significantly higher effective prices for seniors, newcomers, students and families,” Mr. Akstinas said in a statement.
Under the CRTC’s regime, the wholesale rates are negotiated between the parties, with final-offer arbitration available if they cannot come to an agreement. The terms and conditions of the service require the regulator’s approval.
Cogeco Communications Inc., which wants to use the regime to offer wireless services to its customers, has previously said that the Big Three-proposed terms and conditions would impose unreasonable constraints.
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