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Report On Business Roaming fees are CRTC priority as regulator expands investigation

A man checks his cellphone on Bay Street in Toronto.

Gloria Nieto/The Globe and Mail

The Canadian Radio-television and Telecommunications Commission is expanding its investigation of wireless roaming rates, sending the clearest signal yet that it is mulling regulation of those fees.

After spending the last month sifting through reams of confidential information provided by carriers about their domestic and international roaming agreements, the CRTC is creating a special task force to take a deeper dive into the issue.

The move indicates roaming rates are now a top priority for the regulator, which has spent about a year fielding complaints about those fees and their associated terms and conditions. As a result, the task force's recommendations could set the stage for a major showdown between the regulator and the Big Three wireless carriers (BCE Inc., Rogers Communications Inc. and Telus Corp.).

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"The mandate of the task force is to present options for Commission consideration at the upcoming December commission meeting," wrote Chris Seidl, the CRTC's executive director of telecommunications, in an internal memo obtained by The Globe and Mail.

"As this is a relatively short time, I would request that telecom staff, as well as colleagues across the commission provide the task force their support and assistance for this important priority."

Tensions between the regulator and large carriers have run high ever since the CRTC surprised the industry by unveiling a wireless code that effectively kills new three-year cellphone contracts starting in early December.

That same code includes measures that force carriers to cap data roaming fees at $100 a month, an amount some carriers argue is too low.

The CRTC's decision to strike a task force comes just weeks after the federal government vowed to reduce domestic roaming costs during its Speech from the Throne.

In August, the CRTC told carriers that it wanted to gather more information on domestic and international roaming rates. That prompted some new carriers, such as Wind Mobile and Eastlink, to plead with the CRTC to start regulating the wholesale costs they pay incumbents for domestic roaming services, arguing that large carriers were using those fees as a profit centre.

Initial indications from the CRTC's fact-finding exercise showed mark-ups sometimes of more than 1,000 per cent for data roaming services, according to a source.

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That refers to the difference between the rate that incumbent carriers charge their own customers and what they charge their competitors.

"Recently, we launched a fact finding exercise on wireless roaming to gather confidential information.

"The data that has been reviewed to date indicates the need to investigate the roaming question further, " Mr. Seidl's memo said.

His memo also stresses that "wireless communication is clearly an increasingly important service for Canadians," adding the CRTC continues to monitor the competiveness of the industry and is prepared to intervene "as required."

The task force is being led by Andrew Falcone; its members include Bill Mason, Kim Wardle, Adam Mills, Catherine Lemieux and Alastair Stewart.

Currently, domestic roaming agreements are commercially negotiated between carriers, but small carriers complain they overpay their larger rivals for those wholesale rates.

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Since newer players rely on domestic roaming to provide wireless services to their customers who travel outside of their network's coverage area, they are hoping to persuade the CRTC that robust competition at the retail level hinges on regulation of those behind-the-scenes rates.

In March, Industry Canada expanded domestic-roaming and tower-sharing obligations for incumbents and reduced timelines for arbitration. But Industry Canada also stated, "the CRTC may consider applications relating to rates and terms for matters such as roaming and tower sharing."

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