Industry experts have welcomed as long overdue recommendations for
aggressive deregulation and a shift to less government strong-arm
policies in Canada's telecommunications sector.
A 400-page report issued to Industry Canada last week by the
Telecommunications Policy Review Panel outlines 127 steps to
improving the regulatory framework currently overseen by the
Canadian Radio-Television and Telecommunications Commission
(CRTC).
The three-member panel, consisting of Gerri Sinclair, Hank Intven
and AndrC) Tremblay, essentially urged the government to completely
overhaul the existing regulatory system.
Sinclair, who headed the panel, said major changes are crucial if
Canada is to maintain a competitive edge, advance innovation and
grow productivity within the telecom industry.
The report recognizes that competition is coming from a lot of new
places, said Joel Finlayson, a principal with Montreal-based
consulting firm Secor Inc.
The panel has provided clear recommendations for moving towards
deregulation, which sets a high-water mark, he said.
"I think they recognize that regulation needs to be looked at,"
said Finlayson, who describes the report as fair and long overdue.
"They're saying that regulation should be based on a complaints
basis as opposed to setting rules and parameters."
The recommendations reveal an attitude that is refreshing and
positive, according to Valentin Petkantchin, director of research
at the Montreal Economic Institute.
"There are many measures that remove some of the regulation which
is still in place," he said. "There's a real intention to remove
the control on retail prices, even for basic communication
services."
Petkantchin said the report points Canadian telecom in the right
direction and that the biggest change is that of perspective.
Until now, telecom regulation has been perceived as a necessary
control measure by the CRTC, he said. In only a few, rare
instances, has the CRTC felt comfortable enough to step back from
its stringent policies.
"With this report, what's being recommended is exactly the
opposite," said Petkantchin.
Finlayson suggested the report will redefine the CRTC's regulatory
boundaries, within the proposed framework.
"I'm not questioning the validity or the value of the CRTC," he
said. "What I am questioning is, given the [recommended]
technological environment, whether the CRTC will be able to
regulate."
When people are watching Desperate Housewives on their PC or on
their mobile phone, for example, the CRTC really has no
jurisdiction over these devices, and has chosen, appropriately, to
take a light touch to all of that, according to Finlayson.
While the incumbent telcos like Bell, Telus, and Rogers have
historically borne the brunt of CRTC policy and stand to gain the
most in a freer environment, smaller service providers are less
ecstatic over the report.
Some of the recommendations are cause for concern, according to
Chris Peirce, chief regulatory officer with Manitoba-based MTS
Allstream Inc. Pierce said the report appears to equate market
efficiency with bureaucracy.
"It's creating this new body, the telecom competition tribunal, and
it purports to think you can create a quasi-traditional regulatory
authority like that and deconstruct it in three-to-five years,"
said Peirce. "I think that's hopelessly naC/ve."
Canadian telecom doesn't need any more regulatory bodies, as
proposed in the report, he said.
"I don't think it makes sense to try to streamline a process by
creating new structures; you should try to make the structures that
are there work better."
Peirce is also less than thrilled with the perceived theme of the
report.
"The tone that really disturbs usb &is the frank statement in the
report that says b the regime had focused too much on protecting
competitors from the incumbents.'"
"Well, if the regime was looking at protecting competitors, it did
a poor job," he said.
Peirce said there are some recommendations he can work with. "The
need for competitors to have access to essential network facilities
-- the report said we should actually enshrine this in the
Telecommunications Act...that's a good thing."
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