In its submission, the Bureau opines (based on observations and
information collected by the CRTC) that differential treatment is
occurring in the contractual terms of wholesale roaming agreements,
which constitutes discriminatory or preferential behaviour.
The impugned behaviour results from some Canadian wireless service
providers charging significantly higher rates in their wholesale
roaming arrangements with other Canadian carriers than in their
arrangements with U.S. carriers. According to the Bureau, the
differential treatment observed by the CRTC is unfair
discrimination or undue preference, and the submission encourages
the CRTC to intervene to stop this behaviour.
Of particular concern to the Bureau is the fact that the roaming
agreements are being used as a strategic tool by the incumbent
wireless service providers to protect their market power. The
Canadian mobile wireless market is described in the submission as
being "characterized by high concentration and very high
barriers to entry and expansion." The Bureau expressed
the view that the incumbent wireless service providers have retail
market power and are incentivized to take "strategic actions
in order to prevent new entrants from becoming fully effective
competitors." The Bureau notes that such strategic
actions "have likely resulted in, or will likely result in,
entrant service providers charging higher prices at the retail
level, or providing less attractive non-price elements of their
services in those markets, than they would if their roaming
agreements were not affected by the strategic actions of the
incumbent service providers."
In terms of an acceptable remedy, the Bureau calls for a remedy
that would allow entrant service providers to obtain competitive
roaming access on fair terms. Moreover, the Bureau prefers a
remedy that would go farther than strictly necessary to eliminate
the unfair discrimination or undue preference, should the CRTC have
to decide between such a remedy and one that does not go far
This marks the second intervention in the mobile wireless market
by the Bureau's advocacy group in the past year. The Bureau
previously submitted comments on the CRTC's Wireless Code of
Conduct. Perhaps it is not surprising that the mobile
wireless market has drawn the attention of the Bureau's
advocacy group. With 27.9 million wireless services
subscribers in Canada (in 2012), a high level of public interest is
assured. Moreover, the CRTC offers a familiar forum for the
Bureau and has the ability to regulate change. In fact, the
Bureau has had past success in influencing CRTC decisions (e.g. Telecom Decision CRTC 2008-17, Revised
regulatory framework for wholesale services and definition of
essential service). These features make the mobile
wireless market an inviting target for intervention in light of the
Bureau's stated strategic factors that it considers when
assessing potential advocacy projects.
The CRTC expects to publish a decision on this proceeding within
four months of the close of record, which is February 10, 2014.
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