CTRC Hearing - Review of Wholesale Mobile Wireless Services in Canada

Gatineau, Quebec
30 September 2014
Hosted By: the Canadian Radio-television and Telecommunications Commission (CRTC)

The Canadian Radio-television and Telecommunications Commission (CRTC) -- an independent public authority in charge of regulating and supervising Canadian broadcasting and telecommunications -- held hearings to examine the health of the wholesale wireless mobile services market in Canada and consider proposals to impose more aggressive regulation. Specifically, the hearings addressed proposed regulation which would cap the wholesale rates that cell phone carriers charge other wireless companies to allow their customers to roam outside of home networks. The CRTC is also considering imposing regulation that facilitates the entry of mobile virtual network operators (MVNOs) in the hope that this would create more competition.

Dr. Jeffrey Eisenach and Dr. Christian Dippon, Senior Vice Presidents and the Co-Chairs of NERA's Communications, Media, and Internet Practice, testified at the hearings on behalf of Telus Corp. Dr. Eisenach was asked to assess the performance of the Canadian mobile wireless market and to examine the evidence put forward by the economic consultant to Canada's Competition Bureau. Dr. Eisenach provided evidence and testimony that drew three conclusions: first, the performance of the Canadian market is strong, specifically on key metrics such as prices, service quality, and capital investment; second, Canadian mobile network operators (MNOs) are not earning excess returns and do not have market power; and third, a fourth nationwide MNO would not benefit consumers. Dr. Dippon was asked to analyze the roaming cap legislation and the competitive effects of mobile virtual network operators (MVNOs). Dr. Dippon provided evidence that MVNOs add little to competition and provide no measurable benefits to consumers. Further, Dr. Dippon found that, with respect to MVNOs, Canada’s performance is at par, if not better, than US and European benchmarks. With respect to potential wholesale roaming regulation, Dr. Dippon opined that the status quo of commercial negotiation with an arbitration fallback provision should be retained.

Watch the hearing here in which Dr. Eisenach and Dr. Dippon are introduced in the 98th and 103rd minutes, respectively.

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