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TekSavvy hails new CRTC proceeding to bring reasonable rates to wireline telecom competition

April 1st, 2016. Chatham, Ontario & Gatineau, Québec. 

TekSavvy Solutions Inc. hailed yesterday’s long-awaited CRTC decision yesterday, finding that wholesale telecom rates paid by competitive telecom providers are neither just nor reasonable. The decision completes inquiries launched nearly a year ago, and launches a new process to establish more reasonable rates that will intensify competition for Internet services.

Because physical access lines that connect homes to networks are essential facilities that cannot feasibly be reproduced, the CRTC has long fostered retail competition by mandating wholesale network access supply—at rates designed to recover the last-mile operator’s start-up and ongoing costs, plus a mark-up. Incumbent last-mile operators who sell these wholesale services will now be required to propose new rates that better reflect their costs, by building in more accurate assumptions about Internet traffic growth and equipment efficiency.

Building in these more accurate assumptions will lower virtually all of the wholesale rates paid by independent telcos like TekSavvy. That opens the door to players like TekSavvy interested in bringing new services, like video competition, to the marketplace.

“Decisions like today’s are important steps toward better value and more opportunities to innovate for Canadian consumers and invest in improving our network services—which in the end is what TekSavvy is all about,” said Marc Gaudrault, CEO of TekSavvy.

“The CRTC found that Internet traffic grows much faster than 20 percent annually, and that the cost of routing a gigabit falls by much more than 10 percent each year,” noted Chief Legal & Regulatory Officer Bram Abramson. “These may seem like details. But they’re details that drive lower rates and, as a result, a healthier competitive landscape.”

Telecom Decision CRTC 2016-117 is not the final step in correcting the rates for the wholesale network access that competitors like TekSavvy use to connect to end-users. But TekSavvy is hopeful regarding the progress made, and looks forward to working with the telecom regulator and industry partners to see these adjustments through to implementation.

About TekSavvy

TekSavvy prides itself on fighting for a fair playing field that delivers the best results to consumers, and works hard to be at the forefront of protecting Canadian consumers’ rights online. Founded in 1998, TekSavvy is an independent telecom provider that employs more than 500 Canadians in Chatham, Ontario and Gatineau, Quebec, and provides service to more than 250,000 Canadian homes alongside growing business and wholesale offerings. “We’re Different. In a Good Way.”

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