City Wide petitions the Governor in Council to vary the decision
By Amanda OYE
OTTAWA – Eastlink is arguing Dartmouth, Nova Scotia-based independent Internet service provider City Wide Communications merely restated its original argument in its application to have the CRTC review and vary its decision to deny its request to order Eastlink to move its third-party Internet access (TPIA) point of interconnection (POI) in Nova Scotia.
Eastlink’s TPIA POI in Nova Scotia is currently located in the rural community of Pennant Point but City Wide has been asking for it to be moved to a location in the core of Halifax.
The CRTC’s initial decision on the matter noted while the current situation does disadvantage City Wide, “this disadvantage is not undue or unreasonable” and denied the application.
City Wide said in a review and vary application a new potential TPIA POI location has been revealed, which could be used as the “New Site”. If the CRTC decides the new site is not suitable, City Wide requested it regulate Eastlink’s transport services to Pennant Point as it has claimed the costs are a “significant barrier to competition”.
In a response to the review and vary application, Eastlink argued the Commission’s original decision “correctly supports Eastlink’s position that facilities-based providers must be able to configure their facilities in a manner that makes the most sense for their network, and nothing about Eastlink’s TPIA POI location at Pennant Point creates undue barriers to competition.”
On the matter of the “New Site”, Eastlink said it explained to the CRTC the plans for it “did not include infrastructure to support an aggregated POI.” The telecom’s reply goes on to explain in response to a request for information from the Commission, it “provided the relevant information about the New Site we had at that time… which clearly demonstrated that the New Site was not an appropriate TPIA POI facility.”
On the matter of Eastlink’s transport costs, which City Wide has claimed have increased its costs by 12%, Eastlink argued the logic behind the argument is flawed.
City Wide and a report by economist Dr. Zhiqi Chen “compare City Wide’s cost to provide service in 2017 (prior to Eastlink’s implementation of TPIA) to their costs now to suggest that Eastlink’s transport costs have “increased” their overall costs by 12%,” Eastlink said in its reply.
The telecom said this claim is based on an “irrelevant” comparison of its transport services to Pennant Point to the transport services of others to the core of Halifax, as well as a comparison of this “irrelevant” comparison to City Wide’s costs to provide Internet service before Eastlink implemented its TPIA model in 2017.
Eastlink’s claim the comparison City Wide uses is irrelevant is based on Eastlink maintaining it does not have facilities in the core of Halifax that would make an appropriate POI and reiterating the cost of its transport services reflect the cost of providing the service. Eastlink argued “the cost of our transport to Pennant Point compared to a quote from a competitor in a location where there is no viable POI facility is not an “increase” in their costs.”
The telecom further explained City Wide’s use of the comparison of its costs now to its costs of providing service in 2017 is also flawed because at that time, City Wide was not providing service under a TPIA model, but rather a resale model.
Eastlink argued City Wide is seeing increased competition from TPIA service providers, which it claimed, “is the true underlying basis for City Wide’s frustration.” It argued “Allowing a single TPIA customer to dictate the location of a POI based specifically on what is most convenient for themselves does not forward stable competition, it in fact gives that single TPIA customer an undue preference.”
City Wide, in an Aug. 8 response to Eastlink’s reply claimed, “Eastlink’s Answer lacks any credible evidence or rationale,” and pointed out CNOC and PIAC both submitted interventions in support of its application.
“Eastlink does not raise any valid objection to the City Wide’s comparative pricing analysis, which supports the conclusion that transport services at Pennant Point are a significant barrier to competition,” City Wide argued. “Contrary to Eastlink’s mistaken belief, the absence of suitable Eastlink facilities in the core of Halifax has no bearing on a pricing comparison that measures the supracompetitive pricing levels of Eastlink’s non-regulated service at Pennant Point.”
City Wide further argued while Eastlink says its transport service costs are based on a variety of factors, “Eastlink’s unfettered exercise of market power over these rates is the sole explanation for the pricing of transport services at Pennant Point.”
City Wide also disputed Eastlink’s claims calling into question the Chen report’s comparison of costs in 2017 and now because they compare different models of service. “In reality, the Chen Report assessed costs under the TPIA model only and then, separately, benchmarked those costs with reference to the resale model to show the magnitudes of the estimated cost increases,” its reply reads.
In addition to its application to have the CRTC review and vary its decision on Eastlink’s TPIA POI, City Wide Communications has asked cabinet to vary it, according to a petition filed by the service provider, dated June 23, 2022, which was posted online last Friday.
The independent service provider is asking the Governor in Council to direct the CRTC to order Eastlink to move its TPIA POI to a more central location in Halifax, or, in the event the Governor in Council does not believe the TPIA POI should be moved, direct the CRTC to regulate Eastlink’s transport services.
City Wide is further requesting the CRTC be directed “to initiate a proceeding to examine the need to regulate the supply of transport services throughout Canada, since the adverse consequences of the lack of competitive transport on the affordability of Internet access is not limited to the Eastlink Pennant Point situation.”
