Stein talks of “betrayal” by the CRTC and incumbent “bullies”
By Amanda OYE
TORONTO – The game may not be fair, but that will not stop independent Internet service providers from competing, Matt Stein (above), chair of the Competitive Network Operators of Canada (CNOC) and a director of the Canadian Communication Systems Alliance (CCSA) told audience members during his keynote speech Independents unite: How we are fighting for a fairer today and a stronger tomorrow, at the ISP Summit today.
“The challenges our industry has faced over the past 18 months are incredible,” he said.
“As independent internet service providers, we always seem to be the underdogs and we’re constantly being blocked by the other side, as we try to fight our way down the field yard by yard. And just as we’re about to score, they changed the rules on us, again and again.”
Stein told the audience relying on incumbents’ good will does not work.
“They’re always going to be the bullies taking on unreasonable positions because they can, for as long as the rules of the game reward them for doing so,” he said.
“We’re forced to keep fighting, to try to level the playing field, to have fair rules that make sense for everyone so that we can serve Canadians fairly and equitably.”
Independent ISPs now have two priorities they must tackle: first, the “continued fight for fair, cost-based, and not commercially negotiated wholesale rates for aggregated access,” and second, “figuring out how we’re going to shift successfully to a disaggregated access model,” Stein said.
He spoke about the CRTC’s 2021 decision to reverse its own 2019 decision on wholesale rates.
“Leading up to that announcement, we knew a decision was coming, though of course we didn’t know the details. So as we always do, we started preparing our response. We gathered our best minds to discuss all the possible outcomes,” Stein said.
Based on everything they knew, including “that even the Supreme Court had rejected the incumbents attempts to appeal the decision,” they were fairly sure the decision would either be to uphold the 2019 decision or to come to a middle ground between the 2019 rates and rates set in 2016.
“So when the decision came out, we were completely shocked to learn that it was a complete reversal. After all, doesn’t effective regulation consider all sides of an issue?” Stein said.
“Anybody who says this is just about the money is totally missing the point,” he said.
Everyone, including “the Liberal government in its 2019 directive to the CRTC, expected them to be the steward of competition.”
Stein expressed a belief in competition and the CRTC’s role in ensuring a competitive landscape in the industry. “So, when the CRTC threw up its hand, like trust me, I know, it felt like a betrayal,” he said.
“Competition, it isn’t a cactus. You can’t just leave it out in the desert and expect to see it flower. It needs to be tended. It needs water and lights, maybe daily pruning, more like a bonsai tree. If left to its own devices, it can start to get ragged and eventually it will die.”
Anger also stems from the lengthy process and all the work that went into providing the CRTC with everything it asked for, Stein said.
“The money is a small piece of what you’re upset about. I know many of you are angry and I’m angry too, but we’re not giving up.”
Stein talked about CNOC’s petition to the governor in council asking for the decision to be overturned.
“We’re not likely to see an early resolution to our petition,” he said.
“It could be a while before we see any changes, especially with the delay caused by this election. So yes, we’re fighting the fight, but in parallel, we also have to grow and nurture our businesses. We have to continue to do what we do, to offer competitive choice and innovation to Canadians.”
From there, Stein spoke about disaggregation.
“You see in the aggregated world, the model we use today, competitors have access to each incumbent’s entire network and our region, through a single access point. But in a disaggregated model, independent players have to tap into incumbents’ networks at potentially hundreds of points throughout every region,” he said.
The final number of interconnection points the disaggregated model will have is yet to be determined, but there is a CRTC proceeding considering it.
“If the final number is too high there will be independents that simply won’t be able to afford the costs required to move to disaggregated,” Stein said, adding that he is confident they “can land on a configuration that works for all of us.”
CNOC is “active in proceedings to make sure that the rates and configurations of the disaggregated model are fair.” The organization is also looking for ways to facilitate a smooth transition to the disaggregated model.
While disaggregation poses a challenge, it does not “mean gloom and doom,” Stein said. “In a disaggregated world, we just need to find new ways to support one another and partner for the good of the whole. It will be exciting to see where this takes us.”
Moving forward, in light of what is going on with wholesale rates and the need to navigate a future move from an aggregated to disaggregated model, they need three things: referees that do not choose sides, a level playing field and “to continue to play as a team, to support each other, to fight hard, to give our fans what they came for,” Stein said.
“And in our case, that means giving Canadians fair, affordable, innovative Internet services that allow them to work, play, and connect from wherever they are across this country.”
Photo provided by CNOC.
