REGINA – Count SaskTel among those opposed to the CRTC’s proposed plan to phase-out the local service subsidy regime.
The local voice service subsidy was designed to keep wireline voice service affordable in high cost serving areas. The CRTC’s preliminary view is that customers with access to wired Internet at speeds as low as 1.5 Mbps have access to “reliable broadband Internet access service” which can replace traditional voice service and that these customers no longer need the voice subsidy.
SaskTel said that it agrees with the CRTC’s decision to establish a universal fixed broadband service standard for all Canadians with bandwidth targets of at least 50 Mbps download and 10 Mbps upload, calling it “the right goal for our industry”. However, continued the Crown Corp., it is unlikely that the 50/10 Internet speeds will be available in remote rural locations as the technology to deliver those types of speeds is not cost-effective at this time.
“We are extremely concerned that Saskatchewan residents will be immediately impacted by the phase-out of the local service subsidy and yet will likely not benefit from the re-direction of funds to the new broadband fund for several years as more populous areas in Canada are either unserved or more underserved than rural areas in Saskatchewan”, said SaskTel president and CEO Ron Styles, in a statement.
The company said that a phase-out would impact roughly 100,000 Saskatchewan households that still rely on the local voice subsidy for affordable telephone service, and that some customers would potentially face rate increases nearly doubling their current rate.
“The CRTC’s proposed actions are more aggressive and more immediate than we had expected and we are strongly encouraging impacted Saskatchewan rural residents, groups and associations to express their concern through the CRTC’s consultation process,” continued Styles. “The average subsidy is approximately $160.00 per year per High Cost Serving area customer, with some customer’s lines receiving a subsidy of over $300.00 per year, and with the removal SaskTel will have little choice but to increase rates.”
The Commission on Tuesday extended the deadline for interventions by three weeks to June 15, 2017 at the behest of the Independent Telecommunications Providers Association (ITPA), which was supported by Bell Canada, the Public Interest Advocacy Centre, and SaskTel.
