CRTC Decision Will Kill Telecom Competition, Guarantees Even Higher Prices: TekSavvy

ISP scraps plans to offer mobile service and drops out of spectrum auction following CRTC’s «arbitrary» reversal on wholesale internet…

ISP scraps plans to offer mobile service and drops out of spectrum auction following CRTC’s «arbitrary» reversal on wholesale internet rates

CHATHAM, ON, May 27, 2021 /CNW/ – TekSavvy Solutions Inc. («TekSavvy») said it was shocked and disappointed by today’s CRTC decision, which reversed its 2019 decision lowering wholesale rates charged by Canada’s largest carriers (such as Bell Canada and Rogers) to smaller competitors (like TekSavvy). TekSavvy said today’s CRTC’s decision will have immediate, devastating impacts to its business and investments and guarantees even higher retail prices for consumers. 

«Today’s CRTC decision is a tombstone on the grave of telecom competition in Canada» said Andy Kaplan-Myrth, TekSavvy’s VP of Regulatory & Carrier Affairs «Canada’s largest and most profitable telecom companies have successfully gamed the system with impunity. As competitors begin to exit the market, Canadian consumers will pay the price».

Kaplan-Myrth added that as a result of today’s CRTC decision, TekSavvy has scrapped plans to offer mobile services and informed Industry, Science and Economic Development Canada (ISED) that it is dropping out of the upcoming spectrum auction as it scales back investment plans.

The CRTC today reversed a 2019 Rates Order that confirmed the large carriers systematically broke the CRTC’s rate-setting rules to grossly inflate their costs of providing access to their networks, resulting in higher retail prices for consumers. The 2019 Rates Order set new rates and ordered the large carriers to repay amounts they overcharged competitors during its 4-year long regulatory process. 

Today’s reversal came despite the CRTC previously condemning the large carriers’ rate-fixing as «very disturbing» and the 2019 Rates Order being upheld on appeals by the Federal Court of Appeal, the Supreme Court of Canada, and the Federal Cabinet.

The decision is bad news for consumers, as it effectively guarantees internet prices will continue to rise during the COVID-19 pandemic. A 2020 price study prepared by Wall Communications Inc. for ISED found that internet prices increased across all service baskets over 2019, making Canada an international outlier among its peer countries.

In February 2020, TekSavvy filed a formal Complaint with the Competition Bureau, detailing how Bell and Rogers broke rules to inflate wholesale rates they charge competitors, while using their fighting brands to offer competing retail prices below the wholesale costs they inflated.

About TekSavvy

Based in Chatham, Ontario, TekSavvy is Canada’s largest independent telecom service company, serving over 300,000 customers from coast to coast. TekSavvy has been proudly delivering award-winning services and fighting for consumers’ rights for more than 20 years. TekSavvy is committed to providing quality competitive choice and closing Canada’s digital divide.

SOURCE TekSavvy Solutions Inc.