Letter
Ottawa, 16 August 2006
File No: 8661-B2-200605967
By E-MAIL
Mr. Mirko Bibic
Chief, Regulatory Affairs
Bell Canada
110 O'Connor, Floor 14
Ottawa , Ontario
K1P 1H1
Bell.regulatory@bell.ca
Dear Mr. Bibic:
Re: Bell Canada application regrding recovery of wireline costs to enable wireless number portability
On 12 May 2006 , the Commission received an application by Bell Canada ( Bell ) requesting that it be allowed to recover that portion of the costs incurred by the Company to modify the wireline network to enable wireless number portability (WNP) through an exogenous adjustment. In addition, Bell requested that certain associated wireline revenue losses which are solely attributable to the introduction of WNP be recovered from the Company's deferral account.
Bell is requested to provide responses to the attached questions by 5 September 2006 . Comments by interested parties may be filed on 19 September and reply comments by the Applicant may be filed on 26 September.
Yours sincerely,
'Original signed by S. Bédard '
Suzanne Bedard
Senior Manager, Tariffs
Telecommunications
cc:
TELUS Communication Company (Willie Grieve): regulatory.affairs@telus.com
Rogers Communications (Dawn Hunt): rwi_gr@rci.rogers.com
MTS Allstream ( Teresa Griffin-Muir) : iworkstation@allstream.com
PIAC (Michael Janigan): piac@piac.ca
Joanne Baldassi, CRTC (819) 997-4576
ATTACHMENT
1. With reference to the Company's 12 May 2006 application:
• Explain the process steps involved in porting a wireline number to a wireline service provider from the time the porting request is received by Bell until the process is completed. Indicate the resources required for each of the steps.
• Explain the process steps involved in porting a wireline number to a wireless service provider from the time the porting request is received by Bell until the process is completed. Indicate the resources required for each of the steps and quantify the cost of the resources.
• Explain any differences between the two processes
• If LNP for wireline exists at a specific location, identify whether there are additional costs associated with implementing WNP at that specific location. If so, identify the specific costs and provide an estimate of each of these costs.
2. With reference to the Company's statement under Item 6.1, paragraph 15 of the supporting cost study provided in Appendix A:
• Explain why the capital causal to demand such as switching equipment is considered non-fungible.
• Provide a revised Table 5b, assuming that the capital causal to demand is fungible;
• Further provide the assumed life estimates of each major capital resource.
3. With reference to Appendix A, Item 6.4.2, paragraph 20, Software, of the supporting cost study provided in Appendix A:
• Explain in detail, and provide the costs broken down into each of the following components: i) software development associated with modifying the billing and order system; ii) IS/IT project management; iii) network design and; iv) development of methods and procedures.
• Explain in detail whether the local number portability (LNP) network upgrades associated with the implementation of the wireline LNP have captured these costs. If not, explain why not. If so, provide a breakdown of the costs that were not associated with wireline LNP and those that were. Outline the changes required for wireless number portability (WNP) over other LNP changes (eg. Moving from V5.2 - V.6.0).
4. With reference to Appendix A, Item 6.4.3, Switching Equipment:
• Explain and provide the costs associated with the upgrades broken down into each of the following components: i) DMS switches; ii) common channel signalling (CCS7) network; iii) signal transfer point (STP); iv) digital trunk controller, and; v) the associated software.
• Explain in detail whether the LNP network upgrades associated with wireline LNP would have captured these costs. If not, explain why not. If so, provide a breakdown of the costs that were not associated with wireline LNP and those that were.
5. With reference to Appendix A, Item 6.4.3 Other:
• Explain in detail and provide the costs of the upgrades and additions broken down into each of the following components: i) Local Service Management System (LSMS); ii) Number Portability Administration Center Service Management System (NPAC); iii) Global Intelligent Services Node (GISN) and; iv) extra storage for telephone numbers in the LNP database.
• Explain whether these types of costs would be incurred as part of the normal growth in the competitive marketplace and if so, should be recovered through the normal course of business, instead of through WNP development. If not, provide justification for this view.
6. With reference to Appendix A, Item 6.4.4, Service Provisioning, for each year of the study provide the expense cash flow for this activity and provide details of the labour unit costs and the associated labour hours and/or the applicable unit costs used to develop each of the following: i) order fulfilment; ii) administrative activities due to WNP and; iii) miscellaneous expenses related to network and trunking rearrangements.
7. With reference to Appendix A, Item 7.0, paragraph 26, explain, with supporting rationale, why the Company is including as a cost third-party floor space and power consumption related to WNP.
8. With reference to Table 1 of the Attachment and footnote #3, explain the 3 rd party services obtained from Telebec.
9. With reference to the study period:
• Explain why a 14 year study period was used in the imputation test.
• Provide a revised Table 5b based upon a 7-year study period.
10. Given the level of demand for WNP included in the demand forecast, particularly starting from 2007, provide the company's views as to whether it would simply ignore the demand, if the government had not mandated WNP. Comment on whether such a market demand and any company action to meet such demand would not constitute actions within the control of the company, and thus not meet the definition of exogenous adjustment.
Date Modified: 2006-08-16
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