Telecom Decision CRTC 2017-384
Ottawa, 26 October 2017
File number: 8663-S4-201707019
Sogetel inc. – Application to modify the band assignment for the four wire centres
The Commission approves, effective 1 January 2017, the reclassification of the following wire centres for Sogetel: Beauceville and Nicolet to Band F-2, and Saint-Paulin and Warwick to Band E.
- During the 1990s, through a series of proceedings and decisions, the Commission opened up various telecommunications markets to competition, including the local telephone market, to enhance the Canadian telecommunications system and to give Canadians the benefits of competition. The Commission also established a subsidy regime, whereby money is collected from telecommunications companies to subsidize residential telephone service.
- Under this subsidy regime, incumbent local exchange carriers (ILECs) receive a monthly subsidy from the National Contribution Fund for providing residential telephone service in rate regulated high-cost serving areas (HCSAs).Footnote 1 The amount of subsidy paid per month varies by ILEC and by band.Footnote 2 This subsidy regime ensures that residential local telephone service rates are just and reasonable, as required by subsection 27(1) of the Telecommunications Act.
- The Commission received an application from Sogetel inc. (Sogetel), dated 14 August 2017, in which the company requested that the band assignment approved in Telecom Regulatory Policy 2013-160 for four of its wire centres be modified, effective 1 January 2017. Specifically, Sogetel requested that (a) the Beauceville and Nicolet wire centres be modified from Band F-3 to Band F-2, (b) the Saint-Paulin wire centre be modified from Band F-1 to Band E, and (c) the Warwick wire centre be modified from Band F-2 to Band E.Footnote 3
- Sogetel acknowledged that the wire centres had been appropriately classified in Telecom Regulatory Policy 2013-160. However, Sogetel submitted that the wire centres’ total network access service (NAS) counts have declined steadily and are now below the lower NAS thresholds of the bands assigned in 2013.
- The Commission received no interventions with respect to this application. The public record of this proceeding, which closed on 15 September 2017, is available on the Commission’s website at www.crtc.gc.ca or by using the file number provided above.
Commission’s analysis and determinations
- Based on the information provided, the four Sogetel wire centres have dropped below their bands’ lower thresholds and the total NAS in each of the four wire centres has continued to decline. Therefore, it is appropriate for the Beauceville and Nicolet wire centres to be reclassified as Band F-2, and the Saint-Paulin and Warwick wire centres to be reclassified as Band E.
- Accordingly, the Commission approves, effective 1 January 2017, the reclassification of the Sogetel (a) Beauceville and Nicolet wire centres from Band F-3 to Band F-2, (b) Saint-Paulin wire centre from Band F-1 to Band E, and (c) Warwick wire centre from Band F-2 to Band E.
- Given that the Commission approved, in Telecom Decision 2016-473, an interim 2017 Band E subsidy per residential NAS amount for Sogetel inc. – Milot,Footnote 4 this subsidy amount is to be used for the Saint-Paulin and Warwick wire centres, effective 1 January 2017, on an interim basis.
- However, Sogetel inc.Footnote 5 does not have an approved subsidy per residential NAS amount for Band F-2. In this decision, the Commission has used the small ILEC subsidy calculation formula in Telecom Decision 2016-473 to determine that Sogetel inc. Band F-2 wire centres (Beauceville and Nicolet) should receive an interim 2017 subsidy per residential NAS amount of $7.10 per month, effective 1 January 2017.
- Therefore, the Commission approves on an interim basis, effective 1 January 2017, a 2017 subsidy per residential NAS amount of $7.10 for Sogetel inc’s Band F-2.
- The Commission directs the Central Fund Administrator to adjust the distribution of monthly subsidy for the above-mentioned wire centres to reflect the revised band assignments and to use the interim 2017 rates approved in this decision and in Telecom Decision 2016-473.
- Final 2016 revenue-percent charge and related matters, Telecom Decision CRTC 2016-473, 2 December 2016
- Regulatory framework for the small incumbent local exchange carriers and related matters, Telecom Regulatory Policy CRTC 2013-160, 28 March 2013
- Regulatory framework for the small incumbent telephone companies, Decision CRTC 2001-756, 14 December 2001
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