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| quote: | Originally posted by ShadoWolf
http://www.theglobeandmail.com/serv...ory/Technology/
CRTC expected to rein in big phone companies on VoIP service
By SIMON TUCK
Friday, May 6, 2005 Updated at 8:46 AM EDT
Globe and Mail Update
OTTAWA — The budding Internet-based telephone business is widely expected to be regulated the same way as traditional phone services under a CRTC ruling next week that analysts say will strike a blow to the dominant phone companies.
A senior source in the Canadian Radio-television and Telecommunications Commission confirmed that it has rejected arguments from Bell Canada and Telus Corp. that voice over Internet protocol (VoIP) should be left unregulated like other on-line applications.
If their argument had won the day, their competitors say, the incumbent phone companies would have been allowed to limit the number of new entrants by slashing prices in the short term.
Instead, the CRTC's ruling would mean that the large telcos would have to get CRTC approval for their prices, thereby further opening the door for startups, such as Primus Telecommunications Canada Inc. and Vonage Holdings Corp., and cable companies, such as Rogers Communications Inc., Shaw Communications Inc. and Vidéotron Ltée. to pursue the lucrative residential phone market.
VoIP is a technology that allows for telephone service over the Internet and the CRTC's much-anticipated ruling is expected to be a key in determining which industry -- and which companies -- gain the early edge in the nascent niche.
Analysts say the battle for the VoIP market is a flashpoint in a larger, high-stakes war between two converging sectors: cable and telephone. Technology is overhauling telecommunications as the two sectors increasingly roll out similar products. The central debate over the regulation of VoIP is whether it is a phone or Internet product.
The phone companies told the CRTC last fall during VoIP hearings that more competition and less regulation would be good for consumers and the industry. Even though local phone markets were opened up for competition seven years ago, the large incumbents still control about 97 per cent of the market.
Many of the telcos' rivals, however, warned the CRTC that the regulator had to ensure that the incumbents weren't allowed to use VoIP as a "loss leader" that would deter competition through artificially low prices.
The cable companies, some of which are making hefty investments in the lucrative phone services industry, say rapid deregulation would allow the telcos to take over the emerging VoIP market before others are given a fair chance.
UBS Securities Canada Inc., which is among the many brokerages expecting a win for the cable companies, said the ruling expected on Thursday will accelerate the cable industry's moves toward bundling services. The VoIP market, meanwhile, will jeopardize between 15 and 20 per cent of the incumbent phone companies' revenue and between 30 and 35 per cent of their pretax earnings before interest, taxes, depreciation and amortization, analyst Jeffrey Fan said.
Janet Yale, executive vice-president of government and regulatory affairs at Telus, called VoIP a "paradigm shift" because it opens up the phone business to the cable guys. "From our perspective, the entry of cable changes everything."
Lawson Hunter, executive vice-president of regulatory affairs for Montreal-based BCE Inc., which owns Bell Canada, wouldn't comment on the potential impact to Bell, but said that it wouldn't be fair if the CRTC were to regulate only the phone incumbents in the VoIP market. About 18 other countries have issued VoIP rulings and only Singapore has decided to regulate pricing, Mr. Hunter said.
It is estimated about 25,000 Canadians use VoIP services, but Iain Grant, managing director of SeaBoard Group, a telecom consulting firm in Montreal, said he expects the market to grow by about tenfold by the end of this calendar year.
Canada's local telephone market is worth about $10-billion a year.
Mr. Grant also said VoIP will open up the telephone services market to greater competition. "Ten years ago, you needed a trillion dollars to get into this business -- now you need $20,000."
The CRTC's ruling, which is expected to be in line with its preliminary ruling on VoIP last year, is not expected to end the battle over the issue. Analysts said the telcos would likely appeal to the federal cabinet and VoIP could also be part of Industry Minister David Emerson's coming telecom review. |
| quote: | Originally posted by St_Andrew
hmm, what im i missing here, how can regulating a market like voip where you in theory have a place for perfect competition, be good for competition?  |
http://www.canada.com/nationalpost/...bd-4ee2263dca5f
Ottawa pulls plug on VoIP regulation
Cheaper service likely; All providers now able to set their own prices
Peter Nowak
Financial Post
Thursday, November 16, 2006
The government has made its first move to deregulate phone services by removing some of the rules governing Internet-based calling providers, a decision that further marginalizes the CRTC.
Minister of Industry Maxime Bernier announced at an Economic Club of Toronto luncheon yesterday that Voice over Internet Protocol services -- landline phones offered over a broadband connection -- would no longer be regulated.
"Barriers to entry in this market are low; there is no reason to regulate it," he said. "In a competitive sector, there is no reason to regulate some companies while others can offer the services they want at the prices they want."
Under previous restrictions, incumbent phone carriers such as Bell Canada Enterprises Inc. were limited to how low they could price their own VoIP services to compete with specialized providers such as Vonage Canada Inc. With the deregulation, all VoIP providers will be able to price their services as they see fit.
A spokesman for the Canadian Radio-television and Telecommunications Commission said the deregulation will take effect immediately, and the regulator will issue a circular today to address how it will be implemented.
Some incumbents, including Bell and SaskTel, offer VoIP services but don't actively promote them. Industry observers expect that to change as VoIP is much cheaper for them to provide. The result could be cheaper phone services for consumers and less cost to the phone companies, although they will end up competing with their own traditional offerings.
"It's a good news, bad news thing for them," said Greg O'Brien, author of industry newsletter CARTT and an expert on telecommunications regulation. "They'll be able to market freely like the cable companies do, but at the same time they'll end up undercutting their own traditional wireline service."
The government's decision did sow some confusion yesterday, however, by specifying that only "access-independent" VoIP services would be deregulated. Some industry players were not sure what that definition would cover.
"There are definitional issues about what access-dependent services are, when they're VoIP and when they're telephony," said Lawson Hunter, executive vice-president and chief corporate officer of Bell Canada.
Joe Parent, vice-president of marketing and business development for Vonage Canada, said it was too early to tell how the move would affect the phone market.
"While deregulation does open up greater competition, it also opens up the possibility of abuse of market power."
Mr. Bernier said the decision did not affect traditional phone services, but he made clear the government was looking to deregulate that market as well. "It's a small step, but it's a step," he said.
The government's overturning of a decision by the Canadian Radio-television and Telecommunications Commission is a rarity. The CRTC last year decided VoIP should be regulated like a regular phone service, but the government in May asked it to reconsider. The commission stuck to its guns in September and announced its decision stood.
Mr. Bernier said the Conservatives would stick to the key finding of the Liberal government-initiated Telecommunications Policy Review Panel, which was issued in March. The review urged that rather than assuming all telecommunications services should start out regulated, they should only be governed when the need arises. As such, the panel said, the CRTC should have a more reactive role, rather than proactive.
"We want it to regulate only when necessary," Mr. Bernier said. "And when regulation is necessary, we want to ensure that it interferes in the least way possible with market forces."
Some industry observers said the reversal of the CRTC decision does not bode well for the future of the regulator. "The CRTC has one knee down ... they might be gone within three years," said John Ruffolo, national leader for Deloitte's technology, media and telecommunications practice.
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© National Post 2006
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Disco and classical had sex while watching a sci-fi movie. Their child: trance.
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HSDPA before the end of the month, all the while paying $50/month for truly unlimited data.
), then definitely use a GSM provider. GSM is the standard used in most of the world, including Europe. It allows you to use your phone in Europe, either roaming with Rogers or by purchasing a European SIM card. Your only GSM option in Canada is Rogers/Fido. 
