The CRTC’s wholesale regulation aims to deliver more choice and lower prices for consumers while recognising the need to encourage operator investment
The CRTC has launched a review of its approach to broadband competition, with consumers facing few options to choose from
On 13 August 2024, the Canadian Radio-television and Telecommunications Commission (CRTC) announced a decision to extend wholesale FTTH access regulation nationwide. The regulator considers the move “a major step forward” in improving competition in the country’s broadband market. In March 2023, the CRTC launched a public proceeding to improve broadband competition, increase choice and lower prices in Canada, citing evidence that the competitive situation was deteriorating and that this had left many consumers with fewer options for high-speed connectivity. In November of that year, the regulator issued a temporary decision requiring Bell and Telus to provide – for the first time – aggregated access to their fibre networks in Ontario and Quebec where competition had declined most significantly. Services became available to competitors in May 2024 even as Bell warned that it would cut at least C$1bn (£561m) in capex for 2024-2025, equivalent to a reduction in build targets by around 700,000 locations.
To preserve incentives for network investment, incumbent operators will enjoy a regulatory holiday on newly-build fibre until 2029
Following the November 2023 decision, the CRTC continued to collect evidence to inform its latest move. The regulator received over 300 stakeholder submissions and heard directly from 22 groups – including operators and consumers – during a week-long public hearing in February 2024 where participants emphasised the need for the CRTC to act quickly. Based on this information, the CRTC is now extending “workable access” to the largest telephone companies’ fibre infrastructure across Canada. From 13 February 2025, smaller operators will be able to use the fibre networks of the incumbent operators Bell, SaskTel and Telus, enabling them to bring innovative new offers to market. However, the CRTC also recognises that rolling out fibre is expensive and is aiming to ensure continued investments so that more Canadians can get access to high-quality, high-speed internet. The new wholesale access granted by the regulator’s decision therefore only applies to fibre that has already been built. Any new fibre built by the largest telephone companies will be made available to competitors in five years (i.e. from August 2029). This regulatory holiday gives Bell, SaskTel and Telus an opportunity to make a return on their investments, which the CRTC hopes will encourage them to connect more premises to fibre sooner.
The regulator’s decision is part of an ongoing effort to improve consumer choice and affordability in fixed and mobile markets
In the meantime, the CRTC is continuing its work to set the wholesale charges competitors will pay the incumbents to access their fibre networks. The regulator states that it will set “just and reasonable” cost-based rates for access to fibre across the country by the end of this year. These charges will be in place in time for the CRTC’s new regulation to take full effect in February 2025. For now, the existing rates in Ontario and Quebec will remain in place. The CRTC will continue to closely monitor the broadband market and the impact of its framework to ensure Canadians experience the intended benefits. Its latest decision is part of the CRTC’s broader effort to ensure that consumers have access to affordable and high-quality telecoms services under the Canadian Government’s revised, consumer-oriented policy direction for the sector. The regulator is encouraged by the recent competitive activity in the mobile market, where it has given regional players the ability to enter as mobile virtual network operators (MVNOs) using the networks of large mobile providers across Canada. By extending this approach to the fixed market, the CRTC is aiming to lay the foundations for similar success in broadband.
