Canadian telcom regulators have it right

A report on the website of the nationally distributed Canadian newspaper Globe and Mail has a "senior source" at the CRTC (Canadian Radio-television and Telecommunications Commission) confirming that VoIP pricing and services will be regulated the same way that body oversees traditional phone services.It's expected that much to the objections of Bell Canada and Telus Corp.

A report on the website of the nationally distributed Canadian newspaper Globe and Mail has a "senior source" at the CRTC (Canadian Radio-television and Telecommunications Commission) confirming that VoIP pricing and services will be regulated the same way that body oversees traditional phone services.

It's expected that much to the objections of Bell Canada and Telus Corp., the ruling will empower the agency to block any significant rate-slashing these companies might attempt in a move to make entry into VoIP services less attractive to VoIP startups.

In other words, what the CRTC would not want to see happen would be for the two major incumbent Canadian telcos to cut VoIP subscription prices so dramatically that potential new entrants into the VoIP market will run the numbers of what they would need to charge subscribers.

Presumably, such prospective new VoIP providers then would run the cap-ex numbers, relate them to a subscription rate model that would offer them a reasonable ROI time-frame, and then back off until the rate-situation would stabilize.

And then, in an unregulated or lightly regulated environment, incumbents such as Bell Canada and Telus would feel less of a competitive requirement to keep prices low.

This environment, I think, would lead to a shell game full of temporary "special introductory price" offers that could be pulled at a moment's notice. Would also lead to lots of fine print - and fine print is what so many telcos are so good at.

Those are just two of the reasons I tend to favor this type of regulation.

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