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Order CRTC 2000-393
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Ottawa, 10 May 2000
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Commission modifies reporting
requirements for affordability |
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Reference: 96-2176 and
8665-B20-01/99 |
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The Commission finds that promoting bill
management tools (BMTs) to facilitate access to telephone service is an important goal. To
enhance that access, the Commission will prepare a public service announcement to promote
BMTs and require the major incumbent telephone companies, including Télébec, to
distribute the information as a billing insert. The Commission will also set up a
committee to examine the promotion of BMTs and improve access to telephone service. BMTs
include outbound long distance call blocking, inbound collect call blocking and instalment
payment plans. |
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The Commission permits the companies to
file affordability monitoring reports in November and in March of each year. The report
filed in November will contain penetration rates and related data, including penetration
rates for each territory, information on the charges which have caused affordability
concerns, take-rate for BMTs and disconnect studies. The companies are required to file
penetration rates and related data in the report filed in March. The companies are no
longer required to report routine measures taken to promote BMTs. |
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Télébec is directed to report its
take-rate for BMTs and its disconnect studies on a yearly basis. |
1.
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In Local service pricing options,
Telecom Decision CRTC 96-10, dated 15 November 1996, and Telecom Order CRTC 97-1214, dated
29 August 1997, the Commission directed the Stentor- member companies, Québec-Téléphone
and Northwestel Inc. (the companies) to file annual and quarterly reports to monitor
affordability of telephone service in Canada. The companies were also directed to report
measures taken to promote BMTs on a quarterly basis, until further notice was provided. |
2.
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BMTs address the main reasons why persons with
affordability concerns either do not obtain service or disconnect service. A toll-restrict
option allows customers to block outbound long distance calls and inbound collect calls
for free. The instalment payment plan lets customers spread qualifying connection service
charges over a period of up to six months. |
3.
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On 13 July 1999 and 16 November 1999, the
companies filed applications to modify the above-referenced reporting obligations. In the
first application, the companies proposed to discontinue reporting all measures taken to
promote or further promote BMTs. The companies submitted that reporting routine
promotional efforts was of no value. Promotional efforts approved by the Commission in
Order 97-1214 were now discontinued while existing ones (promoting BMTs to persons
expressing affordability concerns through service representatives and informing customers
of the availability of BMTs in White Pages directories) were not expected to vary in the
future. |
4.
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The Action Réseau Consommateur, the
Consumers' Association of Canada and the National Anti-Poverty Organization (ARC), opposed
the companies' proposal to discontinue reporting all measures to promote BMTs. ARC
submitted that BMTs were an important tool to combat affordability problems and should be
promoted to all new customers, not just those expressing affordability concerns. They also
submitted that service representatives could easily promote BMTs to all new customers at
little or no extra cost. ARC submitted that the Commission or Industry Canada should
design a public service announcement and distribute it through the Canadian Customs and
Revenue Agency's (CCRA) Goods and Services Tax (GST) Credit Program and other government
agencies. Finally, ARC submitted that the low take-rate for BMTs either showed that they
were not effective or that customers were not aware of their availability. ARC advocated
that BMTs should be modified to better address affordability problems. |
5.
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The companies replied that promoting BMTs to
all new customers was expensive and ineffective. The companies submitted that promotions
should only target customers with affordability concerns. Promoting BMTs to the general
body of subscribers would reach customers who do not need or want those services and would
encourage some to subscribe to BMTs, and unnecessarily increase the companies' costs for
providing them. The companies also submitted that customers with affordability concerns
were aware of BMTs and use them, relative to the number of Canadians who cannot afford
telephone service. |
6.
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In the second application, the companies
proposed to vary the frequency and timing of the affordability reports. They also proposed
to stop reporting information on which telephone-related charges cause affordability
concerns. They submitted that the current and expected continued stability of this data
justified either not reporting, or reducing the frequency at which it is reported. The
companies submitted that penetration rates remain stable, data consistently show that
customers who do not obtain service cannot afford up-front charges or basic monthly
charges or security deposits, and those who disconnect service do so because they cannot
pay toll charges. |
7.
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The companies proposed to file two reports
each year in November and March instead of filing quarterly reports and an annual report.
The report filed in November would provide the information currently filed in the annual
report, including data on penetration rates. It would also include the companies'
take-rate for BMTs and the disconnect studies, which are currently filed on a quarterly
basis. The report filed in March would only provide data on penetration rates. |
8.
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Télébec, which currently files quarterly
reports separately from the companies, supported the application. It also submitted that
any change to the companies' filing requirement should apply to it. |
9.
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The Government of the Northwest Territories
(GNWT) submitted that the companies should expand monitoring and provide more
disaggregated data for the Northwest Territories, Yukon and Nunavut (the Territories).
GNWT submitted that Northwestel was not subject to competition or price cap constraints
and consumers were therefore not afforded the same rate protection existing in other
telephone companies' territories. GNWT also noted that the monitoring reports did not
necessarily reflect the realities in the Territories, since Statistics Canada did not
collect data in the north. Finally, GNWT noted that penetration rates in the Territories
were substantially lower than in the rest of the country. |
10.
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ARC submitted that penetration rates are of
limited use when measuring affordability of telephone service. Accordingly, they did not
oppose reducing the frequency at which penetration rates are reported. However, ARC noted
that reporting on the reasons why customers either do not subscribe to, or disconnect,
service is critical to any serious effort to understand and design solutions to
affordability problems. ARC believes that the reports showed that people increasingly did
not subscribe or disconnected service because they could not afford basic local charges
and they expected this trend to continue. |
11.
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In reply, the companies indicated that they
rely on Statistics Canada data for their reports. The companies noted that disaggregated
data was not available at the levels requested by GNWT. The companies also noted that
Statistics Canada does not collect penetration data for the Territories on a quarterly
basis. The companies noted, however, that Statistics Canada was now collecting penetration
data for the Territories in its annual survey and undertook to report the Territories'
annual penetration rates in their November report. With regard to ARC's comments, the
companies reiterated that the reasons why customers either disconnect or do not subscribe
to telephone service were well-established and there was no value in continuing to report
this data. |
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Reporting routine promotion of BMTs |
12.
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The Commission notes that, while certain
promotional efforts have been discontinued, the companies plan to continue to promote BMTs
in their White Pages directories and through their service representatives. In the
Commission's view, there is no need for the companies to continue reporting promotional
efforts that have been discontinued. The Commission also finds that the companies do not
need to continue reporting routine efforts to promote BMTs, such as in White Pages
directories, because this information does not provide additional insight to the
Commission or interested parties. However, the Commission expects the companies to report
on any future measures and initiatives taken to promote BMTs. |
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GST credit program |
13.
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The Commission notes that ARC suggested using
the GST credit program to promote BMTs and that the companies supported this request and
were willing to work with interested parties. |
14.
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The Commission considers that distributing an
insert/public announcement through the GST credit program would be a very effective way of
promoting BMTs to those persons with affordability concerns who would most benefit from
those services. The Commission also considers that using the GST credit program would be
simple, cost effective and would greatly avoid duplication of work and resources, because
persons with affordability concerns would likely be eligible for a GST credit. However,
the CCRA has advised the Commission that the proposed use of the GST credit program does
not meet the agency's policy objectives for publishing GST credit cheque inserts because
the BMT inserts would not have direct relevance to the program. Accordingly, the CCRA has
indicated that it cannot send information on BMTs with the GST credit program. |
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Additional measures to promote BMTs |
15.
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The Commission considers that BMTs are
important tools to address affordability problems. The efforts to date to promote BMTs and
to assist customers to either remain on the network or obtain telephone service have not
been as successful as expected. Accordingly, the Commission will take an active role to
promote BMTs and help customers obtain service or remain on the network. As a first
measure, the Commission will require the companies and Télébec to distribute a billing
insert describing the availability of BMTs, with text provided by the Commission. |
16.
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The Commission notes that other promotional
measures put in place pursuant to Order 97-1214 did not produce the outcome originally
expected, such as the limited success of promoting BMTs through social agencies and
organizations. The Commission also notes that existing promotional efforts are aimed at
customers who already have telephone service. There are currently no initiatives in place
to reach those persons without telephone service. To attempt to address these problems,
the Commission will set up a new committee to examine avenues and approaches to promote
BMTs and facilitate access to telephone service. Various interested parties, including
ARC, will be invited to participate on the committee with Commission staff and
Commissioners. |
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Frequency of reporting |
17.
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Parties do not object to reducing the number
of times the companies report penetration rates except in the Territories, where GNWT
submits that monitoring should be expanded and disaggregated to the community and regional
level. However, Statistics Canada does not provide data disaggregated to those levels. The
Commission notes that Northwestel will continue reporting its monthly customers' take-rate
for BMTs and its disconnect studies in the November report, together with the other
companies. The companies will now be able to report the Territories' penetration rates in
the November report, using data from Statistics Canada. Finally, penetration rates have
remained stable and consistently high. Accordingly, the Commission finds it reasonable for
the companies to report penetration rates twice a year in November and in March. The
Commission also finds it reasonable that the companies report the Territories' penetration
rates once a year in November. |
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Reporting non-subscription and
disconnection |
18.
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The Commission finds that the companies should
continue reporting the reasons for which customers either do not subscribe to or
disconnect service. The Commission notes that the grounds most commonly cited for not
subscribing to or for disconnecting service are installation charges, monthly basic local
rates and deposits, all of which continue to be regulated by the Commission. However, as
suggested by ARC, with changes in the competitive environment, these grounds may change.
The Commission therefore considers that the information is relevant and it would be
premature to stop reporting it. |
19.
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Finally, the Commission notes that Télébec
is currently reporting its take-rate for BMTs and its disconnect studies on a quarterly
basis. The Commission permits Télébec to report this data on a yearly basis. |
20.
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In light of the foregoing, the Commission: |
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a) directs
the companies to start providing penetration rates for each territory in their November
report;
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b) directs
the companies, including Télébec, to print and distribute, as soon as practically
possible, a billing insert regarding BMTs and related matters, which will be prepared by
the Commission;
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c) permits
the companies to file penetration rates and related data twice a year in November and
March;
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d) directs
the companies to continue reporting information on the charges which have caused
affordability problems in their report filed in November;
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e) permits
the companies and Télébec to report the take-rate of BMTs and their disconnect studies
on an annual basis; and
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f) finds that
the companies do not need to report routine measures taken to promote BMTs.
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Secretary General
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This document is available in alternate
format upon request and may also be examined at the following Internet site: http://www.crtc.gc.ca |