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The following is quoted from www.stikeman.com/newslett/TelJun04.htm.

The CRTC initiated its VoIP proceeding in early April 2004, with the issuance of Telecom Public Notice CRTC 2004-2 (PN 2004-2). This proceeding was prompted by four developments. The first is the CRTCs recognition that VoIP services have significantly evolved. Originally, this technology allowed users to make and receive calls with a computer over the Internet only when all parties on the call used the same peer-to-peer (P2P) software and the service did not connect to the telephone system. VoIP services are now available that provide subscribers with access to and from the PSTN and that use telephone numbers conforming with the North American Numbering Plan (i.e., a three-digit area code, followed by a three-digit number corresponding to a local exchange, followed by a four-digit number). Second, the CRTC also recognizes that the modern forms of VoIP are currently available in Canada from service providers such as Primus Canada and Vonage. Finally, PN 2004-2 responds to two recent requests for rulings: a November 2003 Bell Canada application requesting the CRTC, among other things, address the rules that govern providers of VoIP services, and a January 2004, Call-Net Enterprises Inc. application requesting that the CRTC investigate the Canadian VoIP service of Primus Canada to ensure compliance with applicable regulatory requirements.

The CRTC expresses a number of preliminary views in PN 2004-2 about how it proposes to regulate VoIP services and seeks comments on these views. For example, in the Commissions preliminary view, VoIP services are functionally the same as traditional telephone service because it allows users to call and or receive calls from any telephone with access to the PSTN anywhere in the world. Citing its principle of "technical neutrality" (meaning that the same regulatory rules apply to like services, irrespective of their underlying technologies) the CRTCs preliminary view is that VoIP services (and service providers) should be regulated according to the CRTCs existing rules. In other words, the regulatory rules for VoIP-based services would depend on the category of service provider (i.e., incumbent local exchange carrier (ILEC), competitive local exchange carrier (CLEC) or reseller), the nature of the telecom service and the geographic area in which the service is provided. For example, when an ILEC provides a local VoIP service in its traditional home territory, it would be required to do so under a CRTC-approved tariff, whereas a local VoIP service provided by a CLEC would not.

Among the other preliminary views about VoIP expressed by the CRTC are the following:

  • Where VoIP technology is used to provide services forborne from CRTC regulation (i.e., long distance) VoIP service would similarly be forborne.

  • Revenues from VoIP services would be subject to "contribution" (the subsidy collected as a percentage from telecommunications service revenues that is used to subsidize the cost of local telephone service in high-cost serving territories).

Other decisions and announcements continue to come from the CRTC on an infrequent basis, including a recent decision regarding VoIP providers and 911 service.

The following is from the latest decision on VoIP by the CRTC:

May 12th, 2005
CRTC decides on limited regulation for VoIP
telephone services to foster competition

OTTAWA-GATINEAU The Canadian Radio-television and Telecommunications Commission (CRTC) today determined that it would regulate Voice over Internet Protocol (VoIP) service only when it is provided and used as local telephone service.

This decision will further the goal of building sustainable competition in local telephone markets. Under this decision, incumbent local exchange carriers those with market power cannot price their local VoIP services below cost to stifle competition.

The Commission's mandate includes creating regulatory conditions that allow competition to grow. As each telecommunications market becomes sustainably competitive, the CRTC then refrains or forbears from regulating that market.

Local telephone markets are among the few remaining telecommunications markets in Canada that are regulated by the CRTC. The CRTC opened these markets to competition in 1997. The continued regulation of the incumbent local exchange carriers reflects the fact that they continue to have market power and competition is not yet entrenched in those markets.

We believe that VoIP represents a key moment in the evolution of local exchange telephone services, said Charles Dalfen, Chairman of the CRTC. This is precisely the moment when Canada needs a regulatory framework that will provide the quickest road to competition.

Fostering competition in local telephone services

This decision is a critical element in furthering the Commission's mandate to create conditions for sustainable competition in local exchange telephone markets. In recent weeks, the CRTC also announced that it would:

  • Accelerate its response to applications for retail tariffs on local service by incumbents, so they can respond more quickly to customer demand.
  • Set criteria for forbearing from regulating the local exchange services market.
  • Allow regulated telephone companies to offer promotions to customers in local markets, subject to certain safeguards.
Why did we find that VoIP is a telephone service? Because Canadians use it as a telephone service, it's being sold as a telephone service and it functions as a telephone service, said Charles Dalfen. It provides two-way real-time voice communications to and from anyone with a telephone number on the public switched telephone network anywhere in the world. This decision is consistent with the focus in the Telecommunications Act on services rather than technologies.

VoIP services under offer at this time are not materially different than primary exchange services the kind of local telephone service now in general use. VoIP lacks the characteristics of a new service because:
  • Many customers regard VoIP telephony as the equivalent or a close substitute for primary exchange services, making it unlikely that most consumers or businesses would have both VoIP and traditional phone service.
  • Most companies selling VoIP services offer them with the same core attributes as local exchange services. VoIP may offer certain distinct features, but these do not define it as an entirely different kind of communications service.
No regulation of the Internet

The decision is consistent with previous Commission decisions not to regulate retail Internet services. The decision also means that the CRTC will not regulate computer-to-computer (peer-to-peer) VoIP services which reside solely on the Internet.

The beginning of a process

This decision also comes at the beginning of a broader process that aims ultimately to eliminate price regulation in local telephone service, including VoIP.

The CRTC issued a public notice on April 28, 2005 (Public Notice CRTC 2005-2) seeking comments on how to reduce the regulation of residential and business local exchange telephone services, as competition becomes sustainable in those markets.

Our goal is not to regulate, Mr. Dalfen said. Our goal is to not have to regulate. And once there is sustainable competition in local markets, we will not do so.

The Canadian Radio-television and Telecommunications Commission is an independent public authority that regulates and supervises broadcasting and telecommunications in Canada.

The most recent decision of the CRTC affecting VoIP services in Canada came in regards to 9-1-1 service. The decision (quoted below) can be found here.

News release

April 4th, 2005
CRTC Decision on 9-1-1 Emergency Services for
VoIP Service Providers

OTTAWA-GATINEAU The Canadian Radio-television and Telecommunications Commission (CRTC) today announced a decision that addresses the requirements for voice over Internet protocol (VoIP) service providers to offer emergency 9-1-1 service.

In this decision, the Commission requires VoIP service providers who provide fixed VoIP service to provide the same level of 9-1-1 emergency service that is provided by the incumbent telephone companies to their existing customers (either Enhanced 9-1-1 or Basic 9-1-1 service), within 90 days from the date of this decision.

The Commission requires VoIP service providers providing either nomadic VoIP service or foreign exchange VoIP service to implement, within 90 days of the date of this decision, an interim solution which provides a level of service comparable to Basic 9-1-1 service.

The different types of VoIP services and Enhanced and Basic 9-1-1 services are explained below.

In addition to the above service requirements, the Commission also requires all VoIP service providers to provide customers with notification, both before service commencement and during service provision, regarding any limitations associated with their emergency 9-1-1 service. The VoIP service providers must also secure the customers express acknowledgement that they are aware of these limitations, prior to providing this type of service.

VoIP service providers must notify customers of all limitations on emergency services before commencement of service to them. This information must be provided to them in the marketing material used for television, radio and printed media; in the terms and conditions of service; in on-line material; through their customer service representatives; in their service contracts and in their starter kits. Where service limitations exist, the Commission also requires that all VoIP providers provide on-going customer notification during service provisioning, by issuing warning stickers to be affixed to telephone sets, through any subsequent advertising and in billing inserts.

The CRTC Interconnection Steering Committee (CISC), composed of CRTC staff and industry, consumer and emergency services representatives, has been asked to resolve the challenges related providing Enhanced 9-1-1 and Basic 9-1-1 service with nomadic and foreign exchange VoIP services. Specific timeframes have been established for when CISC is required to report to the Commission on possible solutions and recommendations to solve the 9-1-1 issues.
Types of VoIP Services

There are currently three different types of VoIP service offered to customers: fixed, nomadic and foreign exchange. Users of fixed VoIP service can only place a telephone call from the location where their service is is being provided. Users of nomadic VoIP service can make calls from any location where users can get access to Internet service. Foreign exchange VoIP service allows users in one exchange to receive telephone calls dialled as local calls in another exchange that they have selected (e.g. a customer located in Ottawa with a Halifax local telephone number).
Existing Enhanced and Basic 9-1-1 Services

The existing local telephone network currently provides for two types of 9-1-1 service: Enhanced 9-1-1 (E9-1-1) service and Basic 9-1-1 service. Enhanced 9-1-1 service automatically sends customer location information to an emergency centre where an operator dispatches a response service. Basic 9-1-1 service connects the caller to a central call centre which then connects the call to the correct emergency response centre, at which point the caller must identify his or her location in order for an emergency response service to be dispatched.

The Canadian Radio-television and Telecommunications Commission is an independent public authority that regulates and supervises broadcasting and telecommunications in Canada.

As is discussed under »Primus TalkBroadband VoIP FAQ »911 Service, this decision has resulted in changes to the way in which Primus handles calls to 9-1-1 via the TalkBroadband service. Please see the referenced FAQ section for further details.

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last modified: 2005-09-08 19:40:08