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reply to elwoodblues

Re: CNOC R&V of CRTC 2011-703 and CRTC 2011-704

said by elwoodblues:

There is a problem with establishing profit levels as a percentage of costs. This does not incent incumbents to cut costs since it reduces their profits. In fact, they have every incentive to find ways to increase costs since increased costs means increased profits for GAS and TPIA services, and this is totally contrary to normal business practices in commercial competitive environments.
This is like government jobs, cost + points, there is NO Reason to control costs, you are guaranteed a profit.

All rates should be set vs. the lowest cost producer.
Of course that would really piss MTS off once Bell filed accurate rates that reflected their vastly better purchasing power.