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pnear

join:2002-06-12
Milton, ON

CRTC and TPIA usage rates overview

I haven't been following the TPIA discussions at the CRTC very much, and my searches came back with lots of unrelated info unfortunately. I've noticed comments from rocca in other threads related to a pending usage rate change for aggregated POIs.

Can you provide an overview for newbies to this conversation?

What was proposed and by whom?
Is there a link to that proposal?
Are you waiting for a yes/no on a price proposal, or for the CRTC to come back with reasonable usage rates that we don't yet know?

I got fairly heavily versed in the DSL and UBB arguments, but not TPIA on the cable side.

Thanks,
Pete

Guru

join:2008-10-01
kudos:2
Not sure, I would also like to know. I hate reading so I don't follow


rocca
Start.ca
Premium
join:2008-11-16
London, ON
kudos:23
reply to pnear
The file is CRTC 2011-703, which split the wholesale cost for the components into 2 parts - the circuit, and the capacity.

They got the circuit cost right for the most part (a few exceptions IMHO) but it's one that is easier to calculate. When it came to the capacity rate, most of the incumbents came up with really confusing, complex and inflated cost studies for capacity rates using 'conversion factors' which inflated their numbers to look like they were 'revenue neutral' - ie the new cost for a wholesale service would be generally the same as the old cost in the previous tariff. This resulted in capacity costs like $22.13/Mbps from Bell and $26.95/Mbps from Cogeco. The exception was MTS Allstream which did their calculations properly in Mbps as directed and using the 'all carriers' approach, ie assuming that they share the network components evenly with wholesale/retail - this resulted in a cost of $2.81/Mbps which is quite the difference.

The cost of capacity is essentially the part of the service from the CO or CMTS back to the POI. This is very similar in structure to commercial transport offered by these same incumbents on a commercial (non-tariff) basis for well under $3/Mbps in most cases and around $1/Mbps in some cases. There are a few exceptions such as Bell which uses BAS's for aggregation/termination which should raise the rates above simply a transport replacement, but the factor of inflation is somewhere between 5x and 10x too much.

As general internet usage continues to grow and more people move to streaming services, the fact that the capacity rate is wrong becomes more amplified since that is the cost that is growing. Imagine if the majority of customers watched IPTV at 8Mbps every night, the average usage component on the Cogeco network would be 8 * $26.95 ($215 per customer) plus the circuit cost and that doesn't include the actual backhaul, or internet transit, support, etc.. - it's impossible to sustain over the top services while the capacity rates continue to be so highly inflated.

Anyway, the file closed end of July or August I believe, and just waiting on a decision at this point. The Commission really did seem to be asking some good questions in their interrogatories so I'm hopeful we see positive results soon.


Shikomu

join:2007-11-16
Ontario
Found your response very informative Thanks.


pnear

join:2002-06-12
Milton, ON
reply to rocca
Thanks for the recap!


pnear

join:2002-06-12
Milton, ON
reply to pnear
Is this the decision you were waiting on, or something else?

»CNOC speed matching decision due next week


rocca
Start.ca
Premium
join:2008-11-16
London, ON
kudos:23
No unfortunately not. That is the decision on speed matching for the disaggregated model. The one we are waiting for is the capacity rate which will be in file CRTC 2011-703


When2013

@start.ca
rocca when will the decision come down on capacity rate (CRTC 2011-703) ?


silvercat

join:2007-11-07
said by When2013 :

rocca when will the decision come down on capacity rate (CRTC 2011-703) ?

I do not think he knows.


rocca
Start.ca
Premium
join:2008-11-16
London, ON
kudos:23
reply to When2013
Unfortunately we won't get any advanced notice other than following the CRTC's web site where they post the decisions of the week ahead. »www.crtc.gc.ca/eng/decisions.htm


coaxguy

join:2009-07-29
kudos:1
reply to pnear
Rocca, will this decision also affect the usage and capacity for customers in Cogeco territory? Or would Rogers subs be affected only.


rocca
Start.ca
Premium
join:2008-11-16
London, ON
kudos:23
It will be for all ILEC's and cable companies.