Wired for war

Start.ca joins a growing chorus of independent ISPs in pushing feds to overturn a CRTC rate decision

LOCAL INTERNET PROVIDER Start.ca is joining a chorus of independent ISPs who are urging the federal government to overrule the CRTC, who in a recent ruling reversed an earlier decision to bring wholesale internet rates down in Canada.

It goes back to a decision that the CRTC made in late May, in which they reversed a 2019 ruling that lowered wholesale rates by up to 80 per cent — a ruling that was lauded by smaller internet providers like Start.ca and TekSavvy, as well as consumer advocacy groups.

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Small providers pay those wholesale rates to access the infrastructure, which is mostly built by Rogers, Bell and Telus; the decision to lower those rates came from a desire to see the price of internet lowered for Canadians, who pay more for internet than almost anyone else in the world.

But after a lengthy appeal led by Bell and Rogers, the CRTC ultimately abandoned that effort and reinstated the 2016 rates — apparently convinced by the argument made by those companies that cutting the rates would jeopardize their ability to maintain and expand the network infrastructure.

The outcome of all of this? A bigger internet bill. For smaller providers, the ability to offer something cheaper than Bell and Rogers depends largely on those wholesale rates being cut. Putting them back at 2016 levels functionally ruins that business model. Start.ca says it has already had to begin notifying customers of upcoming price hikes, and the company says it has abandoned plans for an affordable mobile phone plan.

“In Canada, we already pay some of the highest internet rates in the world. If the government does not overturn this remarkably disappointing reversal on fairer access rates, Canadian consumers should ultimately expect to see their internet bills go up and will have less choice when it comes to their internet services,” explains Start.ca CEO, Peter Rocca.

“By reversing their own decision, the CRTC has demonstrated more concern with protecting the large providers and their billions in profits than fulfilling its mandate of protecting Canadian consumers,” continues Rocca. 

Start.ca CEO, Peter Rocca

“In 2019, the CRTC completed years of analysis and lowered wholesale rates from the levels that had been set in 2016, also ruling that small ISPs would be owed hundreds of millions of dollars in back payments for what they’d been overcharged since then,” said OpenMedia, a consumer rights organization that has been pushing for lower internet and mobile prices for years.

OpenMedia, a consumer rights organization that has been pushing for lower internet and mobile prices for years, had this to say about the decision: “This is the most anti-consumer decision OpenMedia has ever seen from the CRTC. Something stinks here — and it smells like a regulator that’s been captured by corporate interests.”

Smaller providers are now hoping that the federal government — who have made all sorts of lofty promises relating to internet and phone plan prices in their tenure, few of which have materialized — will step in and overrule the CRTC on this case.

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The feds, for their part, say they are looking at the decision and will have more to say in the future.

“We have been clear that our priorities are increasing competition, choice and the availability of services for Canadian consumers and business users,” says Francois-Philippe Champagne, federal minister of innovation, science and industry, in a statement released shortly after the May decision.

“We have taken note of the Canadian Radio-television and Telecommunications Commission’s decision today and thank them for their continued important work during the Covid-19 pandemic. We will be reviewing the decision and its implications to ensure they align with our policy priorities of affordability, competition and innovation in the sector.” Kieran Delamont