Today, the Canadian Radio-television and Telecommunications Commission introduced a new policy that will encourage large telephone companies to rapidly adopt Internet Protocol (IP) throughout their networks. This shift will promote the development of innovative services for Canadians.
“The networks of the future will be primarily based on Internet Protocol,” said Konrad von Finckenstein, Q.C., Chairman of the CRTC. “We have established basic principles to ensure this technology becomes the industry standard for voice networks as quickly as possible. The industry was able to reach a consensus on many key issues during this proceeding, and we appreciate their commitment.”
At the moment, companies are at different stages in their adoption of IP. Large telephone companies have traditionally relied on voice circuit-switched technology (known as TDM) to transfer telephone calls to and from other service providers. Although they are gradually migrating their networks to IP, large telephone companies continue to rely on the older technology.
By comparison, companies that began offering telephone services in the last few years, such as cable companies and wireless providers, have built IP-based networks. At present, they are responsible for converting their IP telephone calls to the older TDM standard.
In areas where a large telephone company uses IP to transfer telephone calls to either an affiliated or unaffiliated provider, it must provide a similar arrangement to any other provider that asks for it. The CRTC is requiring large telephone companies to negotiate such arrangements within six months of a formal request.
The CRTC has also simplified the rules under which the costs of transferring telephone calls between a wireless and a wireline provider are shared. A key point was the different obligations between independent wireless providers and those that are affiliated with a larger communications company. Currently, independent providers are responsible for paying the entire cost unless they allow alternative long-distance providers access to their networks.
Under the CRTC’s new policy, wireless providers will no longer be required to give this access to alternative long-distance providers since they already offer a variety of plans and Canadians can choose from other long-distance options, such as prepaid cards and local access numbers. These changes will reduce costs for many wireless providers, particularly for those that have recently entered the Canadian wireless market, and level the playing field between independent providers and those that are affiliated with a larger communications company.
Today’s decision follows a proceeding that included a public hearing that was held in Gatineau, Que., from October 24 to November 1, 2011.
By the end of the month, the CRTC will have completed a comprehensive review of its major telecommunications regulations. This exercise was launched in response to the government’s policy direction to rely as much as possible on market forces, and today’s decision represents one of the last steps. During the last five years, the CRTC has deregulated many segments of the telecommunications market and reduced the scope of existing regulations.