These pages detail an apparent contravention of Canadian Federal law, and an attempt by a group of individuals to bring the government, through existing bureaucracy, to enforce that law.
Telus Corporation, and its subsidiary companys AGT Ltd. (formerly Alberta Government Telephones) and ED TEL, announced their intention in mid-1995 to offer Internet services to the Alberta population via the existing telephone infrastructure, which they own and control.
Representatives of six Calgary companies, five of which are Internet Service Providers, formally requested that the Bureau of Competition Policy investigate the matter to determine whether it may constitute a breach of the Competition Act.
We have been asked why we didn't raise our concerns with the CRTC (The Canadian Radio and Television Commission) instead. In fact, some did. However, the author of the complaint believed then, and continues to believe, that such an approach would be doomed to failure. The reason for this is that the CRTC is an anachronism - an ineffectual lapdog to the telephone and cable companies. We know this; the telcos and cablecos know this; the CRTC itself appears to be the only one not to have yet figured it out.
The events of the last few months clearly support this view.
Before getting into the details, though, let's take a look at the scenario:
It's pretty simple, really. Alberta Government Telephones, as the name implies, was, until relatively recently, a crown corporation - paid for and owned by the taxpayers of the province of Alberta. Using taxpayers' money - a LOT of it, over the span of many decades - they constructed an efficient telecommunications infrastructure serving the residents of the province. They also, incidentally, didn't hesitate to squander vast sums of that money, most notably on NovaTel, the cellular phone catastrophe ("boondoggle" just isn't descriptive enough) that cost us about a Billion Dollars before falling to pieces, most of those pieces being bought by foreign-owned interests.
During the 1980s, however, AGT, through Telus Corporation, was "privatized". This means that private investors (including those living in Alberta) were given the opportunity to, through the mechanism of the stock market, buy what they already owned. This is an interesting dodge that served a number of functions: They got a pile of cash; More important, it severed the seriously inconvenient connection between the provincial government and the telephone company. The Alberta government happily gave up whatever nominal control it exercised over AGT in exchange for no longer having to answer awkward and embarrassing questions about its operation. The telephone company was left answerable only to the federal regulatory bodies.
As far as they're concerned, this means the CRTC, and only the CRTC.
monop'oly, n. Exclusive possession of the trade in some commodity; this conferred as privilege by State; exclusive possession, control, or exercise (of); thing that is monopolized. [f. L f. Gk MONO-(polion f. poleo sell)]Nothing complicated about this idea. The telephone companies hold what is referred to as a "natural monopoly" over local telephone service. This acknowledges the fact that it is appropriate for this particular monopoly to exist, due to the enormous cost of putting such an infrastructure in place. It is not necessarily desirable, it is TOLERATED.
In civilized countries, it is recognized that any monopoly is an inherently evil and potentially dangerous thing, so there are laws strictly controlling them, if they are permitted to exist at all. In Canada, the federal Competition Act is the rulebook for the governing of such entities. However, as the "telephone natural monopoly" is recognized as a special case, the Act provides for a "regulatory agency" to govern the monopoly to ensure it behaves itself. This is what the CRTC is supposed to do - not just deliver sweeping patriotic proclamations about Our National Identity and shove Canadian Content down our throats (puh-leeze) - but to regulate and control the monopolies in order to keep their behaviour within the confines of the law, to say nothing of common sense.
The federal Competition Bureau (and Tribunal), then, have their hands tied. Bureau staff have agreed with our position - that monopoly telephone companies getting into this business is contrary to the letter - and the spirit - of competition law. They just can't do anything about it, because the telcos can trot out the "Regulated Monopoly Defense". Sort of like that murderous creep in "Lethal Weapon" who waves around his ID and smugly claims "diplomatic immunity" after shooting someone in the head, AGT can slough off any annoying intrusion on the part of the Competition Bureau by pointing out that they have their own "special regulator" - The CRTC.
Which would be fine, if the CRTC knew the first little bitty thing about competition law. Unfortunately, they don't. And they're so mired in their own special brand of bureaucratic inertia, stupidity, and ineptitude that there's really no hope for them.
Your fearless scribe calls up the CRTC to begin investigating its rules, operations, and procedures with respect to matters of competition and monopoly regulation. They obligingly mail him a copy of the Telecommunications Act, and a lot of other silly and useless propaganda such as a piece entitled "So, What Good Is The CRTC?". Indeed, he thinks. If you have to ask...
The Telecommunications Act, he quickly discovers, is a piece of crap. Like other pieces of legislation that rely heavily on "regulations" that are themselves not part of the Act proper, it is vague, hazy, and lacks any specific references (that I've been able to find so far, anyway) to the responsibility for monopoly regulation that the CRTC is apparently charged with. Cleverly, he deduces that if it's not in the Act, and it actually does exist, then it must be in the Regulations. Undaunted, he calls the CRTC again:
Me: Hello, I'd like the regulations pertaining to monopoly regulation. Faceless Federal Functionary: I'm sorry sir, you'll have to specify the regulation you want. Me: Well, I don't know what it's called. Do you have a list of the current regulations? FFF: I'm sorry, sir, we don't. If you tell me which one you want, though, I can find it for you. Me: Well, without a list of the applicable regulations, I don't know which ones to ask for, do I?
You can see where this is going.
This is the bureaucratic obscurity in which the CRTC "functions" - a Star Chamber in which the privileged few (read: Big Business) get their way via secret handshake. They call in camera submissions and proceedings "public disclosure"; the telcos present their "requests" reductio ad absurdum - minced into little pieces and wrapped in the code of Tariff Notices and Telecom Decisions. This is the mechanism they use to make outrageous demands that fly in the face of both the letter and spirit of competition law, to say nothing of fundamental understanding of moral acceptability and ordinary common sense.
Viewed as a whole, the suggestion that AGT - a monopoly already making money on every aspect of this company's operation, from the dialup lines we use to serve our customers to the $1000/month line that runs from our operation to Sprint (our upstream connection) - should be permitted to not only steal potential customers from us by providing a "competing" service, but should then be allowed to then DOUBLE the rates charged for our dialup lines is not just absurd; to anyone with a fundamental grasp of competition law it is a grotesquerie.
But piecemeal, the CRTC has sanctioned all of the above.
Witness not just ordinary greed, but a seething, putrifying, sinister greed unfathomable by people of conscience. It's not enough for TELUS to bring in 1.36 BILLION dollars in revenue (1994). It's not enough for TELUS to simply make profit - they have to make MORE profit, and help themselves by laying off 4,000 workers. They want more, and in blithely acceding to their desires the sycophantic, starry-eyed stooges of the CRTC have endangered the survival of small, independent businesses that have historically been the catalysts for economic development.
This, ladies and gentlemen, is a call to arms. This system is fundamentally corrupt, and the only remedy is the destruction of the CRTC. With the straw man no longer engaged in his regulatory charade, the REAL regulators will see to it that this injustice is set right.
Last updated January 23rd, 1995. To be continued.
Related documents available on this server:
April 19th, 1995:
- AGT Application to CRTC "RE: TARIFF NOTICE NO. 609"
May 1st, 1995:
- Press release announcing the assault on Telus Corporation, et.al.
- Cover letter to the Director of Investigation and Research of the Bureau of Competition Policy
May 29th, 1995:
- Statutory Declaration describing grounds for the action, with supporting documents:
June 26th, 1995:
July 31st, 1995:
- Whining letter from petulant AGT Limited president Little Donnie Lowry to the CRTC demanding they be granted their tariff
(amusing and revealing footnotes coming soon!)
August 1st, 1995:
August 16th, 1995:
- AGT refuses to supply Canada Connect with additional Centrex lines
- With the CRTC's complicity, AGT gleefully announces its next step in the sodomy of independent business: The High Usage Centrex Tariff