Bell VOIP Plans Unclear and/or Unknown
If anything, the appeal of the CRTC's VOIP decision by Bell, Telus, Aliant and SaskTel has got tongues wagging with strong views on both sides. Putting aside the regulatory arguments for a minute, what are the ILECs plans when it comes to VOIP? In other words, they're happy to talk the talk - and hold a press conference to do it - but what about walking the walk? The answer from Bell about its Digital Voice service is “no comment”. How come? They contend talking about expansion beyond its four-city stronghold in Quebec would tip off the competition. Seems like an odd stance given the competition - otherwise known as the cablecos - have little problem talking about their plans. Telus, by the way, is still holding firm on its plans to launch a VOIP service later this year but there are no details on the table yet.
One way to perhaps think about it is the ILECs are in strategic limbo. On one hand, they've got some annoying - but relatively minor - regulatory hurdles when it comes to moving into the VOIP market. On the other hand, their existing local telephone businesses are cash cows that provide consumers with reliable, low-cost service. So what do they do - get aggressive on VOIP and/or start marketing how traditional local service meets the needs of most consumers? In any event, they've got to do something other than complain to the federal government and CRTC.
July 29th, 2005 at 5:07 pm
The cable sector's spin has been that Bell wants to use VoIP as what the Competition Act calls a “fighting brand” — a cream-skimming mechanism to ensure they don't lose customers to entrants. Economically that makes sense; telephony is a network business, and you don't want to enter it unless you think you're going to hit critical mass.
So the argument becomes a simple one: VoIP is no good to Bell unless it's just a way to offer the same old service at a ridiculously low price, forestalling market entry. One can agree or disagree, of course. But it's another possible explanation that does fit the ILECs' behaviour.
(In the interim, it's also become a showpiece in the ongoing Mother of Regulatory Battles the ILECs seem to have decided to engage in on many, many fronts. They have been deploying cannons for every mosquito, and it's getting pretty epic. Ramming the Telecom Review Panel through Liberal Party connections was a nice touch, and you have to admire parachuting Bell's head lawyer into the Commissioner of Competition job.
The Competition Bureau continues, not coincidentally, to covet the CRTC's job. Now it's even using the local deregulatory hearings to run its own parallel process by demanding all intervenors file with the Competition Bureau, too (zipreally going on: is this about a major behind-the-scenes foreign merger? One thing seems relatively clear: this is not about selling VoIP services. At least not the TDM-clone “Digital Voice” ones that Bell has rolled out to Sherbrooke.)