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Media Release: CRTC DECISION ON VoIP GOOD FOR CONSUMERS

Ottawa, May 12, 2005: Today, the Canadian Radio-television and Telecommunications Commission (CRTC) released its decision defining the effect of Voice over Internet Protocol (VoIP) on present telecommunications regulation in Canada. The CRTC focussed clearly on the issue from a consumer perspective, finding that VoIP represents only a new technological delivery method for telephone calls, not an entirely new (and therefore unregulated) service. Local incumbent Canadian telephone companies will have to continue to abide by CRTC rules on pricing and service quality even with their new VoIP services.

The Public Interest Advocacy Centre on behalf of the Consumers’ Association of Canada, the National Anti-Poverty Organization, and l’Union des Consommateurs (the Consumer Groups) argued that the CRTC should require incumbent telephone companies to continue to be regulated as such even though VoIP allows them to route calls differently and integrate voice calls with other Internet services. The Consumer Groups also argued that other “non-incumbent” companies (such as cable companies and VoIP-only providers) seeking to offer local phone service with VoIP technology should be subject to rules similar to those required of competing local exchange carriers. These rules include local number portability, privacy protections, phone directory services and access for the disabled, among other consumer rights. The CRTC largely accepted these requirements for the new VoIP providers.

“We are pleased that the CRTC found that VoIP is basically phone business as usual. Incumbent phone companies with lots of local phone market share will have to abide by fair pricing for local VoIP as dictated by the CRTC until such time as there is real competition in local telephone service, VoIP or no VoIP” said John Lawford, Counsel for PIAC.

Lawford noted that the other regulatory consumer protections built up painstakingly for the traditional telephone system, such as caller-ID blocking and message relay service, will be preserved with VoIP services. “And of course the CRTC already has required 911 service work on a VoIP phone or you can’t offer it in Canada” said Lawford.

Lawford points out that, as noted by the Commission, most VoIP services are sold as replacements for traditional telephone service. “Consumers may not know the limitations of VoIP phones compared to the usual phone or even a cellphone service” he said. “The Commission is simply saying it is more prudent to have industry fix the phone service up to the present standard before leapfrogging it with fancy new services that promise the sky.”

The Consumer Groups note however that the CRTC has issued a Public Notice for comment on whether local phone service regulation should be scaled back or eliminated altogether. “That’s the real battle,” said Lawford, “and we hope that consumers will make their views known to the Commission.”

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