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SECTION II: Analysis of Performance by Strategic Outcome

Strategic Outcome

Strategic Outcome Broadcasting and Telecommunications industries that contribute to Canada's cultural, economic and social prosperity.
Program Activity Regulation and Supervision of the Canadian Broadcasting Industry	Program Activity Regulation and Monitoring of the Canadian Telecommunications Industry

The Commission seeks to achieve, through its activities, the above strategic outcome, which is defined as follows:

1. Cultural prosperity: increased availability of Canadian content and programming that reflects Canadian creative talent and Canada’s linguistic duality, cultural diversity and social values, as well as its national, regional and community characteristics;
2. Economic prosperity: a sustainable, competitive Canadian communications industry; and
3. Social prosperity: increased access to a variety of innovative, high quality communications services, at reasonable prices, that meet consumers’ needs and reflect their values.

Tasks to Achieve the Outcome:

The Commission fulfils its regulatory responsibilities by means of a number of inter-related tasks, including:

• issuing, renewing and amending licences for broadcasting undertakings;
• making determinations on mergers, acquisitions and changes of ownership in the broadcasting industry;
• processing tariff applications for the telecommunications industry;
• fostering increased reliance on market forces for the provision of telecommunications services and ensuring that regulation, where required, is efficient and effective;
• monitoring competition and removing obstacles to competition;
• collaborating with industry to resolve competitive disputes;
• developing and implementing regulatory policies with a view to meeting the objectives of the Broadcasting Actand the Telecommunications Act;
• monitoring, assessing and reviewing, where appropriate, regulatory frameworks to meet policy objectives; and
• monitoring the programming and financial obligations of broadcasting undertakings to ensure compliance with regulations and conditions of licence.

Through its regulatory function, the Commission ensures that social and cultural issues are upheld by the regulated industries. For instance, the Commission fosters the reflection of Canada’s linguistic duality and cultural diversity, the increased provision of closed captioning for persons who are hearing impaired and descriptive video for persons who are visually impaired, and the development of mechanisms to address concerns such as violence or abusive comment in the broadcast media. It also seeks to ensure that its policies keep pace with emerging technology and support such directions as increased competition in local telephone markets and broadcast distribution systems.

Total Financial Resources

Planned	Authorities	Actual
$ 45.6 million	$48.0 million	$47.6 million

Total Human Resources

Planned	Actual	Difference
422 FTEs	409 FTEs	13 FTEs

Planned and Actual Spendings for the Strategic Outcome

Strategic Outcome	Activities	Planned Spending	Actual Spending	Expected Results
Broadcasting and telecommunications industries that contribute to Canada's cultural, economic and social prosperity	Broadcasting: Regulation and Supervision of the Canadian Broadcasting Industry	$23.4M	$23.7M	Canadian content and programming that reflects Canadians Healthy broadcasting and telecommunications industries State-of-the-art technology at reasonable prices
	Telecommunications : Regulation and Monitoring of the Canadian Telecommunications Industry	$22.2M	$23.9M
		$45.6M Total	$47.6M Total

CRTC - Result Chain

Raison d'être Sustain and promote Canadian culture and achieve key social and economic objectives
Mandate Regulate and supervise the broadcasting and telecommunications industries in accordance with the policy objectives set out in sections 3 and 5 of the Broadcasting Act and in section 7 of the Telecommunications Act
Broadcasting Act Ensures that all Canadians have access to a wide variety of high quality Canadian programming	Telecommunications Act Ensures among other things, increased reliance on market forces for the provision of telecommunications services and to ensure that regulation, where required, is efficient and effective
Regulate and supervice Canadian content levels Linguistic duality Cultural diversity Impact of emerging technologies Services to persons with disabilities	Regulate and Monitor Reasonable Prices Market forces Impact of emerging technologies Services to persons with disabilities
Strategic Outcome Broadcasting and Telecommunications industries that contribute to Canada's cultural, economic and social prosperity
Mid-term Results High quality Canadian Programming Increased reliance on market forces State-of-the-art technology at affordable prices Timely decisions and streamlined procedures
Broadcasting Activity Provide the CRTC with information and recommendations needed to supervise and regulate the broadcasting industry in Canada as mandated by the Broadcasting regulatory policy for adoption by the Commission, as per the objectives set out in the Broadcasting Act	Telecommunications Activity Develop advice and recommendations to the CRTC to ensure the implementation of Canadian telecommunications objectives set out in the Telecommunications Act and to ensure that Canadian carriers provide telecommunications services and charge just and reasonable rates, and do not unjustly discriminate or provide an unreasonable preference toward any person

Status of Performance on CRTC’s Priorities for 2006-2007

Element of Strategic Outcome	Priorities as per Reports on Plans and Priorities 2006-2007	Achievements/Results
Cultural Prosperity	• Canadian programming; The Commission intends to review the drama incentives set out in Viewing and expenditure incentives for English language Canadian Television drama, Broadcasting Public Notice CRTC 2006-11, 27 January 2006, on an annual basis and expects to evaluate the success of the program in the context of the licence renewals for major TV licensee scheduled for fiscal year 2008/2009	High quality Canadian programming - Ongoing
	• Linguistic duality & cultural diversity; Obligations pursuant to section 41 of the Official Languages Act; Three-year action plan and Accomplishment report, posted on the CRTC’s website Canadian Association of Broadcasters’s code establishing industry standards for the portrayal of ethnocultural and Aboriginal groups and persons with disabilities	Help foster the recognition and use of both English and French in Canada - Ongoing Ensure and support the development of linguistic minority communities. - Ongoing   Respect and reflect the 200 or more cultures, languages and ethnic traditions that today constitute Canadian Society and offer services to persons with disabilities - Ongoing
	• Review of Commercial Radio Policy; Review of certain aspects of the Regulatory Framework for over-the-air television; and Review of the regulatory framework for broadcasting distribution undertakings and discretionary programming services	Updated regulations and policies in view of reflecting industries’ needs and new emerging technologies - Ongoing
Economic Prosperity	• Forbearance from Regulation – Local Telephone Service	Increased competition and choice for the Canadian consumer through the deregulation of local telephone service. - Ongoing
	• Wireless Substitution	Re-examination of whether mobile wireless services are in the same relevant market as wireline local exchange services - Ongoing
	• Wireless Number Portability	Allowed customers to keep their telephone numbers when switching between wireless service providers, or between wireless and wireline providers. This benefit to consumers will promote greater competition and freedom of choice of service provider. - Completed
	• Deferral Account	The expansion of broadband services to rural and remote communities will allow more Canadians to take advantage of the services, opportunities and benefits that the Internet has to offer. The initiative will also improve accessibility to telecommunications services for persons with disabilities. - Ongoing
	• Price Cap Framework	Price Cap Regime extended without changes for a period of one year. This extension will help provide certainty for the providers of telecommunication services. - Ongoing
	• Telecom Policy Review; Proposed Policy Direction	Revision of Policy and Regulatory Framework for telecommunications. Evolution of regulatory framework will ensure Canadians continue to have a telecommunications industry that delivers products and services at affordable prices for the economic and social benefit of all Canadians. - Ongoing
	• Reconsideration of VoIP - Order in Council P.C. 2006-305 for reconsideration of Telecom Decision CRTC-2005-28	This review of the regulatory framework provided clarity to the telecommunications industry and Canadians with regards to the characterization of emerging technologies as they apply to voice services. - Completed
	• Streamlining procedures	Telephone companies responding more quickly to customer needs in an increasingly competitive telecommunications marketplace through the establishment of service standards for the processing of tariff applications - Ongoing
Social Prosperity	• New technologies	Keeping abreast of emerging technologies will ensure Canadians that the Commission promotes competitive telecommunications and broadcasting industries that deliver leading edge products and services. - Ongoing
	• Telemarketing – National Do Not Call List	Established rules for National Do Not Call List which will enable Canadians to effectively reduce the number of telemarketing calls they receive, thereby, increasing their privacy and reducing undue inconvenience and nuisance caused by such calls. - Ongoing

Broadcasting and Telecom Accomplishments

The following highlights the CRTC’s key accomplishments for 2006-2007 in regulating and supervising the Canadian broadcasting industry and in regulating and monitoring the telecommunication industry.

Major Proceedings

Cultural Prosperity

Cultural diversity and accessibility

To improve the representation and reflection of diversity in broadcasting, one of the Canadian Association of Broadcasters’ (CAB) key initiatives has been a review of its broadcasting industry codes to determine whether they address the concerns identified in recent research findings regarding reflection and portrayal of visible minorities, Aboriginal peoples and persons with disabilities. In this regard, the CAB has submitted to the CRTC for its approval a proposed Equitable Portrayal Code to establish industry standards for the equitable portrayal of identifiable groups. The CRTC will review the proposed code in the Fall 2007, and further actions will be determined at that time.

As part of the review process for the commercial radio policy, the CAB submitted a set of cultural diversity best practices and an annual reporting strategy for all commercial radio broadcasters in order to improve the representation, portrayal and participation of visible minorities and Aboriginal peoples in radio. The CRTC directed the CAB to make a number of amendments to these best practices, including the incorporation of persons with disabilities, and to develop an appropriate annual reporting strategy for small commercial radio stations. Once the best practices are approved by the CRTC, all commercial radio broadcasters will be expected to adhere to them. The annual reporting proposal is expected in June 2007. The Commission is expected to assess the CAB’s revised best practices and its annual reporting proposal together in fall 2007.

To further encourage and expedite the entry of new Canadian third-language services in order to better serve Canada’s ethnic, third-language communities, the CRTC issued an Exemption order respecting certain third-language television undertakings, Broadcasting Public Notice CRTC 2007-33, 30 March 2007.

To improve the accessibility of television programming for persons who are deaf or hard of hearing, the CRTC called for comments on the appropriateness of a requirement for the captioning of 100 percent of all television programming and on proposals to address ongoing concerns about captioning quality (see Review of certain aspects of the regulatory framework for over-the-air television, Broadcasting Notice of Public Hearing CRTC 2006-5, 12 June 2006). The CRTC intends to issue its determinations on these matters in the Fall 2007.

Programming standards

While many concerns of the public with respect to programming content standards are addressed by the Canadian Broadcast Standards Council, the broadcast industry’s self-regulatory body, the CRTC remains responsible for matters pertaining to abusive comment (as set out in its various regulations) and the high standard provision (as set out in the Broadcasting Act). In 2006, the CRTC rendered five decisions concerning allegations of abusive comment in radio and television programming. In two of those cases, the CRTC found that its regulation prohibiting the broadcast of abusive comment was breached (Broadcasting Decisions CRTC 2006-565 and 2006-19). The CRTC also addressed concerns raised by viewers of television programming with respect to the high standard provision of the Broadcasting Act in two decisions (Broadcasting Decisions CRTC 2006-668 and 2006-603).

Distribution of non-Canadian, third-language services

In Public Notice 2004-96, issued 16 December 2004, the Commission adopted a new approach to the authorization of non-Canadian third-language services for distribution in Canada. This revised approach removed unnecessary barriers to the authorization of such services, and thereby put a greater emphasis on expanding the diversity and choice in television services available to underserved third-language ethnic communities in Canada. Applying this approach, in 2006-2007, the Commission authorized the distribution of over 35 non-Canadian third-language services in a variety of Asian and European languages.

Since 2001, the CRTC has been imposing conditions of licence that require Canadian broadcasters to provide a certain amount of programming with described video to enrich the television experience of persons who are blind or who have a visual impairment. In addition to reviewing the obligations of Canadian broadcasters at the time of their licence renewals, Commission staff is now exploring the extent to which broadcasting distribution undertakings are fulfilling their obligations to pass through the described video programming provided by broadcasters. This review is expected to be completed in the summer 2007, and further actions will be determined at that time.

New commercial radio policies

The CRTC conducted a proceeding, including a public hearing beginning on 15 May 2006, to review its commercial radio policies. On 15 December 2006, in Commercial Radio Policy 2006; Revised policy concerning the issuance of calls for radio applications and a new process for applications to serve small markets; and Digital radio policy (Broadcasting Public Notices CRTC 2006-158, 2006-159 and 2006-160, respectively), the CRTC announced the results of its comprehensive review and outlined measures designed to provide commercial radio stations with the flexibility needed to operate in an increasingly competitive environment for the delivery of audio programming.

The Commercial Radio Policy 2006 sets out a new approach to Canadian content development (CCD). The new approach takes into account the unique circumstances of small stations, regardless of the size of their markets, through a basic contribution system based on a station’s revenues that will automatically adjust for changes in the financial situation of the stations.

The new approach also provides stations with the flexibility to fund a variety of development initiatives tailored to their community and format: more than 600 commercial radio stations can now direct a portion of their required CCD spending to projects by independent parties involving Native radio and to programming serving the particular needs and interests of children, Aboriginal peoples, and persons with disabilities. Commercial ethnic broadcasters can now direct all of their CCD spending to independent initiatives that support their unique programming content.

Broadcasters will continue to make contributions to support FACTOR and MUSICACTION, which assist in the development of a variety of Canadian artists, including new and emerging artists.

In Revised Policy concerning the issuance of calls for radio applications and a new process for applications to serve small markets, the CRTC considers the challenging environment faced by broadcasters in smaller radio markets, where the population aged 12 years and above does not exceed 250,000. When the CRTC receives an application to serve a smaller market, Commission staff will assess this market’s economic state to determine its ability to sustain a new radio station. Should its preliminary analysis indicate that the market in question is unable to support a new radio station, the applicant will have the opportunity to either withdraw the application or submit additional information. This step will provide greater transparency and will help prevent overlicensing in smaller radio markets.

In Digital radio policy, the CRTC sets out its revised policy for digital broadcasting: in order to enhance the prospects of digital radio broadcasting (DRB) offered in the L-band, licensees will be free to develop whatever broadcast services they believe will be of greatest interest to the public.

The Digital radio policy also announces that the CRTC will convene a round table with chief executive officers of the major radio groups in six months time to discuss the industry’s proposed plan and implementation schedules for DRB and related issues.

Initiatives undertaken for future reviews

Towards the end of the calendar year 2006, Commission staff held a series of informal consultations with industry and consumer representatives, with the aim of identifying issues and priorities for a review of the regulatory frameworks for broadcasting distribution undertakings and discretionary programming services. In the first part of 2007, Commission staff undertook an assessment of those consultations and began developing recommendations to the Commission as to the scope of the proceeding and the issues to be addressed.

The review proceeding was subsequently announced in Broadcasting Notice of Public Hearing CRTC 2007-10, issued on 5 July 2007. In undertaking this process, the Commission seeks to develop forward-looking frameworks that will, among other things, ensure a strong Canadian presence in the broadcasting system and provide its licensees with the flexibility to react quickly and creatively to the opportunities and challenges arising out of the rapidly changing communications environment.

As part of this proceeding, the Commission will also finalize the framework for the distribution of high definition services by direct-to-home distribution undertakings, as previously announced.

The Commission anticipates placing on the record of the above-noted review proceeding the independent study being conducted by communications lawyers Laurence Dunbar and Christian Leblanc. Dunbar and Leblanc are examining each of the Commission rules and regulations in light of its original purpose. They will be making recommendations to the Commission as to whether that purpose has any continued relevance; whether the same purpose can be obtained by streamlined or less intrusive means or whether the rule or regulation should be altogether eliminated. The Commission has asked that parties to the review proceeding examine the study and comment in their submissions on the recommendations in it.

Economic Prosperity

Local Deregulation (Forbearance)

On 6 April 2006, the CRTC issued Forbearance from the regulation of retail local exchange services, Telecom Decision CRTC 2006-15 (Decision 2006-15). This decision, among other things, established a framework for assessing applications from the incumbent local exchange carriers (ILECs) for deregulation from the regulation of local exchange services (local forbearance).

In Proceeding to reassess certain aspects of the local forbearance framework established in Decision 2006-15, Telecom Public Notice CRTC 2006-12, 1 September 2006 (Public Notice 2006-12), the CRTC invited comments regarding whether the 25 percent market share loss test set out in Decision 2006-15 continued to be appropriate. The CRTC also invited comments on whether mobile wireless services should be considered to be part of the same relevant market as wireline local exchange services for forbearance analysis purposes.

On 16 December 2006, the Governor in Council published, in the Canada Gazette, Part I, a proposed Order to vary part of Decision 2006-15 (the proposed Order) pursuant to subsection 12(1) of the Telecommunications Act. The proposed Order set out a revised framework to determine when local deregulation would be granted to the ILECs. The revised framework would, among other things, eliminate the CRTC's 25 percent market share loss test and replace it with a "competitive presence" test.

In light of the above, the CRTC deferred its consideration of the issues in the Public Notice 2006-12 proceeding pending a final determination with respect to the proposed Order.

Effective 4 April 2007, the Governor in Council issued an Order Varying Telecom Decision CRTC 2006-15, P.C. 2007-532.

Wireless Number Portability

During 2006, the industry continued its effort towards implementing wireless number portability, and the CRTC issued several decisions related to these efforts. On 18 May 2006, the CRTC released Regulatory issues related to the implementation of wireless number portability – Follow-up to Public Notice 2006-3, Telecom Decision CRTC 2006-28. This Decision provided directions on a number of regulatory issues related to such matters as the arrangements for the exchange of telephone calls between carriers, telephone number requirements, treatment of telephone numbers in shared numbering blocks that are used by more than one type of carrier and changes, if any, to other regulatory rules currently in place that could be impacted by wireless number portability.

Regulatory Framework for Northwestel

Price cap regulation generally places upward constraints on prices that an incumbent local exchange carrier can charge its customers for various telecommunications services. The price cap regime includes other rules which govern the rates charged to residential and business customers. Price cap regulation is used to constrain market power with respect to service rates and to ensure customer access to just and reasonable rates.

In Price cap regulation for Northwestel Inc., Telecom Decision CRTC 2007-5, 2 February 2007, the CRTC, among other things, implemented a price cap regime for Northwestel for a period of four years. The CRTC determined that Northwestel would receive $18.9 million in annual funding from the National Contribution Fund for the initial price cap period in support of residential primary exchange services in high-cost serving areas and the ongoing costs associated with Northwestel’s recently completed service improvement plan. In addition, the CRTC determined that resale of local exchange services would be permitted and that it would forbear from the regulation of Northwestel’s long distance services.

Report prepared pursuant to Section 15 of the Broadcasting Act

On 12 June 2006, the CRTC issued Call for comments on a request by the Governor in Council pursuant to section 15 of the Broadcasting Act to prepare a report examining the future environment facing the Canadian broadcasting system, Broadcasting Public Notice CRTC 2006-72. The purpose of the call was to gather information from the public addressing the points set out in an Order in Council issued by the Government. This information was then used to report to the Governor in Council with respect to the future of broadcasting in Canada, as well as to incorporate into the CRTC’s review of certain aspects of its regulatory framework for over-the-air television.

The CRTC received more than 50 submissions from individuals, consumer groups, broadcasters, distributors and industry associations. To further assist in the process, the CRTC commissioned three independent research studies and used in-house information that it acquires in preparing its annual Broadcasting Policy Monitoring Report as well as financial information filed by licensees through their annual returns.

Following its examination of the comments received, the CRTC issued a report on 14 December 2006 entitled The future environment facing the Canadian broadcasting system. This report highlights the evolution of audio-visual technologies and the profound impact this evolution is having on how Canadians communicate, express themselves and interact with various media, leading to important economic and social implications and a new communications and media environment.

In fulfilling its mandate under the Broadcasting Act, the CRTC is required on an ongoing basis to address regulatory issues associated with the introduction and impact of new audio-visual technologies. To do so, it will continue to expand both its general monitoring of the broadcasting system, and to monitor developments in the evolution, contribution and impact of new audio-visual technologies.

The CRTC is conducting reviews of its regulatory frameworks, starting with radio and television in 2006. In other reviews to follow in 2007-2008, the CRTC will continue to focus on the current and anticipated impact of technological change.

Voice over Internet Protocol (VoIP) Reconsideration

In Order in Council P.C. 2006-305, dated 4 May 2006, the Governor in Council, pursuant to subsections 12(1) and 12(5) of the Telecommunications Act, referred Regulatory framework for voice communication services using Internet Protocol, Telecom Decision CRTC 2005-28, 12 May 2005, as amended by Telecom Decision CRTC 2005-28-1, 30 June 2005 (Decision 2005-28) back to the CRTC for reconsideration. The CRTC was directed to complete its reconsideration of Decision 2005-28 within 120 days of the date of the Order in Council P.C. 2006-305.

In Reconsideration of Regulatory framework for voice communication services using Internet Protocol, Telecom Decision CRTC 2006-53, 1 September 2006 (Decision 2006-53), the CRTC reaffirmed the regulatory regime applicable to the provision of VoIP services, as set out in Decision 2005-28.

In Order in Council P.C. 2006-1314, dated 9 November 2006 (Order in Council 2006-1314), the Governor in Council, pursuant to subsection 12(7) of the Telecommunications Act, varied Decision 2005-28, as confirmed in Decision 2006-53, such that retail local access-independent VoIP services provided by incumbent local exchange carriers (ILECs) within their incumbent territories were forborne from regulation. The Order defined access-independent VoIP services as those services in which access and service may be provided by distinct providers – the service provider is not required to provide the underlying network on which the service rides and is not required to obtain the permission of the network provider to offer the service to customers on that network. The Order also noted that access-independent VoIP services require high-speed Internet access as well as special handsets, adapters or the use of a computer, and may be more susceptible to service deterioration or disruption.

In Access-independent VoIP services pursuant to Order in Council P.C. 2006-1314, Telecom Circular CRTC 2006-10, 16 November 2006, the CRTC noted that by virtue of Order in Council 2006-1314, the tariffs previously approved by the CRTC for the following services were no longer of any force or effect to the extent specified in the Order in Council P.C. 2006-1314:

• Bell Digital Voice Lite (Bell Canada General Tariff item 7020);
• Business IP Voice for Broadband (Bell Canada General Tariff item 7025); and
• WebCall (SaskTel General Tariff item 550.14).

Rate Ranges

In response to specific applications concerning local voice over Internet Protocol (VoIP) services, the CRTC approved tariffs introducing ranges of rates for a number of VoIP services being introduced by the major telephone companies. These rate ranges allowed these companies to change the rates for such services without obtaining prior approval from the CRTC, as long as the new rates are within the approved rate ranges. This has allowed the incumbent local exchange carrier (ILEC) to respond more quickly to changes in market conditions for these VoIP services.

In Rate ranges for services other than voice over Internet protocol services, Telecom Public Notice CRTC 2006-8, 9 June 2006 (Public Notice 2006-8), the CRTC initiated a proceeding in order to establish guidelines for dealing with applications requesting approval of rate ranges for regulated services other than local VoIP services.

In Rate ranges for services other than voice over Internet Protocol services, Telecom Decision CRTC 2006-75, 23 November 2006, the CRTC rendered its determinations in the proceeding initiated by Public Notice 2006-8. The CRTC determined, among other things, that rate ranges would generally be appropriate for most local exchange and related services and that it would not generally be appropriate to require the public disclosure of rate ranges.

Other Items of Interest:

Community Notification Services

In Use of E9-1-1 information for the purpose of providing an enhanced community notification service, Telecom Decision CRTC 2007-13, 28 February 2007, the CRTC determined that it was in the public interest to allow public authorities to use the telephone numbers and associated addresses contained in 9-1-1 databases, in order to improve the effectiveness of telephony-based emergency public alerting services, also known as community notification services. The use of enhanced 9-1-1 information for a telephone-based community notification service was subject to certain constraints including limitations to circumstances of use, appropriate safeguards, and notification requirements.

Consumer Bill of Rights

In Statement of consumer rights, Telecom Decision CRTC 2006-52, 29 August 2006 (as amended by Amendment to the statement of consumer rights, Telecom Decision CRTC 2006-78, 21 December 2006), the CRTC established a statement of consumer rights for customers of incumbent local exchange carriers’ (ILECs) local exchange services. The statement of consumer rights restated key consumer rights with respect to local home phone service in a clear and comprehensible manner. Major ILECs were directed to include this statement of consumer rights on their website and in their residential telephone directories.

Competitor Services

The CRTC issued a number of decisions relating to the terms, conditions, and final rates of key competitor services provided by incumbent telephone companies, as follows.

In Follow-up to Trunking arrangements for the interchange of traffic and the point of interconnection between local exchange carriers, Telecom Decision CRTC 2004-46, Telecom Decision CRTC 2006-35, 29 May 2006, the CRTC approved amended definitions of interconnection regions and associated rates for interconnection between the incumbent local exchange carrier and the competitive local exchange carrier. This decision included several enhancements to the interconnection regime for competitive local exchange carriers thereby permitting greater efficiency in the local carriers' networks.

In Aliant Telecom, Bell Canada, MTS Allstream, SaskTel and TCI – Approval of rates on a final basis for Access Tandem service, Telecom Decision CRTC 2006-22, 27 April 2006 and Aliant Telecom, Bell Canada, MTS Allstream, SaskTel and TCI – Approval of rates on a final basis for Direct Connection service, Telecom Decision CRTC 2006-23, 27 April 2006, the CRTC approved revised final rates for each ILEC's Access Tandem (AT) and Direct Connection (DC) services. The DC and AT services are interconnection services that toll service providers typically require to provide service to their customers. In Bell Canada and TCC - Co-location power service rates, Telecom Decision CRTC 2006-42, 30 June 2006, as amended by Telecom Decision CRTC 2006-42-1, 25 August 2006, the CRTC also approved revised final rates for co-location power services. Subsequently, in Bell Aliant Regional Communications, Limited Partnership, MTS Allstream Inc., and Saskatchewan Telecommunications – Co-location power service rates, Telecom Decision CRTC 2007-17, 21 March 2007, the CRTC further approved revised final rates for Bell Aliant’s, MTS Allstream’s and SaskTel’s co-location power services. The co-location power service is used by a competitor that co-locates in an ILEC's central office. Under these decisions, the rates for these services were generally reduced, reflecting reductions to the ILECs' costs to provision these services.

In Cogeco, Rogers, Shaw, and Videoton – Third-party Internet access service rates, Telecom Decision CRTC 2006-77, 21 December 2006, the CRTC approved revised terms, conditions, and final rates for third-party Internet access (TPIA) service using cable networks.

In early 2007,¹ the CRTC approved revised terms, conditions, and final rates for the ILECs' competitor asymmetric digital subscriber line (ADSL) Access services. The TPIA or ADSL access services permit Internet service providers to compete in the retail high-speed Internet market. In finalizing these tariffs, the CRTC recognized the need for comparable competitor high-speed access services and tariffs across incumbent cable and telephone companies.

In Ethernet services, Telecom Order CRTC 2007-20, 25 January 2007, the CRTC approved revised terms and final rates for the ILECs' Ethernet access, CO link and transport services. The Ethernet services have several advantages over previous data transmission services and permit competitive service providers to deliver new services and applications using Ethernet protocol. In finalizing these tariffs, the CRTC considered the importance of providing comparable competitor Ethernet services across ILECs’ serving territories.

Review of regulatory framework for wholesale services and definition of essential service

In Review of regulatory framework for wholesale services and definition of essential service, Telecom Public Notice CRTC 2006-14, 9 November 2006, the Commission initiated a proceeding to consider a revised definition of essential service, as well as the classifications and pricing principles for essential and non-essential services made available by incumbent telephone companies, cable carriers and competitive local exchange carriers to other competitors at regulated rates (wholesale services). The process includes evidence, interrogatories, and an oral hearing to be held in October 2007. The decision is expected to be published by mid April 2008

Review of certain Phase II costing issues

In Review of certain Phase II costing issues, Telecom Public Notice CRTC 2007-4, 30 March 2007, the CRTC has initiated a review of certain Phase II costing issues with respect to major telecommunications and cable companies. Issues to be considered in this proceeding include the appropriate expense inclusions and the update of equipment life estimates to be used in regulatory economic studies. The process includes submission of evidence by all parties followed by two rounds of interrogatories, comments and reply comments. The decision is expected to be announced by mid February 2008.

Emergency alert services

At a public hearing beginning 15 May 2006, the CRTC considered three applications to establish emergency alert services in Canada. Following its deliberations on the proposals, the CRTC set out its approach in Emergency alert services, Broadcasting Public Notice CRTC 2007-20, 28 February 2007, and issued three related decisions (Broadcasting Decisions Pelmorex emergency alert service, CRTC 2007-72, CBC emergency alert service, CRTC 2007-73 and ExpressVu emergency alert service, CRTC 2007-74).

The CRTC considered that a voluntary approach is the best option for the establishment of a Canadian emergency alert system. To remove regulatory barriers to the timely implementation of an emergency alert service by all industry stakeholders, the CRTC issued proposed amendments to the Broadcasting Distribution Regulations on the same day.

The CRTC further addressed emergency alerting in Use of E9-1-1 information for the purpose of providing an enhanced community notification service, Telecom Decision CRTC 2007-13, also issued on 28 February 2007. A summary of that decision is found in a previous section entitled "Community Notification Services".

Streamlining Procedures

Streamlined broadcasting processes

In Streamlined processes for certain broadcasting applications, Broadcasting Circular CRTC 2006-1, 27 March 2006 (Circular 2006-1), the CRTC announced an expedited process whereby it would inform applicants of the status of their licence amendment applications within 15 business days of receiving an application. The CRTC estimated that, in the absence of any significant or unresolved issues or concerns surrounding the applications in question, the processing time could be reduced by approximately half for licence amendment applications processed administratively and by a written public proceeding.

In the first year of implementation, the CRTC has reduced the average time to deal with amendment applications by 50 percent over last year’s results.

In Circular 2006-1, the CRTC announced other areas under review. It has since concluded streamlining review processes in the following areas: processing of requests to add non-Canadian third-language services to the Lists of Eligible Satellite Services; exempting certain network operations from licensing requirements; reviewing broadcasting application forms; and reviewing the policy concerning the issuance of radio calls for applications. In addition, the CRTC set out measures to streamline certain reporting requirements for Class 1 cable distribution undertakings having 20,000 or more subscribers and for television licensees. As noted above, on 30 March 2007, the CRTC issued Exemption order respecting certain third-language television undertakings, Broadcasting Public Notice CRTC 2007-33, which exempts such undertakings from licensing requirements.

The CRTC has also undertaken an exhaustive review of the process for applications that involve an oral public hearing. Significant measures have been identified to streamline and expedite this review process. Measures for certain types of applications, dealt with by an oral public hearing, will be announced early in fiscal year 2007-2008.

Alternative Dispute Resolution

The Broadcasting Alternative Dispute Resolution Team handles broadcasting matters that generally fall into three categories: (1) disputes between broadcasting distributors and the programming services that they distribute over the terms of distribution, including wholesale rates; (2) disputes between competing broadcasting distributors over access to buildings and the end-user; and (3) disputes between programmers regarding programming rights and markets served.

During the period 1 April 2006 to 31 March 2007, five new files were received. With four outstanding files from the previous year, five files were concluded over this period, leaving four files outstanding, one of which has been suspended for some time. The other three cases date from September 2006 or more recently.

In addition during this period, 14 informal files were received. Informal files generally do not involve a formal written process. In the last fiscal period, seven files were closed, two remain suspended and five are active as of 31 March 2007.

Streamlined Telecommunication Processes

In 2005 the CRTC began an aggressive program of streamlining our processes and procedures. In response to stakeholders' comments received, the CRTC issued Introduction of a streamlined process for retail tariff filings, Telecom Circular CRTC 2005-6, 25 April 2005, and Finalization of the streamlined process for retail tariff filings, Telecom Circular CRTC 2005-9, 1 November 2005 (Circular 2005-9).

Further, in New procedures for disposition of applications dealing with the destandardization and/or withdrawal of tariffed services, Telecom Circular CRTC 2005-7, 30 May 2005 (Circular 2005-7), the CRTC set out new procedures and service standards to reduce the time period associated with the processing of these types of applications, and to provide the ILECs with greater regulatory certainty by identifying clear steps, timelines and criteria that could be consistently relied on by both customers and telecommunications carriers.

In Service standards for the disposition of telecommunications applications, Telecom Circular CRTC 2006-11, 7 December 2006 (Circular 2006-11), the CRTC re-introduced service standards for all telecommunications applications including all tariff applications, inter-carrier agreements, international telecommunications services licences, and applications received pursuant to Part VII of the CRTC Telecommunications Rules of Procedure (Part VII applications).

In Circular 2006-11, the CRTC undertook to evaluate the service standard results for all types of telecommunications applications on an annual basis and to post these results on the CRTC's website, following the 31 March fiscal year-end. The CRTC expected to post results for retail tariff streamlined processing and for all tariff applications and inter-carrier agreements on a quarterly basis for information purposes. The CRTC indicated that it would begin measuring the service standards starting on 1 April 2007.

These streamlining initiatives have begun to bear fruit as evidenced by our performance during the 2006/2007 fiscal year.

Alternative Dispute Resolution

The CRTC remained committed to the resolution of competitive telecom disputes through alternative dispute resolution in 2006/2007. The CRTC has also strongly encouraged parties to pursue independent negotiations to resolve any competitive dispute. In instances where the parties could not settle a dispute by mutual agreement, the CRTC has successfully used a number of resolution mechanisms to settle a number of competitive disputes. Specifically, twenty-two of twenty-four files have been resolved using one or a mix of the dispute resolution mechanisms identified by the CRTC in its dispute resolution framework.

Social Prosperity:

New Technologies:

Framework for mobile television broadcasting services

In Regulatory framework for mobile television broadcasting services, Broadcasting Public Notice CRTC 2006-47, 12 April 2006, the Commission announced its determination that certain mobile television broadcasting services provided via cellular telephones by Bell Mobility Inc., TELUS Mobility and Rogers Wireless Inc. were "delivered and accessed over the Internet" and thus fell under the Commission’s New Media Exemption Order. As a result, these services are not subject to licensing and other regulatory measures under the Broadcasting Act. In Public Notice 2006-47, the Commission noted arguments put forth by parties that mobile broadcasting services, as described in the proceeding, are unlikely to compete significantly with traditional broadcasting services due to the limitations of the wireless technology used, the battery life and screen size of the handset, the poor image and audio quality, and the type and range of programming choices offered by the mobile broadcasters.

The Commission also initiated a further proceeding on a proposed new exemption order that would include mobile television broadcasting undertakings that provide mobile television services that are not delivered and accessed over the Internet. That proceeding resulted in Exemption order for mobile television broadcasting undertakings, Public Notice CRTC 2007-13, 7 February 2007, in which the Commission exempted from licensing requirements and associated regulations those mobile television broadcasting undertakings that provide mobile television services that are received by way of mobile devices and that make use of point-to-point technology.

Digital and high definition broadcasting

On 15 June 2006, the Commission issued Broadcasting Public Notice CRTC 2006-74, setting out its Regulatory Framework for the licensing and distribution of high definition pay and specialty services. Public Notice 2006-74 was the latest in a series of policy determinations intended to guide the broadcasting industry in its transition from analog to digital technology and ultimately, with respect to television services, to high definition.

BDU distribution of satellite radio

In 2006, the Commission approved applications by several broadcasting distribution undertakings (BDUs) to distribute the audio programming service of one or more licensed satellite subscription radio (SSR) undertakings on a digital basis, subject to specific conditions of licence intended to place SSR services on a relatively equal competitive footing with pay audio services in respect of BDU distribution and to offer some incentive to distributors to continue to distribute pay audio services, as well as the SSR services. In this way, both subscribers and the Canadian broadcasting system will benefit from a greater diversity in audio services. At the same time, the use of Canadian creative and other resources in the provision of audio programming on BDUs is maximized.

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