CRTC decision addresses telecom access in condos

Recent ruling clarifies multi-dwelling unit guidelines, leaves lingering questions
Tuesday, October 11, 2016
By Michelle Ervin

Let a fourth telecommunications service provider in, or risk losing all Internet access. That was the headline version of an Aug. 15 Canadian Radio-television and Telecommunications Commission (CRTC) decision concerning entry to a Liberty Village condominium corporation’s three buildings.

In reality, the decision was more nuanced than that. The commission set out a series of increasing restrictions for the condominium corporation’s existing telecommunications service providers — also known as TSPs — that would begin to roll out within 60 days. In effect, the restrictions put pressure on the condominium corporation to negotiate reasonable terms and conditions for the timely access of a fourth TSP to its buildings.

The CRTC’s decision echoes two earlier rulings concerning TSPs in condominiums since the commission issued a landmark decision in 2003 spelling out guidelines for access to multi-dwelling units. Designed to support competition and end-user choice, the guidelines establish that, no matter their housing type, consumers should have their selection of TSP.

“The decision makes clear that the CRTC wants to maximize consumer choice in multiple dwelling units,” said condominium lawyer Deborah Howden. “And even in circumstances where there are already three TSPs, the commission is going to order that — subject to capacity or other discrete issues, which was something we raised — a corporation cannot deny timely access to other TSPs on reasonable terms and conditions.”

Howden is a partner at Shibley Righton LLP, the firm that represented the condominium corporation in the latest case. Among other arguments, the corporation submitted that it lacked the capacity to accommodate a fourth TSP’s wiring. The corporation also submitted that it was already serviced by three TSPs and therefore offered residents their pick of competitors.

The CRTC clearly disagreed that the presence of three TSPs satisfied its goals of competition and end-user choice. The commission also accepted the prospective TSP’s contention that there was in fact some capacity to accommodate its wiring.

The CRTC largely gave the condominium corporation and the TSP the freedom to work out amongst themselves what reasonable terms and conditions of access would look like. However, the commission did establish a general framework.

Reasonable terms and conditions of access would at least include letting the TSP extend its wiring from the street into the condominium corporation’s main terminal room. But considering that immediate access to all telecommunications closets in the buildings might unnecessarily disrupt residents — one of the concerns expressed by the condominium corporation — the TSP only needed to be permitted to build out its infrastructure to each floor incrementally, as residents requested service.

Alongside this framework, the CRTC outlined deadlines that would trigger progressive restrictions on the condominium corporation’s existing TSPs.

After 60 days, the corporation’s existing TSPs would be barred from servicing new customers, whether new to the building or new to the service provider. After 90 days, the corporation’s existing TSPs would be barred from changing or upgrading the services of existing customers. And after 120 days, the commission said it would consider its regulatory options. Those options include a decision that would prevent existing TSPs from servicing the building altogether and an order that would have the effect of compelling the corporation to grant the fourth TSP access.

Robert Weinberg, president of the Association of Condominium Managers of Ontario (ACMO), expressed concern as to how infrastructure limits would be practically addressed in light of the CRTC’s latest decision.

“If the building is constructed with a specific diameter conduit to deliver telecommunications wiring throughout and it’s already jammed by three TSPs and you cannot fit in a fourth, what is the corporation to do?” he asked. “They cannot pull someone else’s wires out, and they are likely not going to want to demolish building assets or disrupt the owners’ quiet enjoyment of their units in order to run another conduit, so I don’t know how they’re planning to make this work.”

Indeed, the latest CRTC decision may have raised more questions than it answered, and at a time when new players are trying to crack into the TSP market.

“The field is getting crowded and you’re getting new telecommunications service providers popping up fairly regularly,” said Howden. “It used to be that you were dealing with Bell and Rogers; now you’re getting other players and I think there are a number of considerations that remain outstanding.”

For one, both the corporation and the Public Interest Advocacy Centre (PIAC), which intervened in the case, called on the CRTC to look at clarifying whether condominium boards could be considered the end user with respect to the goal of end-user choice. PIAC is a group that is active on issues concerning the ability of consumers to access, afford and choose important public services, including telecommunications.

Guidelines for the distribution of cable and satellite services in multi-dwelling units suggested that condominium boards could be considered the end user, since directors are elected to represent unit owners.

“Previously when the commission had decided end user choice could be determined by the board, it had assumed that the board would represent the interests of the unit owners and those unit owners were the ones that were actually living in the units,” said Alysia Lau, legal counsel, PIAC.

“A lot of these units are actually resided in by tenants, so the ability of the board in that case to determine what actual residents in the building might want might not be as clear cut anymore.”

The guidelines for the distribution of cable and satellite services were released shortly before the guidelines for TSPs and largely align with them. The two sets of guidelines are separated simply because broadcasting and telecommunications are dealt with by two different pieces of legislation.

While the latest CRTC decision implied that the condominium board may not be considered the end user, it remains a grey area in Howden’s view, because the commission didn’t explicitly say one way or the other.

Up to now, TSP access may not be an issue many condominium boards have confronted. Builders normally negotiate access to new buildings with at least one TSP during construction so Internet service is available to residents at occupancy.

“From what we’ve seen, the developer has already entered into an access agreement with Bell or Rogers, or both, and it’s usually both so as not to exclude anybody,” said Weinberg. “I am not personally aware of buildings that are initially set up with a third alternative.”

But that could change as new players enter the TSP market. The condominium buildings rising in Toronto are an attractive entry point, Lau observed.

“The cost is less risky for companies such as Beanfield and Coextro in a condo because you have negotiated with a developer and, when you build out your infrastructure, you automatically have access to 20 floors of units,” she said. “It’s different from building out to a home.”

Two earlier CRTC decisions on entry to multi-dwelling units concerned disputes between builders and a TSP. In the pair of cases from 2013 and 2015, a TSP filed applications after being unable to access two new developments in Toronto. In the earlier case, only one TSP already had an agreement in place to service the condominium. In the more recent case, two TSPs already had agreements in place.

For their part, the builders in both cases contended that the condominium board could elect to enter into agreements with additional providers after turnover. But the commission, in imposing conditions as it did in the latest case, commented that residents wouldn’t be able to access the competing TSP upon moving into their units.

These decisions might stop builders from punting questions of TSP access to condominium boards when requests come in before turnover. But for those that don’t, there is uncertainty around what would constitute a legitimate technical reason for denying access to additional TSPs.

“What is undecided is what happens when there is no capacity,” said Howden. “Are we going to have 10 and 12 and 25 telecom service providers? That remains an open question.”

Michelle Ervin is the editor of CondoBusiness.

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