Copyright 2002 National Post, All Rights Reserved

National Post (f/k/a The Financial Post)…03/20/2002

From LexisNexis

Videotron ltee has been summoned to a hearing before the federal cable regulator next month to justify charging competitors $5 per subscriber per month to use cable lines it pipes into Quebec apartments.

Industry insiders say the high fee — more than 10 times what the Canadian Radio-television and Telecommunications Commission has proposed cable companies charge satellite and other alternative television service providers — is seen by the commission as a possible attempt to thwart competition in the lucrative business of serving multi-dwelling units.

Complaints filed with the CRTC by Cable VDN Inc., Bell ExpressVu LP and Look Communications Inc. included an allegation that while customers were being disconnected within 24 hours of a request, Videotron competitors were not being given access to reconnect customers.

In a strongly worded notice issued yesterday for a hearing on April 23 in Gatineau, Que., the CRTC said it wants to know whether Videotron has given itself an "undue preference" or placed an "undue disadvantage" on its competitors as a results of its actions.

While many cable competitors use wireless networks, they rely on the final length of wire laid by cable companies — sometimes decades ago — to get their signals into individual dwellings.

The commission wants to establish whether Videotron has breached cable regulations by not permitting competitors to use the wire it installed in apartments "for a just and reasonable price."

The regulator is considering slapping Videotron with what is called a "mandatory order," forcing it to comply with the regulations governing fair competition.

A spokesman for Videotron's parent company, Quebecor Inc., said earlier that the company does not believe the CRTC has jurisdiction over the issue because Videotron's inside wire has been sold to another division, Quebecor Media, which is "not a regulated entity."

The sale was completed in early February, just before competitors received letters telling them of the $5 monthly fee per subscriber, plus a $35 transaction fee for each request.

The commission document said it is also looking into whether the sale of the inside wire breached a condition of the company's license to operate a cable undertaking.

Most cable companies in Canada had been giving competitors free access to their inside wiring in apartment buildings and condominiums while they tried to negotiate an acceptable price.

A deadlock in negotiations resulted in the CRTC proposing a fee of 44 cents per subscriber per month, which is now open to public input. An association representing most of Canada's major cable companies had wanted $2.67 per subscriber per month, while satellite provider Bell ExpressVu had asked for a monthly fee of 8 cents per subscriber.