Telus 2005 Annual Report Download - page 27

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The CRTC stated in Decisions 2005-69 and 2005-70 that it will be initiating a review of the price
regulation framework for TCI and TELUS Québec in the first half of 2006 in order to establish
the price regulation framework that will be in effect beginning June 1, 2007.
On February 16, 2006, the CRTC determined that the funds that had accumulated in TCI’s and
TELUS Québec’s deferral accounts in the current price cap period should be used to extend
broadband service in rural and remote areas (95%) and to enhance access to telecommunications
services for disabled persons (5%). The CRTC also determined that the recurring balance in the
deferral accounts and the required productivity adjustment to the residential services basket on
June 1, 2006 will be passed on to residential customers in non high-cost serving areas through
reduced rates. As a result, no new funds will be added to these deferral accounts.
Quality of Service. On March 24, 2005, the CRTC issued Retail quality of service rate
adjustment plan and related issues, Decision 2005-17 in which it finalized the retail quality of
service rate adjustment plan. The rate adjustment plan sets the maximum rate adjustment at 5%
of local service revenues and this amount is divided equally among the 13 quality of service
indicators. For each quality of service indicator where the average annual performance is below
the standard, a rate adjustment is triggered in a varying amount based on the degree that the
average performance is below the standard. In addition, if the results for a quality of service
indicator are below the standard for five or more months during the year, but the average
performance is above the standard, a rate adjustment is also triggered. The rate adjustment plan
allows an ILEC to apply to the CRTC to exclude the impact of natural disasters or other adverse
events beyond the control of the company from its quality of service results on a case-by-case
basis.
TELUS applied to the CRTC to adjust its quality of service results to take into account three
adverse events, all of which occurred during the latter half of 2003. These events were severe
forest fires in the interior of BC and southwestern Alberta, a major cable cut in Vancouver and
unprecedented flooding in the lower mainland. TELUS is awaiting the CRTC’s decision on this
application. TELUS will also be applying to the CRTC to adjust its quality of service results to
take into account a series of floods in southern Alberta during the month of June 2005 that
resulted in severe damage to the Company’s and customers’ facilities as well as the impact of
TELUS’ labour disruption in 2005 on the Company’s ability to meet quality of service standards
on retail and competitor services.
Local competition framework
The regulatory framework for local services competition has a number of components, the more
important of which are summarized below.
Unbundling of Essential Facilities. In 1997, in an effort to foster facilities-based competition in
the provision of telecommunications services the CRTC determined in Decision 97-8 that ILECs
must make certain “essential or near-essential facilities” available to CLECs, at rates based on
the ILEC’s incremental cost plus an approved mark-up. The CRTC has defined essential
facilities as facilities which are monopoly controlled, required by competitors as an input to