Videotron, Shaw, Cogeco Detail Millions in Retroactive Costs Due to CRTC Rate Cut

More Internet service providers in Canada have announced the impact of the CRTC’s recent rate cut when it comes to wholesale broadband rates, a move made to foster competition.

First, Bell came out to say the CRTC decision would impact the company by $100 million in retroactive payments to resellers, plus also force the company to reduce its wireless broadband rollout to small towns by 20%, or 200,000 households.

Rogers was next to say the impact from the CRTC decision would be $140 million on its Q3 due to retroactive payments, while also noting it would be reviewing future investments in rural and remote communities.

Cogeco Disappointed by CRTC Decision 

Earlier this week, Montreal-based Cogeco said it will see a $25 million impact in the current quarter, from the CRTC decision. For years 2016-2018, Cogeco says $15 million in retroactive payments will be made, and $10 million for 2019.

Cogeco says it “responded with surprise and disappointment” to the CRTC’s decision, while again like Rogers and Bell, emphasized the Competition Bureau’s recent market study, highlighting how “the strength of Canada’s Internet networks is built on large investments made by facilities-based providers, such as Cogeco, and underscores the importance of setting wholesale access rates at the correct level in order to ensure that investment incentives are maintained for the future.”

Videotron Will Face $50 Million Impact in Retroactive Costs

Today, another Montreal-based ISP, Videotron, said the CRTC rate cut on wholesale rates will impact the company by $50 million.

“It has been clearly established that a strong digital economy, supported by powerful networks, promotes the economic development of our communities, and we are concerned about the long-term consequences that delays in investments may have for the country,” said Jean-François Pruneau, President and CEO of Videotron, in a statement.

Videotron says it is “calling for caution and expressing concern about the decision’s potential economic impact.”

Shaw Says “Long-Term Negative Consequences” Coming to Canadians 

Calgary-based Shaw and parent company of Freedom Mobile has today also released a similar message regarding the CRTC wholesale rate cut.

Shaw says there “will be long-term negative consequences to Canadians from the CRTC’s decision to dramatically reduce federally regulated wholesale broadband prices charged to third party internet providers.”

The company says its Q4 for 2019 will be impacted by roughly $10 million, based on retroactive rates being repaid dating to January 2017.

“We cannot understand the CRTC’s rationale for drastically reducing the wholesale broadband rates available to third party internet resellers,” said Brad Shaw, CEO of Shaw Communications, in a statement. “In time, this decision will be seen as short-sighted, and have negative far-reaching consequences for consumers and for the future investment required to build network capacity in all parts of Canada.”

The Shaw CEO went on to say, “network investments that we have made in a pro-competitive environment have allowed us to double the internet speeds to our customers twice in the past year.”

“Unfortunately, the CRTC decision undermines the direction from the government to expand broadband connectivity to all Canadians and to make Canada a leader in the digital economy,” added Shaw.

Sounds like Canadians are going to be facing some bleak and tough times ahead, if these statements from ISPs are considered. What do you think of the clockwork reaction from major ISPs?

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