Emerson awaits bureaucratic advice on telecom sector by Paul Vieira

OTTAWA - Officials at Industry Canada are expected to advise their Minister, David Emerson, early in 2005 whether a major overhaul of the Telecommunications Act -- as suggested by BCE Inc. and the Canadian Chamber of Commerce -- is necessary.

Mr. Emerson is to receive the advice while he is targeted in intense lobbying about changing the rules that govern the telecommunications industry.

BCE and the other incumbent phone companies argue laws governing them are outdated, given that technology has changed the way such services as voice are delivered, and new rules are needed to adapt to the technology.

In a recent letter, the chamber, which represents business across the country, asked for a review conducted by a panel of outside experts.

"We have made no decisions about whether there is a need for a formal, outside review of telecom policy," Ian Jack, a spokesman for Mr. Emerson, said yesterday. "We will wait to see what our officials recommend."

He said the review by department officials is expected to indicate what parts of the Act should be modified and, if so, in what ways. "Everyone in the industry has their views as to what, if anything, should be changed."

While BCE and other phone companies push for change, cable-TV providers would prefer to see the laws stay the way they stand. The Canadian Cable Telecommunications Association has written Mr. Emerson asking he ignore the chamber's request.

Cable companies like the regulatory regime because current rules keep such companies as BCE's Bell Canada and Telus Corp. at bay.

The battle over regulatory change comes as the Canadian Radio-television and Telecommunications Commission nears tabling a decision on Internet telephony, or voice over Internet protocol (VoIP). Phone companies are afraid they will be subject to regulation while cable companies and other service providers will be free to set their own prices.

Some industry observers say they are skeptical federal telecommunications policy needs a drastic makeover.

"I think we need a sober, collegial review of where we are going and where we want to go," said Iain Grant, managing director of SeaBoard Research, a telecommunications consulting firm in Brockville, Ont.

"But do we need a whole review of life, universe and everything? There are problems inherent in that, too. Where do we stop? Are we opening a can of worms? Do we need to open such a tin? I'm not sure."

Meanwhile, the former chairman of the U.S. Federal Communications Commission who was in Ottawa last week and advocated telecom regulatory reform at a conference had his trip paid for by BCE.

A BCE spokeswoman said Reed Hundt, FCC chairman from 1993 to 1997, was invited by the Montreal company to speak with its executives. BCE told the International Institute of Communications, the conference organizer, that Mr. Hundt would be in Ottawa and, perhaps, make an interesting speaker.

He was part of a three-member conference panel discussing how government should regulate the telecom sector, given that technology has transformed the industry's market dynamics.

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