The Canadian Radio-television and Telecommunications Commission (CRTC) announced Wednesday it is opening Canada’s North to local telephone competition.

Residents in many parts of the Yukon, Northwest Territories and Nunavut will have the option to choose from competing telephone service providers as of May 1, 2012.

"For the first time, many northern residents will be able to choose an alternate local telephone service provider," said Leonard Katz, the CRTC’s vice-chairman of telecommunications in a press release.

"Competition will be introduced as soon as possible to bring choice and innovative options to Canada’s North."

The decision follows a proceeding that included a public hearing that was held in Yellowknife on Oct. 4 and 5.

In its ruling, the CRTC also denied NorthwesTel’s request to raise the rates for residential and business local telephone service by $2, saying it was not justified and inconsistent with the current regulatory regime.

The CRTC also found that NorthwesTel had insufficiently invested in its network despite its strong financial performance during the past few years, and is concerned that the company’s aging infrastructure is affecting the quality and reliability of its service.

NorthwesTel must provide, within the next six months, a plan detailing how it will modernize its network. This will form the basis of the CRTC’s comprehensive review of NorthwesTel’s infrastructure and services over the next two years.

"We are disappointed that NorthwesTel, which has until now been the sole provider of local telephone service in the North, has not made a greater effort to improve its services," Katz added.

"Many communities have been plagued by service outages and certain features are not widely available to customers. Northern residents deserve to have access to reliable and high-quality services comparable to those offered in the rest of the country."

The CRTC said it will closely monitor the situation in the North during the next two years as local competition is implemented.