Northern internet company says pricing discriminatory, wants to offer unlimited internet

After recent unlimited internet packages were unveiled in the North by Northwestel, one competitor is crying foul for lack of fair pricing structures.

Wholesale pricing still discriminatory a decade later, SSi Canada says

Local Internet provider SSi Canada says Northwestel Inc.'s wholesale pricing is unfair. (Chantal Dubuc/CBC)

A Northern internet provider has filed two applications to the Canadian Radio and Telecommunications Commission (CRTC), arguing that the ability to offer unlimited internet should be made available to everyone — not just Northwestel clients.

SSi Canada is requesting wholesale high-speed access through third-party internet access from Northwestel Inc. in one application, while the second application states SSi's opposition to the interim approval that allowed Northwestel to offer unlimited internet packages in the North.

What you're looking at is blatant discrimination.- Dean Proctor, SSi Chief Development Officer

"We're not against unlimited internet packages," said David Veniot, SSi's Communications Manager.

"We want to have access to proper wholesale rates so that we can look at offering the same sort of thing as a competitor."

SSi Canada says northern telecommunication competitors have an unfair disadvantage as Northwestel operates and manages the fibre optic cables that form the backbone of the infrastructure to deliver internet service.

"What you're looking at here is blatant discrimination … We cannot buy enough backbone capacity from them at a price that would ever allow us, ever anywhere near, allow us to offer those kinds of services to customers," SSi Chief Development Officer Dean Proctor said.

Rates pass price test, Northwestel says

Northwestel's director of communications Andrew Anderson said the company is aware of the application to the CRTC.

Andrew Anderson is a spokesperson for Northwestel in Whitehorse. (CBC)

"Our focus is on delivering unlimited internet to our northern customers," Anderson wrote in an emailed statement. 

"We're proud of the significant investment and work from our northern employees to bring unlimited internet to cable and fibre customers before the holiday season."

Anderson noted the company provided cost studies and passed the price floor test, which is set out by the CRTC to establish a minimum price threshold to allow new competitors to establish sustainable competition in regulated markets.

Complaints date back almost a decade

Citing the potential significant harm to northern competitors, SSi asked the CRTC to postpone granting Northwestel the ability to offer unlimited internet packages until the regulator had time to review the entire study. But the regulator approved Northwestel's application on an interim basis because of increased needs during the COVID-19 pandemic.    

Northwestel unveiled its unlimited offers in December, with packages ranging from $160 to $249 a month.

But the argument for fair pricing is not a new one, company officials say.

"This has been a long standing, a long standing concern of the competitive side of telecommunications in the Northwest Territories and in the Yukon, where competitors that includes SSi are fully dependent on Northwestel's monopoly fibre backbone to connect to the rest of the world," Proctor said.

SSi has long held the position the Northwestel wholesale costs are discriminatory.

In 2014, the company filed an appeal with the CRTC calling the pricing structure unfair with the commission ordering Northwestel to reassess wholesale pricing in 2016. Two years later, the commission approved wholesale connect rates.

But SSi said the pricing is still unfair.

"Our own end users should have a better package and we'd be able to offer a better package if Northwestel would give us more reasonable rates and better terms of service on that fibre backbone," Proctor said.

Ongoing consultation 

Last month, the CRTC asked northern residents to share their views and ideas on telecommunication services in Northern Canada.

Key topics for the discussion include:

  • The affordability of telecommunications services for residents and businesses in the North,

  • The quality of telecommunications services, including internet speeds, mobile coverage and service reliability, and

  • How the CRTC may foster more competition in the North.

Due to the ongoing consultation, the CRTC said it would be inappropriate to comment on the issue.

"As you are aware we have an open consultation to review the regulatory framework for Northwestel, therefore it would be inappropriate to provide any further information at this point," CRTC media relations spokesperson Patricia Vallado wrote in an emailed statement.

Northerners have until Jan. 20 to give their feedback.