Comments of Rogers Communications Partnership

Transcription

1 Comments of Rogers Communications Partnership Proposed Revisions to the Frameworks for Mandatory Roaming and Antenna Tower and Site Sharing (DGSO ) May 13, 2012

2 Rogers Communications Partnership Page 2 Executive Summary 1. Rogers generally supports the Department s proposed changes to the roaming and tower sharing framework. We believe that the majority of these proposals are the natural next step for the Department. They will extend the significant benefits of roaming to even more Canadians, in more geographic areas. At the same time, the proposed changes will maintain the balance that the Department carefully achieved in its initial policy and conditions of licence. Competitors will continue to have incentives to invest in the expansion of their networks. 2. For the reasons outlined in greater detail below, Rogers recommends that the Department incorporate the following modifications in its revised policy and conditions of licence for roaming and tower sharing. Roaming should be made available to all mobile licensees, inside and outside their licence areas, in all mobile spectrum bands, indefinitely, so that the benefits of roaming will be available to more Canadians. Requesting operators should be required to provide a given level of service to 60% of the population inside their entire coverage footprint before they will be permitted to request roaming using the same level of service. Roaming should continue to be offered using commercial rates and should exclude resale so that competitors will have an incentive to invest in the expansion of their networks. Automatic, seamless hand-off between networks should not be mandated since it is costly and complex. Industry Canada should give effect to its revised policy and conditions of licence for roaming as soon as it issues its decision at the conclusion of this consultation. This will ensure that the associated benefits will be available at the earliest possible date. A new industry database containing detailed and highly sensitive tower sharing information will be impractical and costly and will divert scarce resources away from the processing of tower sharing requests. Instead, Industry Canada should

3 Rogers Communications Partnership Page 3 require licensees to file tower sharing information on a quarterly basis. This will accelerate tower and site sharing and will reduce sharing request processing times. Licensees should be permitted to charge fees for responding to requests for Preliminary Information Packages and for processing Offers to Share. These fees will ensure that licensees will be compensated for the significant work that must be performed to respond to such requests. Cancelling offers to share that have been received but not responded to within 60 days should reduce frivolous tower sharing requests.

4 Rogers Communications Partnership Page 4 Introduction to Roaming Comments 3. The current proposals regarding mandatory roaming follow the initial roaming requirements that were imposed as part of the Advanced Wireless Services (AWS) Policy Framework. The objective of the initial requirement for roaming was to allow new competitors customers to roam on incumbent networks where the new entrants had not yet built any network coverage. Through in-territory and out-of-territory roaming, new entrant customers had access to national roaming as soon as each new entrant began operating their respective networks. The AWS Policy Framework provided that roaming must be offered to requesting operators on the basis of commercial rates, and that disputes regarding rates and terms could be referred to an arbitration process for resolution. Roaming was expressly defined as excluding resale with the objective of encouraging facilities-based competition and it did not include seamless hand-off between networks since this is uncommon, costly and complex. Minimum timeframes were imposed to ensure that information would be exchanged, proposals would be made, and negotiations would be concluded in a timely manner. 4. The result of this policy approach is that the majority of new entrants have successfully negotiated roaming agreements and built their networks, and they are offering competitive mobile services in several regions of Canada. Industry Canada has proposed a number of important changes to its mandatory roaming policy and conditions of licence. As outlined in greater detail below, Rogers generally supports the Department s proposals. 5. We believe that the best course for the Department s mandatory roaming policy is to make roaming available to all competitors so that all Canadians that use mobile services will be able to benefit from roaming inside and outside of their service provider s licence areas, indefinitely. Making roaming more broadly available to all competitors and customers will promote greater usage of wireless services in Canada, which in turn will increase the productivity and competitiveness of the Canadian economy. We believe that roaming should continue to be offered on the

5 Rogers Communications Partnership Page 5 basis of commercial rates and exclude resale since this approach will further promote facilities-based competition and investment. 6. Further details regarding our roaming positions are provided in the following comments. 4.1 Application of the Conditions of Licence 4-1: Industry Canada is seeking comments on the proposed revisions to Section 9.1 of the current Conditions of Licence for Mandatory Roaming as follows (new text is in bold): The Licensee must provide automatic digital roaming (roaming) indefinitely by way of Roaming Agreement(s) on its cellular, PCS, AWS, MBS and BRS networks to any other licensee in these bands (A Requesting Operator). Where technically feasible, the Licensee shall offer roaming in all its licensed service areas in the aforementioned bands. A Requesting Operator includes provisional licence winners. 7. In section 4 of the Consultation Paper, the Department has proposed to revise the mandatory roaming policy and conditions of licence such that roaming will be more broadly available. Specifically, the Department has proposed that mandatory roaming should be offered to all mobile spectrum licensees, inside and outside their licensed areas, in all mobile bands, indefinitely. 8. It is important to recognize that the federal government s efforts to encourage facilities-based competition in the Canadian wireless market have been a tremendous success until now. Historically, the lack of mandatory roaming provided an incentive to licensees to expand their relatively small wireless networks into new geographic areas in order to more effectively compete. This ensured that Canadians would benefit from facilities-based competition in a growing number of markets across Canada. The result is that competing wireless networks have been extended to an extraordinary 95% or more of the population. However, now that Canada has achieved this level of deployment, the incentive to build further is offset by the very poor economics associated with covering the last 5% of the population.

6 Rogers Communications Partnership Page 6 There are simply not enough potential customers living in these areas to justify the investment required to serve them. It is unlikely that demand there will justify the construction of more than a single network. In fact, the construction of multiple networks in such areas has slowed, if not stopped entirely. At the same time, the cost to Canadians of monopoly networks is significant. Canadians residing outside these areas may not be permitted to roam, depending on who their service provider happens to be. It would appear therefore that it is time to introduce mandatory roaming as a means of partially offsetting the negative consequences arising from this situation. 9. An extreme example of the need for roaming in higher cost areas is illustrated in the case of the City of Toronto s subway system. There, subway riders have lacked wireless coverage because of the steep cost of building and maintaining a wireless network in the subway system. In an effort to overcome this economic reality, the City of Toronto has invited proposals for the construction of a single wireless antenna system and has also stipulated to prospective bidders that all wireless service providers must have equitable access to the system. 1 The City has correctly recognized that, in effect, spreading the cost of a single, shared antenna system would be a win-win-win for the City, its subway riders and wireless service providers who would all benefit from the construction of a one for all wireless network in what would otherwise be an uneconomic environment in which to provide wireless coverage. 10. The difficulty of economically serving sparsely populated regions is compounded in areas where Rogers competitors have built their own network facilities using regulated subsidies that are available from their former monopoly wireline operations. For example, in 2010, the Canadian Radio-television and Telecommunications Commission (CRTC) permitted Bell Canada and Bell Aliant to divert hundreds of millions of dollars collected from their wireline customers to fund the expansion of their wireless High Speed Packet Access (HSPA) networks into 1 See Toronto Transit Commission Report, Wireless Network in the Subway Project Status, February 29, /Reports/WIRELESS_NETWORK_IN_.pdf

7 Rogers Communications Partnership Page rural communities. 2 The resulting cost advantage enjoyed by Bell Canada and Bell Aliant has undermined Rogers ability to economically expand its network into these geographic areas. A significant unintended consequence of the CRTC s decision is that the construction of competing network facilities in these communities is now less likely to occur. 11. Similarly, the ongoing co-operation between Bell and TELUS in the funding, building and operation of shared networks has significantly undercut Rogers ability to economically expand its own network. This co-operation between Bell and TELUS began more than a decade ago. In 2001, the companies agreed to extend an existing roaming and resale agreement so that they could offer PCS services using each other s network. 3 The advantages associated with the agreement were described by Bell in the following glowing terms: As a result of this agreement, Bell Mobility and TELUS Mobility will each be able to avoid capital expenditures of more than $500 million (over the term of the 10- year agreement). This is the capital expenditure that would have been required for Bell Mobility to build a network to meet the needs of rural areas in Alberta and B.C. In addition, Bell Mobility will be able to fast-track the delivery of wireless PCS and 3G applications to rural areas without building hundreds of new towers, and customers will have a greater choice of providers In 2008, the companies leveraged their prior sharing arrangement and agreed to split the cost of building and operating a national HSPA network. 5 This co-operation continued into 2012 when Bell and TELUS were reported as having launched a shared Long Term Evolution (LTE) network. 6 2 See Telecom Decision CRTC See 4 Ibid. 5 See 6 See

8 Rogers Communications Partnership Page The ongoing co-operation between Bell and TELUS, allowing them to split the cost of shared networks, means that they will continue to have a considerable, if not insurmountable, cost advantage over Rogers in certain geographic areas. While this is less of an issue in urban areas, since Bell and TELUS cost savings will be offset to some extent by their need to more rapidly add incremental capacity to support the traffic of both companies customers, it is a very real concern in sparsely populated rural areas. In those areas, there will be no need for Bell and TELUS to add incremental capacity, meaning that the cost savings of a shared network will remain intact for some time. This situation therefore will be felt most acutely by Rogers where the population density is low and it is more difficult to achieve a positive return on the significant investments that are required to provide coverage. 14. Given the significant economic disadvantages that have been imposed on Rogers, through regulatory subsidies and shared networks, it will not be economic for Rogers to expand its network in certain geographic areas. It is therefore unreasonable to continue to deny Rogers customers the benefits of mandatory roaming. 15. With respect to the Department s proposal that mandatory roaming should be extended indefinitely, we agree that this would recognize the importance of national coverage, would result in greater certainty for licensees, and would rely on market forces to ensure that parties continue to build out where economically feasible to reduce roaming charges. 7 Extending the roaming requirement indefinitely will ensure that Canadian consumers will continue to have access to the important benefits of national roaming going forward. Since roaming does not include resale and will continue to be offered on the basis of commercial rates, licensees will still have an incentive to invest in the construction of their own network facilities. 16. We believe that the Department s proposals are consistent with the approach that has already been adopted in the U.S. where the Federal Communications Commission (FCC) has mandated automatic in-territory and out-of-territory roaming 7 Consultation Paper, par. 17.

9 Rogers Communications Partnership Page 9 for all carriers in perpetuity. 8 It is important to note that, in mandating this form of roaming, the FCC sought to balance a number of competing interests, including promoting competition, ensuring that consumers have access to nationwide coverage and providing incentives for all carriers to invest and innovate by using available spectrum and constructing wireless network facilities. 9 These objectives mirror those of the Department s mandatory roaming policy and we believe that the current proposals will appropriately balance these objectives. 17. We would also note significantly that the FCC has rightly recognized that, in some areas with very low population density, it will be unrealistic for all carriers to build a network. Specifically, the FCC concluded the following in this regard: Another reason for eliminating the home roaming exclusion is that it does not adequately account for the fact that building another network may be economically infeasible or unrealistic in some geographic portions of licensed service areas. We find that, in some areas of the country with very low population densities, it is simply uneconomic for several carriers to build out The FCC further noted that every carrier, including every nationwide carrier holding licences that cover the entire country, relies on roaming to some extent to fill in gaps in its network coverage and that for many CMRS carriers, there are areas within their licensed service areas where there is insufficient demand to support construction in those areas by another carrier For these reasons, the FCC has adopted criteria that it will use when arbitrating disputes between carriers regarding in-territory roaming which include, among other things, the following criterion: 8 Order on Reconsideration and Second Further Notice of Proposed Rulemaking (FCC 10-59), April 21, Ibid., par Ibid., par Ibid.

10 Rogers Communications Partnership Page 10 Significant economic factors, such as whether building another network in the geographic area may be economically infeasible or unrealistic, and the impact of any head start advantages We submit that the same economic challenges acknowledged by the FCC also exist in Canada and that the Department s proposals adequately recognize these economic realities and will effectively address them. 21. We also support the Department s proposal to extend the roaming requirement to all mobile bands, including the 700 MHz Mobile Broadband Services (MBS) and 2500 MHz Broadband Radio Services (BRS) bands, so that Canadians can benefit from roaming, irrespective of the specific frequency bands that their mobile devices are designed to operate in. We believe that broadening the roaming requirement to include the 700 MHz band is particularly important given that this band will be used by successful bidders to expand their LTE coverage in rural areas and to enhance their LTE coverage in urban environments. The extension of roaming to this band will ensure that Canadians will have access to an expanded and enhanced LTE coverage footprint when they are roaming outside the coverage footprint of their home network. Providing Canadians with ubiquitous access to advanced new services like LTE through roaming will foster increased use of wireless services and improve Canada s productivity and competitiveness relative to its international peers Seamless Hand-off, Level of Service and Resale 4-2: Industry Canada is not proposing any changes to the current Section 9.2 of the Conditions of Licence for Mandatory Roaming. 22. Rogers agrees with the Department that seamless communications hand-off between two networks should not be mandated. We believe that this requirement is unwarranted since seamless hand-off is technically complex, especially in the 12 Ibid, par Telecom Policy Review Panel Final Report, 2006, p. 10.

11 Rogers Communications Partnership Page 11 context of ever-expanding networks and ever-changing boundaries between networks. Even in the case where the boundary between wireless networks is static, Rogers and other major wireless carriers have found that seamless hand-off between networks is very difficult to implement and maintain. 14 For these reasons, as the Department has noted, no other country in the world currently mandates seamless communications hand-off between networks The significant technical challenges and costs associated with seamless hand-off have been presented and considered in several proceedings undertaken by Industry Canada and the CRTC over the past several years. 16 On each occasion, the conclusion has been that seamless hand-off between networks is complex, costly and uncommon and that it should not be mandated. The issue has been examined extensively, and ruled on as recently as April 5, 2012, and it does not warrant further consideration in the present consultation. 17 For all of these reasons, we support the Department s proposal to continue to exclude seamless communications hand-off from the roaming requirement. 24. We believe however that the Department should clarify the extent to which requesting operators will be entitled to roaming on a particular level of service outside their coverage area. Section 9.2 of the conditions of licence clearly state that roaming must enable roamers to originate or terminate communications when out of range of their home network and that licensees are not required to provide a roamer with a service or level of service which the requesting operator does not itself provide on its own home network. The application of this requirement was relatively 14 See Rogers Intervention, September 29, 2011, para. 13, Consultation Paper, par See Consultation on a Framework to Auction Spectrum in the 2 GHz Ranging Including Advanced Wireless Services DGTP , February 16, 2007; Consultation on Proposed Conditions of Licence to Mandate Roaming and Anetenna Tower and Site Sharing and to Prohibit Exclusive Site Arrangements DGRB , November 28, 2007; Consultation on a Policy and Technical Framework for the 700 MHz Band and Aspects Related to Commercial Mobile Spectrum SMSE , November 30, 2010; Industry Canada request for Information from licensees regarding the mandated tower and site sharing and roaming Conditions of Licence (original request letter from Industry Canada dated November 23, 2010 and clarification letter from Industry Canada dated December 13, 2010; Telecom Decision CRTC See Telecom Decision CRTC

12 Rogers Communications Partnership Page 12 straightforward following the conclusion of the 2008 AWS auction. For example, once a new entrant had built its own HSPA radio access network in a given area, its customers were permitted to roam on the HSPA network of another licensee when out of range of their home network. Going forward, the same new entrant may elect to implement next generation LTE services within its home network and it will eventually want to provide its customers with the ability to roam on the LTE network of another licensee. 25. What is less clear is the extent to which a requesting operator must implement next generation LTE services before it will be entitled to LTE roaming. In light of the Department s objective of encouraging facilities-based competition, we submit that it would be inappropriate to require a licensee to offer LTE roaming to a requesting operator that has implemented, for example, a single LTE radio base station within its home network. A requesting operator should be required to implement a minimum degree of coverage with a particular level of service before it is entitled to roaming on the same level of service. Rogers believes that the Department should clarify that requesting operators should be required to cover at least 60% of the population within their entire existing network coverage area with a particular level of service before they will be entitled to roaming on the same level of service outside their coverage area. Once a licensee covers at least 60% of the population inside its entire coverage area with a new level of service, all of its customers should be deemed to be using the new level of service and be permitted to roam accordingly. 26. Since virtually all of the AWS new entrants have focused their initial network implementation efforts on providing coverage in urban centers, and have relatively small networks, the proposed 60% rule would not be onerous for them. The use of this rule would strike the right balance between providing incentives for licensees to invest in next generation network facilities and ensuring that customers of requesting licensees will have access to roaming over the broadest possible area using the most advanced level of service.

13 Rogers Communications Partnership Page We agree with the Department s proposal that mandatory roaming will continue to exclude resale. It is important to remember that the Department s original decision to exclude resale was set in the broader context of the federal government s decision to accelerate the pace of deregulation of competitive telecommunications markets. This decision culminated in the issuing of a direction to the CRTC regarding the implementation of the Canadian telecommunications policy objectives. The CRTC was directed, among other things, to rely on market forces to the maximum extent, increase incentives to promote facilities-based competition and phase out mandated access to wholesale services that are not essential services. 18 Consistent with this broader policy context, the Department introduced mandatory roaming, while at the same time explicitly excluding resale and requiring that roaming be offered at commercial rates that are reasonably comparable to rates currently charged to others for similar roaming services. Where the parties cannot agree to rates and terms, the dispute may be referred to binding arbitration. The new policy sought to enhance competition by ensuring that consumers would have access to national roaming as licensees build out their networks, while also providing the same licensees with an incentive to invest in the expansion of their networks. 28. This balanced approach has resulted in the entry of new competitors in the wireless market and the construction of multiple, competing networks in certain geographic areas. At the same time, mandatory roaming has allowed customers of new entrants to roam on incumbent networks while new entrants continue to expand their networks. We believe that the Department should maintain its current approach. This course would also be consistent with the approach taken in the U.S. 29. We note that, in mandating in-territory roaming in April 2010, the U.S. FCC dismissed the contentions of some parties that it was creating de facto mandatory resale obligations. At the same time, the FCC found that a mandatory resale 18 See Order Issuing a Direction to the CRTC on Implementing the Canadian Telecommunications Policy Objectives, P.C December 14, eng.html and Telecom Policy Review Panel Final Report,

14 Rogers Communications Partnership Page 14 requirement would not be consistent with its stated objective of promoting facilitiesbased competition. The FCC highlighted this issue in the following terms: The Commission s mandatory resale rule was sunset in 2002, and, as the Commission previously stated, the automatic roaming obligations cannot be used as a backdoor way to create de facto mandatory resale or virtual reseller networks. We find that our actions herein in eliminating the home roaming exclusion will not effectively change the Commission s policy on CMRS resale obligations. While resale obligations are intended to offer carriers the opportunity to market a competitive retail service without facilities development, such a resale product would not serve our goals of promoting facilities-based competition, the development of spectrum resources, and the availability of ubiquitous coverage We believe that the Department should similarly uphold its objectives of promoting facilities-based competition and investment in wireless networks by excluding resale from the roaming requirement. 4.3 Responding to Requests for Information 4-3: Industry Canada is seeking comments on the proposed revised text to replace the current wording of Section 9.3 of the Conditions of Licence for Mandatory Roaming (new text is in bold): In order to satisfy the condition of roaming in accordance with this licence, the Licensee must respond to a request for information by a Requesting Operator within two weeks of receiving the request by providing to the Requesting Operator, preliminary technical information, such as technical data, engineering information, network requirements, and other information relevant to formulating a Roaming Proposal. 31. We note that the Department has proposed that licensees should be required to respond to requests for information within two weeks, whereas the existing requirement states that such responses must be provided in a timely manner. Since the information in question is readily available, we believe that it will be practical for licensees to respond to requests for information within two weeks. 19 FCC 10-59, par. 35.

15 Rogers Communications Partnership Page 15 Further, this more specific requirement will be more effective than the existing requirement in terms of ensuring that information requests will be dealt with in a reasonably short period of time. We therefore support the Department s proposal. 4.4 Roaming Rates and Technical Feasibility 4-4: Industry Canada is not proposing any changes to the current text of Sections 9.4 or 9.5. It is expected that roaming agreements will be offered at commercial rates that are reasonably comparable to rates currently charged to others for similar roaming services. 32. Rogers has entered into a number of one-way domestic roaming agreements with new entrants demonstrating that mandatory roaming provided at commercial rates has not in any way impeded the availability and provision of domestic roaming. As noted above, the Department s original decision to mandate roaming on the basis of commercial rates was made at a time when the federal government called for the promotion of facilities-based competition. 20 Within that context, the Department introduced mandatory roaming, while at the same time explicitly excluding resale and requiring that roaming be offered at commercial rates that are reasonably comparable to rates currently charged to others for similar roaming services. Since licensees would receive roaming on the basis of commercial rates, rather than artificially low rates, they would have an incentive to invest and build in order to avoid roaming charges. 33. We would note that the FCC has also mandated roaming on the basis of commercially negotiated rates. Among other things, the FCC has found that the use of commercial rates ensures that carriers will continue to have an incentive to build their own network facilities. The FCC states the following in this regard: AT&T argues that, if the first carrier providing coverage in a given area were required to provide automatic home roaming service to its competitors customers, there would be no reason for competitors to build out their own networks in that area. We disagree. Carriers deploying next generation 20 See supra note 18.

16 Rogers Communications Partnership Page 16 networks will still have incentives to build out to ensure that their subscribers receive all of the benefits of the carriers own advanced networks. We find that, as a practical matter, the relatively high price of roaming compared to providing facilities-based service will often be sufficient to counterbalance the incentive to piggy-back on another carrier s network Given that Rogers has negotiated a number of one-way roaming agreements with new entrants, it is clear that the Department s policy has been successful and there is no reason to abandon it in favour of a regime based on artificially low rates. Artificially low rates would provide an incentive to licensees to rely on roaming rather than invest in the expansion of their own network facilities. It would also require the use of heavy-handed and inefficient price regulation. As such, this alternative approach would be inconsistent with the federal government s broader telecommunications policy objectives and its efforts in reducing regulation of the sector in favour of a greater reliance on market forces. The Department should maintain the appropriate balance it established when it required that roaming be offered at commercial rates. 35. We also agree that the Department s policy should continue to provide that roaming must be offered where technically feasible. Forcing licensees to offer roaming in circumstances where it is not technically feasible would be unreasonable since, in some circumstances, it may not be possible to implement, or it may cause licensees to undertake costly or non-standardized modifications to their network in order to offer it. At the same time however, this provision is important in terms of limiting the extent to which a licensee will be permitted to exercise discretion in offering roaming only to certain competitors. Absent this provision, licensees could deny roaming to certain requestors simply for competitive reasons. 21 FCC 10-59, par. 32.

17 Rogers Communications Partnership Page Good Faith Negotiations 4-5: Industry Canada is not proposing any changes to the current text of Section Rogers supports the Department s proposal to retain the existing wording regarding good faith negotiations. 4.6 Timelines for Roaming Negotiations 4-6: Industry Canada is seeking comments on the proposed revised text to replace Section 9.7 of the Conditions of Licence for Mandatory Roaming (new text in bold). If after 60 days from the date that the Licensee receives the Roaming Proposal, the Licensee and the Requesting Operator have not entered into a Roaming Agreement or have not agreed to any interim arrangement, the Licensee must submit or agree to submit the matter to arbitration in accordance with Industry Canada s Arbitration Rules and Procedures, as amended from time to time. The Licensee shall agree that the arbitral tribunal shall have all necessary powers to determine all of the questions in dispute (including those relating to determining the appropriate terms of the Roaming Agreement and those relating to procedural matters under the arbitration) and that any arbitral award or results under this condition of licence shall be final and binding with no right of appeal subject to applicable provincial or territorial legislation. The Licensee must participate fully in such arbitration and follow all directions of the arbitral tribunal in accordance with Industry Canada s Arbitration Rules and Procedures and any arbitration procedures established by the arbitral tribunal. 37. The Department has proposed that the timeframe for negotiating a domestic roaming agreement should be reduced from 90 days to 60 days. It has been Rogers general experience that, where the parties are negotiating in good faith, although negotiations may take longer than the 90 day limit defined by the Department, the parties usually agree to proceed with negotiations until an agreement is successfully concluded. Nevertheless, circumstances may occasionally arise where the requesting operator becomes dissatisfied with the progress of the negotiations and reducing the limit from 90 days to 60 days as the Department has proposed would permit a requesting operator to refer the matter to arbitration much earlier. Rogers supports the Department s proposal.

18 Rogers Communications Partnership Page Other Issues Relating to the Mandatory Roaming Process 4-7: Industry Canada invites suggestions from stakeholders on additional measures (other than those discussed above) to further increase the effectiveness of mandatory roaming. 38. In light of the significant benefits associated with the Department s proposed changes to the mandatory roaming policy and conditions of licence, and given that mandatory roaming will be available to all existing and future licensees for all mobile spectrum bands, Rogers strongly recommends that the Department give effect to its revised policy and conditions of licence for roaming as soon as it issues its decision at the conclusion of this consultation. This would ensure that the significant benefits of a more broadly applied roaming requirement will be available to Canadian consumers and businesses at the earliest possible date. Deferring the implementation of the proposed changes until, for example, the conclusion of the upcoming 700 MHz auction would unnecessarily delay the introduction of these important benefits.

19 Rogers Communications Partnership Page 19 Introduction to Tower Sharing Comments 39. In 2008, Industry Canada implemented the mandatory tower sharing conditions of licence as a part of the AWS Policy Framework. While tower sharing was already commonplace at the time, Industry Canada established new mandatory requirements in order to reduce tower proliferation and assist new competitors. However, based on information from its review conducted in December 2010, Industry Canada notes in Section 5 of the Consultation Paper that it is disappointed by the number of agreements that had taken place and the amount of time taken to reach those agreements. As a result, it determined that further adjustments to the conditions of licence are required. 40. Rogers has made every effort to comply with the existing tower sharing Conditions of Licence. While backlogs formed occasionally due to the unprecedented large volume of requests from both new entrants and existing operators, Rogers has managed to respond to almost all its requests within reasonable amounts of time. In fact, since 2008 Rogers has received over 2,200 preliminary information requests. In over 600 instances, requestors chose, for various reasons, not to proceed beyond the preliminary information stage and submit Proposals to Share. As a result, the 2,200 preliminary information requests have resulted in Rogers processing almost 1,600 Proposals to Share to which Rogers has responded with over 1,400 Offers to Share. Surprisingly, the volume of both preliminary information and proposals to share has increased and in 2011 we had 30% more requests than in the previous year. 41. While Rogers has made every effort to share towers, some new entrants have abused the process. Over 370 requests have been cancelled by Requestors since 2010 (over 250 are new entrant cancellations) and over 170 requests have been revised after submission during this same time period. Frivolous tower sharing requests and numerous cancellations by some new entrants have wasted a considerable amount of Rogers resources, including thousands of man-hours, hundreds of thousands of dollars and undermined the entire tower sharing process.

20 Rogers Communications Partnership Page 20 Any failure to conclude more tower sharing negotiations can be largely attributed to new entrants. Proposed Revisions to the Framework for Mandatory Tower and Site Sharing 42. With the results of its 2010 study in mind, Industry Canada has proposed several changes to the Conditions of Licence. The Department again seeks to facilitate sharing and decrease turn-around times. Rogers is generally supportive of the majority of the proposed changes. The new rules, or clarifications of the existing rules, should help accomplish the Department s goals. Rogers however has serious concerns regarding the proposed tower database and believes that other measures will better address Industry Canada s concerns. 43. The requirement for a tower site database, proposed in Section 5-7 appears to be a solution in search of a problem. The database will not reduce the time needed to process tower sharing requests. It will however result in a large expenditure of internal resources and will require the hiring of staff to collect and upload the required data elements. Rogers and other Licensees will spend much of their time updating information for sites for which we may never even receive tower sharing requests. In addition, there is no consensus in the industry as to who will actually operate the database so Industry Canada will likely have to expand its existing site information database. Our experience from using the current Industry Canada database is that Licensees are often late in filing data and the database is difficult to use. As a result, it is almost always out of date. The same outcome is likely for any new database requirement as well. Rogers believes that it will not become a reliable source of tower information and will therefore not substitute the need for preliminary information packages. Instead of shortening turn-around times it would likely extend them as the database ties up internal Engineering and Real Estate professionals who would otherwise work on responding to tower sharing requests.

21 Rogers Communications Partnership Page Instead, Rogers makes the following recommendations to the proposed conditions of licence that should address Industry Canada s goal of accelerating sharing and reducing processing times. 45. Rogers proposes that: 1) The preliminary information timeline (Section 5-2) be reduced from 14 days to 10 days to complete a request. This will reduce wait times for preliminary information while avoiding the pitfalls of a database. The proposed database will require many more resources and as a result delay later stages including the preparation of Offers to Share and the review of finalized arrangements. Rogers proposal would reduce Requestor wait times for preliminary information while not being as burdensome as the proposed database. 2) The proposed bi-annual tower sharing information filing requirements (Section 5-8) be revised to require quarterly filings with the results of these filings being made public so that other parties may be made aware of non-compliance. This would satisfy the Department s need for further information to determine noncompliance. Further it may and should spur those that are not meeting the conditions of licence timelines to start meeting them. Quarterly public filings could also reduce the number of frivolous requests made by some requesting parties. 46. Further details on each proposed revision is provided in the following comments. A. Proposals Regarding Existing Conditions of Licence for Tower and Site Sharing Application of the Conditions of Licence 5-1: Industry Canada is seeking comments on the proposed text to replace sections 8.1 and 8.2 of the Conditions of Licence for Mandatory Tower and Site Sharing (new text is underlined).

22 Rogers Communications Partnership Page 22 The mandatory tower and site sharing conditions of licence will apply to all radiocommunication service providers in all bands. 8.1 The Licensee must facilitate sharing of antenna towers and sites, including rooftops, supporting structures and access to ancillary equipment and services ( Sites ) and not cause or contribute to the exclusion of other radiocommunication service providers from gaining access to Sites. Without limiting the generality of the foregoing, - where the Licensee is party to an agreement that includes a provision excluding other operators from the use of a Site, then, in order to facilitate the sharing of Sites, the Licensee must consent to waiving that portion of the agreement to facilitate a Request to Share; - as applicable, the Licensee must consent to or, in a commercially reasonable manner, seek the consent of third parties to the assignment, sublease or other rights of access to Sites pursuant to any agreement or arrangement to which the Licensee is a party; and - the Licensee must not enter into or renew agreements that exclude other operators from using a Site. 8.2 The Licensee must share its Sites containing antenna-supporting structures, where technically feasible, when requested to do so by any other radiocommunication service providers authorized under the Radiocommunication Act or by a party who is a provisional licence winner in accordance with a licensing process( A Requesting Operator ). 47. It is Rogers understanding that paging and trunked radio operators, which are not interconnected, would now be caught under the conditions of licence as they offer radiocommunication services for compensation. Rogers supports the proposed change as it will expand the number of site owners caught by the mandatory tower sharing conditions of licence and as a result will further expand the number of sites available for sharing. Responding to Requests for Information 5-2: Industry Canada is seeking comments on the proposed revised text to Section 8.3 of the Conditions of Licence for Mandatory Tower and Site Sharing (new text is underlined).

23 Rogers Communications Partnership Page In order to satisfy the condition of Site sharing in accordance with this licence, the Licensee must respond within two weeks of receiving a complete* request for preliminary technical information from a Requesting Operator as follows: - the Licensee shall provide to the Requesting Operator any preliminary technical information for each Site, such as drawings, surveys, technical data, engineering information, future requirements, lease provisions and other information relating to the site relevant to formulating a Proposal to Share that it has in its possession or control; and - upon reasonable notice by the Requesting Operator, the Licensee shall facilitate access to the site so that a formal Proposal to Share can be formulated. * a preliminary request for technical information will be considered complete if it contains, at a minimum, two of the following: (1) the Licensee s site reference number (2) the site address (3) geographical coordinates. 48. Industry Canada has not proposed any new wording associated with responses to requests for preliminary information but has proposed that text in GL-06 be incorporated into the conditions of licence. 49. As discussed earlier, Industry Canada has proposed a new database requirement which it hopes will result in the elimination of the preliminary information package process. Rogers however is not confident that the proposed database will shorten or eliminate the preliminary information process. In fact it could increase processing times. 50. Other options to reduce preliminary information times however do exist. Instead of creating the database, Industry Canada should simply reduce the timeline to provide preliminary information packages from 14 days to 10 days. This would reduce Requestor wait times for preliminary information significantly while not adding to the burden of Responding Licensees. As a result, Rogers proposes that Section 3 of the proposed conditions of licence be amended to reflect the ten day timeline as follows:

24 Rogers Communications Partnership Page In order to satisfy the condition of Site sharing in accordance with this licence, the Licensee must respond within 10 days of receiving a complete* request for preliminary technical information from a Requesting Operator as follows: - the Licensee shall provide to the Requesting Operator any preliminary technical information for each Site, such as drawings, surveys, technical data, engineering information, future requirements, lease provisions and other information relating to the site relevant to formulating a Proposal to Share that it has in its possession or control; and - upon reasonable notice by the Requesting Operator, the Licensee shall facilitate access to the site so that a formal Proposal to Share can be formulated. Tower Sharing Rates and Technical Feasibility 5-3: Industry Canada is not proposing any changes to the current text of Sections 8.4 or 8.5. It is expected that Site Sharing Agreements, including access to ancillary equipment and services, will be offered at commercial rates that are reasonably comparable to rates currently charged to others for similar access. 51. Rogers supports the Department s position that tower sharing should be offered at commercial rates. Rogers provides further input on proposed rates under Section 5-9, where Industry Canada has invited comments on other issues relating to the mandatory tower and site sharing process. Good Faith Negotiations 5-4: Industry Canada proposes that the text from Section 1.2 of CPC be moved to Section 8.6 of the conditions of licence for mandatory tower and site sharing as follows (new text is underlined): Licensees must negotiate with a Requesting Operator in good faith, with a view to concluding a Site Sharing Agreement in a timely manner. In order to be considered to be negotiating in good faith, Responding Licensees must offer access to ancillary equipment and services at reasonable commercial rates.

25 Rogers Communications Partnership Page Rogers supports this proposed revision to move the proposed relevant text. Timelines for Tower Sharing Negotiations 5-5: Industry Canada proposes that the text in Section 8.7 of the conditions of licence for mandatory tower and site sharing be modified to indicate that arbitration may be initiated as follows (modified text is in bold): 8.7 If after 60 days from the date that the Licensee receives a Proposal to Share, the Licensee and the Requesting Operator have not entered into a Site Sharing Agreement or have not agreed to any interim arrangement, the Licensee must submit or agree to submit the matter to arbitration in accordance with Industry Canada s Arbitration Rules and Procedures, as amended from time to time. The Licensee shall agree that the arbitral tribunal shall have all necessary powers to determine all of the questions in dispute (including those relating to determining the appropriate terms of the Site Sharing Agreement and those relating to procedural matters under the arbitration) and that any arbitral award or results under this condition of licence shall be final and binding with no right of appeal, subject to applicable provincial or territorial legislation. The Licensee must participate fully in such arbitration and follow all directions of the arbitral tribunal in accordance with Industry Canada s Arbitration Rules and Procedures and any arbitration procedures established by the arbitral tribunal. 53. Under the current conditions of licence, the Responding Licensee and the Requestor have 90 days to complete negotiations and enter into a site sharing agreement unless both parties can agree to an extension. The 90 day period starts when the Licensee receives a Proposal to Share and ends when a site sharing agreement or interim agreement is reached. Included in the 90 day period is the requirement for the Responding Licensee to reply to a Proposal to Share within 30 days. The Department has proposed that the timeline be contracted from 90 days to 60 days. 54. While Rogers is supportive of the changes, reducing the negotiation period from 90 days to 60 days is unlikely to expedite negotiations. Rogers experience has shown that it is difficult to conclude negotiations within the current 90 day timeframe. Overall, site sharing is a time consuming process that requires the efforts of both the requesting and responding party. The process is dependent on the availability of key resources, including outside engineering consultants, to examine and approve tower