The Canadian Radio-television and Telecommunications Commission ordered Bell Mobile Communications Inc. to “cease discriminating unjustly” against Invoice Reduction Services Ltd.-a company that wants to offer discounted cellular service to a group of unrelated small businesses.
Bell Mobility operates cellular systems in the Canadian provinces of Quebec and Ontario, where it offers a Partner Plan Service providing corporations with cellular service at discounted bulk rates.
Joseph Brandt Memorial Hospital is one such account. But JBMH’s contract also has a plan extension giving discounted pricing to its employees.
Since late 1992, IRS has been attempting to acquire Partner Plan Service for its own group but Bell Mobility has refused. The CRTC last month reaffirmed its earlier determination that the IRS proposal was similar in all material respects to the JBMH arrangement and it directed Bell Mobility to provide the service at the same rate and for the same term to both entities.
At the heart of the dispute is the difference between sharing a service and reselling it. Reselling has not been a factor in the growth of Canadian cellular.
“Applications were made a couple of years ago to allow reselling but we ruled against it based on the Infant Industry Argument-cellular companies were not yet profitable, they needed capital to upgrade their systems to digital and they thought that reselling would impede raising capital,” according to CRTC Tariff Analyst Don Bowles.
But in the JBMH case, “The bulk service was being resold to employees and doctors who were not the same entities as the hospital. They were allowing a group to share the service. If you let some share, you have to let all share,” he said.
Bell Mobility disagrees.
“The CRTC did not find a difference between sharing a service and reselling it,” said Yves Desjardins-Siciliano, Bell Mobility’s vice president for law and external relations.
He notes the first distinction is that IRS will share discounted service with people who are not employees of the same corporation and who do not even belong to a homogeneous user group-like healthcare workers. And, secondly, IRS will charge a premium for the service, he said.
Both Bell Mobility and the CRTC maintain that this decision, although it expands the definition of share group, is specific to the IRS proposal only.
“We haven’t extended it to anyone else nor have we had any other similar complaints,” said Desjardins-Siciliano. But he notes that Bell Mobility’s competitor Rogers Cantel Inc. has similar share group plans as do cellular carriers in other Canadian markets.
