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Summary:

Incumbent telecoms will be watched like a hawk, lest they try and use predatory pricing to lock out upstarts in the VoIP market place. Bell Canada and Telus are clearly upset, but CRTC chairman Charles Dalfen told Globe & Technology, “This is precisely the moment when […]

Incumbent telecoms will be watched like a hawk, lest they try and use predatory pricing to lock out upstarts in the VoIP market place. Bell Canada and Telus are clearly upset, but CRTC chairman Charles Dalfen told Globe & Technology, “This is precisely the moment when Canada needs a regulatory framework that will provide the quickest road to competition.”

  1. As a Canadian who is involved in the voip market, I’m interested to understand what economic details I’m missing in my interpretation of the voip markets….

    Why would the traditional carriers undercut others, it seems to me they would have reason to price in ‘quality’ and ‘premium services’ and therefore keep the prices high to not compete with their existing products but instead use voip to create new markets and slowly lower costs.

    Am I missing something or is the real threat non-incumbents who have deep pockets (cable cos etc) and simply want an opportunity to de-thrown the incumbents?

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  2. Exactly. The ILECs aren’t competing against helpless little upstarts, they’re competing against cable mega-monopolies with millions of subscribers.

    The ones that are currently undercutting costs are the competitors Primus and Vonage. Primus is waiting for someone to buy them out, and Vonage can rely on Vonage USA’s deep pockets to stay in the fight.

    With Rogers snatching up CLEC Call-Net (aka Sprint Canada) this week, it is even more apparent what an uneven field in FAVOUR of the CLECs we’re looking at here.

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