(Photo via Eastlink)
Eastlink, which provides cable and internet services to many rural communities across the province, says it may have to cut some of its services in Newfoundland and Labrador because of CRTC regulations surrounding wholesale internet prices.
Executive Vice-Chair of Eastlink, Lee Bragg, says the CRTC is forcing his company to sell internet services on their infrastructure to companies like Telus at rates well below cost.
A frustrated Bragg says the cost is too great in many rural and underperforming areas.
“Newfoundland and Labrador, in particular, are challenging for us because we don’t own any of the major urban markets. Rogers services those. We have all the rural areas,” he says in an interview.
“We can’t afford that risk, so we have to minimize the risk and end up looking at some of these areas to shut down.”
Bragg says the move could affect coverage in just about any smaller region of the province, the largest municipality being Happy Valley-Goose Bay.
“I sell high-speed internet for $80 a month. My costs are $50. My wholesale rate is $25.They only cover half my costs,” he told VOCM News.
“So that gives them a $25 advantage in the marketplace over me, which I need to recover on all my other customers. Why should I have to be forced to raise prices to my other customers in order to give a benefit to Telus shareholders?”