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Internet competition comes north

Northwestel has introduced a new data service, Wholesale Connect, which will give third-party Internet providers access to Northwestel's fibre-optic link to the south.

The North has moved one step closer to having real competition in Internet and phone service.

Northwestel has introduced a new data service, Wholesale Connect, which will give third-party Internet providers access to Northwestel’s fibre-optic link to the south.

“I think it’s a service that should meet the needs of competitors, whoever they may be,” said Paul Flaherty, president and CEO of Northwestel.

While the pricing still has to be worked out, on a technical level the new service looks good, said Dean Proctor, the chief development officer for Yellowknife-based Internet provider SSi Group.

Back in June, SSi filed a complaint with the Canadian Radio-television and Telecommunications Commission over Northwestel’s pricing for its V-Connect service, the raw link to the fibre-optic network.

In January, the commission sided with SSi and decided to start regulating V-Connect. It ordered Northwestel to perform a cost study to prove its pricing was fair.

But instead of complying with the CRTC order, Northwestel came back a month later offering a new wholesale Internet service.

That was met with a strong rebuke from SSi.

The service it offered was only operated from Yellowknife to Edmonton and didn’t offer any quality-of-service guarantees, something vital to transferring voice traffic.

At the time, Proctor accused Northwestel of attempting to stifle competition.

The outrage over the new service came as a surprise to Flaherty.

“I didn’t have a good enough understanding of what the requirements were for the competitor at the time,” he said.

After the spat, Northwestel reached out to SSi.

“We made sure that we had a good understanding of what the requirements were,” said Flaherty.

Its latest offering, Wholesale Connect, will be available in more than 30 communities across the North. It will have quality-of-service guarantees.

Northwestel submitted a cost study to the CRTC last week.

The commission isn’t expected to make a decision on pricing for several months, but Northwestel is offering an interim rate of one dollar a month for the service.

While pricing will be the determining factor on whether or not SSi will be able to expand its services into the Yukon, Proctor said this latest offering is a positive step for both the growth of his business and its relationship with Northwestel.

“We certainly do appreciate that they reached out to us,” he said.

Wholesale Connect will likely open up the North to competition for both data and voice services. That’s something Flaherty said his company is working hard to prepare for.

“We’re going to obviously have to win customers one at a time,” he said. “I think that’s a good thing from Northwestel’s perspective.

“It’s going to have to get us much more focused on customer experience with our products and services.”

Contact Josh Kerr at