A presentation on the current trends and pitfalls of Canadian telecom deals from a legal perspective. This presentation was given by David Crane, a partner at McCarthy Tetrault LLP, at McCarthy Tetrault's 2012 Technology Law Summit in Toronto, Ontario.

1. McCarthy Tétrault Advance™
Building Capabilities for Growth
Technology Law Summit
January 18, 2012
McCarthy Tétrault LLP / mccarthy.ca / January 2012 / #tls12 / snipits.ca

2. Telecom Deals: Trends and Pitfalls
David Crane, McCarthy Tétrault LLP
McCarthy Tétrault LLP / mccarthy.ca / January 2012 / #tls12 / snipits.ca

3. Technology Law Summit 3
Unique Aspects of Telecom Deals
¬ Telecom networks are becoming
increasingly critical to business success
¬ Regulated industry
¬ Mix of custom and commodity services in
the marketplace
¬ Greater choice of providers
¬ Telecom-related technology and services
are quickly involving and changing
McCarthy Tétrault LLP / mccarthy.ca / January 2012 / #tls12 / snipits.ca

4. Technology Law Summit 4
Potential Pitfalls
¬ Using telecom provider standard form contracts or not
sufficiently negotiating provider standard terms
¬ Signing up for services on an ad-hoc basis with new
providers or for additional services with existing providers in
a manner that can inadvertently result in:
¬ staggered terms
¬ higher pricing
¬ incompatibility
¬ inefficiency
¬ Not negotiating sufficient flexibility to address change (in
particular, changes to technology and customer business
requirements)
McCarthy Tétrault LLP / mccarthy.ca / January 2012 / #tls12 / snipits.ca

5. Technology Law Summit 5
Trends
¬ Develop a telecom plan
¬ take into account the current state of available telecom
products and your needs at least five years down the
line
¬ map the plan to anticipated business changes
¬ Contract for services on a consolidated basis (across the
entire corporate group) to create additional negotiating
leverage and obtain better pricing
¬ Use a competitive procurement process to select providers
¬ Select providers based on their ability to be a strategic
partner
¬ Consider using a “qualifying bundle” approach for deals
involving both tariffed and forborne services
McCarthy Tétrault LLP / mccarthy.ca / January 2012 / #tls12 / snipits.ca

6. Technology Law Summit 6
Trends (con’t)
¬ Telecom contracts best practices:
¬ a clearly defined scope of services
¬ service-quality levels and associated failed
performance remedies to ensure performance standards
¬ specific flexibility mechanisms to allow for changes to
the deal, so that you can take advantage of
technological advances and react to changes in your
business
¬ pricing protection provisions to provide cost certainty
and ensure pricing remains competitive
¬ appropriate exit mechanisms
McCarthy Tétrault LLP / mccarthy.ca / January 2012 / #tls12 / snipits.ca

7. Technology Law Summit 7
Trends (con’t)
¬ Some terms to review in particular:
¬ Inapplicable consumer terms
¬ Service descriptions and specifications
¬ Purchase/revenue and exclusivity commitments and related
termination charges
¬ Service levels
¬ Remedy clauses
¬ Billing and payment terms
¬ Compliance with provider acceptable use policies
¬ Force majeure clauses
¬ Confidentiality and security requirements
¬ Limitation of liability clauses
McCarthy Tétrault LLP / mccarthy.ca / January 2012 / #tls12 / snipits.ca

8. Technology Law Summit 8
Questions?
McCarthy Tétrault LLP / mccarthy.ca / January 2012 / #tls12 / snipits.ca

9. VANCOUVER MONTRÉAL
Suite 1300, 777 Dunsmuir Street Suite 2500
P.O. Box 10424, Pacific Centre 1000 De La Gauchetière Street West
Vancouver BC V7Y 1K2 Montréal QC H3B 0A2
Tel: 604-643-7100 Tel: 514-397-4100
Fax: 604-643-7900 Fax: 514-875-6246
Toll-Free: 1-877-244-7711 Toll-Free: 1-877-244-7711
CALGARY QUÉBEC
Suite 3300, 421 7th Avenue SW Le Complexe St-Amable
Calgary AB T2P 4K9 1150, rue de Claire-Fontaine, 7e étage
Tel: 403-260-3500 Québec QC G1R 5G4
Fax: 403-260-3501 Tel: 418-521-3000
Toll-Free: 1-877-244-7711 Fax: 418-521-3099
Toll-Free: 1-877-244-7711
TORONTO
Box 48, Suite 5300 UNITED KINGDOM & EUROPE
Toronto Dominion Bank Tower 125 Old Broad Street, 26th Floor
Toronto ON M5K 1E6 London EC2N 1AR
Tel: 416-362-1812 UNITED KINGDOM
Fax: 416-868-0673 Tel: +44 (0)20 7489 5700
Toll-Free: 1-877-244-7711 Fax: +44 (0)20 7489 5777
Information on our National Technology Group
McCarthy Tétrault LLP / mccarthy.ca / January 2012 / #tls12 / snipits.ca