'I'm accountable for the outage': Rogers CEO vows to make 'urgent fixes' during grilling before MPs

Tony Staffieri, the CEO of Rogers Communications Inc., faced an hour of grilling by members of a parliamentary committee on Monday during a hearing in which he admitted to failing the emergency alert and Interac payment systems.

"As Rogers CEO, I'm accountable for the outage," Staffieri said in opening remarks.

Staffieri, who was named CEO in January following a power struggle between members of the Rogers family, said the company would spend $250 million to make "urgent fixes."

Industry Minister François-Philippe Champagne says he should not have had to reach out to Rogers CEO Tony Staffieri during massive national network outage. It should have been the other way around. #rogersoutage #telecom #wireless

— Barbara Shecter (@BatPost) July 25, 2022

The committee questioned the telecom giant's risk management practices and whether there should be more stringent rules and penalties to protect essential services.

Staffieri was asked if Rogers should be treated as a public utility, if he had the confidence of his board of directors, and if the Shaw acquisition should be put on hold.

Staffieri focused on the billions of dollars Rogers would spend on networks over the next few years. The merger with Shaw would allow for massive investments which neither company could make on their own, and shorten the time it will take to allow Rogers to separate its wireless and wireline operations.

The Shaw wireline network can be used to do this in half the time.

Staffieri spoke for most of the time. Rogers' new chief technology officer, Ron McKenzie, said the "unprecedented" outage should serve as a warning to other telecoms in Canada and around the world.

In a way that was not known, the common core reacted to the upgrade and coding error.

In a letter of explanation demanded by the Canadian Radio-television and Telecommunications Commission, Rogers said that the coding error resulted in high volumes that exceeded capacity levels and eventually caused the common core network to stop processing traffic.

When the entire core network is involved, simulations can't be done on most network upgrades.

Rogers will partition its network in order to keep a problem from occurring in one area. Testing of code is one of the changes that will be made.

Even though the Rogers network was down, calls that should have been routed to a rival network continued to try to connect with it.

Over the next 45 days, fixing this problem will be a priority, as the industry works to create a Memorandum of Understanding to support one another in the event of a large outage.

He told the committee that Rogers spends $3 billion a year on network builds and improvements. He said spending this year would be double what it was last year.

Tracy Gray questioned if Rogers is doing enough to manage risk, given that it has suffered two major network outages in the past 15 months. She questioned Staffieri about why the CFO's office is where the risk is managed.

A rift within the Rogers family that controls the telecom giant caused Staffieri to leave Rogers. Edward Rogers, the son of company founder Ted Rogers, received the B.C. Supreme Court's approval for a move to replace five independent directors.

In May, the Competition Bureau moved to block the company's merger with Shaw due to concerns it would reduce wireless competition and result in higher prices. Rogers and Shaw are fighting the attempt to stop the deal.

Shaw shareholders voted in favor of the merger.

Ian Scott, chair and chief executive of the CRTC, told the standing committee on Monday that Canada's telecom networks have generally worked well, but he acknowledged that the Rogers outage was a "catastrophic failure."

He doesn't know of another situation where the core failed completely.

Scott said it was too early to consider imposing an administrative monetary penalty, which is within the regulators power. He said that imposing financial penalties is meant to encourage compliance rather than punish because the CRTC is still gathering information about what happened at Rogers.

The email is bshecter@postmedia.

The Financial Post is part of Postmedia Network Inc.

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