
Canadians Just Became World's Biggest Internet Losers. - nirav
http://thetyee.ca/Mediacheck/2011/01/26/InternetLosers/print.html
======
acangiano
I'll provide one data point of how this affects Canadian internet users.

I currently have no caps with TekSavvy and pay $39 a month. Starting from
March 1st, I will pay $31.95/mo with a 25 GB cap. Any gigabyte over the limit
will cost about 2 bucks.

Now, you can buy a block at discounted prices. According to TekSavvy, based on
my internet usage, I will need to buy at least a 275 GB extra block. Believe
it or not, I don't torrent. I simply like to watch NetFlix, HD movies from
iTunes, lots of educational videos online, and backup data in the cloud.

That 275 GB block costs $55/mo. So I suddenly go from paying $39 for unlimited
data to paying $86.95 per month, and having to be careful about what I
download and what not.

Oh, and the first thing I need to do is stop backing up my data, videos, and
photos in the cloud. That's pretty much out of the question with the risk of
paying $2 per extra GB. I'm buying an additional external hard drive instead.

How is that for innovation?

~~~
neonfunk
I actually agree with metering; I think it's the only fair measure. Granted,
the metering you describe sounds atrocious, and there'll probably be a long
messy transition to the point where our internet bill is more like our
electric bill.

But imagine this: on mobile networks, instead of voice minutes, text messages,
data caps, fees for tethering, and every other scheme the Telcos are
concocting right now (with regard to charging for individual services), we
instead have a single measure of our usage — data — and our bill starts at
something reasonable like $5 or $10 a month.

The problem with "unlimited" in my view is that it conditions us to think that
said resource really is unlimited, versus, say, electricity where we are
incentivized to be aware of our usage. Now, if they're going to charge $2 per
GB above some arbitrary cap — that's clearly absurd. But to start the bill
very low (for the basic connection), and then charge, say, 10¢ or 15¢ per GB?
Sign me up.

~~~
lsc
Metering only makes sense if the costs vary with usage. In the case of DSL,
the vast majority of the cost is the cost of maintaining the copper pair to
your house, and that cost largely doesn't change, regardless of usage.

Now, if the line from the CO (where the DSL terminates) to the internet was a
significant bit of the cost, I'd agree with you. But my understanding is that
the line from the CO to the 'net is a very small cost compared to the cost of
all those copper pairs.

You also have a point when it comes to shared-loop technologies like cable.
Metering is probably the most fair way to decide who gets what percentage of
the limited fixed loop. (and probably the best way to get the telco to add
more capacity when a loop becomes overloaded)

I'm just saying, the last-mile has many situations where running the
connection, regardless of how much you use that connection, dominates the
cost. And in those cases, "unlimited" (up to your port speed) billing makes a
whole lot of sense.

~~~
zmmmmm
> Metering only makes sense if the costs vary with usage ... in the case of
> DSL, the vast majority of the cost is the cost of maintaining the copper
> pair to your house, and that cost largely doesn't change, regardless of
> usage.

That's a somewhat naive view of things. It only works if all the upstream
equipment has infinite capacity. If you (and others like you) use 275GB
instead of 10GB then it absolutely does cause more equipment to have to be
installed upstream, which I don't think is an insignificant cost.

I'm like the GP - I wish every connection was metered, the problem is not
metering, but the rate which invariably seems to be way above what is
reasonable. Metering seems to always just be a cynical strategy to exploit
naive users who don't know how much bandwidth they consume (bill shock, etc)
rather than a rational economic way of sharing a limited resource.

~~~
patrickgzill
It is not at all naive, it is very accurate.

After the connection hits the DSLAM it goes onto fiber, which starts at 1 Gbps
capacity and goes up to either 40Gbps or 100Gbps per port. Only in the
smallest markets would they use a T3/DS3 connection.

Actual bandwidth costs for 200GB (which is about 1Mbps) over the course of a
month are about $1 USD in almost any major US city.

Even assuming 4x the cost for Canada's smaller market size, we are talking
about a ($4 into $55 upcharge) 13 times markup once the cost of the basic
connection, tech support, marketing, etc. is covered by the initial $31.95.

~~~
vacri
Sounds like a bargain. There's a business opportunity for you!

~~~
nikster
I think this hits on the real, underlying issue: There is no free market
competition in internet access. In the case of Canada it appears one state-
owned company owns all the physical lines, and that company is starting to
meter access.

So, a sensible approach by the government would be to review the actual access
costs - whether it's $2 / 100GB or some other figure - then fix the price at
that level. Review it every year. Fair for all. I am sure the guy using
275GB/month wouldn't mind paying $4 for it.

Unlimited access is unrealistic, as is gauging the public for 10x the fair
value _when you're a monopolist_.

~~~
jarek
The really stinging part is that Bell isn't state owned, even though it
certainly acts the part.

~~~
jacquesm
Indeed, but Canada has a long history of the government supporting business
interests against the interests of its own population. I have a list somewhere
that I prepared for an article that I intend to write about this, it's
probably never going to happen because I can't get mad enough about it any
more (since I've left Canada that sort of thing has gone on the back burner).

~~~
warrenwilkinson
I would love to see that list actually. I live in Canada and often debate
politics.

If its no trouble, could you please contact me at warrenwilkinson@gmail.com?

~~~
jacquesm
Sure, I'll dig it up and I'll mail it to you, it's on my todo list now.

It was made because I was planning on writing a book on immigrating to Canada
from the perspective of someone that has gone through the whole process, and
this was to become one article (a blog post) and / or a chapter in there.

The whole thing had as working title 'movingtoca'.

Canada is a fantastic country but some things there are just - how to say this
without insulting Canadians - peculiar.

The system works for the most part but if you don't dig in to Canada's history
and do your best to understand the way the various interests interlock there
is no way you're going to understand how things got to be the way they are.

To an outsider they'd make no sense at all and to people living there that do
not have the historical perspective they probably also do not.

Some of these things date back all the way to the prohibition days of Capone!

How do you explain to an American that the same bottle of wine costs 50% more
in rural Canada than in New York City :) ?

~~~
jarek
> How do you explain to an American that the same bottle of wine costs 50%
> more in rural Canada than in New York City :) ?

Shipping cost? If anything, I'd have thought the LCBO, keeping prices uniform
across the province, helps rural areas at the expense of higher density areas
(though perhaps not strict downtowns where store lease cost might be
significant).

~~~
wmoxam
Alcohol is heavily taxed and the LCBO also enforces a price floor to
discourage heavy drinking.

<http://www.lcbotrade.com/selling_pricing.htm>

------
JeffJenkins
This doesn't explaining what's going on very clearly. Small Canadian ISPs are
allowed to use the infrastructure of Bell Canada at wholesale rates in order
to foster competition. This has been reasonably successful. What has happened
now is that the CRTC ruled that Bell is allowed to impose the same per-user
bandwidth caps on its wholesale customers as it does on its own users.

Since the smaller ISPs should simply be getting bandwidth from Bell, this is
totally ridiculous. Their ability to compete with Bell on price or levels of
service is almost totally eliminated. When my friends and family in Ontario
were explaining this to me I kept having to ask them to repeat themselves
because it _boggled my mind_ how ISPs using bell's infrastructure could be
subject to those sorts of restrictions.

~~~
jacquesm
The Canadian government has a long history of propping up the monopolies
operating inside its borders, especially when it has a stake in them. For
additional entertainment read up on the LCBO and the Egg Board (no, that's not
a joke).

~~~
cal5k
Not to mention the Canadian Wheat Board, perhaps the most egregious of all
monopsonies (apparently it's not a "monopoly" because it is the only BUYER of
wheat).

~~~
derefr
Monopsony.

~~~
cal5k
I... believe that's what I said?

------
waterside81
For those not familiar with Canadian bureaucracies, the CRTC governs telecom
issues, similar to the FCC in the US.

What may not be so obvious, even to Canadians, is that the members of the CRTC
used to work for Bell, Rogers, Telus etc. Much like employees of the Treasury
Department in the US, these people go from private sector to public sector and
back continuously. A running joke at Rogers used to be that whenever they
wanted some sort of legislation changed, the VPs would draw straws to see who
had to quit and join the CRTC.

~~~
rapind
This is very true, and the real root of the problem is abstraction and voter
apathy. Of course it doesn't help any when Rogers and Bell own many of our
major media outlets who might otherwise draw more attention to the issue.

No, not a conspiracy theory. If you're a publicly traded company capable of
creating more wealth for your shareholders by creating an agreeable political
environment it would be practically unethical to your shareholders not to take
advantage of it... Regardless of the long term impact to your customers. After
all, it's pretty hard to convince your board that you shouldn't do something
that may negatively impact your customer base in 20 years, and should instead
settle for less profit today.

So pretty much the same game as the states.

------
jacquesm
The telecommunications situation in Canada is terrible.

Typically, in rural areas the way to get broadband goes something like this:

A bunch of people get a deal with a small ISP to _finally_ provide them
broadband because Bell says they won't be doing it. Then two weeks after all
the gear gets installed and the small ISP starts signing up customers Bell
will swoop in with an offer to undercut them and suddenly all the things that
made it 'impossible' to get broadband before are mere chalk lines instead of
the hurdles they were made out to be before.

In Canada it is illegal (or was, this is 4 years ago, it may have changed) to
have a satellite receiver that receives FTA programming and so on.

~~~
xxpor
As an American, I'm not very familiar with the telco situation in Canada. Is
Bell related to AT&T (the old one)? Do they have a approved monopoly over all
phone service, ala AT&T way back when (by this I mean do they carry all calls
at some point, even if its only as a wholesale co)?

~~~
pyre
As it was when I was living in Toronto, the last-mile lines are owned by
either Bell (DSL/Phone) or Rogers (Cable). Both of those companies are the
Canadian telecom heavy-weights.

Rogers does: cable tv, ip phone over cable (ala Comcast in the US), cable
internet (which IIRC it own the only coax last-mile lines in the areas where
it is a monopoly -- I think that west Canada has a different cable monopoly),
the only gsm carrier in Canada+, a chain of video rental stores that competes
with Blockbuster Canada.

Bell does: phone, DSL++, and the only CDMA cell carrier in Canada+++.

\+ At the time I was living in Canada, there were many smaller GSM players,
but they had all been bought out by Rogers, so you largely just had different
branded GSM services from the same provider. More recently there have been at
least two new GSM players (Wind and Mobilicity) though I believe that their
coverage area is mainly just the Greater Toronto Area. [Of note is that Bell
and Rogers use the same 3G bands as AT&T does in the US and Wind/Mobilicity
use the same 3G bands as T-Mobile does in the US.]

++ The last-mile DSL lines were being sold to 3rd-parties ISPs as well as Bell
itself being an ISP on those lines. See me ascii-art diagram in the other
thread.

+++ Similar to Rogers, IIRC there were a couple of smaller players that were
bought out by Bell so that all of the CDMA carriers were under the Bell
'umbrella.'

~~~
gabbo
A few things to add though you painted a pretty good picture:

\- Shaw is the cable monopoly in the west. Shaw used to have a presence in
Ontario but they did a big asset swap about 10 years ago.

\- A few areas have different cable monopolies but they're vastly smaller than
Rogers/Shaw. Cogeco and Videotron, I think.

\- Beyond Rogers (who bought Microcell a.k.a. Fido) and the smaller players,
Bell and Telus actually teamed up and built their own GSM network. I think it
went live shortly before the 2010 olympics.

\- As far as I know Bell and Telus both operate their own CDMA networks across
Canada. In Ontario, at least, you've been able to get CDMA service from both
for a long long time.

~~~
pyre
\- I was under the impression that Bell owned Telus or something similar.

\- I heard about the GSM network, but IIRC there is some sort of transition
period going on right now. Also, I've heard varying reports about it. I wasn't
sure if they actually _had_ a GSM network or if people were talking about them
not using CDMA for 3G internet.

~~~
gabbo
Today's Telus came out of a merger a long time ago between the old Telus and
Clearnet. There hasn't been any merger _yet_ , but oddly there are articles
floating around speculating that there will be one in the not-too-distant
future. Great, just what Canada needs: less choice in telecoms.

Re: the GSM network, I thought it was kind of ridiculous at first for the two
carriers to build an entirely new 3G network when their CDMA works just fine.
The speculation I heard was (1) they wanted to sell the iPhone (2) roaming
revenue for the 2010 Olympics. Neither seemed like enough reason for such huge
expense though. I can't find much solid information but I'm willing to bet
you're right and their GSM network is available in a few places nationwide.

------
cal5k
Here's another reason why this is bullshit... this is an excerpt from an
article I'm working on:

The biggest problem with these caps is that they are, plain and simply,
anticompetitive. Probably illegally so.

Let’s take Bell’s internet service as an example. Bell recently rolled out
their “Fibe” offerings, both for internet and IPTV.

Their most accommodating plan, Fibe 25, has a ludicrously low cap of 75GB. It
would be pretty easy to exceed that with HD content from iTunes, Netflix,
YouTube, etc.

Fibe TV, however, delivers TV over the same network. Bell even treats the IPTV
traffic preferentially, as you can in this gushing review:
[http://www.benlucier.ca/work/tech/bell-entertainment-
service...](http://www.benlucier.ca/work/tech/bell-entertainment-service-the-
results-are-impressive/)

There’s only one minor difference: Fibe TV is not subject to the same usage
caps. You can stream as many movies as you like over Fibe TV, watch as much TV
as you like, and never get charged extra for the bandwidth.

Well now, that’s funny. Didn’t Bell’s regulatory spokesperson say something to
the contrary just the other day? Oh yeah!

“A bit is a bit is a bit. If you’re a heavy user, regardless of what’s causing
the heavy use, you will pay more. That’s the concept,” said Mirko Bibic, Bell
Canada’s senior vice-president for regulatory affairs.

[http://www.theglobeandmail.com/news/technology/tech-
news/net...](http://www.theglobeandmail.com/news/technology/tech-news/netflix-
confronting-canadian-challenges/article1866312/)

Yes, Mr. Bibic, it appears that all bits are equal – but some bits are more
equal than others.

This is a textbook case of anticompetitive behaviour, one of a long litany of
recent sleazy undertakings by major Canadian telecoms (e.g. Rogers’
suspiciously well-timed lowering of caps on their most popular plans when
Netflix entered the Canadian market). It is also a textbook method for
successfully stifling innovation, a problem Canadians are all-too-familiar
with.

The Internet is now an essential service. While smart countries like South
Korea, Australia, and Japan are making (or have made) large public investments
in fast, ubiquitous, and unlimited Internet for all citizens, Canada continues
to lurch backwards courtesy of myopic regulators, oligopolistic telecoms and a
government that is unwilling to intervene for the good of all Canadians.

~~~
waterside81
_Rogers’ suspiciously well-timed lowering of caps on their most popular plans
when Netflix entered the Canadian market_

I have intimate knowledge of this issue and it really was just bad timing on
Rogers' part. They had been planning on rolling this out well before Netflix's
announcement, at least 8 months, but they just chose to pick the absolute
worst time to make their announcement.

~~~
cal5k
If you like, I could also point to the convenient dropping of calls when they
are passed from Wind Mobile's network to Rogers' (and the subsequent marketing
campaign around that fact) as another example of sleazy behaviour. This does
not happen anywhere else in the world.

It may not have been the case in this instance, but it's certainly not outside
the realm of possibility. I can tell you that reduced caps are, broadly, an
attempt to make alternatives to Rogers' content services like Rogers on Demand
less attractive.

------
gregsadetsky
How expensive would it be to start a number of small independent Wireless
Internet Service Providers (WISPs)?

I'm thinking of a decentralized "movement" of geeks organizing what's required
to get neighborhoods and villages online: an omnidirectional antenna high
enough that Line of Sight can be provided to most residents, a high bandwidth
fiber optics connection at the center, and subscriber antennas at the
residences.

I've tried to find more information on Motorola Canopy technology in the past
days -- look at this example deployment in Nova Scotia:
[http://en.wikipedia.org/wiki/Broadband_for_Rural_Nova_Scotia...](http://en.wikipedia.org/wiki/Broadband_for_Rural_Nova_Scotia_initiative)

From what I'm gathering, Canopy can be deployed over unlicensed frequencies
(2.4 and 5 Ghz), allows for hundreds of subscribers connecting to a single
Access Point, can provide up bandwidth in the 5-10 Mbps range, etc.

Are there particular advantages to Canopy over 802.11x? Could it become
viable, with infrastructure costs spread over some years, to run a small local
WISP? I'm thinking of a "Real Internet" designation/"certification" that could
be given out to any ISP that follows a basic code of conduct: offers at least
one unlimited transfer connection plan and does not throttle traffic.

Is starting an ISP, regardless of the physical layer, overly regulated by
CRTC? The Wikipedia page says "The CRTC does not regulate rates, quality of
service issues, or business practices for Internet service providers" -- is
that in effect true?

How can anyone manage with 25 GB per month? Are Netflix or the NFB going to do
something about this? If not, can "we"?

~~~
a_m0d
Could be quite expensive. Where I live (40kms from Perth, WA, in a semi-rural
area) we use this Motorola wireless technology, and the prices are
astronomical - $80 for 3GB on peak and 5GB off peak. When we first signed up,
we also had major stability issues (connection constantly dropping out,
connection hijacked by a hacker for a few months, etc.), although things are
looking better now.

~~~
gregsadetsky
Thanks a lot -- do you know if you're using a 900Mhz, 2.4 or 5Ghz subscriber
unit?

Also, what's the distance from the ISP to you?

~~~
a_m0d
No idea. This is a really bad ISP who seem to get nothing but complaints -
they assume that all their users are really dumb, so their technical FAQ
(<http://oceanbroadband.net/info/faq.html>) states only that they use a
proprietary system from Motorola Canopy Wireless. As for the distance from the
exchange, I think we are about 10kms away, but once again I'm not entirely
sure.

------
rafd
I'm embarassed to be Canadian.

I'm not opposed to usage based billing - users who use more should pay more,
but the rate should be commensurate to actual costs. Regulation is meant to
protect the public from potentially unfavorable actions by authorized natural
monopolies. Perhaps the ISPs should be selling bandwidth on a market, like
with electricity.

------
MikeCapone
I'm a Tesksavvy customer and I got a email about this yesterday.

Until now I thought it was crazy that Austrlia was getting a censored internet
and wondered how such a thing could happen in a pretty modern democracy. But
now I feel like something worse has happened here... While new internet
applications that use more and more data are coming out all the time and the
cost of moving a byte on the net is going down rapidly, caps are getting
smaller and smaller here just so the big telecoms can protect their on-demand
TV businesses and keep internet service minimal without having to worry about
competition.

This is so anti-competitive that it sickens me.

------
ronnier
This really disturbs me. I just moved to Seattle where I signed up for Comcast
internet. A couple of days later, my connection stopped working until I
activated my account on comcast.com. I did, and the first thing I saw was

High-Speed Internet Data Usage: 17% 43GB of 250GB

They sure hide that fact when you signup, not that I have any options, as
Comcast is the only provider where I live. This is a horrible direction we are
heading. And, if you go over the limit, they call and warn you. If you go over
again, they cancel your account.

~~~
citricsquid
Same here. I'm with BT in the UK and I'm on an unlimited* plan with a fair
usage policy. This is fine by me, I held off downloading until night time (for
both my own convenience and others) but because I had 2mb/s download and a
Steam library of 200+ games, I figured I may as well DL my entire library at
once. After a couple of days I'd downloaded over 300GB, one night I get an
email saying blah blah fair usage cap has been hit. So now I'm capped at 1mbps
between 5PM and midnight every day for 1 month (thankfully the cap is lifted
tomorrow) because my "unlimited" plan has _hard_ defined limits that aren't
publicised. Try finding the limit for the unlimited plan I have and it doesn't
exist, yet EVERYONE gets capped at 300GB/m. In a normal month I use ~150GB and
would stick to that if I'd known about the defined limit, the misleading
nature of it sucks.

I don't mind limits, unlimited is impossible, but when the limit is the same
for everyone regardless of how the service is used and then tout it as
unlimited... it's ridiculous.

~~~
slavak
Wouldn't that be considered a breach of contract? I know that if this happened
to me (Israel) the first thing I would do is call up my ISP and threaten a
lawsuit unless they provide me the service I signed up for.

~~~
jarek
Some small print in a terms and conditions document probably says something
like "we reserve the right to Manage Our Network (read: throttle you) as we
see fit." Also "we reserve the right to terminate the contract at any time for
any reason."

~~~
slavak
This probably depends a great deal on the legal system where you live. Over
here there's a decent chance of a "small-print" condition like that being
thrown out if it was ever challenged in court. Of course it also helps that
usually you sign up with an ISP over the phone, without actually signing any
physical contract they can fill with "small-print".

------
sedachv
Canadians can sign a petition that also purports to send email on your behalf
to the CRTC:

<http://openmedia.ca/meter>

I've been considering not getting Internet at my new place when I move (which
is coincidentally the end of the month, when this regulation takes effect) for
productivity reasons, and this cements the decision. I've been pretty happy as
a Teksavvy customer otherwise.

------
ashchristopher
The real kick in the junk is that the infrastructure Bell owns was paid for by
the Canadian taxpayers when Bell operated as a crown corporation.

Not sure if the Rogers infrastructure was publicly funded (I suspect it was in
part).

------
goombastic
Ok, here is what is happening in India. It's even more sinister. The ISPs have
made some sites free and everything else paid. So, facebook for instance is
free while your "littlesite dot com" is charged. The regulators are sleeping.

~~~
aristus
Can you elaborate? Users have to pay to visit littlesite.com, but access to
facebook is free?

~~~
blntechie
Yes. But it's not happening with fixed line ISPs as i know. It only happens
with mobile data usage in EDGE and 3G. Mostly facebook.com and twitter.com can
be used unlimited for free or for a very low cost add-on plan. Other sites
accessed are charged as per the normal plan.

Even though it appears sinister, the mobile operators do this to attract young
customers who use these sites the most on the move. Personally, i don't agree
with this setup.

~~~
Swannie
I've seen that in Australia and the UK too. Good idea to attract the younger
market.

------
dholowiski
Iv'e been following this debate, but it's been difficult to find actual facts.
Right now with Telus (Canadian dsl ISP) i pay for 125gb transfer a month and
$2/gb if I go over. Yes, the overage charge is insane but it's been like that
for a long time.

As far as I can tell, the issue is that the big ISPs (tells, Rogers, bell) all
have caps/overage, but the smaller ISPs that piggyback on their network can
offer unlimited data transfer. This new ruling seems to 'even the playing
field'.

I want the Internet to be free and unlimited as the next guy, but I have yet
to understand what the big deal is here.

~~~
jaysoo
The big deal here is that instead of offering competitive plans the big ISPs
are _decreasing_ the level of service and _increasing_ the prices of plans.

Also, Bell/Rogers/Telus have the advantage of offering bundles if you use them
for cable/satellite+cell phone+Internet, whereas a lot of smaller ISPs would
not able to do such things. This screams anti-competition.

FYI, I don't mind paying per usage as long a the rates are reasonable. How
about charging us $10-15 for connection fees, and then $0.25/GB of transfer?

~~~
dholowiski
>The big deal here is that instead of offering competitive plans the big ISPs
are _decreasing_ the level of service and _increasing_ the prices of plans.

Are they? I have the fastest plan from Telus and over the years they have
upped the speed without upping the price, several times.

>Also, Bell/Rogers/Telus have the advantage of offering bundles if you use
them for cable/satellite+cell phone+Internet, whereas a lot of smaller ISPs
would not able to do such things. This screams anti-competition.

agreed, to a point. However all of the little guys I am aware of offer some
kind of an Internet/phone bundle

There are several wireless Internet providers here in Alberta and I'm watching
them with interest. They've built their own network run along natural gas
lines or old railway tracks (where it's easy to obtain right of way rights)
and are beholden to nobody (other than their backbone providers). If the big
three go crazy with fees, I think these tiny wireless providers are poised to
jump in and beat them down.

------
hekar
I'm really lucky to live in Waterloo, Ontario. There's a provider called Yak
that offers unlimited bandwidth, non-throttled DSL up to 10MB for $60 a month
(comes with non-voip phone line and 5 calling features).

They have their own DSL centers and hence aren't going to be affected by this
new proposition. I think we might see more companies starting their own DSL
centers.

~~~
jarek
To confirm - does Yak own their own last mile? I'm under the impression this
is the crux of the issue.

------
colindecarlo
Didn't the Egyptians just have the Internet cut off? I'd say they're the
biggest losers.

~~~
va1en0k
they aren't on the internet anymore, so no, they aren't the biggest losers on
the internet

------
JimmyL
If you're curious about the regulatory history of this issue - and who isn't,
really - then CRTC decisions 2010-255
(<http://crtc.gc.ca/eng/archive/2010/2010-255.htm>) and
(<http://crtc.gc.ca/eng/archive/2011/2011-44.htm>) 2011-44 may be of interest
to you. The former is the final in a series of decisions relating to Bell's
request to allow them to move independent ISPs onto usage-based billing, and
the latter is the recent decision on (effectively) an appeal of that decision.

If you don't care to skim the whole thing, the bottom line is that Bell is now
able to force usage-based billing onto third-party ISPs, but must offer them a
discount of 15% under the retail price at which Bell sells those services
directly to customers.

Some other interesting tidbits found in there:

Unsurprisingly, Bell was against the idea of any discount, saying that even
without a discount it would still be possible for independent ISPs to
differentiate their services on price and "other methods". It's not clear how
they'd actually do this, however. Oh, and PS there's way to determine an
acceptable discount rate even if those assertions weren't true, so we
shouldn't have one.

There's a nice note in there that "[the] Commission also received a large
number of comments, mostly from individuals, that almost unanimously opposed
the Bell companies' applications [to force usage-based billing]" - thanks for
pointing that out, CRTC.

Bell is only required to provide third-party access to their legacy ATM
networks, and not their new fiber-optic networks. This makes sense - as I've
never seen the service advertised - but I hadn't seen that in writing
anywhere.

If Bell ever does some form of promotion where they let people sign up on
unlimited plans, they have to let third-party ISPs do this as well - although
the mechanics are unstated ("[The] Commission finds that...to the extent that
each company chooses not to charge UBB rates to any existing or new retail
customer, it is required to treat GAS ISPs on an equivalent basis.").

Bell was about ambitious as you can get in the list of things they requested
from the CRTC in these decisions. I'm not saying that I like this decision (as
of March 1st I'll be paying TekSavvy more for less), but the CRTC did OK for
the little guy when you see what else Bell wanted.

No one - not Bell, not the CRTC - says this is a technical issue. It's not
that Bell can't handle all the bandwidth people use (which require a technical
ITMP, in CRTC-ese), but that they see this as a way to increase profits by
charging people who use more bandwidth more money (hence it's an economic
ITMP).

~~~
cal5k
This is EXACTLY what regulatory capture is all about. Bell knows the game and
played it masterfully.

Ask for the moon - ask for really ridiculous things, but expect to only get
half of those things. The CRTC, wanting to seem "reasonable" and "balanced",
meets Bell halfway. Unfortunately, halfway towards Bell's ridiculous agenda is
still absolutely terrible for consumers, a perspective that the CRTC has
utterly failed to consider.

This is a classic problem, one that recently contributed to the Gulf oil spill
as well (and resulted in the disbanding of the regulator, just as the CRTC
should be disbanded or, at the very least, stripped of its ability to regulate
the internet).

~~~
forensic
The fact that the CRTC is stacked with former Bell and Rogers employees and NO
ONE to represent the public or small ISPs also helps.

The CRTC is just a stooge pretending the play the part of opposition, while
they are actually a collaborator.

~~~
JimmyL
Are they? From <http://www.crtc.gc.ca/eng/about/commissioners.htm>, the
backgrounds of the Commissioners:

von Finckelstein (Chairman) was the head of the Competition bureau and
implemented NAFTA.

Katz (Vice-Chair, Telecommunications) was at Bell and Rogers until 2001.

Morin (Secretary-General) was a career bureaucrat.

Cugini (Ontario) was with Alliance Atlantis, a film and TV company.

Lamarre (Quebec) was with the CBC.

Duncan (Atlantic) comes from various small players in the Cable TV industry.

Molnar (MB and SK) comes from Customer Service and Regulatory Affairs at
SaskTel.

Menzies (Alberta) ran the Calgary Herald, a large newspaper.

Denton was on the board of CIRA and was the solicitor of the Canadian
Association of Internet Providers (the industry group of independent ISPs).

Patrone, Morin, and Poirier were journalists.

Simpson was an ad exec.

If you're counting obvious (perceived) biases there, you'd say Katz is
representing Big Telco and Denton is representing independent ISPs. Molnar
would count as a half-vote for Big Telco (as SaskTel is an ILEC), but it's a
minor one. The rest, as I see it, have no obvious perceived biases in this
case.

As for the high-ranking staff, that's a lot harder to figure our their
backgrounds - although most of them should be civil service positions, which
means they're relatively impartial.

If we check out our lobbying disclosures (always interesting when it comes to
this), we see that in the past year there have been 18 registered
conversations between lobbyists and the CRTC on the issue of
Telecommunications - and of those, I'd guess that the two from Bell and one
from SaskTel were probably focused on Internet-related issues, whereas the
Quebecor/Globalive/Shaw/CMPA ones weren't.

~~~
cal5k
Okay, here's another ponderous question then: How many of those individuals
have any qualifications whatsoever that would indicate they are in any way
knowledgeable about digital media and the internet?

Why are we allowing broadcasters, journalists, former telecom execs and
bureaucrats to rule on a topic and culture they clearly don't understand?

Furthermore, where are the consumer advocates? Clearly the companies they're
regulating are well represented. Where's the other side of the picture?

------
DrStalker
It's not that bad. Really.

Australia has had data caps since broadband first came out; for the vast
majority of of users a basic plan provides all the data they need, techy users
with heavy usage patterns get higher plans, and people with the compulsion to
torrent every TV in existence get plans with unmetered periods (a few ISPs
don't meter traffic during the quiet periods at night)

The usual behavior once you're over your data cap is to drop the internet
speed down to ~64kbs for the rest of the month so even if you kill your data
cap you can still access email and other low bandwidth services, you're not
off completely.

~~~
westajay
It is bad. We never started with caps in Canada so we're losing a lot.

In australia you get ripped so badly for broadband it is not funny.

This affects not only consumers, but also the whole tech ecosystem.. For
example business models that rely on unmetered internet (think netflix, or
offsite backup).

It also affects people like me who have to host services in Canada (for
regulatory and/or data security reasons). If I get nailed on wholesale
bandwidth, I have to pass that cost onto my customers.

This ruling appeared out of the blue.. Without much time to prepare
contigencies.

------
SaintSal
This reminds me of when the Canadian RIAA (CRIA) successfully campaigned the
Canadian government for a "levy" on all blank data media in 2002. They wanted
to charge an extra $21 per GB on CDs, DVDs and hard drives in digital media
player - ostensibly to cover the costs of piracy. Sound silly? Canadian
legislators obliged (though it was overturned in court years later.)

<http://news.dmusic.com/article/4580>

As I recall, this backfired since the levy eventually meant that they couldn't
sue people for pirating content - they had already paid for it via the levy.
Like double jeopardy.

Anyway, it proved that levies like this don't actually change behaviour much.
Canadians drove to the US to buy their MP3 players. Telcos benefitted by
online media consumption and competed heavily for broadband subscribers.
Digital lifestyles in Canada flourished.

Ironically, it's now the telcos that are complaining for the same reason. The
key difference now is that big telcos can use this decision to squeeze their
competitors (who they also supply.) Though I can see ways that this will
backfire too.

The good thing about the Canadian government is that they have a history of
continually watching, listening, adjusting and even backtracking if they feel
they made the wrong move. I hope this keeps the telcos from abusing their new
rights, and from stifling digital innovation in Canada, which hurts them too
in the long run.

------
westajay
This could snowball with a nasty public backlash.

Can anyone tell me if this is specific to bell? If so, how would this affect
us out west where our wholesale provider might be telus, shaw or allstream?

------
Swannie
A much better article explaining the same issue:

[http://www.zeropaid.com/news/91228/crtc-ruling-could-mean-
da...](http://www.zeropaid.com/news/91228/crtc-ruling-could-mean-data-caps-
for-all/) (2010 Nov 3)

Sounds like the regulator really dropped the ball on this one, giving small
ISP's only 90 days to investigate possible alternatives, plan for them, and
implement. 90 days?! That's insanely short. 9-12 months would have been
reasonable. 90days? I'm stunned.

------
GrooveStomp
I wonder how this will affect companies like Mobilicity who offer unlimited
cell phone data usage for an additional $10/month. I have no idea how
Mobilicity operates and whether they're dependent on Bell's infrastructure or
not, and whether the infrastructure is the same for cell phones as it is for
internet.

A systematic breakdown on how this affects all ISPs and phone providers across
all of Canada would really clarify the issue!

------
dhughes
This is going to suck, software gets bloated far faster than network hardware
can be developed and certainly faster than network hardware can be installed.

New services such as Netflix and who knows what else is coming down the line
(3D Netflix movies?) are going to use up your overpriced bandwidth faster than
your ISP can evolve, they'll just charge more for the same service.

This will be like when video became popular when everyone was still on 56kbps
modems, the web developed faster than the hardware meant to use it and it will
stall development. Why develop when there isn't anyone using it or able to use
it?

In the end people will do what they have to when they only have a limited
amount of disposable income, ISPs will see people spend $50 for 10Mbps service
and when the ISPs increase the monthly bill by a $1 here and a $1 there (to
serve us better) consumers will get the 5Mbps service for $50.

------
efsavage
The most dangerous problem isn't the markup or extra cost, it's that as soon
as UBB is old news, the media companies that are now also the internet
companies (comcast/nbc) will offer discounts on "in network" bandwidth, so an
NBC show will cost you the regular 1.99, but a movie from another network, or
an independent production will cost you extra.

I'd be all in favor of this kind of pricing if it was anything resembling an
open market, like how the cell phone industry had/has major downward price
pressure, but there are far fewer choices when it comes to wires into your
house, so the local monopoly effects are very strong.

------
sheldonnbbaker
From the CRTC website (<http://www.crtc.gc.ca/eng/INFO_SHT/t1003.htm>): "The
CRTC does not regulate rates, quality of service issues or business practices
of Internet service providers as they relate to retail customers. This is
because there is enough competition in the market that retail customers can
shop around for service packages."

Yet they've completely paved the way for competition to be swallowed into
oblivion. They're standing aside saying "it wasn't us - it's not our fault"
and yet snickering behind our backs while they rake in the dough.

Disgraceful.

------
westajay
This is really about conflict of interest. Perhaps it is time for regulation
mandating the split of telecom from media content ownership.

In Canada, the telecoms own most of the major media assets (Shaw, rogers,
bell).

------
nl
We have this in Australia.

Here at least the situation isn't too bad, because we have competitive
resellers at the ISP level[1].

The ISPs compete on service, bandwidth, data limits and inclusions. For
example, many (most?) ISPs arrange peering with video providers like Tivo so
video streamed on their services don't count towards the data cap.

[1] There are laws to ensure that any ISP can install their equipment in the
exchanges, or get access to the dominate telco's equipment at close-to-cost.
Most of the time, these laws work, if slower than ideal.

~~~
jay_kyburz
It might also be interesting to some that in Australia, where we have always
had metered plans and where people have come to accept it, natural competition
has seen our first unlimited plans emerge. For $60 a month TPG offers uncapped
internet and phone line bundle.

Even thought this may now be legal to do, Canadians may find that some ISPs
still offer unlimited plans just to get ahead.

------
chad_oliver
You mean that most countries don't pay per gigabyte? I live in New Zealand,
and there's only one company with an unlimited broadband package, and that's
only with a two-year contract.

The norm in New Zealand is to pay for say, 20GB per month, and if you exceed
that then you drop down to dial-up speed (or pay for more).

With all due respect to the Canadians here, it's not really that bad at all.
Life goes on, and it actually seems to be a pretty good life too.

~~~
forensic
>With all due respect to the Canadians here, it's not really that bad at all.
Life goes on, and it actually seems to be a pretty good life too.

You do realize you are being horribly ripped off?

It's true that life goes on, even for slaves.

------
transition
Would be interesting to see if companies like Google, who have a significant
stake in a "free and open internet", could establish operations in Canada.
Google wants users online as much as possible so they can continue to serve
ads. It's too bad all that dark fiber they own doesn't extend into Canada.

~~~
mthoms
Canadian telecom providers must (by law) be majority Canadian owned. So sadly
no, Google could not do this.

------
reedF211
Socialism FTW! My province's government run ISP faught against the CRTC and is
not implementing UBB. Bravo MTS!

------
Dramatize
Welcome to Australia

------
commanda
Literally, I think Egyptians just became the world's biggest internet losers.

------
benregenspan
Doesn't that title still belong to Sierra Leone? Or perhaps Liberia?
<http://www.internetworldstats.com/stats1.htm>

------
yoyar
Seems like the CRTC needs to find a way to remain relevant. This is central
planning, socialist style. I hope everyone enjoys it.

~~~
jaysoo
If this was socialism then either the government or the public would own
Bell/Rogers/Telus.

This is also not free-market capitalism. I'm not sure what you would call it.

~~~
nirav
This is called Oligopoly <http://en.wikipedia.org/wiki/Oligopoly> in half-
assed capitalism. Note that this can be worse than monopoly because few
competitors can essentially create informal cartels.

~~~
shawnee_
Yup. What frequently happens is that companies in an Oligopoly are able to
collude to raise the barriers of entry, keeping out new competitors: sometimes
with "help" of government regulations, sometimes because of lack of government
regulation. As long as there are only a couple of them (< 4 controlling > 80
percent of the industry), they can keep prices artificially higher than they
need to be.

When there's no actual competition and little threat of new competitors
entering the market, their incentive to innovate or become more efficient is
diminished. Consumers end up paying too much for mediocre goods/services.

------
fleitz
It's not a matter of regulations, it's a matter of markets. Some companies
such as Bell treat their customers like crap and just want to lock them into a
long term contract. So what? There are lots of competitors who will not be
doing UBB such as Telus / Shaw / Rogers. Customers on Bell just became the
world's biggest internet losers. If people don't like UBB they can always
switch carriers unless they were dumb enough to take Bell's crappy long term
contract.

~~~
napierzaza
You're ignorant. Everyone has to apply the UBB and no one has contracts, even
Bell.

~~~
fleitz
Actually I'm not. <http://www.channelcanada.com/Article5436.html> Some ISPs
are not using UBB, nor have plans to implement it.

[http://internet.bell.ca/index.cfm?method=content.view&co...](http://internet.bell.ca/index.cfm?method=content.view&content_id=12184)

oh and here's an article talking about people being on 1 2 or 3 year contracts
for bell internet. How could they be on contracts if no one has them?

------
thangalin

        while true; do
          wget http://www.crtc.gc.ca/eng/publications/reports/policymonitoring/2010/cmr2010.pdf;
          rm cmr2010.pdf;
        done
    

Signed,

Japan ($9/month unlimited Internet access)

------
switch
what an overreaction. I`m in Canada and calling Canadians the biggest Internet
losers is nonsense.

People who use 300 GB of data per month cost the ISP more than people who use
a few GB a month. That`s just a fact of life.

Should they have flexibility to charge more - Yes.

------
itistoday
If this actually passes, any sentiments I had about moving to Canada would
evaporate. Good job guys, you're keeping the techies out.

~~~
rapind
They also throttle our bandwidth and our taxes are ridiculously high. You'll
generally have a constant feeling of being ripped off, but you get used to it
eventually, and it gives you something to commiserate and bond over with
fellow canadians ;)

------
napierzaza
Working at a Canadian university I hear my boss say that bandwidth doubles
every year for the same price. But Bell has been selling the same service
(DSL) for less and less bandwidth... for a higher price every year.

------
mkramlich
Selling Internet access could become something like the next oil. Almost
everyone in the US has to buy oil/gas, whether directly or indirectly.
Therefore, that's a good business to be in. Internet usage, both in terms of
breadth and frequency and data volume, will likely keep increasing. Therefore,
getting into the business of selling access to it -- especially if you can
sell metered usage -- could be increasingly lucrative. And it's a growing pie.

Furthermore, since so many mediums and industries are seeing their traditional
cash flow streams go away due to the easy availability of free alternatives on
the Internet, it makes sense that if you can't beat em, join em, and then just
charge for the pipe to it all. So-called "pirates" can avoid paying for the
official e-versions of digitizable media (songs, movies, images, encyclopedic
info, sound effects, games, books, news, etc.) but it's much harder for them
to avoid paying for the physical connection.

------
napierzaza
I'm surprised as to how many regular people I've talked to who don't torrent
and who have gone over bandwidth (with Bell). The caps are super low, even for
regular users and not just the techies.

------
Createideas
Well honestly this does kind of make sense.I'll explain 1.Verizon owns the
pipes an charges companies or.Facebook or NEtflix a set fee for bundled usage
fee. 2.Netflix and Facebook in turn would have to charge customers basic
membership or usage fees to recoup the cost of there bundled usage fees they
pay Verizon. 3.Customer would pay membership fees for services that we in
theory and utilize alot more because there free.

In retrospect though based on the amount of members or customers of both these
companies would there usage growth take that much of a hit and would those two
companies still be able to operate if they were forced to change there
business models and chage people just to access there content.

In the case of Facebook how many members would thy have if people were
required to pay say $9.99 a month to access Facebook.

In the case of the Internet as a whole clearly it costs money for companies
like Verizon to expand and lay new lines to meet the demands of usage.Why then
would it not be right to charge the data hogs for overuse of bandwith?

Society has become addicted to free and believe that content in itself should
have no cost associated with it.However people don't realize the
manpower,creativity and cost associated just to have that content produced. It
makes sense now as to why Rupert Murdoch is against the freemium models for
news via the web.

I mean just think about it on a small scale just for me to write this
comment.I'm paying for Internet service,heating bill,electric and other costs
also.So why shoudnt I be able to pas that cost to the end user?

