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CRTC Approves Usage Based Billing In Canada 381

Posted by timothy
from the weigh-your-bits-at-the-counter dept.
qvatch writes with this from CBC News: "The CRTC has approved Bell Canada's request to bill Internet customers, both retail and wholesale, based on how much they download each month. The plan, known as usage-based billing, will apply to people who buy their Internet connection from Bell, or from smaller service providers that rent lines from the company, such as Teksavvy or Acanac. ... Customers using the fastest connections of five megabits per second, for example, will have a monthly allotment of 60 gigabytes, beyond which Bell will charge $1.12 per GB to a maximum of $22.50. If a customer uses more than 300 GB a month, Bell will also be able to implement an additional charge of 75 cents per gigabyte."
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CRTC Approves Usage Based Billing In Canada

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  • Got it (Score:1, Insightful)

    by hampton (209113) on Thursday May 06, 2010 @11:04PM (#32121536)

    So in otherwords prices for all Bell broadband customers are going up $22.50 a month.

  • by cowwoc2001 (976892) on Thursday May 06, 2010 @11:09PM (#32121578)

    What is the CRTC thinking? Bell should be split into two companies: one responsible for the internet infrastructure, another for selling internet service to end-customers. It makes absolutely no sense for Bell to be able to rent its lines to Teksavvy, then tell it how to run its business. Bell is abusing its monopoly power!

    What can we do about this?

  • by LostCluster (625375) * on Thursday May 06, 2010 @11:11PM (#32121604)

    For those of you just joining us, it may be easy to forget the days when consumer Internet access wasn't unlimited. Dial-up connections were called "56K" but actually around 40-53K in practical use, and services like AOL and Prodigy billed by the hour to look at your e-mail, post on limited message boards, and use their clunky early Web browsers.

    Unlimited service isn't a right, it was just a trend that started when a price war broke out because there were far too many ISPs. There were even a few national ISPs back then that offered free access if you were willing to look at ads on your screen. Natural selection shut these companies down and a string of mergers leave us basically back where we started with the Bells dominant and their upstart competitors being the already-hated cable TV providers.

    If this leads to a $20 a month 5 GB at 1 Mbps plan I'd have it installed at my grandmother's house where there's no computer and no cell phone service in an instant for the family to use while we're visiting. Right now, the cheapest non-dialup plan is an $35 for 1 Mbps DSL that isn't worth it.

  • Usage based fees? (Score:5, Insightful)

    by TouchAndGo (1799300) on Thursday May 06, 2010 @11:12PM (#32121614)
    Unsurprisingly no mention is made of reduced fees for people consuming less bandwidth. I guess "usage based pricing" sounded better than "we're capping monthly bandwidth and charging if you go over".
  • by sjames (1099) on Thursday May 06, 2010 @11:22PM (#32121710) Homepage

    The problem I have with it is that that's an outrageous amount to charge for moving a gigabyte of data. You can pay to have the data PHYSICALLY CARRIED on DVD or Blu-Ray cheaper than that (high latency, outrageously high bandwidth).

  • Re:Got it (Score:4, Insightful)

    by Anonymous Coward on Thursday May 06, 2010 @11:23PM (#32121720)

    The problem is that you are a computer geek living by yourself. When you factor in the average family size of about 3 people, that 30GB usage of yours would be 90GB for a geeky family.

    At 90GB, that hits the $22.50 mark which is about 70% increase at the fees with NO additional improvement in services. What else in the IT world has rates going up without major improvements/speeds/capacity?

  • This kind of thing (Score:4, Insightful)

    by Anonymous Coward on Thursday May 06, 2010 @11:25PM (#32121746)

    will only lead me to block more advertising. They eat up most of the bandwidth..

  • by sjames (1099) on Thursday May 06, 2010 @11:27PM (#32121772) Homepage

    Looking at your data differently, it means that at one time competition was sparse and prices high. Then competition popped up and drove prices down. Now the big players have strangled the competition and prices are heading back up.

  • by mirix (1649853) on Thursday May 06, 2010 @11:29PM (#32121808)

    Price it like a utility then.

    $8 "connection fee" for 100amp err... 10Mbit service

    $0.07 per GB.

    But then people that just check email would only net them $8.07... can't have that, can we?
    $1+ per GB is insane. In civilized countries you can get 3G internet for that sort of money.

  • Re:Got it (Score:4, Insightful)

    by Shakrai (717556) on Thursday May 06, 2010 @11:30PM (#32121812) Journal

    The problem is that you are a computer geek living by yourself. When you factor in the average family size of about 3 people, that 30GB usage of yours would be 90GB for a geeky family.

    Well, if you buy into the notion that bits cost money, why shouldn't that family pay more? They pay for the increased electrical consumption of multiple people, why not the increased data consumption?

  • by CoffeeDog (1774202) on Thursday May 06, 2010 @11:30PM (#32121822)
    The real point of this is that Bell is allowed to impose this pricing on their wholesale customers, IE other ISPs that lease Bell's ADSL lines. For example my ISP is not Bell, however my ADSL line runs through a Bell DSLAM which then pushes the traffic to my ISP, thus my ISP will be forced to start billing me for usage because Bell will be billing them per GB instead of just for my line. Basically the CRTC just sounded the death knell for the smaller ISPs who stand next to no chance at competing against a giant company that already is allowed to throttle their traffic and limit bandwidth to 5Mbit, and now is allowed to set their bandwidth costs.
  • by Shakrai (717556) on Thursday May 06, 2010 @11:33PM (#32121836) Journal

    This gives them an unfair advantage over smaller companies.

    Bigger companies have all sorts of advantages over smaller companies. Why is this particular advantage unfair in your mind? Would you object if a smaller ISP was offering breaks on additional services?

    Bundling should not be allowed.

    Why? Here in the states so-called "triple play" (phone/data/tv) packages are popular. You really think it would be to the benefit of society to force those consumers to pay more?

  • by Anonymous Coward on Thursday May 06, 2010 @11:47PM (#32121968)

    That's a cute idea, but it is wrong.

    With utilities, you are using consumable resources. Water costs per gallon. Gas costs per cubic foot. Electricity costs per ton of coal. If you don't use these resources in your home, then the utility doesn't burn up these resources at their end.

    With the internet, the "utility" uses bits whether customers data are in those packets or not. As a second goes by, X number of Mbits are used and gone forever. You CANNOT save them like the other utilities I mentioned. It doesn't matter if anyone was using the network then or not, the resource is available and then gone forever.

    That's why I think you should pay for a data RATE. Not a data QUANTITY.

  • Re:Got it (Score:5, Insightful)

    by Korin43 (881732) * on Thursday May 06, 2010 @11:52PM (#32122018) Homepage

    First "Grandma who checks her email once a day" should be getting the internet for $1.99 per month with a $50 install fee.

    This is the problem. I think it makes sense that the people who use the most should pay the most, but the prices only go up, not down. So if you want a fast connection but only plan to download 1 GB of data per month, you still have to pay full price, but now the ISPs want to say "Well we'll keep charging everyone the same price as before, but now we'll charge certain people more". In other words, it costs more, but there's no benefit for consumers.

  • by TermV (49182) on Thursday May 06, 2010 @11:55PM (#32122038)

    Bell Canada is imposing their caps and pricing scheme on customers of all independent ISPs selling DSL connections. So say an ISP is selling an account with a 200 gig limit for 30 bucks. Now Bell is saying that each ISP must pay them a $21 fee for leasing the DSL connection and a surcharge of $1.25 for every gig of usage above 60 gigs. The numbers are approximate but they're close enough.

  • Re:Got it (Score:2, Insightful)

    by Anonymous Coward on Thursday May 06, 2010 @11:55PM (#32122044)

    The rest of the modernized world are flat rate. For the same $30 a month, people in Hong Kong have unlimited 1Gbps internet. So wise one, please explain to me how can they make money even assuming that 100% of that $30 goes into just transporting bits at 200X times faster and potential 200X usage than the 5Mbps of DSL in Canada that is under this decision?

    CRTC's reasoning of approving UBB is it is an economic measure of "traffic management" and not so much as a cost recovery.

  • Re:Got it (Score:3, Insightful)

    by Shakrai (717556) on Thursday May 06, 2010 @11:58PM (#32122060) Journal

    Australia and South Africa aren't part of the 'modernized' world?

    Besides, I wasn't condoning this pricing practice. I was just pointing out the fact that the "I have a family, we need to use more" justification really wouldn't fly under a metered billing system for any other product, why should it fly for data?

  • by Nutria (679911) on Friday May 07, 2010 @12:08AM (#32122128)

    But then people that just check email would only net them $8.07... can't have that, can we?

    We should.

    The powerco doesn't "rate limit" me depending on what I do with the electricity I use, and neither should my ISP.

  • by Anonymous Coward on Friday May 07, 2010 @12:13AM (#32122166)

    The problem isn't that they are charging regular users on a scale, it's that they are charging their wholesale customers this way. All of the ISP's in Canada are required to sell their pipes to other companies, this is to create competition, as many of the companies are working off former legal monopolies, (crown corporations), and competition is few and far between. What this means is that competition is going to be COMPLETELY shot in the ISP world.

  • by camperdave (969942) on Friday May 07, 2010 @12:16AM (#32122184) Journal
    Bigger companies have all sorts of advantages over smaller companies. Why is this particular advantage unfair in your mind?

    Because Bell owns the wires. The smaller ISP has no access to its customers except by going through Bell. Bell can thus force the smaller ISP to raise its rates until it goes out of business.
  • Re:Got it (Score:4, Insightful)

    by i_ate_god (899684) on Friday May 07, 2010 @12:56AM (#32122436) Homepage

    The rest of the modernized world are flat rate. For the same $30 a month, people in Hong Kong have unlimited 1Gbps internet. So wise one, please explain to me how can they make money even assuming that 100% of that $30 goes into just transporting bits at 200X times faster and potential 200X usage than the 5Mbps of DSL in Canada that is under this decision?

    CRTC's reasoning of approving UBB is it is an economic measure of "traffic management" and not so much as a cost recovery.

    Population of Hong Kong: 7,038,000
    Population of Toronto: 2.48 million people (5.5 million in the GTA - Greater Toronto Area)
    Size of Hong Kong: 1,104 sq km
    Size of GTA: 1,451.5 sq km

    Conclusion? Higher population density for Hong Kong, which probably means it's cheaper to wire everyone up.

    Sounds like a good conclusion too, but then:

    Population of Sweden: 9,059,651
    Size of Sweden: 410,335 sq km of land

    So I don't get it either...

  • Re:Got it (Score:3, Insightful)

    by Tanktalus (794810) on Friday May 07, 2010 @01:03AM (#32122470) Journal

    Remember: you can download tons of games, music, and movies each month not only legally, but with the blessing of the industry behind it (e.g., iTunes or other such online music store, NetFlix or other such video streaming service, etc.). And those aren't the only big things you can download. For a while, especially early in the release cycles, I was grabbing regular snapshots of KDE. That's about 300MB per snapshot. And I could be getting two, sometimes even three, a week. That doesn't take long to chew up real bandwidth. (I just downloaded and compiled 4.4.3 today.) And then, if a new release of OpenOffice comes out in a given month, that's another ~540MB.

    Ok, so downloading KDE and OOo aren't normal-user activities. iTunes and NetFlix probably are.

    I'm not sure if RIAA/MPAA are cheering on Bell's charges, or are opposed because it'll impact NetFlix's royalties among Bell customers. And in such a fight, who do we cheer for?

  • by dontbgay (682790) on Friday May 07, 2010 @02:22AM (#32122930)

    Why? Here in the states so-called "triple play" (phone/data/tv) packages are popular. You really think it would be to the benefit of society to force those consumers to pay more?

    Just because it's popular doesn't mean it's not anticompetitive. I believe that it's shutting out other players in the market by unfairly bundling services at a cutrate discount. This is just my opinion, but I don't think it's too far fetched to see where it could go badly.

  • by FriendlyLurker (50431) on Friday May 07, 2010 @02:22AM (#32122932)

    Because Canada paid for the infrastructure that they are about to fuck us in the ass with?...

    Not to mention that all that publicly funded infrastructure also runs through public land.

    camperdave: Bigger companies have all sorts of advantages over smaller companies. Why is this particular advantage unfair in your mind?

    Why should a huge company freeloading off subsidies, publicly funded infrastructure, AND rent-free public land use be allowed monopoly status by society? Not just any monopoly, but a government granted Coercive monopoly [wikipedia.org] - once of the worst kinds.

    No need to answer through - we all pretty much know the answer. They are powerful and well funded enough to grease the right palms in the halls of government, a method that is particularly effective in persuading politicians to grant monopoly "for the good of society".

    Newsflash: Monopolies like Bell create a dead-weight loss [youtube.com] for society.

  • by mcrbids (148650) on Friday May 07, 2010 @02:24AM (#32122958) Journal

    Do you watch TV online? (Hulu/Netflix/etc?) Because in my family, we do, and we'll blow past your 30 GB in a week or so.

    Today, few people are watching TV online, but that figure is growing rapidly. My own habits have spread to my 5 employees and my business partners, due in part to my endorsements. Add in online gaming, video chats, working from home via VPN and remote-desktop, and perfectly legit, normal usage suddenly passes your threshold for "reasonable".

    But why? Bandwidth is one of the few things which has no unit cost! Think about it...

    In the garage at my house is a router. Currently, it's an "N" router with a 1Gb wired hub. Let's look at its history, roughly:

    15 years ago, it was a 1.5 Mbit Lantastic network.

    10 years ago, it was a 10 Mbit switching hub.

    5 years ago, it was a 100 Mbit switching hub.

    Today, it's a 1000 Mbit switching hub.

    My point? the 1.5 Mbit Lantastic network used about the same amount of power as the Gbit switching hub - less than 1 amp of power, a la power brick. And yet, there are 3 orders of magnitude in useful performance, from the top to the bottom. That's from 1, to 10, to 100, to 1000 units.

    BAD CAR ANALOGY: Can you imagine having a car when you are 16, that goes 20 MPH?
    Can you imagine having a car when you are 21, that goes 200 MPH?
    Can you imagine having a car when you are 26, that goes 2000 MPH?
    Can you imagine having a car when you are 31, that goes 20,000 MPH?

    See how silly this becomes? Bandwidth has no effective unit cost. Charging by the unit is counterproductive and is a detriment to social progress, and works to impede social advancements like watching the TV show you want, when you want to, and video chatting with Aunt Gladys before her Hysterectomy.

    It's not just irritating, it's just a very bad idea founded in bad physics.

  • Or even better, we actually start treating it like a utility, and get the government to run it relatively non-profit. Use the money collected for the service to upgrade infrastructure, not pad the pockets of investors. Price it accordingly to some pre-set target for infrastructure improvement (ie - "100/100 for every home" or something). Integrate network development with business development strategies to increase availability of cheap bandwidth to Canadian businesses so that they can develop innovative networked platforms in all sorts of fields. Driving down the cost of bandwidth nationally, by having the government run stuff (even with the government overhead). Let companies like Rogers, Bell, even the small ISPs, compete over the services they currently offer - like e-mail, newsgroups, net-filtering, etc. even support for home internet users and support for home network devices/set-up, etc. - sure it'll hurt their bottom line. A lot. But rogers is already adjusting to people watching TV on the internet by offering on-demand service online if you subscribe to their cable service. Sell THAT to the barebones internet customer. Compete over streaming media offerings. Or whatever. But competition between the coax and rj-11 jacks in my house is never going to drive the cost of the internet down as much as a government run monopoly can (not will necessarily... but it COULD). [Though to be fair, I'm in general, just moderately pissed off at having absolutely no competition in my area, as Bell refuses to service my area with any new DSLAM circuits to service new customers, so I can ONLY get Rogers internet or no internet - at least until "2012 or so..."] - rant over - But seriously, I expect a public utility to be a bit above self-sustaining, with room for adequate and well paced growth... not raking in profit hand over fist. And with an ISP the size of "All of Canada" - the peering agreements should be decent enough to keep even out of network bandwidth costs low.
  • Re:Got it (Score:3, Insightful)

    by iamhassi (659463) on Friday May 07, 2010 @02:49AM (#32123136) Journal
    What if grandma watches TV all day, does she pay more than me since I never watch tv? Since most tv connections are digital now then this is only fair, she is using more bandwidth than I am.
  • Re:Got it (Score:2, Insightful)

    by YayaY (837729) on Friday May 07, 2010 @02:53AM (#32123156) Homepage

    What is the most impressive is that they managed to charge more for the same old 5Mbps ADSL service! + now they throttle P2P connection between 5PM and 2AM.

    Clearly, this is an abused of their monopoly.

  • by Mashiki (184564) <mashiki.gmail@com> on Friday May 07, 2010 @03:21AM (#32123304) Homepage

    What's wrong is UBB is applied at the GAS level. Which means that independent ISP's who use their own network are also forced to pass this onto their customers even if they in turn have their own private network, and have paid Bell/Rogers/Telus/etc for access to the line. It's been proven in the past that the amount of service per node is way under what compaines like Bell are actually telling the CRTC. The problem is the CRTC is full of former industry execs. The majority of Canadians also know that the CRTC screws over the average customer through this, and via other things.

    Originally the CRTC was meant to ensure that the market remained fair. Now it exists to screw the consumer, and maximize the profit of corporations. An interesting point, Bell for example is building a "next generation network" aka FFTN/FFTH, and they receive the majority of the funding through ... you guessed it GAS.

  • Re:Got it (Score:5, Insightful)

    by loraksus (171574) on Friday May 07, 2010 @07:16AM (#32124372) Homepage

    If people want to use the Internet to download massive amounts of p2p content, do they really expect they should pay the same as Grandma who checks her email once a day? Bandwidth is a finite resource, even if we don't believe it.

    Yeah, totally. And because of this move, Bell will be cutting the price of grandma's connection by 90%!

    Oh wait, it won't, because this really isn't "usage based billing", but both a money grab and an effort to cripple competition even further.
    They're charging a dollar a gig, which is quite literally thousands of times the actual cost.

    And they're allowed to cripple the speed of wholesale lines while they offer higher speeds to their direct customers.
    Never mind that they have all this leverage (in terms of infrastructure and last mile copper) because they were a monopoly until '97.

    And sadly, there are more than enough people like you out there to let the telecoms get away with pretty much anything.

    This is why our cost for broadband is about twice as much (well, even more now) as it is for people in the USA.
    http://gizmodo.com/5390014/internet-speeds-and-costs-around-the-world-shown-visually [gizmodo.com]

    No, the "Canada is less dense and they have to provide to these small villages" argument does not fly because our broadband coverage of rural areas is laughably pathetic and a significant portion of small communities can't get any decent internet access.

    And it's just going to get worse, so thanks for being part of that.

  • Re:Got it (Score:2, Insightful)

    by Shakrai (717556) on Friday May 07, 2010 @08:22AM (#32124798) Journal

    Maybe the Government shouldn't have given them that monopoly in the first place?

  • Re:Got it (Score:3, Insightful)

    by Shakrai (717556) on Friday May 07, 2010 @09:29AM (#32125502) Journal

    If it meant that I had a choice of internet service providers, yes, I would put up with this.

    Of course the "ten companies tearing up the street" image is a straw man. In many locales they would be able to utilize existing telephone poles and/or wiring conduits. New construction could be built with the wiring conduits in mind for multiple service providers. Older construction might have to be torn up to accommodate the new infrastructure, that's a fact of life as technology advances, isn't it?

  • Re:Got it (Score:3, Insightful)

    by TheRaven64 (641858) on Friday May 07, 2010 @10:42AM (#32126654) Journal

    That's not the real issue. If you look at a datacenter, it typically has a dedicated connection to a backbone somewhere. With most consumer connections, the bottleneck is in the last mile. There may be, say, 200Mb/s available on particular segment. In typical usage, most customers won't be saturating their connection for more than a few minutes at a time, so the 200Mb/s will provide some head room for them. If one customer is using 100% of their 10Mb/s slice all of the time, then that means that there's a bit less for everyone else. Not really a problem.

    Once a few customers are doing this, however, the entire segment experiences degraded performance unless the company upgrades the last mile infrastructure (expensive), shapes traffic for the heavy users (they complain), or charges the heavy users enough to discourage most people from falling into this category and to make enough to upgrade segments where a lot of people do.

    Of course, this is assuming that they actually will invest in the infrastructure, which is not really certain with a regional monopoly.

  • Re:Got it (Score:3, Insightful)

    by TheRaven64 (641858) on Friday May 07, 2010 @11:02AM (#32127058) Journal
    I have absolutely no idea why this was moderated up. TV is broadcast. The bandwidth is allocated in fixed channels, and it makes no difference whether one person or everyone on the network is watching (the network being everyone on the cable segment, within range of the transmitter, or under the satellite). If all of your network use is receiving packets sent to the segment's broadcast address, then you'd expect to pay a lot less than if it's receiving point-to-point packets.

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