Canadians Get To Pay More Money For The Same Broadband

from the abuse-by-the-byte dept

Thu, May 6th 2010 11:57pm — Karl Bode

In 2008 we noted how Canadian incumbent phone company Bell Canada began throttling smaller wholesale ISP traffic before delivery -- without bothering to tell anyone. In short, Bell wanted to make sure that smaller, independent ISPs that were reselling Bell's bandwidth weren't able to offer services that were superior to their own throttled and capped DSL service. Independent ISPs complained, and Canadian regulators (CRTC) largely ignored them. Now reader Slatemass writes in to direct our attention to the fact that the CRTC has also approved another Bell plan to begin charging all (wholesale and retail) customers per-byte overages up to $1.13 per gigabyte. Needless to say, operators of smaller ISPs are rather angry:

"The rates are absolutely atrocious. How the hell are we doing above one dollar for extra usage?" said Rocky Gaudrault, president of Chatham, Ont.-based Teksavvy. "It's in the thousands of multiples beyond what the costs are." Gaudrault said Bell also continues to have an advantage over smaller ISPs in that it is able to offer superior speeds. The CRTC issued an order in December 2008 that gave wholesale ISPs access to the faster networks of phone companies such as Bell and Telus, but the federal government last year ordered the regulator to reconsider the decision."

To be clear: this shouldn't be confused with pure "billing by the byte." The low cap and high overage model (which Time Warner Cable tried -- and failed -- to impose in the U.S. last year) simply jacks up prices "thousands of multiples beyond what the costs are" on top of the already high flat rate price -- ensuring that consumers wind up paying significantly more money for the same service. Bell also wants to ensure resellers can't offer a flat-rate pricing model that could better compete with their expensive capped DSL services. Of course Bell couldn't get away with this kind of obnoxious pricing were there more competition -- but just like in the States, most Canadian customers lack the option to be able to vote with their wallets.

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Filed Under: broadband, canada, competition
Companies: bell canada, crtc

13 Comments

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Anonymous Coward, 7 May 2010 @ 4:51am

I'm so, so tired of Bell and Rogers.
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abc gum, 7 May 2010 @ 5:04am

Does Canada have an equivalent to anti-trust regulations ?
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adam (profile), 7 May 2010 @ 5:07am

That is amazing
I already tried voting with my wallet (switching to Teksavvy from Bell) and now it seems that didn't work. The cable provider in my area manages to be even worse than Bell so I am basically out of luck. Thanks, Bell.
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Christopher (profile), 7 May 2010 @ 5:13am

Vote with their what?
Every single time I see an article about how an incumbent enjoys competition due to cable/ wireless/ dishes I cringe, because the fact is that all incumbents enjoy a monopoly. They provide a wire to a home, a wire that takes an infrastructure build-out comparable to a road. Yet, somehow, people would complain if a tollbooth was installed at the foot of their driveway... and think they "enjoy" competition by being able to switch to cable. This is no different than pulling out of your driveway and choosing the Turnpike over the Parkway (Jersey references).

No, Dave Isenberg called it right over 15 years ago. Build-outs to homes should be owned and managed by your town/ county/ state. The central office, however, is just an empty data center. Verizon installs their switches, AT&T install theirs, Joe's County Mile installs theirs, and everyone competes on services.

There's nothing magical about a fiber connection, or copper wire. The magic happens at the end points. Bid out the maintenance of the fiber and be done with it.

-C
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Anonymous Coward, 7 May 2010 @ 6:03am

Re: Vote with their what?
it takes my town / county / state two weeks to replace a burned out street light. how many months would i wait with my internet down because of one of their problems?
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Pickle Monger (profile), 7 May 2010 @ 6:35am

News
Are we sure that this is current? I was shopping for a new ISP and was told by one customer service rep that Bell was trying to get CRTC to mandate across the board caps of 60 GB/month/customer for ALL providers in Quebec and Ontario. I have spoken to CRTC last week and they told me that for the time being that proposal was not going anywhere.
According to what I've read on some forums it would seem that Techsavvy, however, decided to "freak out" early and put in the pricing that Bell Canada was trying to force but that wasn't yet mandated by CRTC. I will try reaching CRTC again and see what they have to say and will write back on this.
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Anon Coward, 7 May 2010 @ 7:59am

But the Canadian market is hypercompetitive
According to the Financial Post: http://www.financialpost.com/news-sectors/technology/story.html?id=2972862
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Karl Bode (profile), 7 May 2010 @ 5:11pm

Re: That is amazing
Well, technically, this ruling forces Teksavvy into offering the same crap, low cap, throttled nonsense that Bell offers. That's something I know Teksavvy has been trying to fight, but given that the CRTC is staffed with plenty of ex Bell and Rogers lobbyists -- not too surprisingly it didn't work out.
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Karl Bode (profile), 7 May 2010 @ 5:12pm

Re: News
"I have spoken to CRTC last week and they told me that for the time being that proposal was not going anywhere."

They were wrong, and this proposal that just passed is the very proposal they told you was "going nowhere."
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Greg Potts, 8 May 2010 @ 6:28am

Re: Re: Vote with their what?
It's easy... just make sure their tax payments aren't due unless the customer has internet/telephone access.
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TtfnJohn (profile), 8 May 2010 @ 7:05am

Re: But the Canadian market is hypercompetitive
In that sense, yes it is. Particularly if you live in what's known as "MTV" instead of smaller areas because that's where the money is for new entrants as well as established ones.

Outside of that, for now, you're probably hooped.

I'll have to check again to see about the official 60GB limit blessed by the CRTC cause there are so many problems with that as well as with policy that I can't quite swallow that the CRTC has moved it beyond application stage. (Mind you, Bell was arrogant enough to apply so anything seems possible)

The policy problem is that the CRTC is mandated by law to allow all players access to the "last mile" of copper telcos own etc to provide services to end customers that can be no worse that what they offer their own. Too bad similar regimes don't exist for cable.

One thing to keep in mind. though, is that the CRTC, like the FCC, doesn't exist to make life easy or fair to the end customer no matter who they may be but to ensure that telcos and cablecos make money and lots of it. Particularly if the companies in question are the huge, by Canadian standards, incumbents like Telus, Bell, Shaw and Rogers.

(MTV = Montreal, Toronto, Vancouver)
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Bob, 9 May 2010 @ 8:05am

That isn't all that's affected
The other thing that Bell won is the ability to unilaterally change the no download limit contracts that their early subscribers had. That group includes me. The law used to prohibit changing that without my consent. I paid a slightly more expensive rate for a while to keep this contract. Now I've got a slightly less expensive rate due to price and plan changes at Bell. Presumably that is so 'unfair' that the CRTC just had to change the law at Bell's request.

I think I'll be looking for an alternative and dumping Bell on principle (of course I'll dump all Bell 'services' I've using)
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Sunny, 8 Oct 2010 @ 11:51am

Re: Vote with their what?
Sorry, but the infrastructure expense was not paid for by Bell but from our tax dollars. Thats right, we're paying more than most countries for using a service our tax dollars had built.
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