In a devastating blow to the Internet as we know it, the Canadian Radio-Television Telecommunications Commission tried to rule that Internet service providers who own telecommunications infrastructure (ex. Bell Canada, Rogers Communications) could charge the ISPs who rent it for every byte they use. This scheme was known as usage based billing. In essence, the prices of small ISPs would be the same as the large. In contrast, the current pricing regime has the smaller companies renting the lines and buying bandwidth at a flat rate and allowing the small ISPs to differentiate their prices from the larger ones. The implications of such a move were dire, unless you were a shareholder of Bell, Rogers, or Shaw. They included the drastic draining of your bank account, a decrease in quality of service for you as a consumer, a decrease in quality from those who deliver content via the internet (YouTube, Facebook, etc.) and a decrease in quality of television service.
You may not have heard of Teksavvy, Acanac or Primus. Where you might have had your bandwidth usage capped at a paltry 25 gigabytes a month by Bell or 60 gigabytes a month by Rogers, subscribers of these smaller internet service providers have been enjoying caps of 200 gigabytes per month since their inception. This is the main difference between the small and large ISPs in Canada. It is the reason why anyone would sign up for service from a small ISP. The removal of this difference would turn these small ISPs into subsidiaries with the result being a duopoly. In Ontario, this duopoly would consist of Rogers and Bell. Those of you who have paid your own cell phone bills for years know that choice is never a bad thing. Prior to the birth of Wind Mobile, being gouged by Telus, Bell or Rogers was practically a requirement for being a Canadian citizen. This duopoly would not be restricted to your ISP service.
The soft cap to be imposed on wholesale buyers of bandwidth by Bell stands at 25 gigabytes. This amounts to less than half an hour of high quality (1080p to be specific) video per day. Beyond that, a charge of $2 a gigabyte would be incurred. Compare to this your television service where you can leave it on 24/7 with the only extra cost being that of the electricity used to power it. With Bell, Rogers and Shaw owning television networks in Canada, this is a conflict of interest. By making it artificially cheaper to watch TV on your television than on your computer, many viewers will opt for the couch. This translates into in an increase in TV subscriptions and an increase in revenue for Bell. If allowed to stay, UBB will mean the end of TV on your computer. But, what if live television or syndicated programs were never your thing. What if you preferred Hollywood instead?
Netflix is a company which offers movies streamed through your computer or gaming console. For $7.99 a month one receives unlimited viewing privileges. A single movie from Bell’s Premium Movies subscription costs $5.99. These movies take up bandwidth with your one and a half hour movie at high definition taking up 3 gigabytes. If this bandwidth is free, Bell’s business model is obviously untenable. That is, until you add the $6 Bell wants you to pay for the bandwidth consumed. With a movie taking up 3 gigabytes and Bell’s pricing of each gigabyte at $2, a movie from Netflix costs $6 plus the $7.99 a month. Bell is attempting to make itself relevant not by offering better products or services, but by abusing its position as the owner of the infrastructure. However, this does raise the question of the right of ownership. After all, Bell owns all the phone lines our bandwidth travels through and took upon itself the risk in building them. It should be able to do whatever it wants with them, right?
Connecting a country is never easy. For a country as large as Canada, it is even harder than most. In order to deliver internet and phone services, a company needs to build the physical network of wires used to deliver the service. The upshot is an extremely high barrier to entry into the telecommunications industry. In Canada, this barrier is so high that no company ever surmounted it alone. This includes Bell Canada, as it was (and still is) heavily subsidized for the very purpose of setting up and maintenance of this network. Bell Canada would never be in the position it is in today without the help of the Canadian people. The cables which run across our country are just not Bell’s, but our (as well as Bell’s) network. To see them attempt to cheat their partners in such a manner is not only disgusting but damaging.
Fortunately, the government has decided to overturn the CRTC’s ruling on usage-based billing due to the huge public outcry. However, the CRTC’s recent efforts to institute UBB should be a reminder of how vigilant we need to be when confronted by the duopoly of Rogers and Bell.
