CRTC ruling on usage-based billing threatens affordable Internet access, critics say
A decision by the country’s telecom regulator could lead to higher broadband costs for Canadians, according to an open-Internet advocacy group.
The Canadian Radio-television and Telecommunications Commission gave a continued green light today (January 25) for large, incumbent Internet service providers to bill independent ISPs for wholesale broadband on a usage-based system.
However, the commission made the concession of requiring major telecom companies to bill independent ISPs 15 percent less than retail customers.
To the chair of the Canadian Association of Internet Providers, the discount is little more than a “token acknowledgement” that independent service providers will face a cost to implement the usage-based billing policy.
“The 15-percent discount is nowhere near recognizing the impact that this is going to have on independent providers,” Tom Copeland told the Straight by phone. “The cost to implement this, the cost to deal with the carriers, the ensuing billing problems that come from these sorts of things, and more than anything the cost of dealing with our customers and the repercussions there, just aren’t adequately represented in that 15 percent.
“While the whole industry is becoming homogenous, it’s definitely more difficult for the independents to stand out in the crowd,” he added.
The nonprofit group OpenMedia.ca, which organized an online petition against usage-based billing that now has over 40,000 signatures, also maintains the discount for independent ISPs doesn’t go far enough.
“Unfortunately, that 15 percent is not huge, and it’s not going to be enough for them to meaningfully differentiate themselves from incumbent ISPs or from the big telecom companies,” spokesperson Lindsey Pinto told the Straight by phone.
Today’s ruling comes after the CRTC made decisions in May and October of 2010 that opened the door for large telecom companies like Bell Canada to bill independent service providers on a usage-based model.
Pinto argues that the latest decision stifles competition in the telecom market.
“There’s no longer much of a check on doing things like lowering caps and raising prices,” Pinto said. “The independent Internet service providers would otherwise have provided that check, and now they’ve been more or less incapable of doing so.
Pinto said potential consequences of the usage-based billing scheme to retail consumers could include a deeply widened “digital divide”, and challenges for libraries and coffee shops that provide Wi-Fi service.
Usage-based billing, also known as Internet metering, can allow companies to charge retail or wholesale customers at a higher rate for using more than a predetermined amount of broadband.
Telus spokesperson Shawn Hall said that while today’s decision “doesn’t apply to Telus”, the debate around usage-based billing has been going on “for many, many years now”.
“I think it’s important to note that usage-based billing has been in place since the very first days of the Internet,” Hall told the Straight by phone. “We have to recognize that the Internet isn’t this free-floating cloud that’s out there, but it costs billions of dollars to create, and that those who make more use of the Internet should pay more.”
In today’s ruling, the CRTC acknowledged that it had received “a large number of public comments”, many in opposition to usage-based billing.
The commission has directed carriers with usage-based billing systems to implement the new wholesale billing policy by March 1.
Pinto said OpenMedia plans to continue gathering signatures on their online petition, and to present it to federal industry minister Tony Clement.