Canada gets first, bitter dose of metered Internet
Lance McLain <lance@...
2011-02-01 05:29:15 GMT
This will impact Netflix streaming!
200GB to 25GB: Canada gets first, bitter dose of metered Internet
By Matthew Lasar | Last updated about 15 hours ago
Metered Internet usage (also called "Usage-Based Billing") is coming
to Canada, and it's going to cost Internet users. While an advance
guard of Canadians are expressing creative outrage at the prospect of
having to pay inflated prices for Internet use charged by the
gigabyte, the consequences probably haven't set in for most consumers.
Now, however, independent Canadian ISPs are publishing their revised
data plans, and they aren't pretty.
"Like our customers, and Canadian internet users everywhere, we are
not happy with this new development," wrote the Ontario-based indie
ISP TekSavvy in a recent e-mail message to its subscribers.
But like it or not, the Canadian Radio-Telecommunications Commission
(CRTC) approved UBB for the incumbent carrier Bell Canada in
September. Competitive ISPs, which connect to Canada's top telco for
last-mile copper connections to customers, will also be metered by
Bell. Even though the CRTC gave these ISPs a 15 percent discount this
month (TekSavvy asked for 50 percent), it's still going to mean a real
adjustment for consumers.
This is going to hurt
Starting on March 1, Ontario TekSavvy members who subscribed to the
5Mbps plan have a new usage cap of 25GB, "substantially down from the
200GB or unlimited deals TekSavvy was able to offer before the CRTC's
decision to impose usage based billing," the message added.
By way of comparison, Comcast here in the United States has a 250GB
data cap. Looks like lots of Canadians can kiss that kind of high
ceiling goodbye. And going over will cost you: according to TekSavvy,
the CRTC put data overage rates at CAN $1.90 per gigabyte for most of
Canada, and $2.35 for the country's French-speaking region.
Bottom line: no more unlimited buffet. TekSavvy users who bought the
"High Speed Internet Premium" plan at $31.95 now get 175GB less per
"Extensive web surfing, sharing music, video streaming, downloading
and playing games, online shopping and email," could put users over
the 25GB cap, TekSavvy warns. Also, watch out "power users that use
multiple computers, smartphones, and game consoles at the same time."
You need "protection"
Here's the "good" news: TekSavvy users can now buy "insurance,"
defined as "a recurring subscription fee that provides you with
additional monthly usage." For Ontario it's $4.75 for 40GB of
additional data (sorry, but the unused data can't be forwarded to the
There are also "usage vault" plans—payments made in advance for extra
data. Consumers can buy vault data for $1.90/GB up to 300GB in any
Where once TekSavvy consumers could purchase High Speed Internet
Premium at a monthly base usage of 200GB for $31.95 a month, now they
can get about half of that data (if they buy two units of insurance)
at $41.45 a month.
TekSavvy's DSL rates: now and after March 1
Starting to hate this? TekSavvy hates it, too.
"The ostensible, theoretical reason behind UBB is to conserve
capacity, but that issue is very questionable," noted the ISP's CEO
Rocky Gaudrault on TekSavvy's news page. "One certain result though,
is that Bell will make much more profit on its Internet service, and
discourage Canadians from watching TV and movies on the internet
instead of CTV, which Bell now owns."
Given these dramatic changes, and the fact that ISPs around the world
have made clear they wouldn't mind implementing similar schemes, it's
no wonder that high-bandwidth businesses are fighting back. Last week,
for instance, Netflix started publishing graphs of ISP performance in
both the US and Canada, and it plans to update them monthly.
Netflix is also stepping up the war of words against ISPs who try to
implement low caps and high overage fees:
"Wired ISPs have large fixed costs of building and maintaining their
last mile network of residential cable and fiber. The ISPs' costs,
however, to deliver a marginal gigabyte, which is about an hour of
viewing, from one of our regional interchange points over their last
mile wired network to the consumer is less than a penny, and falling,
so there is no reason that pay-per-gigabyte is economically necessary.
Moreover, at $1 per gigabyte over wired networks, it would be grossly
The big question now is how these kind of billing changes will impact
'Net consumption patterns. Many subscribers use minimal data, but
that's changing as Internet video becomes the norm. If these new plans
simply discourage data hogs from backing up their 120GB pirated movie
collection over the 'Net every night, there's no sleep to be lost. But
if they scare consumers away from legitimate non-ISP affiliated movie
and content sharing sites, that should be a firebell concern to
consumers, entrepreneurs, and regulators.
And not only in Canada.
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