February 22, 2011 - 11:22am
by Shane Simpson

For our Canadian customers and friends...

I'm sure by now every Canadian has heard of the big ISP's trying to ram unfair Usage Based Billing (UBB) down our throats. It's not that I'm opposed to usage based billing, I actually think the concept is quite fair. The problem is, we don't have a truly open market up here in Canada, so the concept as it will be applied in reality is flawed. A few big companies get to set pricing to whatever they want because they know no one will compete on price.

So these big companies set unrealistic usage caps on their internet plans and then charge ridiculously high overage fee's when you go over the caps. Pricing as high as $5 per gigabyte of data transfer - that's higher than EZP charged for overages back when we started in 2000! Back in 2000 it was still possible to run a good hosting company with only a T1 connection (1.54mbps connection), whereas today you need multiple gigabits of connectivity (gbps). Trust me, not only has network capacity improved significantly year over year, but the cost of transferring data has gone down by the same amount or more.

So why aren't we Canadian end users getting any benefit in our packages from our ISP's? I think this video sums it up nicely: Rick Mercer: Our Gouge-Based Heritage. This article is also a good read: Phone and Cable Companies Strike Back.

Now back a few years ago, limits really weren't a problem for anyone except for a few users who downloaded everything under the sun, typically all copyrighted videos and songs. But today, we have all sorts of services that rely on our internet connection... like Netflix, Voip, streaming radio, online backup services, photo sharing sites, etc. Personally, I work from home, I have 2 Voip lines, I get several thousand emails per day, I have to download/upload linux distro's & backups frequently, re-install servers with virtual media, have a daughter who watches cartoons via streaming video daily, my wife and I both have iPhones, we have an iPad in the house, 2 pc's, 3 laptops a wii and a ps3. We don't use torrents to download/pirate movies or anything like this. Yet if UBB comes in, I'm positive that my already insane ISP bill will go up significantly.

It's ridiculous and IMHO; a cash grab. We'll be paying more for less. It's also going to stifle the introduction of new and useful services delivered over the internet and reduce our competitiveness in Canada. The end result? Consumers will be worse off. The economy will be worse off.

As such, I've gone and donated to StopTheMeter.ca. I strongly suggest everyone do the same.

Shane Simpson

***Updates***

So I've had a few people ask me some questions about this. Let me try and answer them:

1) Shane, this doesn't affect you or EZP really. It only affects third party internet access providers .

Yes indeed, it doesn't affect me today as I am a Shaw customer. While I am actually above my package limits on a monthly basis (and we DON'T use Netflix or download illegal content in my house), currently Shaw doesn't enforce their $2/GB overage pricing - if they did, I would pay significantly more than I already do. However, it seems Shaw will soon: Shaw introducing UBB style caps soon.

It definitely has very little impact on EZP directly, that's true...

2) Even then, all this fuss over Bell wanting to charge $4.25 for 40GB of data transfer to third party access providers?

That's not the full story. My understanding is that Bell and all the big boys already get paid a per subscriber fee from the third party internet access providers. Now they want more. I can't really blame them as who doesn't like to make more money? But this really does just seem like a cash grab. They claim UBB is a fair commercial method to help thwart network congestion, but how does it do that? By penalizing users and making customers internet shy? That's not what we need in Canada. All users are becoming "heavy" internet users. It's only going to get worse as time progresses so we need a real solution to this.

There are some methods that could possibly have merit in the name of "reducing network congestion". Peak hour and non peak hour rates, bandwidth throttling during peak hours, etc. I personally don't think throttling p2p traffic is all that important anymore as streaming media becomes more and more popular. But UBB treats all traffic, network congesting or not; equal.

3) Isn't StopTheMeter and OpenMedia just using a bunch of fear mongering and scare tactics to make people believe this decision has a direct impact on everyone, when it doesn't?

Fear mongering? Obfuscation of the facts? Sounds like politics to me :) Well, it does look like this is just the tip of the iceberg here. I mean, Shaw is planning to implement UBB style billing it seems. So maybe they aren't all that far off the mark? Besides this is, if nothing else; a great way to stand up and show the powers that be that Canadians want a connected, digital lifestyle without needing a second mortgage to maintain it.

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