Strangling Democracy For Corporate Profits

"Oligopoly friendly policies have taken Canada to the bad place we're at now".

The subheader to Mr. Beer's insightful essay says it all.

Most markers of a robust democracy in Canada are rapidly diminishing. This latest decision by the CRTC is another strike against the polity.

As we see wages statutorily reduced, profits rise, while the real inflation rate goes up, people are struggling every day to keep up. Raising the costs of internet will only push people further away from equal access.

The result, regardless of intent, is the rich will be able to surf the net 24/7, and the working poor won't.

What a sad plight for a once great democracy.

Excellent coverage as usual.

where has all (the other) $$$ gone?

In 2008, Industry Canada auctioned off more of the radio spectrum (our public property) and made $4.3 billion. Originally, all of it was earmarked for rural broadband development. Once the auction ended, the Harper government quietly changed this to $250 million. Over five years. Imagine what this could have done? And just imagine if we actually had a say in it?

Living in the 50's

The main issue with the CRTC is that they don't have a clue as to the modern world.
Satellite TV, VOIP, Internet TV/Radio, etc... are a mystery to this group and they don't know how to handle it.
All guidance is provided by large corporations (CD levy, Internet cap's) and if they don't listen they get smacked by the federal government.

Also, bandwidth is not the issue and shows the writer does not understand the issue. Bandwidth is the speed of download and everyone has always paid a premium for this. The issue is a limit on the amount of data that is downloaded.

Loke, I get it

I understand exactly the difference between bandwidth and charging people for more data pulled or pushed through that bandwidth. Which is why I wrote this

"A people's creative edge will reside in its ability to share and manipulate ... digital content. That's why other nations, one way or another, have managed to insure more competitive, cheaper and varied ways to push more through the Internet pipes. Only in Canada do our regulators not seem to get that today's hog is tomorrow's everyday user. Or that setting caps as low as two gigabytes, or even 25 gigabytes, places Canada at a serious global disadvantage."

It's the Caps

Imagine if Hydro was billed like the internet. We would be paying a flat fee of say, $100 for "free" power, up to an arbitrary cap, then $1 per Kwh above that.
This is not usage-based billing - it is cap-based billing, where we are required to purchase more product than we need in order to avoid usurious overage charges.

It's totally nuts that the CRTC has allowed the ISPs to bill on the basis of deliberately obtuse contracts, bundles and anything other than actual raw bandwidth (pressure) and volume usage.

We all know the caps and overage charges are ridiculous - predatory in fact - but to focus the argument on "usage-based billing" misses the target.

More important I think, is that this line of argument cannot lead to the result we all want - reasonable and fair prices for internet services, for the simple reason that without a true usage-based billing, there is no way to establish a fair price for all users. So the ISPs will ultimately win the argument, and we'll be stuck with this corporate wet dream of cap-based billing.

Sources

David ... there are all kinds of numbers being thrown about in this debate. You state "Our phone and ISP bills have run higher than in most other countries.". Can you please provde the source for your statement.

Blatant policy laundering

Has anybody else been watching the standing committee on industry, science and technology holding hearings on this stuff? Konrad got pulled out of the BCE/CTV merger proceedings to answer questions last week. One of the most amazing things is that he straight up admits that the CRTC did this at Bell's behest!! And the 15% discount that they have to give indie ISPs? Bell had proposed 25% before but changed their minds. Konrad's been ordered to submit a report on exactly how the CRTC came to this decision - we'll see if that black box lets us peak inside.

Standing Committee Hearings, Part 3 - tomorrow! 3pm EST
http://www2.parl.gc.ca/CommitteeBusiness/CommitteeHome.aspx?Cmte=INDU&Language=E&Mode=1&Parl=40&Ses=3

isn't internet access really public infrastructure?

In agreeing with the previous comments, the argument can be made that competent high speed access is now a matter of essential public infrastructure. Regulatory models exist to "aid" in managing the predatory instincts of utilities and other essential service providers.

The concept is well established in the Canada. BC Hydro, Manitoba Hydro and Quebec Hydro are all profitable with regulated, infrastructure based markets.

Making the case for rural BC, in the area I inhabit, there is still a significant deficiency of any access to a high speed connection.
Other commenters have described technologies currently deployed in other countries that could provide access alternatives.

The CRTC, and by extension the Government of Canada needs to be held accountable for addressing the needs of all Canadians.

Double-billing

Bits-per-second or bits-per-month? One or the other. That is the question.

If you get your data by cell phone, you pay a month connection fee plus bits-per-month. If the network is slow, that's too bad.

Most ISPs provide multiple plans for the home or small business. You can get the Lite version of so many bits-per-second or the Heavy version of so many more bits-per-second.

What the CRTC doesn't seem to understand is that charging bits-per-month in addition to bits-per-second is double-billing. The same bits are being billed twice.

Now some may argue that there's a difference between bandwidth and usage. As the net-admin for an ISP, I am well aware of the differences. But I'm also well aware of the simularities. This is why I don't phrase it as bandwidth and usage but as bits-per-second and bits-per-month.

Bandwidth is the maximum capacity that can be transferred at any one time. Usage is the amount actually transferred.

A 1TB hard-drive loaded with data and shipped FedEx overnight has a higher bandwidth than your home connection. In fact, the bandwidth would be 1TBpd or 8tbpd or roughly 92.6Mbps when averaged out over a day. If the drive was only half full, the usage would be 0.5TB. But in both cases, what did you pay for? In both cases, you paid to ship a 1TB hard-drive via FedEx overnight delivery. In this case, you're paying for bandwidth, not usage. Wouldn't you be upset if FedEx decided to charge you again for what was stored on the hard-drive? But this is exactly what Bell, Rogers, etc. are arguing for!

This is why I say it is double-billing and why I put it into terms of bits-per-second versus bits-per-month. It makes it clearer for most people to understand.

Stick it to the man

If you really want to do it here's how.

Order an open-mesh router for $25 and use it to share and secure your home network at the same time. The more plugged in, the more they mesh up. No fuss no programming just plug em in. Open-mesh allows restricting the amount of bandwidth available to neighbors. Contributors can also require logins, resell it if desired, restrict on mac addresses, and boot heavy users.

Citizens doing it for themselves

Sources

I did a bit of checking on how Canada ranks on pricing. We are not the most expensive but not the cheapers. However, we rank cheaper for higher usage and more expensive for lower usage, so maybe there is some truth to the argument that the low users are subsidizing the higher users.

http://www.crtc.gc.ca/eng/publications/reports/policymonitoring/2010/cmr2010.pdf

The "utility" aspect -- the

The "utility" aspect -- the pipes -- should be unbundled and regulated to secure coverage and "reasonable" return on investment. Content to be produced by other entities, and able to charge as desired (just as I can buy books or theatre tickets or music etc over the net). I'm sure there are lots of detailed complications in working out how to do this. Only magical thinking could place reliance on "competition" among 3 or 4 or 5 pipes providers in large market (and monopoly in small ones) to provide both efficiency and fair prices to people.

JPR

Here's one comparison, for example,

http://www.xcrew.net/content/the_cost_of_bandwidth_canada_versus_the_world.html

concluding that 'Canada is by far the most expensive country to surf the web' -- at least of the countries compared here.

My message to the CRTC/ISPs (Part 1)

I have spent the last few weeks reading arguments on both sides regarding the issue of UBB and I have yet to see one argument that is even remotely convincing as to why UBB should be implemented.

The most popular argument is that the "bandwidth hogs" are somehow getting a free ride at the expense of the "light users". This argument does not hold up. As most of us are now aware (some of us such as myself already were), the marginal cost of delivering a gig of bandwidth to my house is less than 1 cent. Therefore, with the above logic what is being said is that I am stealing a penny from my neighbor and as my punishment for bad behavior I now have to pay a third party (The ISP) $2-4. I see no logic here. On top of that, I must ask who exactly are you calling a bandwidth hog? The fact that I choose to use my internet to do my work and consume the majority of my entertainment does not make me a hog or an evil person as it is being presented by various ISPs and the CRTC. Others who don't consume as much internet do so at their own discretion and research suggests much of that will change in the next few years and the hundreds of thousands of unhappy customers will become millions of unhappy customers in the blink of an eye. The internet was created by all of us for all of us. The ISP provides the pipes necessary to access this. Telling me I have pay by the byte for going over a ridiculous low limit (and the proposed limits are truly ridiculous) is no different than telling me I have to pay $1/pound for every pound over 200 when I want to get on the bus (or more like 20 pounds in this case) or telling me that even though I have a gym membership, I will have to pay an extra $5 per visit if I exceed 10 visits per month (or in this case 2). It is unacceptable.

The other argument of comparing Internet to utilities such as gas does not hold up either. Gas is a finite resource stored at the provider's facilities with true costs associated. If all a guy company did was the put up the pipes and make sure they stay up to allow an infinite resource to pass through them, no one would stand for this kind of billing there either and even if that argument is strong enough, comparing the penalties of consuming extra gas and the proposed penalties of consuming extra internet make for a hilarious comparison. It would be the equivalent of charging an extra $50 for the gas consumed in cooking for one party in the given month.

My message to the CRTC/ISPs (Part 2)

Another argument I have heard is that Canada's ISPs provide some of the fastest internet connections in the world and extra money you pay is for that speed. This I found most amusing. For one, It is simply not true and also is it was true, exactly what good does all this speed do for me if I am not allowed to download anything in fear of getting a $300 bill the next month? the answer is nothing. It's useless. I don't need all this speed. I need to be able to use my internet for what I want and as much of it as I want. I am not saying I should be able to host a server out of my house and consume terabyte upon terabyte of data, but whether I like to create videos and post them online, or if I want to download high-resolution photos, or if I want to watch movies online instead of paying ridiculous prices for Blu-Ray movies... I don't want to have to sit there and crunch numbers to make sure I can still pay for food this week.

The last argument I have heard is that a lot of money is needed to build up the our infrastructure and the heavy users are the ones who should pay for it. Again, considering the marginal cost of providing extra gigabytes of internet is close to 0, this argument does not really hold up. We all have access to the internet heavy user or not and early adopters and innovators must not be punished but instead encouraged to use the internet. These "bandwidth hogs" are our country's face on the internet and as much as they may consume it, they add to it to the benefit of everyone using it and this new infrastructure will do the same. It will benefit everyone. If there is indeed need for money for infrastructure that is not already being paid by our enormous bills (hard to swallow after a look at the 5 major ISPs financial statements), we will pay for it as a collective after a thorough third-party audit by a reliable source. Thanks to the internet itself, we the users have become more aware and weary of what we are told to believe. I hope no one here is expecting us to blindly take them at their words.

My message to the CRTC/ISPs (Part 3)

I have no interest in my country become the technological backwater of the world. I have no interest in living in a country that discourages innovation and reduces competition to the benefit of a few at the expense of millions. Seeing as how I love this country and I have no interest in leaving this country, I will fight it and so will many others. The consumers see what is going on here (or least the important parts). We know that the internet has not done the TV business much good. Attempting to reduce competition through monopolistic practices will not fly (what Bell is trying to do). Is it a coincidence that at the same time the CRTC made its decision to allow UBB Bell just so happens to have a service ready to deliver TV through the internet without it counting toward bandwidth consumption? No. I think not. Also, what happened to the congested networks? Am I being told that the congested networks aren't affected by delivering TV through the internet? That's humorous. Whether I choose to consume my entertainment from the internet or from TV is my choice. Delivering high definition TV is not much different (if at all) than delivering me bandwidth for internet. The only difference here is that on the internet, the money for the entertainment might be paid to someone else. To try to stop this by lobbying to the government is an anti-competitive practice that shouldn't (if it even is) be allowed under the law. It's lower than low.

The internet and the users are expanding. The need for bandwidth will continue to increase and the UBB is not the solution unless you plan to push this country miles behind the rest to increase shareholder value for 4-5 companies. I know that I am on the right end of this argument. I have been looking and reading and challenging people on the other side for a counterargument that would even remotely hold up and I have yet to heard one. So please, if there is something I missed do let me know. As it stands, I know I am right and I know I have many people on my side and I cannot stop fighting this knowing that I am right and so I will not. We are asking for unmetered internet and seeing as how it's been done in many other countries we know that is possible. If current ISPs cannot provide what the consumers want, perhaps it is a mistake to restrict competition from companies in other countries who can and would be able to do it for us. Do the right thing. Before anything else, you are people and you are Canadians.

The myth of "Bandwidth hogs"

"Bandwidth hogs" are like "Cable hogs" and "phone hogs".

That's right; the concept doesn't actually make sense. It's just a cleverly misleading analogy.

People who use their internet connection a lot don't hurt other users any more than people who yak all day on the phone hurt phone service or people who watch lots of TV deprive other cable subscribers.

Ironically, Usage Based Billing (UBB) actually makes the product being sold both less useful and less valuable, even as it increases the price (though it might increase the ISP's immediate profits while providing excuses for not re-investing in infrastructure).

Anyone who cares to research the issue will quickly realize that these supposed abusers of the internet commons are in fact a myth -- not just "relatively few" but actually non-existent. The internet just doesn't work that way (but perhaps some Internet Service Providers do).

Anyone who appeals to this deceptive analogy is either ignorant of the facts, or incompetent or lying. Hopefully, the CRTC is just ignorant.

Sweet complications

A lovely set of complicated reasons here, all valid, all unfortunately after the fact.

Netflix and the like coupled with digital televisions make cable unnecessary in any livingroom anywhere in the world. replaced by internet access. All cable in Canada is provided as a monopoly by companies which do not compete, and charge something like $100 per livingroom, which figure is completely unrelated to the cost of providing the service.

People are aware of the unscrupulous nature of cable companies since Shaw granted an interview to CBC during the negative billing cashgrab a couple of years ago and basically admitted that they planned to capitalize on the inability of most consumers to figure it out, and so be tricked into paying anything they are told to pay, by ...well, guess.

Enormous profit at little cost. Lets call it power. Power enough to get our lovely government to grant these monopolists a further near monopoly over bandwith, access to which is about to make cable obsolete, and give already annoyed customers, aware of the gouge, an alternative. a much better one at that.

That the CRTC should make such a ruling in these companies favour, simply exposes a level of co-option that ought to be and used to be very illegal for a public regulator.

They clearly simply wriggle and squirm, calling in favours from bureaucrats they feel they own to keep the illicit cash flowing regardless. If they could have kept you from knowing about Netflix and its ilk forever, they clearly would have done so.

If they can keep you from ever accessing it, they clearly will.

Well, it's been going on a long time

..ever since voicemaiil and call display came out, and the telcos decided to squeeze consumers for every once of flesh for each one of these "services" on a per-month basis, when the software and switches for it were already installed and operating on every circuit - only needing activation. That finished me forever as a supporter of telcos, and incidentally, on consumers as well, who never complained about paying every month for these "services" which were installed once, just like bandwidth, instead of exercising their rights with their chequebooks.