Usage Based Billing
Posted by Laurel L. Russwurm on August 27, 2009
There is a growing stock of information, articles and commentary about Usage Based Billing online. I’ve been adding links to web pages on this and related subjects in my sidebar. (All links… no ads!)
But reading through some of the online commentary I’ve found some bits that bear repeating, so that’s today’s thing.
It’s interesting to see what happens when the Usage Based Billing issue rears its ugly head south of the border. They actually have competition. And they appear to have Regulation which appears to be beneficial for the consumer. Particularly interesting is that in the US, Usage Based Billing is thought to be a bad thing for the ISPs for precisely the reasons that Bell Canada wants Usage Based Billing
I’ve heard this before
“ But first, why is usage-based billing a really bad idea?
Consumers don’t get it.
While many understand that a gigabyte is a measure of file size, the average consumer isn’t able to correlate web activities—e.g., downloading movies, uploading photos—with bandwidth usage. And anyone claiming that consumers also don’t understand kilowatt hours might want to think twice before comparing themselves to regulated monopolies.
The bill could be really big.
Even the most eco-ignorant consumer, leaving lights and appliances turned on 24×7, is unlikely to receive a power bill more than two or three times the monthly average. Compare this with the following hypothetical example: a 5Mbps broadband service costs $34.95 per month and carries a 40 gigabyte per month cap. Each gigabyte above the cap costs a buck. Before going on vacation, your teenage son decides to download YouTube (like, the whole site). Assuming the broadband service could actually run at 5Mbps (few operators will admit that it can’t), the bill at the end of the month? $1,637.45, almost 50 times the base price.
Never change the price without improving the product. One of the reasons airlines encountered such stiff headwinds with their checked-luggage policy is that the service wasn’t improved. Bags didn’t arrive more quickly or get lost less frequently. Consumers dislike this, especially where technology is concerned. Although they may talk about fairness, few broadband operators claim that usage-based billing results in a better broadband product, it’s just priced differently. ”
— Kevin Walsh
I found this look at our growing internet need strangely appropriate:
from Slashdot Forum
“Such A SCAM
(excuse the vague “profit” comparison here )
1 – charge per use, people balk ‘ why do i need that internet thing’
2 – make it unlimited flat rate and people love it and flock to sign up
3 – let people get used to it for a decade or so
4 – start overselling to get the last few holdouts
5 – slowly add caps, incrementally so people don’t complain too much
6 – reinstate charges per use now that its an integral part of daily life.
Sounds like drug dealers to me.”
— nurb432, Thursday April 16, 2009
Quite often gems can be found in the online Comments pages.
From the CBC ONLINE: Petition spurs CRTC debate – Comments
“bottom line is : it should be illegal to be the carrier and the content-provider at the same time. Then EVERYONE is on equal footing. The carrier(s) (really, think about that) also should be so heavily regulated that even partial ownership in one and in a content provider should mean a 5 year jail sentence with no chance to buy your way out of it.”
–justcase, 2009/08/22, 2:32 AM ET
When I was first finding out about Usage Based Billing Antonio Cangiano’s blog told me the mechanics of how to complain to the CRTC. Even though it was already “too late” for the CRTC to happily accept submissions, I believe that it is important for Canadians to continue to make their complaints directly to the CRTC, select Tariff as a subject, use File Number # 8740-B2-200904989 – Bell Canada – TN 7181. If you want to ensure that your words are heard, you can post them in an online blog, or if you aren’t a blogger, copy your comment to somebody else’s blog or forum online, perhaps even in the Dissolve the CRTC forums
“If Bell were to be successful with their application, ISPs would be forced to change their current offerings, cap internet usage and substantially increase the price of extra Gigabytes per month. In practice, we’d be paying more to get much less, and most people would not go through the hassle of dealing with this, thus opting for Bell – despite their absurds usage limits (60GB per month, are you kidding me?).”
One of the things that I especially like about Antonio’s post his very Canadian advice to those of us who are enraged to “please send your polite comments and concerns to the CRTC” Another place ordinary people are talking about Usage Based Billing is michaelgeist.ca:
“CRTC should be dismantled
So we have the net neutrality hearings which were dominated by traffic-shaping practices, are we to have another for restrictive bandwith caps? I have had it with the CRTC. Why are former employees of the very organizations they seek to regulate being allowed serve on the CRTC? I mean lately we are seeing opposition to police investigating police as being a problem, should we not see the same concerns in the CRTC?”
“Bell is effectively choking out competition with the aid of the CRTC.
The CRTC mandated access to the last mile connection to promote competition in the market, which spawned the formation of various businesses to use the network connection to supply their own internet connectivity. It seems that the CRTC has now seen fit to allow these businesses to be squeezed out of the market. This protection of Bell at the expense of competition is not healthy for the future of the internet connectivity in Canada and runs contrary to the purpose of the CRTC and the best interests of Canadian citizens.
What this does is highlight the problems in the CRTC and its inherent internal conflicts in both the Broadcast and Telecom sectors.
Perhaps rather than have these biased myopians deal with future convergence it is time to disband the CRTC and replace them with a body that really understands the big picture and represents the best interests of Canadians.
The CRTC’s interpretation of media convergence would seem to be, all Canadian media access controlled by two or three corporate giants. We are firmly on that road, now just a few gratuitous public hearings away from it being cast in stone.”
And yes, I do know we’re Canadian. And as a rule Canadians don’t like to push our views on each other. Personally, it made me uncomfortable to send a spam-like email to my Canadian friends and family. But the thing to remember is that this is not spam. This is a public service announcement.
It is in your friends’ and family’s best interests to know about this. Usage Based Billing will have a tremendous detrimental impact on every Canadian who uses the internet. So, I know you’re Canadian too, but anything you can do to help fight this fight will be worth it.
You may have noticed the dearth of Usage Based Billing coverage in the traditional media. A huge part of the problem is that the CRTC has allowed incestuous relationships between our major media carriers and broadcasters. So CTV is not likely to speak out against Bell Canada unless forced to. But if there is enough outcry, they will HAVE to cover this story. Fortunately we have CBC online covering the story.
But Canadian consumers have been at a decided disadvantage in this fight because the story has NOT been getting out. A huge part of the problem is that the interested parties conveniently control most of the media in this country. Should Usage Based Billing be implemented, I expect that will only get worse. So maybe we can help save the internet by using it now in any way that we can.
So of course after you’ve signed the petition, encouraging others to follow suit would certainly help.