interweb freedom

(formerly Stop Usage Based Billing)

Speculation not Prophecy

Posted by Laurel L. Russwurm on January 4, 2010

No Usage Based Billing

Stop Usage Based Billing

Usage Based Billing in a Nutshell

In August of last year research for my personal blog in the wind first brought Usage Based Billing to my attention. UBB is a technical issue filled with jargon so new much of it isn’t even in wikipedia, making it hard for ordinary people like me to understand. I’m not a programmer, I’m a mom, an artist and a writer, but I thought it important enough to create this public service blog to share the things I’ve learned to try to help other Canadians understand Usage Based Billing.

The left side bar lists of all the blog posts as an index to allow this blog to serve as a reference. I’ve tried to cover issues and technologies in as much depth as I can handle. (The glossary is probably the best place to start.) There is also a listing of websites and blogs there. The right side bar is loaded with links to specific articles which may also help understand the issue.

But for today’s purposes, we’ll just do a quick recap:

Fifteen years ago Canada was an internet technology leader and Canadians could connect to the internet at reasonable rates. Today we pay some of the most expensive rates in the world for mediocre service. The reason is simple; the internet carriers (Bell/Rogers) chose to make only minimal infrastructure re-investment.

kids at a computer

Families upgrade when they can.

As a mom I know that computer systems are obsolete after about six months.

As a mom I know it is important to buy the best system I can afford so that it will last the longest.

I need the best value for the family. Moms have to keep computer systems running far longer than programmers or corporations because families can’t afford otherwise.

Even so, there is not a single component on my desktop that I had 15 years ago. My system has changed many times over in the last 15 years. Because I have re-invested in my infrastructure.

Bell Canada has told the CRTC that Usage Based Billing is necessary. They say they need more income or they can’t improve their infrastructure. But what they did NOT tell the CRTC is that any infrastructure problems Bell Canada may be experiencing is because Bell Canada chose not to reinvest in infrastructure improvements for the past fifteen years.

Canadian customers have been paying premium prices for a steadily declining service. In order to encourage ISP competition the Canadian government mandated Bell Canada to make wholesale bandwidth available to Independent ISPs. The Canadian government encouraged these Independent businesses to set up shop so Canadian consumers could have Internet competition. Bell Canada was allowed to set the rates charged (astronomical) but in spite of that, the Independent ISPs have not only survived, they are now at the point of offering meaningful competition. They have a loyal customer base. But Bell Canada does not want to have to compete.

Canadian Independent Internet Service Providers include:

MTS Allstream, Primus, Yak, SureNet, Electronicbox, Skywaywest, MNSi, apexia, START CommunicationsAccelerated ConnectionsEgate, AEBCWightman, Caneris, AcanacVianet, Interlink, Lightspeed, Execulink, Telnet, Auracom, The Internet Centre, goZOOM, Diallog, KOS, Telinet, Compu-SOLVE, Merge Internet, NINA-IT, Broadline Networks, ISP.ca, OdynetAirnet and of course the Independent ISP I am happy to use, TekSavvy.

easier than competition

Bell Canada LogoBell Canada was caught “throttling” the internet service of the customers of the Independent Service Providers. Over strenuous protests from both customers and Independent ISPs, the CRTC actually gave Bell Canada permission to continue to interfere with internet service of their competitors customers.

This is a business practice unprecedented in any nation aspiring to free markets and democracy.

That wasn’t enough for Bell Canada. Now they want to additional levels of billing, again, not just for their own customers, but for the customers of the Independent ISPs. In addition to the near highest internet rates in the world Canadians are already paying, Bell wants us to pay them Usage Based Billing and apply usage caps which will double the rates of moderate internet users and exponentially increase the rates paid by heavy users. This will certainly harm Canadian internet customers.

Implementation of Usage Based Billing will most likely put the Independent ISPs out of business because these CRTC rulings will have removed their ability to compete. Since the Independent ISPs will merely be able to offer inferior rate packages as dictated by Bell Canada, they certainly won’t thrive.

Canadians don’t understand computer numbers

Although I’ve used computers since the 1980’s, I am a user, not a technical person. We users do not understand things like bandwidth (particularly since it means different things… see glossary again). A long time ago there were bits and bytes. Kilobytes. Megabytes. Now there are are Gigabytes and Terabytes. These words sometimes mean big and then all of a sudden they don’t. I remember when my sister had a computer with an incredibly big hard drive… two whole gigabytes. Today my digital camera has an 8 gigabyte memory card.

My essential point is that since most Canadians do not understand how much bandwidth is required for the the things we do online, we won’t know what we will need to do to cut back our internet use so that we can continue to afford it. This means that the biggest worst effect of Usage Based Billing will certainly be that after paying the first huge internet bill, Canadians are going to use the internet as little as possible. Anyone who doesn’t think that this will do serious damage to the Canadian economy is in denial.

The internet stopped being a luxury some time ago. It has become a key economic tool.

Ajax and Cassandra painting

Solomon Joseph Solomon′s painting of Ajax and Cassandra

Pretty big nutshell.

Now what?

RobertX asked what my predictions for UBB in the New Year would be.

I’m no Cassandra (which is just as well, actually) so I can’t predict what will happen to Usage Based Billing in 2010.

What I can do is speculate.

What might happen if they implement Usage Based Billing?

Since the CRTC has provisionally approved Usage Based Billing– on the basis of Bell Canada presentations unsubstantiated by evidence– Usage Based Billing could very well be implemented. Although the CRTC chose to ignore all of the dissenting voices, the CRTC did ask Bell Canada for some clarification, as well as the legal challenges the Independent ISPs have offered, so Usage Based Billing is still not a foregone conclusion.

Implementing UBB on the Quiet?

Because the bulk of the mainstream media “news” outlets haven’t actually informed Canadians that UBB is an issue– let alone one that they need to be concerned about– most Canadians still don’t know anything about Usage Based Billing or what it will mean to them.

It would be very possible, ridiculously easy even, to implement Usage Based Billing quietly. Even if the Independent ISPs forward a warning to customers, most people don’t read all the junk mail routinely include with our invoices. So implementation might well be slipped into effect without warning.

Since there isn’t likely to be a big outcry before UBB implementation, the CRTC might allow implementation of UBB thinking it won’t cause much of a fuss.   After all, Bell Canada says its necessary.   Bell Canada has many investors.   Bell Canada has many employees.   Which is why Bell Canada is so powerful. Rich.   Canadian consumers aren’t.

There will be a fuss. But it will come AFTER UBB implementation.

When most Canadians get the unhappy surprise that their internet bills have gone through the roof– for no reason other to enrich Bell Canada— there will most certainly be a fuss.

Usage Based Billing will cause untold damage to Canadians and the Canadian economy. Usage Based Billing may in fact be the tipping point for Canadian consumers.   Once implemented Usage Based Billing won’t be in the dark any more, and although slow to anger, Canadians will be angry. Very Angry.

Any or all of the following could well result from implementation of Usage Based Billing:

  • independent Internet Service Providers put out of business due to CRTC interference
  • Independent ISP class action lawsuits brought against Bell Canada, the Government of Canada, and the CRTC
  • media coverage as Canadians angrily demand to know who is responsible for Canadian overcharging
  • Canadians will want to know why we pay the highest rates in the world for mediocre internet service
  • cabinet overturning the ill advised CRTC decision to allow implementation of Usage Based Billing
  • Government dissolution of the CRTC because of the public outrage over CRTC decision to allow implementation of Usage Based Billing
  • Canadian class action suits brought against the so-called Canadian “backbone” ISP carriers for fraudulent charges for levels of service they don’t deliver because of throttling
  • Royal Commission to investigate malfeasance or corruption of CRTC
  • political upheaval, elections
  • the Pirate Party of Canada might well form a majority government and ensure Canadian Net Neutrality through laws prohibiting ISPs from being content providers

It would only be reasonable for the Independent ISPs to defer any CRTC orders allowing implemementation of Usage Based Billing in the absence of a sitting government. Certainly it is reasonable that a Minister of Industry might over-rule bad decisions made by the CRTC. After all, it happened for Wind Mobile.

Particularly since implementation of Usage Based Billing will require mammoth outlays of investment for usage monitoring equipment. If I ran an Independent ISP, I would not be willing to lay out funds before exhausting every possible avenue.

Implementation of Usage Based Billing cannot possibly be undertaken until the Measurement Canada holds a consultation with stakeholders. It would be incumbent on Measurement Canada to establish approved Marketplace Monitoring, Standards Calibration, Traceability, Delegation of Authorities, Complaint Investigation, Accreditation and Auditing standards just as they do for the natural gas industry.

Implementation of Usage Based Billing should not be undertaken without a framework of rules, as well as enforcement and auditing by the Privacy Commissioner.

What might happen if the CRTC reverses the decision and rules against Usage Based Billing?

I would happily wind down this blog.

The Independent ISPs would be able to get back to the business of providing excellent internet service to Canadians.   Now freed from frittering away their profits in court, they would be able to continue to expand and grow.

Those of us customers who have been aware of the Usage Based Billing threat would be happy, even though we are paying some of the highest internet rates in the world for mediocre service.

Pretty much everyone would be happy.

Everyone except Bell Canada.   The Bell Canada dream of eliminating the competition would have failed, so Bell Canada would not be happy.

Perhaps Bell Canada would start acting like a real company.   They would need to lower the dividend payments they make to their investors and instead reinvest in infrastructure.   Instead of using their “loyalty department” to offer quarterly bribes, maybe Bell Canada would treat their customers better overall in an effort to keep them, by offering good service for fair value.

It isn’t that Bell Canada has not been paid more than enough to upgrade the infrastructure, it’s that Bell Canada has spent large quantities of money on other things… like trying to start up a music downloading channel. (#fail)

You just never know.


Since Prime Minister Harper has chosen to prorogue government, things are different now.   It is unlikely that the petition to Dissolve the CRTC will be presented to Parliament before an election is called.

STOP Usage Based Billing

This makes it all the more important for Canadians to sign the petition.   If you haven’t yet, sign the petition, and encourage everyone you know who uses the internet to sign the petition at http://dissolvethecrtc.ca/.   Lets keep the heat on.  Spread the Word.


Advertisements

5 Responses to “Speculation not Prophecy”

  1. […] 2010 #46 Welcome to Another Book Title Year #47 Speculation not Prophecy #48 Nutshell Net Neutrality #49 We Interrupt this […]

  2. Mike said

    A group of Canadians are coming together to launch a class action regarding UBB, in particular how usage is measured – which they believe is unlawful. More information can be found here: http://www.ubbclassaction.ca

    • Sounds interesting. I signed up.

      I do, however have a *really good* spam filter I’ve been training for years.

      Since there’s no privacy protection offered on your site, I can’t recommend others to sign unless their security is as good as mine.
      (Sadly, we live in a world where some unscrupulous organizations that exist purely to harvest email addresses.)

  3. Luke said

    Let us make this simple-

    so you pay for 6Mb service, and with streaming movies and such, it is coming to where people are constantly using that 6Mb or close to it. The customer says “I’m paying for 6Mb I should always get 6Mb”. Unfortunately, Internet access is built on “over-subscription” to attain a profit. Let me explain easily-

    An ISP can pay $3,500/month (sometimes higher) for a DS3 which gives 44Mb of room. $3,500/44 = That comes out to just over $79.00 per Mb! So, if a customer is to say “I should ALWAYS get my full 6Mb without any over-subscription, they would have to fairly pay $79.00 x 6 = $474.00/mo. I’m thinking that isn’t going to happen. The solution used to be over-subscription as internet traffic fluctuated a lot. Now days, it still fluctuate, but it is doing so MUCH less with movies being streamed and site using flash etc. Also, don’t forget, a network-wide upgrade to support fiber and other technologies such as faster DSL or wireless can cost close to a $1million for a business of less than 4,000.

    With usage based billing, it’s simply closing the gap of the high user (that would fairly pay up to $400+/mo for their service) and the low user that doesn’t use that much at all. I do believe there should be plenty of bandwidth included in you “package”. I have found that 200Gb/mo can give you multiple movies a day and tons of browsing and email. I also believe or except that if I’m pulling 400Gb a month, given the math above, it only makes sense I have to pay more for the extra and decide if that extra bandwidth is worth the money.

    It should stay reasonable (which I do believe 150-250Gb/mo is), but common people, the ISP (especially smaller ones) have to make some profit to stay in business. Hopefully the simple above math can put that into perspective as I don’t believe anyone is willing to pay the same amount/Mb that the ISP pays and if that is so, you agree to over-subscription…. and if THAT is so you recognize that if over-subscription is becoming less possible then the costs have to compensate… right?

    • Well, no, Luke.

      If customers are paying for 6 megabytes that what they should get. If they are not getting it, they are being defrauded. I was shocked to learn from some University students that Rogers routinely cuts them off of they stray over their cap. The CRTC should be protecting Canadian Internet users from being gouged by ISPs. Instead the CRTC gave the Carrier/ISPs permission to “throttle” users by artificially inflating their bandwidth use, so adding UBB into the mix means that users will be paying for bandwidth they don’t get.

      You’re talking about the amount of digital “room” dictating cost, which is simply wrong. I may not be a tech person, but I know very well that the cost of digital storage has fallen through the floor. A quick check of the Canada Computers website shows me I could pick up a 2TeraByte drive right now for $129.00. This is amazing for someone whose first three thousand dollar computer didn’t even come with a hard drive. If If Bell had upgraded their infrastructure to get back into the leading edge five years ago, it would have cost substantially more than if Bell were to do the same thing today. The technology has become better and faster with a steadily decreasing price tag.

      Though I’m not a math person, even I can tell your numbers are off. FUD aside, after infrastructure costs, bandwidth costs next to nothing. Since Bell has not been upgrading, what have they been doing instead? A few years back Bell tried to start their own pay-per-download service at around the time they were caught throttling other people’s downloads. (It’s no wonder Bell’s download business tanked.) Another thing Bell clearly spends time on is CRTC lobbying. And just skimming through the CBC online site you’ll find that Bell’s lawyers spend a great deal of time in court. I’d be willing to guess that their investors are pleased with the dividends they get.

      I really don’t know where you got your numbers from, Luke, but the Independent ISPs have been able to do very well indeed by offering much higher limits than either Bell or Rogers and offering this service at a fraction of the price, and of this more than half of what they charge customers is paid to Bell for G.A.S. I don’t see evidence of this “over-subscription” sounds rather like a shell game. Any business model based on selling what you don’t have is not going to be stable. The only problem looming over the Independent ISPs would be the implementation of Usage Based Billing.

      Your understanding of how bandwidth is portioned out is in error. I suggest you read more of the site to get a better understanding of what this is all about.

      “Bell offers 25 Mbps (million bits per second) download speeds, with a 75 GByte cap. 75 GBytes is 600,000 Mbits, so at 25 Mbps it takes only 6 hours and 40 minutes to use up all your bandwidth for the month…”

      Bob Jonkman

      The inflationary fees Canadians have been paying should have easily covered upgrading the infrastructure many times over.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

 
%d bloggers like this: