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CRTC Boss Rather Annoyed Having To Defend Himself To You
Regulatory Head Can't Answer Basic Questions Upon Examination

Yesterday we watched Canada's head of the CRTC, Konrad von Finckenstein get called before Canadian politicians to justify the agency's implementation of usage-based billing (watch the video here). The severe new price structure has seen significant Canadian consumer outrage resulting in Canadian leaders promising to overturn the CRTC's ruling. von Finckenstein was clearly annoyed by the entire proceeding, complaining at several points that he was being pulled before committee. More interesting perhaps was how he was repeatedly unable or unwilling to answer basic questions about the CRTC's decision -- like how exactly they came to the 15% discount for wholesale operators.

Click for full size
If you read his opening remarks, you'll note they sound oddly similar to many of the Bell Canada talking points used to justify usage-based billing to begin with. As with any ISP executive you'll ask, von Fickenstein framed the decision to impose significant overages not as a way to make more money and protect legacy business models in an anti-competitive fashion (which, make no mistake, is what it is) but as an issue of fundamental fairness and altruism:
quote:
I would like to reiterate the Commission’s view that usage-based billing is a legitimate principle for pricing Internet services. We are convinced that Internet services are no different than other public utilities, and the vast majority of Internet users should not be asked to subsidize a small minority of heavy users. For us, it is a question of fundamental fairness. Let me restate: ordinary users should not be forced to subsidize heavy users.
As we've noted countless times, while you certainly could have an ISP design new usage-based pricing that's fair and offers value, we haven't seen any ISPs do so yet. The pricing models we've seen emerge in Canada with the CRTC's blessing aren't designed to save light users money, as even the lowest, cheapest tiers result in significant and confusing penalties for even the lightest of use (say one HD film of the new baby for grandma). You don't reign in the use of a tiny percentage of your userbase by imposing severe penalties on the entire userbase. We've also yet to see any ISP offer raw financial or congestion data supporting the need for this pricing instead of flat-rate pricing or even straight and reasonable caps/throttling.

Canadian consumers in our forums didn't quite like von Fickenstein's justifications, many arguing that the reason von Fickenstein couldn't really answer direct questions about the CRTC's decision making process -- is because they've allowed Bell Canada to do the decision making for them.
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DataRiker
Premium Member
join:2002-05-19
00000

1 recommendation

DataRiker

Premium Member

Good news

Hopefully this gets overturned for good.

Matt3
All noise, no signal.
Premium Member
join:2003-07-20
Jamestown, NC

Matt3

Premium Member

Re: Good news

said by DataRiker:

Hopefully this gets overturned for good.

Finally, something we agree on!

In all seriousness, I wouldn't have a problem with UBB if I had the opportunity to actually LOWER my bill when I used less. But as we all know, that's not going to happen.

Chris 313
Because It's Geekier
Premium Member
join:2004-07-18
Houma, LA
·AT&T FTTP
·Comcast XFINITY

Chris 313

Premium Member

Re: Good news

said by Matt3:

said by DataRiker:

Hopefully this gets overturned for good.

Finally, something we agree on!

In all seriousness, I wouldn't have a problem with UBB if I had the opportunity to actually LOWER my bill when I used less. But as we all know, that's not going to happen.

Ha! You're right. UBB is nothing more then a money grab. They want their cake and it eat it too. While we, the consumer, take one to the shorts. I'm glad to see that like what happened in the US, the unhappy canadians made a ton of noise over this.

Slapnutzz
@bell.ca

Slapnutzz

Anon

Re: Good news

The cable tv providers are hellbent on increasing the cost of the internet to protect their revenues. It's that simple.
shimh
join:2003-05-23

shimh to Matt3

Member

to Matt3
Very true. If the bill is lower for light use, the revenue loss would be higher than the gain from heavy users. And bhell knows if ubb is implemented, there will be much less so called heavy users. Since the bill is not lowered, saying heavy users subsidize light users is simply a lie. Heavy or advanced users just make better use of networks and potentially put an obstacle for bhell's wide deployment of iptv. As matter of fact, iptv is the real-time bandwidth hog.
Kearnstd
Space Elf
Premium Member
join:2002-01-22
Mullica Hill, NJ

Kearnstd to DataRiker

Premium Member

to DataRiker
And this is the rub, UBB does not work like a utility which tends to have a rather small "Line Fee" to be hooked to the system.

This is why I fight UBB because I know here in the US a fully metered service would likely be 42.95 just to be hooked up to them and then a per gig metering at way more than one pays per Kilowatt Hour to keep the lights on.

Already here
@acsalaska.net

Already here

Anon

UBB in the US. Look no further than Alaska

Cable ISP GCI.com holds a rather large monopoly position here in Alaska. They've implemented and run UBB since 1999. GCI is charging these rates in Anchorage, Alaska, a city of well over 300,000 with high population density. I can understand charging rates such as these in a very small community, but economically, it these rates should not be justified in Anchorage.

»assets.gci.com/2011/01/T ··· x111.jpg

Packages/Prices on the left side are only attained with subscription to GCI's bundled services (Cable TV, local phone, long distance) Essentially you're being forced to pay $100 for those services before you have any opportunity to purchase a tier package with higher usage.

Matt3
All noise, no signal.
Premium Member
join:2003-07-20
Jamestown, NC

Matt3

Premium Member

Re: UBB in the US. Look no further than Alaska

At least in GCI's case, they have a relatively low amount of users who have to subsidize their long-haul fiber optic cables to the US. One is over 1500 miles long, that's not cheap.

They also look like they are somewhat good about providing service to rural Alaskans.

»www.gci.com/about/compan ··· overview

already_here
@acsalaska.net

already_here

Anon

Re: UBB in the US. Look no further than Alaska

In GCI's case they were making large enough profits to buy & deploy a 2nd undersea cable within less than 4 years time.. (first cable purchased around 99, second cable 650Gbps around 2003)

GCI is making lots of money. Now I can understand charging higher rates to rural communities where fixed costs are much higher and population density is smaller, but in a city like Anchorage with high population density, rates and service should be the same as any city with 300,000 stateside. Transport costs for GCI's undersea cable are less than 1 cent.

Matt3
All noise, no signal.
Premium Member
join:2003-07-20
Jamestown, NC

Matt3

Premium Member

Re: UBB in the US. Look no further than Alaska

said by already_here :

In GCI's case they were making large enough profits to buy & deploy a 2nd undersea cable within less than 4 years time.. (first cable purchased around 99, second cable 650Gbps around 2003)

GCI is making lots of money. Now I can understand charging higher rates to rural communities where fixed costs are much higher and population density is smaller, but in a city like Anchorage with high population density, rates and service should be the same as any city with 300,000 stateside. Transport costs for GCI's undersea cable are less than 1 cent.

»assets.gci.com/financial ··· 2010.pdf

They profited a whopping $7 million, or $0.14 per share.

Ysean
@comcast.net

Ysean to Kearnstd

Anon

to Kearnstd

Re: Good news

I don't know what power company YOU have but, Ameren charges almost as much for their distribution fees as is charged for the electricity. I DEFINITELY wouldn't call that a "small" fee. Ameren: "$80 worth of electricity usage? We'll bill $64 in delivery fees. There, that's better... The bill is $144."

trainwreck6
join:2010-09-21
off track

1 recommendation

trainwreck6 to DataRiker

Member

to DataRiker
We're working on it! God forbid that our neighbors in the U.S. have to put up with what we're going through.

It's hard enough with throttling, etc. to have these guys just leave our pipes ALONE!

MerinX
Crunching for Cures
Premium Member
join:2011-02-03

1 recommendation

MerinX

Premium Member

Poor Poor von no clueinstein

»www.cbc.ca/video/#/News/ ··· 79545308

»www.cbc.ca/video/#/News/ ··· 79426903

"They were gonna get a discounted rate by the big boys!"

15% off of a 10000% percent markup on customers that are not yours... yes that sounds fair and balanced much like fox news....

The clueless leading the blind...

milnoc
join:2001-03-05
Ottawa

milnoc

Member

Re: Poor Poor von no clueinstein

Try between 32,000% and 96,000%.
Speed bot
join:2010-10-30
canada

Speed bot

Member

Walking papers...

Time to fire Konrad von Finckenstein, and dissolve the CRTC. Enough is enough!

FFH5
Premium Member
join:2002-03-03
Tavistock NJ

1 recommendation

FFH5

Premium Member

Re: Walking papers...

said by Speed bot:

Time to fire Konrad von Finckenstein, and dissolve the CRTC. Enough is enough!

The problem with independent gov't agencies is that they become independent of those who created them. I am naturally antagonistic to all gov't regulation. But when pols get lazy and turn loose a regulator without specific detailed rules the results are usually the worst. So, end the CRTC altogether or at least cut their independence and make them more directly responsible to the voters by proscribing their powers.

tschmidt
MVM
join:2000-11-12
Milford, NH
·Consolidated Com..
·Republic Wireless
·Hollis Hosting

tschmidt

MVM

Re: Walking papers...

said by FFH5:

The problem with independent gov't agencies is that they become independent of those who created them. I am naturally antagonistic to all gov't regulation. But when pols get lazy and turn loose a regulator without specific detailed rules the results are usually the worst.

While I'm generally in favor of of more regulatory oversight of companies - regulatory capture is a big problem.

The folks doing the regulating tend to have close ties with the companies they are regulating. Where else can you find knowledgeable individuals. Difficult crafting regulations to maxim the public good when your allegiance is with those you are regulating.

I have no problems with "price gouging" in a truly competitive environment. In that case there is a sweet spot break-even pricing based on cost and prices so high no one uses they service. Customers are able to vote with their wallet. Unfortunately in many areas (broadband being one) true competition does not exist, one or at most a few companies control the market so customers have little option other then pay up or drop the service.

/tom
bt
join:2009-02-26
canada

bt to Speed bot

Member

to Speed bot
He can't be fired without hard evidence of illegal conduct.

Stupid decisions are, unfortunately, not illegal.
munky99999
Munky
join:2004-04-10
canada

munky99999

Member

Re: Walking papers...

said by bt:

He can't be fired without hard evidence of illegal conduct.

Stupid decisions are, unfortunately, not illegal.

Wrong. They are a commission and are subject to being fired at will.

elwoodblues
Elwood Blues
Premium Member
join:2006-08-30
Somewhere in

elwoodblues

Premium Member

Re: Walking papers...

said by munky99999:

said by bt:

He can't be fired without hard evidence of illegal conduct.

Stupid decisions are, unfortunately, not illegal.

Wrong. They are a commission and are subject to being fired at will.

Look at Linda Keen, head of the Nuclear Regulatory commission, she got turfed for refusing to turn Chalk River back on again
acrufox
join:2004-07-14
Fort Wayne, IN

acrufox

Member

Hasn't a clue...

Fire the whole lot of em!

These aging dinosaurs have haven't a clue on what they are doing. Does this guy look like someone that understands the needs any of the needs, wants, and expectations of the younger generations of Canadians that use and depend on the internet from day to day.

Wonder if this guy could even manage a smartphone, or how much he uses the internet himself.

m35g35
@wideopenwest.com

m35g35

Anon

Re: Hasn't a clue...

the guy has no clue about life period, let alone the Internet!

Doctor Four
My other vehicle is a TARDIS
Premium Member
join:2000-09-05
Dallas, TX

Doctor Four

Premium Member

Re: Hasn't a clue...

said by m35g35 :

the guy has no clue about life period, let alone the Internet!

He sounds like many of our politicians here in the US.

Many here remember Ted "Series of Tubes" Stevens anti net neutrality speech.
moonpuppy (banned)
join:2000-08-21
Glen Burnie, MD

1 recommendation

moonpuppy (banned)

Member

When you make a decision...

....you better be able to stand behind it. If you cannot or will not explain yourself, you have forfeited your right to defend yourself.

Kitchener
@distributel.net

Kitchener

Anon

Konrad

Konrad doesn't know the first thing about computers or internet, why is he the person making ANY decisions regarding them.. It makes no sense!

Jeffer71
join:2008-09-13
Carrying Place, ON

1 recommendation

Jeffer71

Member

Re: Konrad

So how many megahertz and gigasmurfs are we allowed to download now Konrad Mein Fรผhrer?

Jamos
@teksavvy.com

Jamos

Anon

Re: Konrad

thanks for that one made me laugh

Disillusion
@rogers.com

Disillusion to Jeffer71

Anon

to Jeffer71
ROFLMAO

trainwreck6
join:2010-09-21
off track

trainwreck6 to Jeffer71

Member

to Jeffer71
To you Americans: He actually said "gigahertz" Thursday in the proceedings.

Atticka
join:2001-11-26
Montreal, QC

Atticka

Member

Re: Konrad von Fuckenstein is a complete, unmitigated FOOL.

And "three dimensional games" are the problem! Get off my lawn you crazy kids!

TigerLord

join:2002-06-09
Canada

TigerLord

Let me restate: ordinary users should not be forced to...

bend over and take it up?

If you didn't want ordinary users to subsidize the heavy users, Bell would have dropped Internet prices so compensate for the lowering of the cap, and kept prices identical for the same cap so heavy users could use the Internet properly.

You are full of shit Finckenstein. Not only were you unable to answer the most basic questions thoroughly (such as why Bell had opted for such low caps when other countries' were so much bigger, to which you answered 'I don't know, you'd have to ask Bell).

Here's a hint, you moronic waste of taxpayer dollars: if you're the director of a commission that just passed a controversial bill and you are asked to go defend it in front of an oversight committee, you need to be prepared so you don't look like a moronic waste of taxpayer dollar.

You were obviously ignorant of the technicalities and reasons behind UBB, and you managed to convince this entire country of your uselessness.

Congratulations, I firmly believe you gave the opposing side all the ammo it needed to showcase your relevance to the World. NONE!

JfromC
Problem
join:2010-10-30
Cobourg, ON

JfromC

Member

FAIR Market Value on Bandwidth!

How many times will the CRTC and Bell compare the use of bandwidth to that of other common utilities such has hydro? They compare it time and time again saying it's fair. Pay for what you use..

YET!, If you paid $2.00 per kWh you would be PISSED OFF!

WHY!, can they get away with charging us upwards of $2 a Gigabyte when it's value is somewhere under 10ยข per gig.

FAIR MARKET VALUE, PEOPLE!

(Yes I'm an agitated Canadian)

••••••
Atragon0
join:2004-05-16
Gloucester, ON

Atragon0

Member

Not quite the case...

As we've noted countless times, while you certainly could have an ISP design new usage-based pricing that's fair and offers value, we haven't seen any ISPs do so yet. The pricing models we've seen emerge in Canada with the CRTC's blessing aren't designed to save light users money, as even the lowest, cheapest tiers result in significant and confusing penalties for even the lightest of use (say one HD film of the new baby for grandma). You don't reign in the use of a tiny percentage of your userbase by imposing severe penalties on the entire userbase. We've also yet to see any ISP offer raw financial or congestion data supporting the need for this pricing instead of flat-rate pricing or even straight and reasonable caps/throttling.
I'd like to take slight issue with this statement, it seems to imply that the CRTC is allowing ISPs to implement UBB-based pricing schemes, and that no ISPs have chosen to implement a fair scheme.

This isn't quite the case, the CRTC has mandated that all ISPs who are paying bell for access to their wholesale services must also pay Bell based on an absurdly priced UBB model per user, and thus the small independent ISPs seem to have had no choice but to implement a pricing scheme that nearly mirrors Bell's own retail prices.

Frankly, I'm disgusted that the CRTC allowed this to pass.

trainwreck6
join:2010-09-21
off track

trainwreck6

Member

Re: Not quite the case...

said by Atragon0:

As we've noted countless times, while you certainly could have an ISP design new usage-based pricing that's fair and offers value, we haven't seen any ISPs do so yet. The pricing models we've seen emerge in Canada with the CRTC's blessing aren't designed to save light users money, as even the lowest, cheapest tiers result in significant and confusing penalties for even the lightest of use (say one HD film of the new baby for grandma). You don't reign in the use of a tiny percentage of your userbase by imposing severe penalties on the entire userbase. We've also yet to see any ISP offer raw financial or congestion data supporting the need for this pricing instead of flat-rate pricing or even straight and reasonable caps/throttling.
I'd like to take slight issue with this statement, it seems to imply that the CRTC is allowing ISPs to implement UBB-based pricing schemes, and that no ISPs have chosen to implement a fair scheme.

This isn't quite the case, the CRTC has mandated that all ISPs who are paying bell for access to their wholesale services must also pay Bell based on an absurdly priced UBB model per user, and thus the small independent ISPs seem to have had no choice but to implement a pricing scheme that nearly mirrors Bell's own retail prices.

Frankly, I'm disgusted that the CRTC allowed this to pass.

Exactly. Nice correction. The CRTC has basically reversed years of rather progressive wholesaler/incumbent regulation with one fell swoop, and dictated that TekSavvy et al. pay Bhell for something they already pay for.

They completely violate the proper definition of wholesaler in the process by taking away the ability of the independent to buy in bulk and sell retail. Under UBB, everyone's a white label Baby Bhell reseller. Under the old status quo, independents had the flexibility to price their product the way THEY wanted.

nanaan2011
@eastlink.ca

nanaan2011

Anon

I Want TO ASK BELL, TELUS, SHAW, ROGERS

I WANT TO ASK BELL, TELUS, SHAW, ROGERS

when is digital going to get cheaper? as stated way back
if i recall going digital is Cheaper was one of the selling points of Broadband Internet all 4 advertised.
acrufox
join:2004-07-14
Fort Wayne, IN

acrufox

Member

Re: I Want TO ASK BELL, TELUS, SHAW, ROGERS

I have a good laugh when I hear some of the local radio stations and TV commercials saying that Bell has the "Best network in Canada"

Rest assured, Bell, Shaw, and Rogers all say they have the best network in Canada, which is why usage based billing is so attractive to them.

How will customers ever get by knowing how they're the best unless they all charge the most. I mean really just sending them money for nothing is a privilege in itself.

n2jtx
join:2001-01-13
Glen Head, NY

1 recommendation

n2jtx

Member

I'd Be Annoyed Too

Heck if I had to explain to politicians why I was helping my friends out and gouging people in the process, I'd be annoyed too. He really needs to tell the Canadian government to STFU and let him continue to be a servant to the companies that pay him. After all, he has to think about a future job in the private sector working for one of these companies he is so richly providing for now.

(Disclaimer: this is sarcasm for those who are humor impaired)
a1_Andy
Premium Member
join:2005-12-29
Oshawa, ON

a1_Andy

Premium Member

Re: I'd Be Annoyed Too

Rest assured no Joke, He will have a great job as a consultant for Bell when he quits the CRTC, this we know from experience with other CRTC chairmen.

Ken8
@shawcable.net

Ken8

Anon

O noes

Someone got caught with his hand in the cookie jar stealing cookies for bell...

BigDaddyChud
join:2002-11-16
Gladstone, OR

BigDaddyChud

Member

Public Utility

Well he said..." We are convinced that Internet services are no different than other public utilities, and the vast majority of Internet users should not be asked to subsidize a small minority of heavy users. " So do it, make it a public utility and base the fees like Electricity and Water. Small base fee and a usage fee would be fair, and price increases would have to be reviewed, discussed and approved or denied just like other utilities. Sounds reasonable to me.
homeplanit
Premium Member
join:2002-11-06
Toronto, ON

homeplanit

Premium Member

Re: Public Utility

And if billing is per-GB, then it should be price DECREASES over time. Technology advances make this cheaper, while energy resources are getting scarcer. That's one of the problems with setting per-GB pricing at any point in time.

fatness
subtle

join:2000-11-17
fishing

1 recommendation

fatness

CRTC makeup

Are there consumer members of the CRTC? There should be at least as many consumer members as provider members to have any shot at being practical.

Mashiki
Balking The Enemy's Plans
join:2002-02-04
Woodstock, ON

Mashiki

Member

Re: CRTC makeup

said by fatness:

Are there consumer members of the CRTC? There should be at least as many consumer members as provider members to have any shot at being practical.

No and there more than likely never will be. The CRTC is a 'hands-off' agency of the government meant to regulate specific things. It also has created various broadcast rules(like cancon). But it exists at the behest of government to do 'what's best for canada, and consumers'. Right now, it's doing neither. The problem itself is two fold, one it believes it has the right to dictate whatever it wants(internal rot), second it gets no direction on what it should be doing(as industry canada has taken over large parts of it's portfolio in the last 10 years--external rot).

dillyhammer
START me up
Premium Member
join:2010-01-09
Scarborough, ON

dillyhammer to fatness

Premium Member

to fatness
said by fatness:

There should be at least as many consumer members as provider members to have any shot at being practical.

Yup. At least a good mix of industry insiders, consumers, and consumer advocates.

Mike

footballdude
Premium Member
join:2002-08-13
Imperial, MO

1 recommendation

footballdude

Premium Member

Bond

Does anyone else think this guy looks (and has a name like) a Bond villain?
tmc8080
join:2004-04-24
Brooklyn, NY

tmc8080

Member

wholesale change..

canada needs to vote out alot of the cronies selling out to big business interests. this is long overdue.. if canada thinks they can run their economy based upon selling shale oil to the USA, think again..

companies are already perfecting biomass *biogasoline* which is sustainable @ $3-$5 a gallon. the best part is that this new fuel is a direct replacement for gasoline.. biomass gasoline and doesn't have to use FOOD as it's source.. almost any bio waste can be used.

the middle east better get their ducks in a row.. oil might end up a commodity with permanently destroyed demand the higher they raise the price. just about the same can be said for broadband when sold as a metered (by the byte) product.

CableConvert
Premium Member
join:2003-12-05
Atlanta, GA

CableConvert

Premium Member

Clueless what IPTV is!

He didn't even know that IPTV is delivered in the same pipe as internet. He tried to explain they were not the same. I can't believe none of the MPs called him on it. Perhaps thats why they allowed Bell's IPTV offerings to be exempt. Incompetence of the highest degree. Lets not forget this stooge was put there by the Tory government to begin with!
cheapbastard
join:2009-04-14

cheapbastard

Member

Unprepared, Bribed Bullshit (UBB)

I began to watch the link provided (thank you and book marked for futher viewing, if UBB or some other stupid money grab doesn't allow) but i stopped it very early at the point where he stated, "i'm sorry but we're unprepared" using the CTV purchase as an excuse. If they/he was unprepared then how well thought out was UBB to begin with?

GrandPa
@shawcable.net

GrandPa

Anon

"Double dipping the consumer"

Keep current 'plan' dollar rates and lower CAPS = double our revenue!

[ above a bean-counter's organismic dream ]

* I'll offer myself as chairman of CRTC with this guideline to Canadian ISP's...

"Your proposal was flawed - corrected your proposal to show following..."

1/ Cut plan-rates @ same percentage you cut CAPS
2/ UBB rate @ 50% markup from cost = $0.05/GB

Therefore your proposal now reflects proper charges:

Plan for consumer connection fee = $10.00/mth
[$50.00 minus $40.00 = $10.00]

UBB @ $0.05/GB [use 300GB/mth] = $15.00

Total monthly charge for consumer = $25.00/mth

Sincerely.

GrandPa
[chairman CRTC]

Trisomy21
join:2006-04-27
Kingston, ON

Trisomy21

Member

fire him!

Fire VonFuckelstein!

CableDude60
@74.198.8.x

CableDude60

Anon

Re: fire him!

Finkenstein sounds more like Frankenstein to me. I heard on the news their is some rally going on regarding UBB. The 2 month review process is being challenged as unacceptable. They dont need to review the decision, it's just nothing more than a face saving measure on the part of the CRTC because their authority has been challenged. They will never admit that it's a bad decision.
Herring
join:2011-01-05
Wakefield, QC

Herring to Trisomy21

Member

to Trisomy21
Indeed!
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