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.
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:
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.