dslreports logo
 story category
Canada Sees Usage Billing Broadband Backlash
As Independent ISPs Fight Regulatory Capture

Yesterday Canadian telecom regulator the CRTC finalized their ruling on usage-based billing, making some fairly minor concessions at the behest of independent ISPs, such as capping wholesale UBB rates at 85% of retail UBB rates. By and large however this was a largely empty gesture, and the CRTC remains a breathing example of regulatory capture and government dysfunction. By every measure, this was a coordinated move by incumbent ISPs to overcharge consumers for Internet video and crush independent competition using the bogus threat of the Exaflood.

Canadian consumers tend to be fairly-well keyed into the broader anti-competitive and innovation-stifling ramifications of the move, if this Vancouver Sun article on the growing consumer backlash is any indication. Our various Canadian broadband forums have exploded with consumer complaints in recent months, and independent ISPs are also voicing their concerns. Rocky Gaudrault, CEO of independent ISP TekSavvy, shares his thoughts on the CRTC ruling:
quote:
The current decision was expected although the percentage was disappointing. Before this can get better, hopefully permanently, we will have some turbulence in the days to come. While we do what we can to fix this, this issue needs to be an issue beyond dslreports. It needs to be an issue for the non-techies who have no clue what's about to hit them. We estimate more than half our clients are above the 25GB cap now imposed. I see you people as the future trend of what the regular users will be over the next 3-4 years.
It's an interesting battle to watch given that Canadian incumbent ISPs took a lesson out of the U.S. ISP playbook in using hijacked, cajoled, lobbied and otherwise bribed regulators to help them kill off independent ISP competition. They just did in two to three years what it took U.S. ISPs a decade to accomplish. Those same U.S. ISPs eager to impose this kind of punitive, economically surreal price structure are watching this unfold with great interest, given previous attempts in the United States to impose very low caps and very high per byte pricing have fallen painfully on their face.
view:
topics flat nest 

torobull123
join:2009-06-20

torobull123

Member

EPIC FAIL

Capitalistic corruption and greed at its finest.

DOWN WITH BELL!

DOWN WITH CRTC!
j0ly
join:2007-03-22
Calgary, AB

1 recommendation

j0ly

Member

Netflix's sees this as being groosly overpriced

From Netflix's quarterly report. Bottom of page 9 »files.shareholder.com/do ··· ders.pdf
Wired ISPs have large fixed costs of building and maintaining their last mile network of residential cable and fiber. The ISPs’ costs, however, to deliver a marginal gigabyte, which is about an hour of viewing, from one of our regional interchange points over their last mile wired network to the consumer is less than a penny, and falling, so there is no reason that pay-per-gigabyte is economically necessary. Moreover, at $1 per gigabyte over wired networks, it would be grossly overpriced.
j0ly

j0ly

Member

Re: Netflix's sees this as being grossly overpriced

opps spelling.. Grossly.. my bad

KrK
Heavy Artillery For The Little Guy
Premium Member
join:2000-01-17
Tulsa, OK

KrK to j0ly

Premium Member

to j0ly

Re: Netflix's sees this as being groosly overpriced

There ya go. Less then a penny per GB from their regional interchange. That sounds about right.

$1 + Per GB = absolute pillaging, raping, and gouging. Fact.

DaDawgs
Premium Member
join:2010-08-02
Deltaville, VA

DaDawgs

Premium Member

Re: Netflix's sees this as being groosly overpriced

said by KrK:

There ya go. Less then a penny per GB from their regional interchange. That sounds about right.

$1 + Per GB = absolute pillaging, raping, and gouging. Fact.

Yeah, and then there is the local loop but you really have no experience at all with reselling broadband so your opinion can be ignored. The fact that you suck up to an obvious shill of Netflix can also be ignored, I suppose...


KrK
Heavy Artillery For The Little Guy
Premium Member
join:2000-01-17
Tulsa, OK

KrK

Premium Member

Re: Netflix's sees this as being groosly overpriced

I guess you can be ignored as well, because you failed to read "Wired Networks".....

Everything they said was absolutely valid, but non-applicable to small WISPS.
KrK

KrK to DaDawgs

Premium Member

to DaDawgs
said by DaDawgs:

Yeah, and then there is the local loop but you really have no experience at all with reselling broadband so your opinion can be ignored. The fact that you suck up to an obvious shill of Netflix can also be ignored, I suppose...


Sheesh. "Wired Networks." One could easily say "you have no experience at all with Video delivery via IP so your opinion can be ignored. The fact you suck up to an obvious shill of UBB can also be ignored, I suppose..."

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

1 edit

FFH5 to j0ly

Premium Member

to j0ly
said by j0ly:

From Netflix's quarterly report. Bottom of page 9
The ISPs’ costs, however, to deliver a marginal gigabyte, which is about an hour of viewing, from one of our regional interchange points over their last mile wired network to the consumer is less than a penny,

The key word there is MARGINAL. That concept doesn't account for last mile costs for replacement of equipment; upgrading or splitting nodes; doing stepwise increases that need brand new ports for fiber connections, etc.

Resellers always quote marginal traffic increases and always ignore that that isn't where the real last mile costs are.

rebus9
join:2002-03-26
Tampa Bay

rebus9

Member

Re: Netflix's sees this as being groosly overpriced

said by FFH5:

The key word there is MARGINAL. That concept doesn't account for last mile costs for replacement of equipment; upgrading or splitting nodes; doing stepwise increases that need brand new ports for fiber connections, etc.

Resellers always quote marginal traffic increases and always ignore that that isn't where the real last mile costs are.

But those NON-marginal costs are (relatively) fixed, regardless if the user consumes 10 GB or 50 GB in a month.

So in that regard, it's entirely appropriate to discuss marginal costs above certain thresholds.

KeepShilling
@bellsouth.net

KeepShilling to FFH5

Anon

to FFH5
And here we go, really, yes it might cost a little for the connection but the overhead and profit they get especially after they recoup the cost over the initial connection is tremendous

dvd536
as Mr. Pink as they come
Premium Member
join:2001-04-27
Phoenix, AZ

1 recommendation

dvd536 to j0ly

Premium Member

to j0ly
said by j0ly:

From Netflix's quarterly report. Bottom of page 9 »files.shareholder.com/do ··· ders.pdf
Wired ISPs have large fixed costs of building and maintaining their last mile network of residential cable and fiber. The ISPs’ costs, however, to deliver a marginal gigabyte, which is about an hour of viewing, from one of our regional interchange points over their last mile wired network to the consumer is less than a penny, and falling, so there is no reason that pay-per-gigabyte is economically necessary. Moreover, at $1 per gigabyte over wired networks, it would be grossly overpriced.

Caps *aren't* about bandwidth costs, its about protecting the LUCRATIVE VIDEO business!

DaDawgs
Premium Member
join:2010-08-02
Deltaville, VA

1 edit

1 recommendation

DaDawgs to j0ly

Premium Member

to j0ly
said by j0ly:

From Netflix's quarterly report. Bottom of page 9 »files.shareholder.com/do ··· ders.pdf
Wired ISPs have large fixed costs of building and maintaining their last mile network of residential cable and fiber. The ISPs’ costs, however, to deliver a marginal gigabyte, which is about an hour of viewing, from one of our regional interchange points over their last mile wired network to the consumer is less than a penny, and falling, so there is no reason that pay-per-gigabyte is economically necessary. Moreover, at $1 per gigabyte over wired networks, it would be grossly overpriced.

Yeah, and gawd damnit Netflix has no interest in this matter, they just want every freakin' ISP on the planet to deliver their data at zero cost because their broke assed business model won't work if they can't push the cost of delivery off to someone else...

Bullshit, document or suffer the label, "liar" or if you prefer the label, "moron". I don't really care. I am a WISP and I know what it costs to deliver a GByte and at $1.00 per I can just barely make a profit unless that shit comes in over my main connection to the Internet and since I don't have 50k users NetFuckx wont even talk to me about putting one of their vampires on my network...

So, yeah, either liar or moron works for me, whereas Netflix gets only one label, they lie, they know they lie, and all of the ISPs know they lie.

How long do you think they will survive? Not long on my network... I promise.

birdfeedr
MVM
join:2001-08-11
Warwick, RI

birdfeedr

MVM

Re: Netflix's sees this as being groosly overpriced

said by DaDawgs:

How long do you think they will survive? Not long on my network... I promise.

What WISP network are you running?

RealityCheck
@newwavecomm.net

RealityCheck

Anon

Re: Netflix's sees this as being groosly overpriced

said by birdfeedr:

said by DaDawgs:

How long do you think they will survive? Not long on my network... I promise.

What WISP network are you running?

It's called "LINKSYS". Haven't you seen it?
tired_runner
Premium Member
join:2000-08-25
CT
·Frontier FiberOp..

tired_runner to DaDawgs

Premium Member

to DaDawgs
said by DaDawgs:

I am a WISP and I know what it costs to deliver a GByte and at $1.00 per I can just barely make a profit

Are you saying that the network connections at your points of access or down/upstream providers are metered or that the available bandwidth to everyone at each point of access is slowly degrading due to increased utilization, therefore forcing you to purchase a fatter pipe at each?

If the former, I suppose your business is bound to fail anyway in the advent of internet video. If the latter, you can do what Clearwire is alleged to be doing; throttle your power users at a certain threshold.
Skippy25
join:2000-09-13
Hazelwood, MO

Skippy25 to DaDawgs

Member

to DaDawgs
1.) Not a very professional post from someone that "runs a WISP".
2.) They pay for their connections so they arent asking for zero cost.
3.) Your customers are requesting this data so take your anger out on them by disconnecting them or raping them with your charges. But dont whine when they go elsewhere.
4.) Your a WISP, nothing more to say on that.
Expand your moderator at work

joebarnhart
Paxio evangelist
join:2005-12-15
Santa Clara, CA

joebarnhart to DaDawgs

Member

to DaDawgs
Since the quote you posted clearly says "WIRED networks", why are you in such a lather? Wireless networks cost more to operate, and nothing in the Netflix response disputes that fact.
meowmeow
join:2003-07-26
Helena, MT

meowmeow to DaDawgs

Member

to DaDawgs
Please tell me who your WISP is so I can know to avoid it if I ever move to Virginia. The only WISP I could find in your area is »www.nnwifi.com/ - but they seem to have more sites than you'd be able to manage.

RealityCheck
@newwavecomm.net

RealityCheck

Anon

Re: Netflix's sees this as being groosly overpriced

said by meowmeow:

Please tell me who your WISP is so I can know to avoid it if I ever move to Virginia. The only WISP I could find in your area is »www.nnwifi.com/ - but they seem to have more sites than you'd be able to manage.

It's »www.kaballero.com/ . 1-3 megabits per second for $40/mo. Woo.

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

FFH5

Premium Member

Re: Netflix's sees this as being groosly overpriced

said by RealityCheck :

said by meowmeow:

Please tell me who your WISP is so I can know to avoid it if I ever move to Virginia. The only WISP I could find in your area is »www.nnwifi.com/ - but they seem to have more sites than you'd be able to manage.

It's »www.kaballero.com/ . 1-3 megabits per second for $40/mo. Woo.

It is a lot better than max 56kbps dial-up for people with no cable or dsl capabilities. Price is reasonable. At least he is providing a valuable service to those without options.

DaDawgs
Premium Member
join:2010-08-02
Deltaville, VA

1 recommendation

DaDawgs to j0ly

Premium Member

to j0ly
said by j0ly:

from one of our regional interchange points over their last mile wired network to the consumer is less than a penny, and falling, so there is no reason that pay-per-gigabyte is economically necessary. Moreover, at $1 per gigabyte over wired networks, it would be grossly overpriced.

Yawn, now that I have gotten over my shock... This statement is absolute bullshit from Netflix, intended to do nothing more than reassure their investor base. They have been asked by their investors why people here (at DSLR) and other forums are saying that their business model is going to fail. Rather than actually investigate these assertions they have elected to post stupid sheite in these forums...

Here is the deal, NOBODY IN AMERICA can deliver a gigabyte for 1 cent... If you believe that you are an ignorant fool. Don't believe it. NOBODY IN AMERICA OR ANYWHERE ELSE IN THE WORLD CAN DELIVER A GIGABYTE OF DATA FOR A PENNY...

If you accept that nobody can help you... because you are stupid beyond any reasonable help...
Warez_Zealot
join:2006-04-19
Vancouver

Warez_Zealot

Member

Re: Netflix's sees this as being groosly overpriced

I heard a barrel of gigabytes are going to cost more than a barrel of oil before the end of the year............

You do realize that data transfer isn't a commodity right? Of course the cost to deliver a GB ain't shit. That's cause the networks they are transferred on are old, and well paid off.

Also, ISP's need to upgrade their networks to newer technology, and that's called an investment.

When you pay for your monthly service fee, your paying for the service, and the fact that you transfer 100MB or 1000GB+ should mean absolutely nothing.

The big problem is that ISP's offer faster speeds than their shitty networks can support, then they get all pissy when everything goes to shit and they refuse to upgrade their infrastructure to meet the capacity.

I remember back in the day I had COGECO, and the scumbags were throttling P2P because they couldn't provide the speeds they sold. Apparently a fraction of their customers on the nodes used all the bandwith.

A person from COGECO always argued in the forums that they could never upgrade enough because the bandwidth would just get used right away... Talk about poor network management.... If they can't even figure out the 80/20 rule it means they need to reduce their internet speeds to meet garbage capacity.

KrK
Heavy Artillery For The Little Guy
Premium Member
join:2000-01-17
Tulsa, OK
Netgear WNDR3700v2
Zoom 5341J

KrK to DaDawgs

Premium Member

to DaDawgs
Welcome to your future of being marginalized. Perhaps your customers have no choice and will have to do without.... or, if choices arrive, perhaps you will be the one without.... business.
quote:
from one of our regional interchange points over their last mile wired network to the consumer is less than a penny,
Fact.

trainwreck6
join:2010-09-21
off track

trainwreck6 to DaDawgs

Member

to DaDawgs
said by DaDawgs:

said by j0ly:

from one of our regional interchange points over their last mile wired network to the consumer is less than a penny, and falling, so there is no reason that pay-per-gigabyte is economically necessary. Moreover, at $1 per gigabyte over wired networks, it would be grossly overpriced.

Yawn, now that I have gotten over my shock... This statement is absolute bullshit from Netflix, intended to do nothing more than reassure their investor base. They have been asked by their investors why people here (at DSLR) and other forums are saying that their business model is going to fail. Rather than actually investigate these assertions they have elected to post stupid sheite in these forums...

Here is the deal, NOBODY IN AMERICA can deliver a gigabyte for 1 cent... If you believe that you are an ignorant fool. Don't believe it. NOBODY IN AMERICA OR ANYWHERE ELSE IN THE WORLD CAN DELIVER A GIGABYTE OF DATA FOR A PENNY...

If you accept that nobody can help you... because you are stupid beyond any reasonable help...

Actually it's a small fraction of 1 cent. 1 cent can be argued is predatory pricing.

JohnInSJ
Premium Member
join:2003-09-22
Aptos, CA

JohnInSJ

Premium Member

Re: Netflix's sees this as being groosly overpriced

Does that 1 penny include depreciation of plant?
Warez_Zealot
join:2006-04-19
Vancouver

Warez_Zealot

Member

Re: Netflix's sees this as being groosly overpriced

said by JohnInSJ:

Does that 1 penny include depreciation of plant?

I guess you forget you pay a monthly fee to use the internet.. eh?

Man... Some peoples kids....

chuckcar
@teksavvy.com

chuckcar

Anon

Can't afford broadband in Canada anymore

Just signed up for dial-up from America today. That's the end of my broadband connection forever unless i move to another country.
hemzer
join:2009-10-29

hemzer

Member

yea right@

BAstards
Windogg
join:2002-07-24
Redwood City, CA

Windogg

Member

What a shame

What a shame. Toward the late 90s/early 2000s, I read many articles touting Canada as a leader in data communications. Fiber was being laid everywhere and network speeds were mind boggling for the time. I paid a premium for 1.5mbps cable while a cousin in Toronto was getting symmetric 10mbps ethernet for a fraction of the price.

Today the tables have turned as the major telecoms in Canada squandered their broadband lead. She is with one of the few uncapped DSL providers at 5mbps (4mbps actual). Quite a downgrade. The monopoly/duopoly system in Canada makes US telecoms look like charities. The system up north will need a major shakeup or things will eventually lead to 128k ISDN lines for $99/month with a 150MB cap.
chgo_man99
join:2010-01-01
Sunnyvale, CA

1 edit

chgo_man99

Member

Re: What a shame

It seems to me Canada has unique telecom industry from the rest of the world. Majority of countries have investors from many countries, not just for cell phone but also landline (like in Europe). In the US, you have DT T-Mobile and part of Vodafone (vzw).

In Canada, Rogers, Shaw, Bell all just Canadian. It seems to be that foreign companies are almost not allowed into Canada, except of Wind that entered. It seems to me Canadians pay a heavy price for protectionism and nationalization.

••••••••

chuckcar
@teksavvy.com

chuckcar to Windogg

Anon

to Windogg
The sad part is you can download and upload more on two dial-up connections than you can on Bell's broadband internet which has a 25 gigabyte a month cap with huge overuse fees. This makes dial-up quite a lot safer and much cheaper too.

KrK
Heavy Artillery For The Little Guy
Premium Member
join:2000-01-17
Tulsa, OK

KrK

Premium Member

Canada is in big trouble and we're next.

Is there anything we can do?

They are being screwed like how!

••••••••••

creed3020
Premium Member
join:2006-04-26
Kitchener, ON

creed3020

Premium Member

Looks of the end of an era...

I guess I will need to download the internet before March 1st...

I think I will need more time to purchase some 100GB blocks from TekSavvy while I still can.

I wrote my MP an angry letter, I sure hope he reads it.
mexicaro
join:2011-01-03

mexicaro

Member

Fight UBB now!

www.antiubb.com

Fight UBB now (no ads, and a list of things to do to oppose UBB)

TSI Outages
TSI Support
ISP Employee
join:2009-09-28
Chatham, ON

TSI Outages

ISP Employee

The GByte is not a physical resource!

I can't believe they are trying to quantify usage of bandwidth as if it were a physical object. As if 1 Gb was like 1 L of water. It's not ... it's an electrical signal, and it's there establishing a connection whether you are transferring files or not. Sure additional energy is needed to send but really how much more energy is used to send an additional Gb over the network. I can assure you its no where near 2.50$ per Gb. I could see the argument if usage of bandwidth was priced by the kilowatt and we paid for the extra energy it took for the signal to be sent.

Merin
@shawcable.net

Merin

Anon

Re: The GByte is not a physical resource!

Indeed its a bigger rip off then bottled water that came from the closet municipality....

gat
@verizon.net

gat

Anon

that's not backlash!

I don't see any canadian public officals getting shot up over this... so it's not backlash yet. candians are generally a pacifist country.

DryDSL
@teksavvy.com

DryDSL

Anon

UBB Stop Usage Based Billing CRTC web site news server

as a customer there no credit to my account proffered by accounting doing this fyi

»www.topix.net/forum/worl ··· P30FSN1R