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Why Are Canadian ISPs Temporarily Ditching Caps?
They Were Worried Canadian Regulators Would Do Their Job For Once
by Karl Bode 03:26PM Thursday Feb 21 2013 Tipped by fatness See Profile
Fear that Canadian regulators were going to do their job has resulted in a welcome -- though likely brief -- return to unlimited broadband in Canada. Our friends to the north are well-known for some of the most predatory and punitive broadband caps and overages anywhere, courtesy of uncompetitive broadband markets and regulatory capture. Yet over the last few weeks, Canadian providers Rogers and Bell (and soon Videotron) have been offering Canadian consumers unlimited broadband as limited-time-promotions -- if they're willing to pay $10 to $30 extra.

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Why the sudden change of heart? Fear.

Canadian broadband industry watchers have been expecting a new ruling from Canadian regulators most thought would lower wholesale rates, allowing independent ISPs to offer more viable unlimited services. As such, incumbent ISPs started offering these promotions in the hopes of beating independent ISPs to the punch. As it turns out, they didn't actually have much to worry about.

A War on Consumers and Independent ISPs

For the last five years Canadian telcos like Bell have been waging war on independent ISPs in an effort to drive them from the market. In 2009, they started to throttle independent ISP wholesale connections without bothering to tell independent ISPs (kind of important). Incumbent ISPs then gamed the regulatory system to impose new rules letting them charge independent ISPs both up front and based on usage, effectively allowing them to "double dip." All of this was designed to not only prevent indie ISPs from offering unlimited, throttled service superior to their own -- but to crush them.

Throughout most of this process Canadian regulators -- most of them former incumbent ISP executives -- played blind, deaf and dumb, holding unproductive public hearings under the pretense of consumer advocacy, but by and large allowing incumbent ISPs to use phantom network congestion as justification for anti-competitive behavior. Users in the States of course are more than a little familiar with this tactic.

Fast forward to this year, when the CRTC was forced to examine wholesale rates after pressure from consumer advocacy groups like Open Media. Open Media managed to pressure a large-scale review after they snagged half-a-million citizen signatures on a petition, directing large-scale consumer ire directly at the CRTC. Meanwhile, many Canadian users hoped that after a string of agency leaders that seemed like poorely-written Star Wars villains, new CRTC boss Jean-Pierre Blais would actually be driven by facts.

There Goes Alderaan and the Rebel Alliance

Unfortunately for the optimistic, the CRTC released their new rules governing wholesale rates today, and they weren't the kind of significant across-the-board wholesale rate cuts many people had expected. As users in our forums note, many of the rates everyone (including incumbent ISPs) expected to be lower -- are instead higher. Users note that rates for some dead-or-dying DSL services are lower, but by and large rates for future technologies are predominately higher -- specifically for independent cable ISPs operating through Shaw and Telus.

That's particularly frustrating since the push for regulatory review was driven primarily by the opinion that cable wholesale rates were too high. To have the CRTC suddenly raise cable wholesale prices was a slap in the face. Consumer hope was met with a giant glass of status quo, resulting in a generally sour mood in our Canadian broadband forums. Adding insult to injury is the fact that the CRTC's tone deaf rhetoric hasn't changed one iota under the leadership of Jean-Pierre Blais.

"Large and small independent service providers now have the certainty they need to continue offering Canadians a choice of innovative and competitive services," said the new boss, same as the old boss. "We are pleased to finally close this chapter after a careful examination of the wholesale rates, which included a review of the costing information."

Heads We Win, Tails We Win

What happens next? Operators likely leave their promotions up and running until they've netted a few more customers, then the promotions will probably slowly go the way of the Laserdisc and the war on independent ISPs will continue. The CRTC still seems to be basing a lot of their mathematics on network congestion and operation claims nobody seems willing to independently verify, and until that changes, nothing truly changes.

Meanwhile, incumbent Canadian ISPs are winning the PR war by pretending that they're easing off caps because of the "massive broadband network investments" they've been making. That was the same reason they gave for backing off throttling in late 2011. In reality, the threat of a regulator doing its job honestly spooked them for just a second -- but you'd be hard pressed to find a Bell or Rogers lobbyist or exec willing to admit that.

That does appear to be the biggest bright spot in this proceeding: if the faint threat of regulatory action nets that kind of response from giant incumbents, what could a real regulator accomplish? It's clear that the folks at Open Media and other Canadian broadband activists are on the right path, as even if Canada's clinging to the status quo -- we've felt the anti-competitive foundation tremble just a bit.

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TigerLord
Resident pentaxian
Premium,Mod
join:2002-06-09
Canada
kudos:8

Law 60

Thankfully, Quebec is exempt from the contract clause since our government passed law 60, which is a good example of government protecting its citizens.
stevey_frac

join:2009-12-09
Cambridge, ON

Re: Law 60

You're on crack. Videotron rates went up, in Quebec.

El Quintron
Resident Mouth Breather
Premium
join:2008-04-28
Etobicoke, ON
kudos:4
Reviews:
·TekSavvy Cable
·TekSavvy DSL
·WIND Mobile

Re: Law 60

said by stevey_frac:

You're on crack. Videotron rates went up, in Quebec.

He stated that you're not stuck with them if you don't like them because of QC contract law, nothing about the actual rates.
--
Support Bacteria -- It's the Only Culture Some People Have
stevey_frac

join:2009-12-09
Cambridge, ON

Re: Law 60

Ahh. My bad.

buddahbless

join:2005-03-21
Premium
Reviews:
·AT&T DSL Service
·Verizon Online DSL

Re: Law 60

law 60 sounds good for QC too bad its not in Ontario, when I lived in the GTA I had Acanac I really hated paying a year in advance but at the price for there service at the time I couldn't beat it! It was something like $225 for the year for 5 mbps DSL unlimited, compared to Bell who wanted $45+ fees per month for the same service. I saved up for a month and dropped that $225 on Acanac faster than flies on ..... !

CC34

@distributel.net

Re: Law 60

Acanac is awesome. They now serve Quebec too. Their 30Mbps uncapped service is $57/month (they even give you the phone service for free on your first year). That's 20$ cheaper than the equivalent Bell plan.

As long as you know how to setup basic network equipment, there's no reason not to be with them.
InvalidError

join:2008-02-03
kudos:5
Bill 60 does not prevent rate hikes. It caps early termination fees to $50 or the balance of whatever subsidized device you got when you signed the service contract.

Since incumbents are now unable to charge their former $125-200 ETFs anymore, they have all given up on the entire concept of contracts for wired internet.
Sparky

join:2013-02-19
I'm in Toronto and I use AEI in Qubec. In fact I've used them for 10 years straight now. $30 per month for 5/1 mbps and they've never had caps!
technocar2

join:2009-05-29
Brampton, ON
kudos:2

No contract for rogers.

No contract for rogers either. Just have to sign up by Mar. 31st
yyzlhr

join:2012-09-03
Scarborough, ON
kudos:2

Contracts not required

Don't know how Videotron is implementing their unlimited "promo", but Rogers and Bell do not require contracts for their unlimited options.
morph69

join:2001-09-03
Penetanguishene, ON

never again

... will bell or rogers ever see my money directly .... happy with the reseller concept and will never look back
technocar2

join:2009-05-29
Brampton, ON
kudos:2

A bit misleading there Karl

quote:
As it turns out, they didn't actually have much to worry about.

Not really true...one has to realize bell's rates were pretty much cut in half so they had a lot to worry about and thus came out with unlimited. Rogers and Videotron simply offered unlimited because of bell, remember cable cos don't like getting dissed my telcos; and bell was pretty aggressive in their TV ads by dissing rogers' tiny caps.
Candew

join:2005-09-23
Ottawa, ON

Took the plunge with Rogers

As my wife an I are already on a bundle, we took the deal.

We recently began using un-block US. We now have access to the US Netflix offerings and my Step-son's HBO-Go account (he resides in the States and has HBO as part of his cable package).

With my Step-daughter coming home for the summer from college, that unlimited @ $10.00 a month will pay for itself in no time.

Gimli
Premium
join:2006-01-03
l5a2o4

Re: Took the plunge with Rogers

said by Candew:

As my wife an I are already on a bundle, we took the deal.

We recently began using un-block US. We now have access to the US Netflix offerings and my Step-son's HBO-Go account (he resides in the States and has HBO as part of his cable package).

With my Step-daughter coming home for the summer from college, that unlimited @ $10.00 a month will pay for itself in no time.

Right you are, and that is exactly what they want you to feel... Good deal for $10 right? Well sure - because the bastards have place limitations on your useage.

Same crap as gas pricing going up until the point that you are used to such a high rate, that any reduction causes a run for the pumps for a "good deal"

That retail store Club Monaco used to jack their prices up 25% a month before Christmas, then had a 15% off boxing day sale - controlling the masses with smoke and mirrors.... kinda like the CRTC...bastards....
malocite

join:2004-05-24
Hamilton, ON
Reviews:
·TekSavvy DSL

Dead and Dying DSL?

What? DSL Rates went down by like 60% plus Business and Residential now basically have the same rate since they are the same service.

The only annoyance was that cable is inching up a little. And this is based on cost + 30%. The problem here is the 'cost' cablecos seem to have seems awfully high. Why does it cost 2.5X as much to serve internet over Cable? And if its that bad a technology its time to dump your Rogers stock. Bell can operate Television over their DSL network, and Internet and do it at a fraction of the price?

The truth is those 'cost' prices need to be examined a lot closer but to say that DSL is dead and dying is patently untrue as well as asinine.

J E F F
Whatta Ya Think About Dat?
Premium
join:2004-04-01
Kitchener, ON
kudos:1
Reviews:
·Rogers Portable ..

Re: Dead and Dying DSL?

said by malocite:

What? DSL Rates went down by like 60% plus Business and Residential now basically have the same rate since they are the same service.

The only annoyance was that cable is inching up a little. And this is based on cost + 30%. The problem here is the 'cost' cablecos seem to have seems awfully high. Why does it cost 2.5X as much to serve internet over Cable? And if its that bad a technology its time to dump your Rogers stock. Bell can operate Television over their DSL network, and Internet and do it at a fraction of the price?

The truth is those 'cost' prices need to be examined a lot closer but to say that DSL is dead and dying is patently untrue as well as asinine.

What are you talking about? When I first had DSL, with Bell, it was $34.95 per month, free modem, unlimited usage. Sure, it was only 3meg connection, but that was the cost. Now for unlimited Bell DSL, it's $69.95 ($39.95 + $30 for unlimited). That's for a 5meg (if you can get it) connection. Cable doesn't charge 2.5 as much either.
--
If you can't explain it simply, you don't understand it well enough. - Albert Einstein
t0xicCode

join:2008-12-27
Ottawa, ON

Re: Dead and Dying DSL?

We are currently paying $59.95 ($49.95 + $10 for unlimited) on Bell DSL for 14 (or was it 16) Mbps. It's far from stellar, but it's an improvement as we had between $30-80 dollars extra on "overuse" each month.

ChuckcZar

@teksavvy.com

Rogers network can not support unlimited

Rogers is a joke! They still throttle because they have to. Heck before i ditched them for high definition television most of the channels pixelated. If they can't even provide enough bandwidth for television how could they possibly support unlimited internet?