OTTAWA – Canada’s communications regulator has handed down a landmark ruling that impacts how Canadians use the Internet.
The CRTC has rejected a controversial plan proposed by Bell that would have allowed big telecommunications companies to impose a usage-based billing model on smaller companies that resell internet access.
“The net effect of it will be there will be no caps, no limitation, no metering of use for the retail consumer as a result of the CRTC decision,” said Konrad W. Von Finckenstein, the CRTC’s chairman.
For consumers, Tuesday’s decision means if you download movies and music, you won’t have to pay for each bit and byte. But depending on what your service provider decides, it might cost you more to surf the web at the speeds you’re used to.
Internet service providers will now have to buy enough bandwidth from telecom companies to make sure its customers can download as much as they want. The only hitch comes if the consumers use more than projected, then the service providers may lower the speed of the Internet to stay within the amount it pre-purchased.
The big companies can either charge Internet resellers a flat rate per user or sell a specific amount on their networks.
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In making the ruling, the CRTC rejected a usage-based billing model proposed by Bell.
A version of the model was first proposed and was essentially approved by the CRTC in 2010, but an ensuing public backlash forced the parties back to the table.
Large telecommunications companies sell access to their bandwidth to smaller service providers who then offer unlimited downloading to customers.
Bell said a volume-based billing plan was required to help pay for the costs of the growing networks and to reduce congestion caused by the unlimited plans offered by ISPs.
That idea was rejected, leaving consumer groups satisfied.
“Consumers win on this one. It’s a great decision for consumers. It sets a nice framework for competition in internet. Hopefully we will see lower prices and getting rid of caps on higher fees in Canada,” said John Lawford of the Public Interest Advocacy Centre.
Bell said, the outcome, while not ideal, does go some way to address some of the problems the company raised.
“While we would have preferred the CRTC to accept our proposal, its decision does at least ensure that we can now charge our ISP customers for the network capacity they consume,” said Mirko Bibic, Bell’s senior vice-president of regulatory and government affairs.
Shaw Communications, the parent company of Global News, says it has already raised its download caps so that only the heaviest users will pay more.
Von Finckenstein said Tuesday’s decision struck the right balance between the two types of internet service providers.
“The risk is shared because the ISP has to decide how much they need. If they buy too little they have a problem with their end users. If they buy too much they pay for something they don’t use,” he said.
The NDP’s Charlie Angus says the decision still doesn’t address the larger issue of high internet rates in the country – as small service providers only control a fraction of the market place.
“For the five per cent of Canadians who’ve gotten a little bit more competition that’s good news. For the other 95 per cent of Canadians you are still getting ripped off,” he said.
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