Usage Based Billing–Cutting the Cord

Recent changes to how ISP resellers are charged for their use of the connections to Bell and Rogers’ infrastructure, have left a bad taste in the mouth of heavy users. But let us first explain what a heavy user really is.

– During the month of November I watched all my TV through legal sources online. Including the web sites of CTV, Global, CBC and Hulu. All web shows were watched either on YouTube or by an iTunes download. I would say I am a mild user. I watch and listen to about 15 podcasts a month, some are weekly some are monthly. I watch about an hour or 2 of web TV a night, normally the news and what ever primetime show I am interested in. I should mention that during this month we have a Roger’s connection on their Express 10 Mbps, 60GB, which cost a whopping $46.99 plus tax. There are 3 people that share this connection, 1 was away the whole month, and the other the computer was not working, so it was just my use. During this month there was the usual software updates, web browsing and document backups to a cloud storage. Can someone guess what the usage came to? Well it was over 100GB. Which meant we were forced to pay an additional fee of $50 for exceeding our allowed usage. The best part of this, we cannot upgrade to the larger packages as the service is not available in our area.

So what if we watched TV using a cable service instead of an online service. Well to get Basic Cable with the HD option (which this should not be optional anymore) it would be $47.43 plus tax ($53.60). So in total our bill to rogers would be ($46.99 + $4(modem rental) + $47.43) x 13% HST = $111.21. And this is all for base packages nothing special.

I know you are asking why did I go into what the cost of cable is and what the cost of internet is. Well the reason is, that was based on one user. When all three users are using the internet we easily go over 400GB of traffic a month. Now we do use the internet for uploading and do allot of work on cloud sites. But honestly we are only ahead of the curve because of who we are, this type of usage is going to become normal for all users in a few years.

So where am I going with this? Well because of the CRTC ruling; ISPs’ like TekSavvy had to change their pricing scheme to just remain in business.

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Take a look at the table to the left. A service plan which used to offer 200 GB of usage for $31.95 a month has now be crippled to 25 GB, at no price reduction. A 87.5% reduction resulted in no price increase. Actually if you were going to continuing using 200GB you would have to buy the highest possible insurance policy (that is right they are calling them insurance policies) for an additional $55. So a bill which used to cost you $31.95 in February, come March will now cost you $86.95. And that is if you pre purchase the insurance policy, if you do not it will cost you $1.90 per GB, so that would be; again using the 200 GB scenario a total bill of $364.45 for one month of usage.

So at what point do we all stand up and say that an internet connection is an essential service and that the rates need to be monitored? I think that time has come.

I understand that Canada is an unique situation as the land mass makes it very difficult for national ISPs’ to deploy effective coverage and still charge reasonable rates. But with all the grants, one time federal expenditures, and cost sharing between carriers. The cost is not what Bell and Rogers are telling you.

Bell explains that they require to charge higher rates to their resellers’ because of congestion on the network. But what they do not explain to you that resellers’ only use one part of Bell’s infrastructure and then they made their own peering agreements with backhaul providers. So that point is mute.

Everyone should read and sign this petition if you think that UBB – Usage Based Billing is a bad idea.

Links:

Bell’s Original Application
TekSavvy New Rates
OpenMedia