Canada’s government to overturn Internet usage caps
The Canadian government will seek to overturn an independent agency’s decision to allow Internet providers the ability to cap usage, effectively turning bandwidth into a commodity.
The Canadian Radio-television and Telecommunications Commission (CRTC), an agency that regulates telecommunication carriers in Canada, issued a decision in May 2010 that allowed Bell Canada to charge its customers based on the amount of bandwidth they use.
“CRTC must go back to drawing board,” Canadian Industry Ministery Tony Clement recently wrote, after being asked if he would work to overturn the ruling.
“This is about forcing a single business model on all competitors.”
Many small Internet Service Providers (ISPs), such as RipNet, Xplornet and Storm, purchased bandwidth from Bell Canada and then resold it to their customers.
The decision allowed Bell Canada, the largest telecommunication company in the nation, to charge smaller ISPs a flat fee for network connection with a 60 gigabytes (GB) monthly usage cap. ISPs that exceeded the cap would be forced to pay additional fees of more than $1 per GB.
Because of the CRTC’s ruling, smaller ISPs would not be able to offer “unlimited access” plans to their customers and would be forced to switch to usage-based billing.
“It means you could get charged in the hundreds of dollars for what you currently pay $35 or $40 dollars for,” Rocky Gaudrault, the CEO of TekSavvy Solutions Inc, told The Globe and Mail. “You could have multiples of your current monthly fee when this all comes through.”
CRTC Chair Konrad von Finckenstein is scheduled to explain the decision Thursday before the House of Commons industry committee.
“The CRTC should be under no illusion,” a senior government source told The Gazette. “The prime minister and the minister of industry will reverse this decision unless the CRTC does it itself.”
CORRECTION: Previous version of article incorrectly stated Rogers Communication purchased bandwidth from Bell Canada.