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CRTC Internet Billing

November 16, 2011 by staff 

CRTC Internet Billing, The federal telecommunications regulator has rejected a controversial plan that would have allowed the big phone and cable companies to impose a usage-based billing model on Internet service resellers, a system that the Conservative government and many consumers had opposed.

The Canadian Radio-television and Telecommunications Commission’s decision on Tuesday instead gives the companies a choice of either charging the smaller Internet providers a flat rate per user or selling the ISPs a specific amount of capacity on their networks.

“The net effect of it is that there will be no caps, no limitations, no metering of use for retail customers as a result of this CRTC decision,” CRTC chairman Konrad von Finckenstein said Tuesday.

The decision reverses an earlier plan that would have seen some independent Internet service providers — which provide unlimited download services — forced to adopt the same pricing model as Bell with limits usage.

The regulator launched its review after a social media campaign launched by the ISPs and an ensuing public backlash, as well as urging by former industry minister Tony Clement.

“Our original decision was clearly not the best one. It was wrong as was pointed out by a lot of people, including minister Clement. He was right. We have today fixed it. We have made this new decision,” von Finckenstein said.

Under the new capacity-model for billing, a small ISP buys a certain amount of network capacity from one of the big providers and if its customers unexpectedly increase their usage, their service could slow.

“If they buy too little they have a problem with their end customers, if they buy too much they pay for something that they don’t use,” von Finckenstein said.

Industry Minister Christian Paradis said the government would study the CRTC decision carefully to ensure it stimulated competition and investment and allowed Canadians to choose.

“Let me be clear: our government’s policy will always be to encourage competition, ensure consumer choice and minimize regulation,” he said in a statement issued Tuesday night.

Bell (TSX:BCE) and some cable companies had proposed they be allowed to charge their wholesale customers based on the volume of data they used, something that the CRTC rejected.

However, Mirko Bibic, senior vice-president of regulatory and government affairs at Bell parent company BCE, said the capacity method will force the smaller providers to take on some of the risk that was carried by Bell.

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