Of the statements issued by three major Canadian political parties on the subject of usage based billing, I thought the Liberal’s is the least credible and most opportunistic.
The NDP critic, Charlie Angus, has been unwavering in his position that the internet needs to be regulated with intervention on the technology, network management and pricing. So his statement on UBB follows along that consistent theme.
The Industry Minister, Tony Clement, cautiously couched his language in his statement to say that it will study the issue carefully to ensure “that competition, innovation and consumers were all fairly considered.”
In their statement, the Liberals took what I believe was an unfair swipe at the people at the CRTC. Other than pandering, what was the value of the line “CRTC has come to mean ‘Consumers Rarely Taken into Consideration.’” I think it was a slur targeting public servants who, in my experience, have never acted in a manner that warrants such a cheap shot.
Where does the issue go from here? The history of the issue ties the hands of the government in how it might approach a solution to the public outcry.
The reality is that there are limited options for selling shared network services other than usage based pricing. Will the Minister send last week’s decision back to the CRTC to reconsider the pricing level? For example, the government could indicate that it wants the service to be priced on the basis of cost plus rather than as a discount off retail.
That could change the level of the caps and costing of exceeding those levels, increasing the pricing flexibility for ISPs that rely on wholesale aggregated services. But banishing usage based wholesale pricing is not a likely outcome.
I’ll have a possible way out for the government in tomorrow’s blog post.
the hype is deafening! The vote buying has started.
If the wholesale decision is reversed and the vast majority of those complaining about UBB realize that their BB is still capped – as the ISPs are free to do – the outcry might spread to incumbent pricing/caps. What are the chances that this misunderstood debate causes a regulation of retail broadband caps?
Consumers should be careful what they wish for. The inability to charge for usage is a recipe for killing investment in infrastructure.
Consumers see revenues and margins but don’t understand return on capital. Despite the high margins, the telecom industry has a lousy record of producing a decent return on capital.
Mark – if you haven’t seen it already you should try to get a copy of a recent report by Bernstein’s Craig Moffet called Capital Punishment.
What’s opportunistic? The part where they say the CRTC is throwing Canadians under the bus? Or the part where they say “if you want us to represent you, you have to support us”? Makes perfect sense to me as far as how the Liberals can get anything done.
The CRTC deserves more of the blame than Bell in this situation. At the very least, Bell could say they were acting out of their own interest. On the other hand, the CRTC has conducted themselves to date with every intention of legislating unfettered greed. There is no disputing the contempt of those in the CRTC for their mandate, they have facilitated these disasters by letting companies like Bell spoon feed them misinformation. You don’t have to take offense on the CRTC’s behalf just because of who they are. It’s what they’ve done that the Canadian public takes issue with.
The trust was CRTC to Bell, not the other way around and with the majority of people in charge at the CRTC being former Bell execs there is more than a reason to suspect corruption.
I see you spending a lot of time defining solutions, yet I have yet to see anywhere any kind of indicator that these solutions have problems to go with them. I’m curious, what technical problem is UBB designed to solve? Can anyone at Bell, Shaw, Rogers, CRTC or any other ISP actually provide a list of urgent concerns that would require a billing system that charges per GB over a billing period?
Let’s go one better after that. Can you provide any kind of science that details how usage is best controlled on a monthly basis and that the rates chosen are in fact rational for what many would argue has become an essential service?
We can’t even extol the virtues of a free market with internet in Canada, so you can’t slam peoples’ faces into that brick wall of ideology either!
We have legislated greed and so through that process we have encouraged it’s innovation with the CRTC acting like a minimally abstracted arm of big ISPs. If the true problem to be defined is one of strained networks, then present the information regarding the shortage. There’s a lot of hearsay so far when it comes to gauging the potential for strain and this isn’t even beginning to look at the topic of how Bell has monopolized public infrastructure (another part of this discussion).
Internet services are capacity based, not usage. Total amount of data transmitted does not provide a shred of insight as to how heavily the network is being used. Much less on such arbitrary terms as billing periods. I haven’t heard you, or any other pundit even approach the subject the same way someone with technical knowledge would. It’s just a lot of economic theory, terminology and no deliverables that have any practical merit.
Confirm and define the problem before you start coming up with solutions.
CiD, a simple Google search (or a visit to his homepage) would be enough evidence of my father’s experience with respect to the technological, business and regulatory aspects of the telecommunication industry as a whole. He was able to put me through college because decision-makers from start-up companies and big-bad-corporations alike value that expertise greatly.
But even someone such as myself, a chemist by training, can understand and explain in simple terms why your reasoning is flawed.
Consider two individuals, Joe and Sally.
Joe uses the internet to check his e-mail, play Yahoo Towers here and there, and watch a 3 minute YouTube video once in a while when his kids send him a link.
Sally, on the other hand, does not pay for cable TV – she gets all the entertainment she needs by watching Netflix and playing videogames on the internet.
Consider, hypothetically, that both of these individuals want the same bandwidth. Joe would be annoyed if he had to wait quite some time for that occasional link to load, and Sally certainly wouldn’t be able to play the latest multiplayer FPS games on a low-bandwidth connection.
You would have Joe and Sally pay the exact same amount of money per month because their data is delivered at the same speed. But this shouldn’t be the case, and here’s the key point:
During their times of non-usage, all the Joes on a network allow for more Sallys to experience the speed that they demand over longer periods of time.
When a network has limited and shared capacity, pricing models can be established to encourage users to use the network to a lesser extent to make room for those who are willing to pay more to use more.
The bottom line is that, yes, the instantaneous rate of data transfer does matter, but so does the average rate of data transfer (GB/month) when dealing with a shared resource.
And it didn’t take much technological knowledge to explain that, did it?
Alex, there are several flaws in your reasoning and you haven’t used any evidence – technical or not – to prove the strain. So I’d have to say that as a chemist, you may be in over your head at this point.
You’ve simply cited a comparison and how you feel this accurately portrays the situation. Worse still, you have discriminated based on the content being transmitted rather than the effective data rates. Further deepening the misunderstanding in this situation.
You have not correctly defined the shortage, nor have you isolated a proper reason why one of Joe or Sally is more entitled to the connection they paid for than the other. If the service provider can’t deliver the data rate they advertised, why are they selling it? You’ve basically outlined a philosophy where Sally – through no fault of her own – has to feel guilty for the legitimate use of her internet connection as advertised. This would be like you being penalized for driving your car at the speed limit while someone perhaps less confident only feels comfortable driving 10km/h less. There is no logical reason for it because in that circumstance, you have done nothing wrong.
Worse still, nobody has come forward with any indicator that the usage patterns of people like Sally have in fact created a doomsday situation. Expecting the people to take the word of a corrupt regulator and greedy telecom corporations is not going to cut it. The one thing ISPs need to prove is the one thing they and other UBB supporters shy away from. Very telltale. Especially when you consider the effective data rate of most of the things people like you complain about is laughable in terms of what the maximum transfer rate of the average internet connection.
You have only advocated a solution that placates UBB rather than explore it. Out of loyalty to your father and the misunderstanding of how network strain is measured by total data transmitted? Perhaps. The correct solution is simple to come up with once you accept that rate of transfer is the only way to measure network usage. In your example, Joe’s internet service provider need only offer a cheaper internet connection. Perhaps one that can only get up to 300mbps in effective rate of transfer. That would suit him quite nicely. Which, we’ve already had for a while. Again proving that the service providers already know how network strain is properly measured, they just want another way to reach into peoples’ pockets.
To compound the irrationality of UBB, all users of the Internet in Canada are being billed for the amount of data they transfer, regardless of how busy the network was at the time they were using it. This is of course overlooking the fact that data transmitted per billing period is a complete farce. But with so much knowledge on networks how is it that Mark has overlooked this one detail?
Usage based billing is a complete mismatch and an unwarranted punitive model for internet usage. It will ensure that people cannot make practical use of their connections by allowing ISPs to charge extortionate rates for bandwidth they barely had to lift a finger to provide. This is for light and heavy users alike.
A complete rip off and a huge setback for our entire country.
Unfortunately, you need to enter technical discussion on this matter, and this is sadly something long overdue. The foundation of any explanation will try to prove why one of two people who buy connections of equal speeds should be penalized based on how they use it; keeping in mind that by design neither can exceed the speed they are assigned!
At the end of the day, you’ll find this is a policy that cannot be legitimized. The only way to control bandwidth usage in a fair way is to sell less.
But that would result in the big ISPs being outed for misrepresenting the current state of their network and gouging Canadians big time for their internet connections.
I am going to step in and say that I am getting tired of the so-called technical experts challenging internet companies to prove there are limits to capacity. That was a battle already fought and you can review the CRTC process documents. we won’t debate it here.
Further, there is a difference between flow rate and volume for any network. If customers want to run 10 Mbps 24 hours per day, there is another service that they should be buying; that is a dedicated private line connection. That is not a $40 internet access.
CiD – it must be comfortable for you hiding in anonymity taking ad hominem pot shots at folks – like my son – while not using your own identity. Take notice now: if you make it personal, I won’t give you the privilege of posting on my website. Fair deal?
Actually, the sort of connection that you seem to want is called a “dedicated line”. ISPs advertise speeds “Up to X MB/s” exactly because they are selling a shared resource.
And thanks for bringing up the freeway analogy – that’s a great one, except for the fact that you presented it incorrectly. It’s more like you’re dealing with a toll-road: people who drive on it more frequently pay more. The fact that there is a toll on the road will limit the number of people driving on it, thereby allowing its users to avoid traffic jams. (Not to mention that the most frequent users end up paying the most for the maintenance of that road)
You can choose to deliberately misunderstand/misportray my remarks, but it kind of undermines your stance as a technological expert, doesn’t it? I mean, I can’t blame you for not quite understanding the interplay between technological limitations and economic management of that limitation, just stop putting on the pretense that you somehow understand it better than everyone else.
I’m going to guess his name is A******** T****** from Winnipeg, Manitoba… But who knows, I’m no technological expert.
Who is to say I am not a technical expert and you are? 30 years will have taught you that the cream doesn’t always rise to the top in this field.
We are having what’s called a disagreement and you’re going to have to rely on more than your status to get through this one with so much popular support for the issue.
Case in point, I’ve never heard a single person who actually gets their hands dirty with networking use terminology like “…economic management of that limitation”. Sounds far too high level to be rooted in reality. It sounds more like some buzzwords thrown together to spin people and regulators’ heads.
You bring up “technological limitations”, but haven’t defined them yet. If it’s so cut and dry, why not take a short paragraph here and enlighten us on the subject rather than on myself. Keep it short and sweet if you want to, I’ll read. Promise.
Again, neither father nor son have presented a technical explanation as to how UBB is a legitimate way to charge for internet access. Sure, you can bring up past CRTC processes and economic voodoo, but that doesn’t shed any light onto the truth. It’s all misinformation in the end and many Canadians are calling for the CRTC to be investigated for corruption on these grounds.
Whatever processes that happened at the CRTC are sadly in question now because it appears technical expertise has not been applied. Only baseless economic theory, most likely at the urging of investor greed.
Mark, your idea of what kind of connection people should get doesn’t hold up. People have been using a fraction of the total bandwidth sold to them for years. We’ve had these kinds of connections to move information in our houses for a long time. No caps.
Alex, you do what most pro UBB advocates have done so far and that is to turn this into a discussion about analogies. You haven’t asserted anything but your own misunderstanding as to how computer networks incur strain. Again, where is the figure that says:
“On so and so date, Bell’s network at [location] incurred so much strain that service was effectively blacked out.”?
This is where industry and CRTC have given us nothing but tumbleweeds – and you both continue to here.
Further to that, I think it is very alarming for both of you to try change this discussion to one about who I am. Is this how you will respond to all Canadians as they call for UBB to be struck down? Charming! Who I am has nothing to do with this but if you are going to use your status as an explanation, it will have to be factored in the response. I’m more than happy to forget who everyone is so long as they can have an intelligent technical discussion on computer networks. It matters not to me, so let’s keep away from the primal chest beating antics.
Back on topic: It seems very cheap to keep dodging the questions I’m having to ask pro UBB advocates over and over again. Canadians are tracing a line around the deception with this strategy, so it’s not going to hold much longer. Why not answer them? Not a single representative or pundit I’ve been talking with has been able to offer that information.
Telltale to say the least.
Canadians disagree (at least ~250,000 of them so far) with UBB and so the time has come to justify usage based billing with more than a profit goal and some theory in mind. Are you going to want to know all of the people and turn this into “who has worked for 30 years and who hasn’t”? Is this really what this is about? Your career? Frankly, nobody cares, the facts just don’t support UBB and that is what people are going after.
There may be an answer in there somewhere. I’m more than ready to have my mind changed, but you’re going to have to provide it.
To the technically inclined, you don’t measure network burden in GB per billing cycle. That stands uncontested. Define the problem.
Canada is waiting.