Usage based billing reading

February 19, 2011 / 7 Comments

A discussion on broadband shouldn’t be constrained to a narrow perspective.

I noticed a reading list on another communications policy blog that supposedly represented a “wide range of commentary and articles”; a quick scan shows that the “wide range” is reminiscent of Henry Ford’s wide range of colours for the Model T.

Here is a first attempt at a broader range of views on broadband billing:

I am happy to augment this list as readers write in – or send your additions through the comments to this post.

Thank you to my readers who suggested these pieces that I missed in the first listing:

7 thoughts on “Usage based billing reading”

  1. Pingback: Tweets that mention Usage based billing reading • Telecom Trends -- Topsy.com

  2. Jason

    The first article has very good points, particularly its conclusions. However, trying to put the blame at the feet of “Netflix and its customers” is entirely misleading. Netflix pays its own bills, and it would be contrary to the very principles of net neutrality adopted by the CRTC to require any kind of compensation from them for any alleged ‘strain’ they caused. Any ‘strain’ or congestion is caused solely by consumers.

    Secondly, I disagree with the use of the word “excess”. Internet bandwidth usage always goes up, and it is led by early adopters, and trailed by late adopters. Today’s average of 16GB/month/user was unthinkable a mere 5 years ago. In 5 years, that will be a distant memory. Words like “excess” and “hog” carry too much moral baggage to be a useful concept in this debate. KvF himself recognized this in his testimony before committee, where he retracted his use of the word as it was not appropriate.

    Finally, if the model of UBB adopted by the CRTC had been anything close to appropriate, we would not have seen the reaction we have from the public. There are a lot of misinformed people on both sides of this debate.

  3. moosebump

    This debate has spawned a lot of bad analogies.

    The electric utility analogy doesn’t work because electricity is consumed and your bill has generation and transportation packaged together. But in the broadband case, the bits delivered by Bell did not originate from them but from suppliers like Netflix or iTunes who may have paid a content owner for the right to distribute the bits.

    Highways are a tricky analogy because they are generally paid for out of taxes though usage based tolling does seem to have gained favour. But do we really want a broadband system funded out of general tax revenue? Roads are a utility – they allow us to move around, get to work, the grovery store, school. They are generally not used for entertainment purposes and where they are it is usually discouraged (speed overage charges!).

    But how about pipelines? Like any piece of the internet they have a finite capacity. They don’t own the gas or oil being shipped inside and have nothing to do with its origin or its end consumption. They are just a pipe. Capital costs are high and marginal costs very low – very much like telecom infrastructure.

    So try to imagine unlimited shipping plans being forced on pipeline companies. The only mechanism to manage capacity would be the flat rate price. Small volume shippers would pay the same as large shippers. Large shippers would get a great deal and small shippers would be subsidizing them. This would be bad for the small shippers who would be getting ripped off or would be forced out of the market. And unless the pipeline co. could raise prices enough, they would probably have a hard time earning a return on investment that would encourage them to build more pipelines.

    And in broadband, unlike pipelines, usage is growing 50% a year and the investment being made today has to consider a world 5 or 10 years from now. Do consumers really want to create a situation where the inability to earn a return and uncertainty around regulation dissuade the large ISPs from investing for that future?

  5. Tammy Flores

    *DISCLAIMER* There probably will be typos in this, but I think the thoughts are more important than the spelling LOL.

    There’s lots of colorful ideology floating around about UBB… Canada’s cornered… government supporting UBB causes a dilema… let’s try something different shall we.

    Let’s call a spade a spade. I am not an annalyst or a reporter, but I can read between the lines and understand what the real issue is here. There has been a pushing and a shoving to merge Broadcast & Telecom for some time now and what’s happening in Telecom is that ugly head raising itself and refusing to die.

    I love the imagery that words like “data hogs” paints a picture of in the mind. But I just remember what it was like growing up with a father that had the TV on 24/7 and I just don’t buy into that.

    This wouldn’t have anything to do with the fact that people are watching NetFlix, ect… and uploading their own content to share and someone else is getting the ad revenues. NOOOOOOO not at all. The cable companies that supply “the pipe” wouldn’t be upset about that at all now would they?

  6. Jason Koblovsky

    The separation of the those that support the telecom industry and those that support growth of the digital economy is going to be every present in this debate. Usage Based Billing basically limits the access to a part of the economy that is booming right now. While I’m not for or against usage based billing on whole, I am against non transparent industry data that is hiding somewhere on the desks at the CRTC. I think in order for all to debate this properly we need the proper information made public by the big telecoms.

    Consumers can’t get an accurate take on exactly what state our national Broadband infrastructure is in because this information is being kept confidential even from the GAS providers, nor can any expert in the field put forth recommendations for or against something that lacks critical transparent data for analysis, so essentially public debate at this time becomes irrelevant and inaccurate. From the sounds of the CRTC chair before committee, he has provided the committee with data that is not entirely accurate especially around online gaming and bandwidth used while playing online games. This strongly discriminates a part of the market that isn’t even close to “heavy user status” when 1 visit to youtube sucks way more bandwidth than the latest gaming titles do while playing online. There is tremendous doubt in my mind that the information supplied to the CRTC under confidence by Bell can be considered accurate, nor can I see the CRTC agreeing to usage based billing if they were up to speed on how much cloud access will play a part in future consumer participation in the market.

    From what I have heard today, the industry committee has already made its decision on usage based billing. I think the debate revolves around what to do to foster more competition in the telecoms market which is something that has been a continuous debate in the telecom industry for over 40 years. I think what’s clear here is that Internet users have spoken out against usage based billing, politicians have listened to this and are siding with the consumer. I highly doubt that will change under the circumstances.

  7. Kate Leadbeater

    Disclosure: I’m the Marketing Manager for Distributel, a Canadian ISP operating in Ontario and Quebec (for those who don’t know us). Our whole team follows your blog with interest! Although it’s not “reading”, we though a video that we recently produced about UBB would be a good fit for your list of ressources: it’s available at http://www.distributel.ca/UBB. In it our president Mel Cohen (who has been heavily involved in telecom regulatory space since he founded Distributel in 1988) talks candidly about being an independent ISP and why UBB doesn’t make sense.

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