Giga-gouging: Bell and Shaw want to charge you more for your Internet

Canada’s major internet service providers want to charge you more for your internet usage.

Despite Stephen Harper’s government coming down on the Canadian Radio-television and Telecommunications Commission’s decision to implement usage-based billing for internet service providers and demanding a review, major ISPs have come out to insist that – even if it’s not through UBB – they be allowed to charge heavy internet users more money.

This goes to show that, when compounded on CRTC chairman Konrad von Finckenstein’s reluctance to completely scratch the UBB decision, Canadians are still fighting an uphill battle for fair internet costs – and that campaigns like Vancouver-based OpenMedia’s Stop the Meter are still relevant and must be suported. (Signatures for Stop the Meter’s online petition skyrocketed to 300,000, but once the government delayed the CRTC’s March 1st UBB-implementation date, signature growth slowed. However, it does still sit at a groundbreaking 460,000.)

Bell and Shaw in particular are taking unkindly to the government’s counter-decision.

As noted in a recent Globe and Mail article

Canada’s big Internet providers are sticking to their demand that they be allowed to charge heavy users more than other customers, even if the controversial usage-based billing system is not the answer. Officials from Bell Canada and Shaw Communications came under heavy fire Thursday from MPs over the practice, which the Harper government has all but pledged to stop. But in heated exchange at a House committee hearing, officials said the basic principle that heavy users should pay more must be maintained.

Sounds intense. And it is. In fact, Mirko Bibic, Bell’s senior vice-president of governmental affairs, warns (or threatens) that Canada’s “place in the new global communications economy” might depend on Bell further gouging its customers:

Bibic said that there may be other ways to approach the issue, but the end result must remain that billing should reflect usage or else the vast majority of Internet clients would wind up footing a bigger bill on behalf of a few. Citing the billions of dollars needed to increase network capacity, Bibic said only the large providers are capable of keeping Canada at the forefront of the digital age.

“If Canada is to continue to be a world leader (in Internet technology), it’s companies like Bell, Rogers and Shaw that will do it by investing,” he said in a heated exchange with Liberal MP Dan McTeague.

But Dan did not see it this way; he responded by saying that Bell and the other big providers (Rogers, Shaw, Telus) an oligopoly and are stifling innovation in Canada. In Dan’s eyes, the major ISPs want to charge the smaller, independent ISPs significantly more money than they need to:

“They’re charging far exceeds the investments,” he said. “The best expertise we have is that these costs may be just pennies (per user), instead we’re seeing charges of $1.50, $2.50 for every gigabyte you use. It amounts to a giga-gouge.” And he blamed the federal Conservative government for the problem, saying its deregulation policies had stopped new players from gaining ground so they could compete against the incumbents. “These ISPs and consumers are at the mercy of a handful of competitors who do not compete against each other on price.”

Unfortunately, at the end of the debate, no progress was made. Every party involved in this war is being stubborn. 

Who do you think is correct? How can we fix the Canadian telecom industry?