Ok, there’s a lot of hubbub around this “Usage Based Billing” thing that’s just starting to come into effect up here in Canada. I’m going to explain what it is and why it is a big deal for some of us.

Here in Canada we have three big Internet Service Providers (ISP’s), Bell Canada, Rogers Communications and Telus Communications (and there’s sort of a 4th provider, Shaw Communications as well) and they are the guys who own most of the telecommunications infrastructure here in Canada. Not surprisingly, they also happen to own a lot of the television, cable and movie networks as well. You may already see where this is heading. Now that Netflix, Zune Marketplace (video only, unfortunately) and a few others are finally starting to get a foothold here in Canada, the cable and movie guys are starting to get nervous. So instead of setting up something like Hulu Plus where we’d gladly pay for our television content streamed online, they seem to prefer to let us consume our television though traditional channels.

It starts to get tricky when we look back just over the last few years, and finally last year when the CRTC decided the the big ISP’s had to share their infrastructure with smaller ISP’s to allow for increased competition in the marketplace. This was awesome, it allowed ISP’s like Teksavvy in Ontario to offer internet service that was competitive with the larger guys, and offering the opportunity for customers to have large data caps to download content.

As I am a new Toronto resident, I did my research when I first arrived here and decided on Teksavvy as my ISP. For $43 a month I get a 15Mbps download speed and am able to download 200 gigabytes before I hit my limit. Now I think the big ISP’s were a little pissed they had to share their lines with the little guys, in fact they managed to delay the line sharing ruling for years before it finally came into play. Now, less than 6 months later we see that Usage Based Billing is the new internet battleground for Canadian nerds, but it needs to be more than that. UBB is really a bit of marketing-speak that sounds reasonable at first glance, that people who download lots of stuff from the internet should pay more. (please note that there is no discussion whether this content is legal or not, but with services like Netflix it is quite easy to download quite a bit of data these days) What you start to realize is that people who know they are going to be downloading more are already paying more, as internet plans that offer a faster download speed are more expensive.

The thing that’s really getting people going is that UBB will make it difficult for the smaller ISP’s to compete with the big guys again, rendering the line sharing decision ineffective in light of the new UBB decision by the CRTC. Yesterday, the first caps were introduced, for DSL customers in Ontario and Quebec. Here in Ontario the 200GB caps are now reduced to 25GB, a 87.5% reduction. This sucks.

There’s been a lot of traction over at OpenMedia.ca, they have some great information and an easy way to email some prominent Canadian politicians. Be warned though, sending the message also adds you to the petition and they count you among those who are “minding the cap”. I support the cause, and for those who know me, I don’t generally believe in online petitions as they are too easy to manipulate. I had written most of this last night, and now – a day later the Liberals have said they are against the CRTC ruling and the Prime Minister has said he’ll be asking for a review of the decision, so it appears their public push is working.

And now some numbers showing how ridiculous this all is one hour of Netflix HD is 1.5GB, the average adult Canadian watches almost 29 hours of TV a week, so that’s 43.5GB a week, or around 124GB a month, and with other internet services (Youtube, Gaming, etc) it’s not hard to hit 200GB monthly.

Here are some fun stats, how much 200GB would cost you, and how quickly you can hit your bandwith cap with the available download speeds (that are so heavily advertised).

Bell Canada

Not that if you downloaded at maximum capacity on the Fibe 25 plan all month you would incur a bill of $7919.95
Also note that “Fibe” has nothing to do with “Fibre” which is used in the USA for such awesome services as FIOS which is fibre optic internet delivered to the home at speeds of up to 150Mbps.

Rogers Communications

Note, pricing matrix and overage fees are available here

I’ll update this once I know Teksavvy’s or competitors cable rates once UBB kicks in. In the DSL world, the caps went from 200GB to 25GB with overages costing $2 per GB. This is solely because of the CRTC UBB decision.