Canada's big Internet carriers have scored a major victory, as the telecommunication regulator ruled it is okay for them to slow down some of the Web traffic travelling to customers' personal computers - as long as the companies explain ahead of time what they are doing.
In a decision that clarifies its approach to the practice known as traffic shaping, the Canadian Radio-television and Telecommunications Commission said Wednesday that companies such as Bell Canada, Rogers Communications Inc. and Telus Corp. should do everything they can to expand network capacity.
But if they have to slow down or "throttle" some kinds of Internet traffic - such as downloads of large video or movie files - during high traffic periods, they can do so.
The CRTC said home customers must be told 30 days in advance if their service provider is going to use some form of traffic management, and how it will affect their service. Wholesale customers - such as smaller service providers who piggyback on the Bell, Telus or Rogers networks - must get 60 days notice.
The carriers won't need any advance rulings from the CRTC to manage their traffic, unless they plan to treat their wholesale clients differently than the rest of their customers.
If clients don't like what the carriers are doing, they can appeal to the CRTC.
The regulator said preference should be given to "economic" measures that control traffic, such as charging more for higher bandwidth, or giving discounts in off-peak hours. These are transparent and allow customers to make informed decisions, it said.
The CRTC's decision won praise from the big carriers, but was condemned by some who argue for "net neutrality" - the idea that all Internet traffic should be treated equally in order to foster innovation.
Mirko Bibic, Bell Canada's senior vice-president of regulatory and government affairs, said the ruling gives carriers the right to run their businesses the way they see fit. "We're the experts, and we get the flexibility to determine how to manage our networks to give the user the best experience," he said.
Bell already "throttles" its Internet service by slowing peer-to-peer downloading between 4:30 p.m. and 1 a.m. to make sure the network is not overloaded by a relatively small number of people transferring large video and music files.
Small Internet providers that use the Bell network are less enthusiastic about the CRTC's decision.
Tom Copeland, president of Eagle.ca in Cobourg, Ont., said he is happy the new rules mean his customers can't be treated differently than Bell's, unless the CRTC gives prior approval. But Mr. Copeland is frustrated by Bell's throttling of the entire network every evening, a move he says throws a "wet blanket" over service to his customers.
John Lawford, counsel for the Public Interest Advocacy Centre, said it will be very difficult for consumers to fight carriers' traffic-shaping decisions. Individuals or groups will have to gather evidence and line up experts if they want to take complaints to the CRTC - an expensive and time-consuming proposition.
His group wanted to see an end to any traffic management practice that involved "looking inside the [data]package to see what application is running."
The only part of the decision that Mr. Lawford supports is the rule that information service providers cannot disclose any information they glean from individual customer accounts when they perform traffic management. The carriers are also forbidden from using that data for any other purposes.
University of Ottawa professor Michael Geist, an expert in Internet and e-commerce law, said the new disclosure and privacy rules imposed by the CRTC are "long overdue."
Certain provisions - such as the rule that says carriers cannot slow down "time-sensitive" data transfers, such as teleconferencing, without prior approval - are welcome, he said. Over all, the decision is a "positive step" and "in typical Canadian fashion they've tried to strike a middle ground," he said.
The American approach to the issue will become clearer Thursday, when the U.S. Federal Communications Commission unveils proposed net neutrality rules.
"If they take a tougher approach," Mr. Geist said, "there are going to be a lot of people saying, 'How come our regulator isn't doing the same thing?'"