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CRTC chairman Konrad von Finckenstein waits to appear before a Commons committee in Ottawa on Nov. 18, 2010. (Adrian Wyld/THE CANADIAN PRESS)
CRTC chairman Konrad von Finckenstein waits to appear before a Commons committee in Ottawa on Nov. 18, 2010. (Adrian Wyld/THE CANADIAN PRESS)

Usage-Based Billing

CRTC details metered Internet review process Add to ...

The CRTC announced the terms and principles by which it would review its controversial decision on usage-based billing for Internet service on Tuesday, coming after the agency's chairman told a committee of MPs last week that he would review the decision.

The decision comes amid mounting consumer and political pressure against the practice, which raises the Internet fees of a some users on small Internet providers that lease space on larger providers' networks. Small providers argue that the way the regulator's ruling is structured would effectively eliminate their popular "unlimited" use plans and make them less competitive.

But the relatively technical issue has exploded into a national debate over Internet pricing in Canada and whether such use should be metered, as is already common practice on the networks of large providers such as Bell and Rogers.

"The great concern expressed by Canadians over this issue is telling of how much the Internet has become an integral part of their lives," said Konrad von Finckenstein, chairman of the Canadian Radio-television and Telecommunications Commission in the release.

Interestingly, despite widespread consumer outrage, intense media coverage and orders from the Prime Minister and Industry Minister Tony Clement to review and overturn the decision, Mr. von Finckenstein maintained that he came to the decision independently - something he first told the industry committee on Thursday.

The announcement on Tuesday opened a consultation process whereby citizens and interested parties can submit comments up until April 29. Mr. von Finckenstein reiterated in the release today that he does not feel that average Internet users - who download only light amounts - should "fund the bandwidth used by the heaviest residential Internet consumers."

However, the CRTC faces a unique challenge in that it is unclear exactly what will satisfy Mr. Clement, who has said he will overturn any decision that implements usage-based billing on small ISPs.

"I'd like to be clear ... regardless of the outcome of the CRTC review, under a Conservative government, this ruling will not be implemented," Mr. Clement told reporters Thursday after Mr. von Finckenstein's appearance.

Many industry experts and analysts have already criticized the chairman's insistence on this principle, given that many small businesses use unlimited download plans and that more and more consumers are bumping up against their monthly limits as bandwidth-heavy online video becomes more popular.

Rocky Gaudrault, the CEO of small Internet provider TekSavvy Solutions Inc. and an outspoken critic of the decision, will be appearing before the industry committee on Tuesday afternoon.

Also on Tuesday, Calgary-based cable giant Shaw Communications said it will begin holding public sessions with its customers on usage-based billing and allow them to provide feedback to the company online. The company said it will finish the consultation process before it implements any type of usage-based billing, even though the regulator's recent moves have nothing to do with the retail Internet service offered by large cable and phone companies. Shaw has monthly download limits, but does not charge users for exceeding them -- relying on a tactic common in the United States of contacting users who consistently go over the limit.

"Bandwidth is not unlimited and that is the crux of the issue," Shaw president Peter Bissonnette said in a news release. "There are many potential solutions to this challenge and we're asking for our customers' help to build a solution that works for everyone."

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