INTERNET UBB
The usage-based billing controversy is more about politics than anything else.
When you turn up the heat in your home, when you flip on a light or turn on a tap, you are accessing a network of pipes and wires that are constantly maintained and upgraded to provide you with service. And you are expected to pay for not just the commodity you are using, but for the utility system that distributes and delivers it.
Because it doesn't make practical or economic sense for different players to duplicate the same, expensive infrastructure, the cost of the commodity and its delivery are typically regulated to make sure the monopoly isn't abusive for those who rely upon it.
Strip out the political consideration. Discount the fact that its users are a very communicative and organized cohort. Set aside your aversion to the dominant power of a couple of big players in a relatively small domestic market. Then, ask yourself how the Internet is different from any other utility.
Essentially, telephone and cable companies have invested billions of dollars to meet the booming demand for Internet access. The more businesses and individuals have come to rely on the Internet for communication, entertainment and data transmission, the more it has cost service providers to pay for the technology to make it more reliable, more secure and, above all, faster.
The obvious question — one that's currently at the centre of an emotional public debate in Canada — is why consumers shouldn't have to pay for the capacity they use. After all, if you leave the lights on or the tap running, your usage is metered and your monthly bill will reflect that.
For some reason, however, usage-based billing (UBB) for the Internet is considered an outrage. It's a concept that the Canadian Radio-television and Telecommunications Commission (CRTC) recently decided to introduce after much deliberation.
The decision means that the small Internet service providers, who have been granted access to the networks developed by the big telecom companies (Bell, Telus, Rogers and Shaw) in a government-mandated attempt to create artificial "competition," will no longer be able to offer the flat-rate Internet access they have used to get a toe-hold in the market.
That means that the relatively small number of people — about 20 per cent of users create 80 per cent of traffic — who use the Internet to download movies and games and other big-byte items, will have to pay more if they use more.
This apparently is a violation of some inalienable right to cheap Internet access. And in the face of tremendous public clatter, the Prime Minister has now personally weighed in, demanding a review of the CRTC decision.
It's an overtly political response to the fact that this government likes to portray itself as the champion of "the little guy," especially with the possibility of an election looming this spring. The fact that UBB charges are higher in Quebec than in other jurisdictions doesn't make the concept attractive to a government that really, really wants to gain some seats in that province.
Individuals and small businesses have organized a collective bleat about the CRTC's initiative. The fact that they are taking aim at massive companies - like Bell, Telus, Shaw and Rogers - doesn't hurt.
Those prone to see plots and schemes are quick to point out one of two potential, if conflicting, conspiracies in all this: the big players now own television networks and are jacking up Internet pricing to drive viewers away from computer screens and back to television screens and/or they are trying to pump up the cost of Internet access so that they can capitalize on the download of all the content they now control.
There may or may not be something to that, but for their many (and often deserved) critics, the whole David and Goliath dynamic may make it easier to package and sell their outrage. However, the fact is that the small ISPs which are providing the flat-rate Internet service are an artificial construct.
Although they exist because the government said so, they perpetually claim that they can't be quite as competitive as they were supposed to be because they're charged too much by their competitors for access to networks.
It's a rather twisted turn in the federal government's aggressive push to let free market forces rather than intrusive regulation determine prices on the menu of telecom options. Now that the CRTC has complied by giving the nod to UBB, there's all sorts of complaining and second-guessing going on. And the chairman of the CRTC has been summoned to explain himself to the Committee on Industry, Science and Technology.
Chances are, however well he explains the approval of UBB, it's going to get overturned. There are certainly some reasons why that should happen, but those aren't the reasons that will prevail.
As with copyright and as with two previous reversals of CRTC decrees, short-term political objectives will trump a meaningful debate on an important topic.
My thanks to Deirdre McMurdy for her insight and article.
Ahh Sah
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