Chances are, some of you may read the title, and think it doesn't affect you. If you're Canadian, give it a chance and read this. If you're American, I don't think this is much of a problem now, but may be in the future.
What is Usage Based Billing?
Usage Based Billing is pretty much what it sounds like. You get an internet service, and it comes with a certain usage allotment. Let's say 200 GigaBytes for example. If you use more than 200GB of internet usage, then you're charged per GB for the overages. As an example, $0.50/GB.
What is the current UBB situation?
Nearly 2 years ago, in March 2009, Bell filed a tariff to the CRTC to charge independent Internet Service Providers such as TekSavvy, Electronicbox, Caneris, Distributel, or Acanac for their customers usage. These independent providers use a regulated service called GAS (Gateway Access Service), which allows them to provide DSL internet using the current copper phone line network. In this case, the copper network is owned by Bell Canada (Why does Bell Canada still have Canada in their name?). In a way, UBB is somewhat fair when done right, but what Bell asked for has a SEVERE markup. First of all, these ISPs already pay certain IP transit providers for bandwidth. It's a little hard to estimate a price since these ISPs pay for usage based on a percentile. Based on what I've read online, if we were to change that to a per GB cost, it would be between $0.05 and $0.25 per GigaByte. Yes, you read that right, 5 to 10 cents per GB. While these small ISPs currently offer high caps around 200GB - 250GB with overage rates between $0.25/GB and $0.50/GB and even offer an option for unlimited usage at $7 - $12 more, the larger telco and cableco ISPs offer caps which are a fraction of what the indie ISPs offer.
Bell offers caps from 2GB to 100GB, with overage rates between $1.00/GB and $2.50/GB. They have a maximum overage limit of $60. Bell's maximum overage limit was previously $30, but they increased it to $60 on November 2nd (13 days ago).
Videotron offers caps from 3GB to 200GB. On Videotron's 2 lower tiers, they charge $4.50/GB and the maximum overage limit is $50. On Videotron's higher tiers, they charge $1.50/GB with no overage limit.
Rogers offers caps from 2GB to 175GB, with overage rates between $0.50 and $5.00 . They have a maximum overage limit of $50.
Bell wants to charge ISPs like TekSavvy what they charge their own retail clients. This means that TekSavvy customers will have a 25GB or 60GB cap (nobody is really sure which it is). TekSavvy will be forced to charge AT LEAST $1.50/GB or $2.50/GB to customers since those are the prices that Bell is charging TekSavvy. The new $60 overage limit will likely apply instead of the old $30 overage limit. Keep in mind that these ISPs are already paying Bell for each Gigabit link to Bell that they use, which I think is about $1000 each. These links are used to connect TekSavvy's (or other GAS ISPs) network(s) to Bell's copper network. Also, about $20 of what you pay each month to TekSavvy or the other above mentioned small ISPs goes to Bell. Now Bell wants to triple dip.
Why does Bell want to charge UBB to wholesale DSL internet providers?
Good question. Here is what many people following these things believe, and we're probably right.
Bell, Rogers, Videotron, Cogeco, Telus, and Shaw all provide TV services. The average household probably pays about $60/month for cable or satellite. Media is evolving and people are cutting their cable or satellite TV service to replace it with services that run over the internet, such as Netflix. These providers have low internet usage caps so that you'll be discouraged to use Netflix and instead of getting $60 for the TV service that you're not using, they'll get $50-$60 when you go over your internet usage cap.
Another thing. The main Canadian TV channels are CBC, CTV, and Global. CTV, The Comedy Network, Much Music, MTV Canada, TSN, RDS, and other CTV owned channels are currently owned by Bell. Global, BBC Canada, DejaView, The Food Network Canada, History Television, HGTV Canada, Showcase, and other channels that were previously owned by CanWest are currently owned by Shaw. CityTV, OMNI, G4 Canada, and Rogers Sportsnet are owned by Rogers.
Well, what should we do? The answer sounds logical. Switch to one of the independent providers. Of course, now the CRTC allowed Bell to start charging these ISPs for UBB, forcing the ISPs to pass it on to the customers. Sure, TekSavvy Cable is available in parts of Ontario, unfortunately, there are many places where it isn't available. It's available in Quebec, but Videotron's TPIA (Third Party Internet Access. It's similar to GAS, but for cable instead of DSL.) is very restrictive, with high activation costs and it has had UBB for years.
Since TekSavvy is stuck with slow speed internet and will be forced to charge higher prices than Bell, many people won't see much of a reason to stick with them and they'll go back to using their TelCo or CableCo's internet service. Eventually, most of the smaller providers will go out of business.
What happens once the indie ISPs go out of business? It's probably best not to think about it, but it'll probably be tiered internet. In this case, tiered won't be referring to speed, but instead the sites that you're able to access.
How does this affect us? What counts toward Internet Usage?
Anything you do on the internet counts toward your internet usage. Here are some of the things that take up lots of internet usage.
Netflix - Netflix recently became available for use in Canada. For about $8/month, you're able to watch as many movies or shows as you want, as long as it's available in their selection. Sounds good, right? Well, according to people on the internet, Netflix in Standard Definition uses 1GB per hour of content while HD content uses 2GB per hour.
Online game distribution (eg. Steam) - Steam is a online game distribution service. You're able to download game demos, buy them, and Steam will automatically update both the Steam Client itself, and the games that are on your computer. Game sizes are pretty big and will keep getting bigger, FAST. As an example, Call Of Duty: Black Ops launched about a week ago. The game download is 16GB. Game updates are also pretty big. I'm not sure how big the World Of Warcraft download is, but the latest update is about 4.9GB.
iTunes. I'm not sure how big iTunes music files are, but I'd assume video downloaded from the iTunes Store is around the same size as video from Netflix. Also, the iTunes download is 90MB, and each minor update requires you to download the full installer.
Skype. Skype supports text chats, audio calling, audio/video calling, and screen sharing plus audio. Text chatting uses minimal bandwidth, so I didn't test that. I tested the other 3.
Audio call: It used about 6KB/s for both upload and download, so 12KB/s total. An hour long 2-way call would use about 42MB.
Video call: It used about 60KB/s - 80KB/s in each direction, so that's about 120KB/s to 160KB/s total. An hour long 2-way video call would use about 420MB to 560MB.
Screen Sharing: This actually used less bandwidth than I thought it would. I guess it's the compression. 6KB/s download (for the audio) and about 45KB/s upload. I was the only one sharing my screen, my helper didn't share his/her screen.
Thanks helper.
Youtube. Youtube hosts lots and lots of videos. I think 15 minute videos in 480p quality are between 60MB and 80MB.
Streaming websites. CBC, Global, CTV, The Comedy Network, etc. host episodes of their TV shows that you're able to watch. As an example, I watched a 22 minute episode of South Park. It was about 100MB and the quality could have been a little better.
Software updates. Whether your computer runs Windows, Mac OS, or Linux, it gets constant updates. Windows usually gets about 100MB of updates every month. Mac OS X gets an update about once every 2 months. These updates are usually pretty big at about 550MB per Mac OS X system update. On average, that's about 250MB per month. I think Linux updates are usually between 100MB and 150MB each month, but those include updates for all of the installed software.
What can we do to help?
There are a few things you can do.
You can sign the "Stop The Meter" petition. Their goal is 12000 signatures (UPDATE #1: November 17th 2010 at 2:00PM. They've passed 12000 signatures. The new goal is 15000 signatures.) (UPDATE #2: November 19th 2010 at 1:30PM. They've hit 16000 signatures.) by the end of the week.
You can send an email to the Minister Of Industry, the CRTC, the Chairman of the CRTC, and the Prime Minister. The Stop UBB website has a form that makes this simple to do.
Back around 2002, Canada was in 2nd place for best internet. Now, as we're nearing 2011, Canada is quickly heading backwards at around 30th place. I know I don't want my internet bill going up by as much as 300%. Let's try and change that.
UPDATE November 29th 2010 at 9:30PM: The petition is now at 20659 signatures.
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