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Bell Acquires Manitoba Telecom for $3.9 Billion; Cell Phone Rates Expected to Rise

bell badBCE, Inc., the parent company of Bell Canada, has acquired Manitoba Telecom Services, Inc. (MTS), in a deal worth $3.9 billion, further enlarging Canada’s largest telecommunications company.

“Under the terms of this transaction, MTS will achieve much more than it could have as an independent company,” Manitoba Telecom president and CEO Jay Forbes said in a conference call with analysts. “BCE’s commitment to invest $1 billion over five years into Manitoba’s telecommunications infrastructure will also contribute greatly to the prosperity of our province and the quality of our customer experience.”

Many MTS customers and consumer advocates disagree with Forbes’ assessment, noting the deal will further consolidate Canada’s wireless marketplace by eliminating the province’s largest wireless carrier – MTS. The wireless business has nearly 500,000 customers – by far the largest provider in the region. Under the deal, BCE will sell off about one-third of MTS’ customers and retail storefronts to competitor Telus in a separate transaction.

Manitoba and neighboring residents in Saskatchewan pay some of the lowest prices for telecom services in Canada. MTS offers unlimited, flat rate Internet plans for both its broadband and wireless customers — plans likely to disappear or become more expensive after Bell takes over. The result, according to one Canadian telecom expert, will be higher rates.

“With MTS out of the way — and Bell and Telus sharing the same wireless network — prices are bound to increase to levels more commonly found in the rest of the country,” lawyer Michael Geist wrote on his blog.

The deal is also likely to deliver a death-blow to a government commitment assuring Canadians of at least four competing choices for wireless service. If Bell’s buyout is approved by regulators, Manitoba will be served by just three competitors — all charging substantially more than MTS.

...but soon we'll be with Bell.

…but soon we’ll be with Bell.

“Compare Bell’s wireless pricing for consumers in Manitoba and Ontario,” offered Geist. “The cost of an unlimited nationwide calling share plan in Manitoba is $50. The same plan in Ontario is $65. The difference in data costs are even larger: Bell offers 6GB for $20 in Manitoba. The same $20 will get you just 500MB in Ontario. In fact, 5GB costs $50 in Ontario, more than double the cost in Manitoba for less data. The other carriers such as Rogers and Telus also offer lower pricing in Manitoba. The reason is obvious: the presence of a fourth carrier creates more competition and lower pricing.”

That Manitoba Telecom would be up for sale at all came as a result of its controversial privatization in 2006 under a previous Conservative provincial government. The decision to privatize came despite a commitment from then-Premier Gary Filmon that Manitoba Telecom should remain a provincially-owned telecom company. Critics point to one possible reason for the flip-flop. Shortly after leaving politics, Filmon was appointed to the board of directors of the privatized company and was given $1.4 million in director fees and compensation over ten years, along with company shares with hundreds of thousands of dollars.

Economist Toby Sanger compared costs and returns of Manitoba Telecom and SaskTel, Saskatchewan’s publicly-owned telecommunications company. After two decades, the cost of a basic landline with SaskTel is $8 less per month than MTS, and SaskTel paid $497 million in corporate income taxes to the citizens of Saskatchewan – SaskTel’s shareholders – over the past five years, compared to $1.2 million paid by MTS over the same time period. In 2014, the CEO of SaskTel earned $499,492 compared to $7.8 million paid to the CEO of MTS for managing a very similar sized operation.

The acquisition will be reviewed by the Canadian Radio-television and Telecommunications Commission, the Competition Bureau and Industry Canada, and could be approved later this year or early 2017.

Canada Talks TV: Preparing for A-La-Carte Cable TV; Providers Threaten Rate Hikes

alacarte

Does Canada’s Food TV need special protection when it made 53% gross profits on the backs of cable subscribers that pay for the network whether they watch it or not?

“If you cut your cable, then your Internet is going to go up,” predicts Gary Pelletier, president of the Canadian chapter of the Cable & Telecommunications Association for Marketing.

That is just one of several predictions many Canadian cable and phone companies are claiming will come from the “disastrous decision” to allow consumers the freedom to pick and pay for only the cable channels they want to watch. Amidst claims that over 10,000 jobs will be lost, chaos and bankruptcy will stalk minority and niche cable networks, consumers will pay much higher bills, and American programming will boycott Canada fearing a-la-carte could make its way into the United States, Canada is at least having an adult discussion about the future of television and where it fits in the country’s identity.

Big changes are coming as a result of the latest great soul-searching made by our good neighbors to the north, always concerned about the potential of the Canadian Experience being overrun, if not decimated by the United States’ entertainment hegemony. In a moment of clarity, regulators have just realized what the rest of English-speaking Canada already knew: protectionist content regulations don’t work on the Internet. Canadians routinely bypass geographical restrictions and Canadian content laws with virtual private networks that relocate them, online at least, to a home address in the U.S. so they can binge-watch the unrestricted American versions of Netflix, Hulu and other online video services.

Regulators have now adopted the attitude – “if you can’t beat ’em, join ’em,” encouraging Canadian entertainment producers to create fewer, but better shows that will not only attract Canadian audiences, but those abroad.

Only the exchange is supposed to be mutual. High quality Canadian television productions like Orphan Black, Schitt’s Creek, X Company, The Book of Negroes, This Life, 19-2, Vikings, Killjoys, Rookie Blue, and Murdoch Mysteries are all among Canadian critics’ top favorites. But relatively few Americans know these shows exist or assume they are co-productions owned by some American entertainment conglomerate. Only a brief glimpse of a Canadian flag during the warp speed end credits might clue viewers this isn’t the case.

Despite protectionist media policies that have endured since 1970, the Canadians are now boldly going where Americans have so far feared to tread. They are having the conversation about the future of television and online entertainment in all forms while American media barons remain in denial.

For average consumers, the biggest change will begin next spring when the era of Canadian a-la-carte cable television arrives, allowing consumers to take an ax to the expensive 120-300 channel television package once and for all. Starting March 1, all Canadian providers will be required to offer consumers a basic cable package priced at no more than $25 a month, containing Canadian and U.S. over the air stations and networks, educational, and public channels. If you want more, you can have it by buying channels or mini-packages of networks individually to create a personalized cable TV lineup of networks you actually care to watch.

Programmers across Canada, particularly those catering to sports fans, foreign audiences, religious viewers, and minorities are horrified by the idea. So are media critics that fear the change could help bring an end to Canada’s unique multilingual and multicultural identity.

special reportCustomers like James Rehor of Hamilton explains why.

“Why would I pay for it? Why do I get it? Why does it come on my TV?” asks the 60-year-old construction worker. He’s ready on day one to purge the large number of French and other non-English channels from his Cogeco Cable lineup. Rehor offers comfort to sports programmers, however. He’s a big fan of the Toronto Maple Leafs, so Leafs TV, Sportnet, and TSN will stay.

Non-sports fans are another matter. They can’t wait to ditch the sports networks that are always the most expensive channels in a Canadian cable package.

“Clearly the most expensive (channels) will always be sports,” Pelletier tells the Canadian Press. “At the end of the day, for sports watchers, their cable bill will probably stay the same or increase, maybe … In the case of someone who doesn’t watch any sports at all, their bill will probably decrease.”

An Age of Abundance: Canadian telecom regulators are transforming media regulations in Canada, recognizing the way Canadians watch television has changed. Quality, not quantity, is now most important. CRTC chairman Jean-Pierre Blais discusses the new reality. (6:08)

Pelletier and his industry friends are on a mission to convince Canadians to leave well enough alone and not drop the current all-for-one price cable television package for a-la-carte — not realizing the potential consequences.

catnipSome in the cable industry have tried other scare tactics to no avail.

One industry-backed study predicted pick-and-pay could cost the economy 10,000 jobs. Consumers could care less. Unifor, a union that represents many in the television sector, seemed to agree Canada’s cultural heritage will be at risk with lowest common denominator programming dominating from St. John’s to Vancouver, much of it shoveled from the United States. But Canadians still want their House of Cards and Homeland.

Howard Law, a media spokesman for Unifor, predicts less profitable Canadian channels will fold under a pick-and-pay pricing model.

“The introduction of pick and pay will, in itself, lead to a major loss of revenues to Canadian broadcasting system, which ultimately plays out in less Canadian content and less Canadian jobs and less Canadian broadcasting,” he said in an interview on CBC’s The Exchange with Amanda Lang.

Minority interest and religious channels are also worried about their future. Most of those networks are classified as “specialty channels” by the Canadian Radio-television and Telecommunications Commission (CRTC). Legacy networks that have been around since at least the 1990s have been sitting pretty, protected by their designation as a “Category A” specialty station. Unlike in the United States, Canadian cable networks are licensed to operate by the CRTC, and at least 60 of those Category A networks also enjoy “genre protection,” a CRTC policy that guarantees their channel carriage on Canadian cable, satellite, and telco TV systems and protection from other cable networks that want to run the same kind of programming.

For decades, protectionist Canadian content regulations made certain Canadian television reflected its audience. But online video and the Internet has allowed Canadians to bypass traditional cable television to watch they want, not what the government hopes they will. New CRTC rules reflect that reality as Canadian TV rethinks how to get the viewer’s attention. From CBC-TV’s The National (4:16)

CRTC policies have allowed Canadian specialty channels to flourish despite operating in a smaller marketplace with fewer viewers than their American counterparts. That means networks like FoodTV and HGTV in Canada have profit margins ranging from 53-58 percent. Fashion Television and BookTV made an improbable $2.7 million in pre-tax profit, not so much from viewers but from the licensing fees every Canadian cable customer pays for the four networks whether they watch them or not.

From its inception, Canadian TV has always faced a looming shadow from the south. Protecting Canada's identity has been a priority for decades.

From its start, Canadian TV has always faced a looming shadow from the south. Protecting Canada’s identity has been a priority for decades.

“If you’re a specialty channel that’s lived within the protective cocoon of bundling for years, you’ve gotten used to having a full-time job with benefits,” independent technology analyst Carmi Levy told CBC News. “Contrast that with living outside the protective cocoon, you’re essentially a freelancer, you fight for every contract, you have no benefits, there are no guarantees that money will be coming tomorrow or next week.”

It probably won’t be coming from subscribers like Mr. Rehor, who won’t hesitate to drop channels if they go unwatched.

The CRTC is also doing some dropping of its own, starting with genre protection, which could lead many specialty networks to follow American cable networks that today depend on chasing ratings to justify their licensing fees. The unintended result in the United States has been questionable lineup changes like the appearance of Law & Order rerun marathons on WEtv, a network supposedly dedicated to women’s entertainment. Ovation, a fine arts independent cable network that is about a niche as a network can be, depended on weekend binges of PBS’ Antiques Roadshow reruns in 2012 just to attract enough viewers to show up in the ratings.

Lesser known networks like OutTV, Canada’s only network dedicated to lesbian, gay, bisexual, and transgender viewers, may face an uncertain future if it can’t charge a premium price to make up for expected subscriber losses from pick and pay. Other niche channels may have to merge with other networks or more likely relaunch with an online platform and deliver a reduced menu of content to audiences.

crtcLarge Canadian mainstream networks and programmers don’t expect too much change from pick and pay, as most Canadians will likely still demand a package with their programming included. But distributors – cable, satellite, and telco TV platforms, do expect some major changes. The average Canadian now pays around $50 a month for basic cable, a price that will be cut in half next spring.

Rogers Cable already knows what is coming. It ran a trial in 2011 in London, Ont., with 1,000 customers who were given the choice of picking and paying for the channels they wanted. It didn’t take long for the cable company to discover customers loved it and TV stations and cable programmers hated it.

“We found that customers like bundles, but want to build their own. They want a basic package and an extra package they create,” Rogers spokesman Kevin Spafford told the Toronto Sun. “We did get push back from TV stations. There was concern about offering this service. They did not want us to proceed with that model.”

After the trial ended, Rogers allowed the pilot project participants to keep their pick and pay packages, something they’ve held tightly for over four years.

Rogers’ pilot offered something like what the CRTC is demanding be available to all Canadians:

rogers logoROGERS PICK AND PLAY PILOT

  • $20 a month for “skinny basic” TV package of Canadian stations. (The CRTC plan mandates no more than $25.)
  • 15-channel package for $27 a month. Other packages of 20 and 25 stations also offered, for more money. (The CRTC wants networks to offer channels individually or in mini-bundles.)
  • U.S. major networks offered for $3 a month. (Under the CRTC policy, these stations may appear under the basic or a-la-carte tiers.)

REGULAR ROGERS

  • Basic: $40 a month, 190 channels
  • Digital Plus: $63, 220 channels
  • Sports packages: $77, 230 channels
  • VIP TV: $77, 270 channels
  • VIP Ultimate: $119, 320 channels

The upcoming changes are probably the biggest in Canadian cable television history, but they still may not be enough to attract cord-nevers — those who have never subscribed to cable TV. Most are under 30 and already watch all their favorite shows online. Some budget-minded Canadians who want to cut their cable bill may consider joining them by cutting the cord altogether or slimming down their cable packages, but Pelletier warns that cable operators will not leave their money on the table.

cablecordSupplementing a slimmer cable package with a streaming service or two could increase data charges, Pelletier warns. Plus, you may have to surrender any discounts you get from bundling cable with home phone, Internet and/or wireless service.

Usage capped Internet is also still an effective deterrent for cord-cutting and whether your television entertainment comes over the cable or online, providers will still make a run for your wallet. Some observers predict providers will dramatically increase the retail prices of a-la-carte networks to limit potential savings while also continuing to raise broadband prices.

A 2014 national PIAC poll found 90 per cent of 1,000 consumers polled were willing to pay an additional $1 a month per channel, while 54 per cent would be willing to go $3 a month, and 21 per cent would be willing to pay $5 a month for an extra channel of their choosing. Many don’t realize under the current system the wholesale rate for many channels is under 50 cents a month. Considering what Canadians are willing to pay, it is likely cable companies will price channels according to what the marketplace will tolerate, which could be around $3 for each channel a month.

Suspicion about any cable company offering a New Deal is something Americans and Canadians have in common. Mr. Rehor is already keeping a wary eye.

“I think it’s a good idea, I just don’t know how they’re going to really work it,” he says, fearing it could ultimately end up costing the same amount he pays now.

CBC News offers this extended discussion about the implications of “pick and pay” cable television. (10:11)

HissyFitWatch: Cable Operator Shames Past Due Customers by Naming Them on Facebook

Phillip Dampier December 2, 2015 Canada, Consumer News, HissyFitWatch, Public Policy & Gov't 4 Comments

past dueA cable operator in Canada’s Northwest Territories doesn’t bother sending past due notices to customers in arrears anymore. It posts their names and amounts owed on Facebook instead.

Senga Services Cable TV is facing heat for posting its past due list publicly on several Facebook community pages, including the ‘Fort Simpson Town Cryer‘, naming and shaming customers including former Member of the Legislative Assembly (MLA) Kevin Menicoche (who quickly called to make payment arrangements).

Jennifer Simons, who works with Senga Services, told CBC News she’s fed up with sad stories about why people won’t pay their cable bill.

“We always got excuses from everybody,” Simons said. “Promissory notes and everything, and it never arrives. So we found the most effective way is to publicly post the names.”

Customer reaction varied from supportive to swift and harsh condemnation. With the story going viral, Senga has restricted access to its own Facebook page.

“What a shotty [sic] disrespectful way to try and get people to pay,” wrote one reader.

fort-simpson-town-crierMost of the amounts owed are between $100-300, but one customer had managed to avoid paying an apparent court judgment of $1,406.80.

Michelle Léger, a Fort Simpson resident told the CBC the post “just wasn’t right.” With a population of just 1,200 in Fort Simpson, the list was sure to generate a lot of buzz in the community.

“If I had been a person on that list, I would have been really embarrassed,” she said. “It’s publicly shaming people. That’s kind of abusive to your customer base. Everybody knows who owes money to a cable company. So we know who is irresponsible with money or who might be struggling. If I were struggling to pay bills, I wouldn’t want my community knowing.”

Simons had none of that, doubling down in a follow-up message that people “should not live outside their means,” adding “maybe their family can step up and help them out.”

“We run a business, not a charity,” Simons explained. “We have bills to pay and paying customers who deserve to have services. Not paying your bill is stealing.”

MLA Menicoche told the CBC he was not embarrassed after appearing on the list, but complained he should have been contacted privately first.

Whether customers agree or disagree, the public disclosure does not appear to violate Canadian law.

According to Canada’s Personal Information Protection and Electronic Documents Act, organizations may disclose personal information of an individual without their consent if “the disclosure of the information is necessary in order to collect a debt owed to the organization.”

Regulators Want to Know Why Vidéotron Has Room for Unlimited Data for Some Apps, Not Others

videotron mobileThe Canadian Radio-television and Telecommunications Commission is asking some hard questions of Quebec-based mobile provider Vidéotron, which began zero-rating preferred partner music streaming services last summer that allow customers to stream all the music they want without it counting against their data cap.

The CRTC is examining whether the practice violates Canada’s Net Neutrality policies, which insist all content be treated equally.

“If, as Vidéotron has stated, congestion is manageable and there is no meaningful risk of service degradation as a result of offering Unlimited Music service, explain why Vidéotron did not either increase or eliminate data usage caps for your broader customer base instead of zero-rating certain applications or services,” the CRTC has asked.

Unlimited Music allows customers to stream Spotify, Google Play Music, Deezer and Canadian-owned Stingray Music without it counting against a customer’s allowance. Other streaming services do count, potentially putting them at a competitive disadvantage.

videotron_coul_anglais_webObservers say zero-rating enhances a customer’s perception that data has a measurable financial value, often arbitrarily assigned by competitors in a marketplace. If providers charge an average of $10 per gigabyte, customers will gradually accept that as the base value for wireless data, despite the fact many providers used to sell unlimited data plans for around $30. Zero rating content can be used in marketing campaigns to suggest customers are getting added value when a provider turns off the usage meter while using those services. Stream 3GB of music and a provider can claim that has a value of $30, but provided to you at “no charge.”

In the United States, most providers generally offer “bonus data” allowances in promotions instead of focusing on individual services. But T-Mobile goes a step further, also offering Music Freedom, a zero-rated music streaming service of its own.

Consumer reaction to the services are mixed. If a customer is a current subscriber to the preferred content, they often perceive a benefit from the free streaming. But customers looking to use a service not on the list may consider such plans unfair.

The CRTC will be awaiting Vidéotron’s formal answer.

Rogers Enables VoLTE Voice/Video Calling It Exempts from Its Own Usage Allowance

netneutralityIf you make a voice or video call over Rogers’ wireless network using Skype, you will chew into your monthly data plan. If you make the same phone call over Rogers’ Voice over LTE network, your data allowance is safe.

Rogers this week expanded VoLTE in Canada to iPhone 6 series phones, joining select Android devices that have had VoLTE service available as an option under phone settings for some time.

VoLTE relies on the same wireless LTE 4G network data sessions do, but Rogers has “zero-rated” voice and video calls made over its own phones so they do not count against a customer’s data plan allowance. Customers using a competing app like FaceTime or Skype are not so lucky — using either counts against your data plan.

rogers logoThat could suggest a potential Net Neutrality violation for one of Canada’s largest cellular providers because Section 27 (2) of the Telecommunications Act makes it clear unjust discrimination is illegal:

(2) No Canadian carrier shall, in relation to the provision of a telecommunications service or the charging of a rate for it, unjustly discriminate or give an undue or unreasonable preference toward any person, including itself, or subject any person to an undue or unreasonable disadvantage.

“It is the main ‘backbone’ behind implementation of Net Neutrality in Canada, along with the ITMP rules (2009-657),” said , who closely observes the Canadian Radio-Television and Telecommunications Commission, responsible for upholding Net Neutrality in the country. Mezei tweeted the CRTC this afternoon, asking who they thought would be the first to file a Net Neutrality complaint against Rogers for the practice.

Rogers Communications: Canada’s Newest Net Neutrality Advocate?!; Blasts Vidéotron for Fuzzy Caps

rogers logoCanada’s largest wireless carrier and near-largest Internet Service Provider has just become one of Canada’s largest Net Neutrality advocates. How did that happen?

In an ironic move, Alphabeatic reports Rogers Communications today filed a letter with the Canadian Radio-television and Telecommunications Commission that supports a ban on providers exempting customers from usage caps when accessing content owned by the provider or its preferred partners.

The issue arose after Vidéotron, Quebec’s largest cable operator and significant wireless provider, began offering an Unlimited Music service that keeps the use of eight streaming audio services – Rdio, Stingray, Spotify, Google Play, 8Tracks, Groove, Songza and Deezer – from counting against a customer’s usage allowance.

videotron mobileThe practice of exempting certain preferred content from usage billing, known as “zero rating,” is a flagrant violation of Net Neutrality according to consumer groups. Rogers now evidently agrees.

“The Unlimited Music service offered by Vidéotron is fundamentally at odds with the objective of ensuring that there is an open and non-discriminatory marketplace for mobile audio services,” Rogers’ CRTC filing said. “Vidéotron is, in effect, picking winners and losers by adopting a business model that would require an online audio service provider (including Canadian radio stations that stream content online) to accept Vidéotron’s contractual requirements in order to receive the benefit of having its content zero-rated.”

The practice of zero rating can steer users to a provider’s own services or those that agree to partner with the provider, putting others at a competitive disadvantage. That is what bothers the Public Interest Advocacy Centre, which calls the practice incompatible with an Open Internet.

Rogers has an interest in the fight. The company owns a number of commercial radio stations across Canada, many that stream their content over the Internet. None are exempt from Vidéotron’s caps.

Rogers’ advocacy for Net Neutrality is new for the company, and ironic. Rogers partnered with Vidéotron and Bell to offer its own zero-rated online video service for wireless customers until last August, when consumer groups complained to the CRTC about the practice.

Rogers may also be in the best position to judge others for the practice while finding a convenient loophole for itself. Its current promotions include free subscriptions to Shomi, a video streaming service, Next Issue, a magazine app, or Spotify, the well-known music streaming service. While Rogers won’t exempt your use of these services from its usage caps, it will effectively exempt you from having to pay a subscription fee for the service of your choice, which could provide the same amount of savings zero rating content would.

Microsoft’s Windows 10 Updates Cost Some Users Hundreds of Dollars in Internet Overlimit Fees

badbillAbbes Nacef was not very happy when he opened his web browser a few days ago to see a message inserted at the top of his screen.

“Your Internet service has reached the maximum limit of allowable overage charges. If you wish to continue service, please contact our business office to discuss your account.”

Nacef, who lives in Monastir, a Tunisian city best known for its tourism, was surprised because it was the first sign his Internet account had gone over the limit.

“While you can get uncapped DSL in Tunisia, it is not very good service and in my area it is not offered,” Nacef told Stop the Cap!. “Most in our neighborhood rely on a wireless ISP service which is less costly than 3G or 4G mobile service, but is capped and charges roughly $25 for each extra gigabyte allotment.”

Nacef’s call to his provider was not pleasant. He had already accumulated almost $180 in charges for the month of August, most in overlimit fees. The culprit was quickly identified — Microsoft Windows 10, which took several attempts to reach Nacef’s computer over a challenging Internet connection. But Nacef also learned his computer was repeatedly requesting updates from Microsoft, including three software patches that would not complete and were sent over and over for almost two weeks.

“It was the fifth call my ISP had received about this problem, and they were very annoyed also because Microsoft Windows 10 assumes you will use their Edge browser which defeats the early warning messages from my ISP that usage limits are approaching,” Nacef said. “When I switched back to my old browser the bad news was there, but it was too late.”

Windows-10His ISP has agreed to cut the charges in half and has warned all of its customers if they want Windows 10, the ISP will offer them a copy on a returnable USB memory device for free.

Nacef thinks the huge multiple download attempts to receive Windows 10 itself was responsible for most of the extra usage, but he is wary about the frequent software updates and the fact they are shared with other users by default.

That is what may have tripped up Rob DuGrenier who paid an exorbitant $150 this month for 1.5Mbps Internet service just to get a 75GB usage allowance for his immediate family in far northern Québec. The alternative was an overlimit fee of $20 for each 5GB allotment of usage over the usual 30GB allowance granted to “Power” users.

“Internet is not an option for our family for medical reasons, but this hurts,” DuGrenier writes. “It is definitely Windows 10 and there is something wrong with it because our ISP reports we are sending a lot more data than we are receiving, and there are no viruses or malware on the computers.”

Internet access is northern Québec is slow and costly.

Internet access is northern Québec is slow and costly.

His ISP now suspects Microsoft is using his connection to distribute software updates to a number of other users across northern Canada. When DuGrenier’s family disabled the option that opted them in to distributing Microsoft updates to other customers, upstream traffic dropped 98%.

“Were we sending Windows 10 itself all over northern Quebec and Nunavut? We just don’t know and Microsoft has not responded,” DuGrenier reports. “They have billions, I do not. They should be paying my Internet bill this month.”

The worst of the reported problems of bill shock are occurring in remote areas where Internet service can be a mixture of wired and wireless connections that are often slow and usually usage-limited. Windows 10 was designed to reduce bandwidth demand on wireless connections, assuming they would be metered. But how Microsoft detects which networks are wireless and metered and which may only partly be so is apparently a work in progress.

This morning, the Sydney Morning Herald reports at least one customer on a Pacific island was slammed with a catastrophically high Internet bill. Maureen Hilyard in the Cook Islands owes her ISP $390 this month, all because of automatic updates from Microsoft for Windows 10.

“In this context, where Internet access is both painfully slow and seriously expensive, these forced updates are almost literally forcing people off the Internet and are resulting in massive excess data charges,” EFA executive officer Jon Lawrence told the newspaper.

cook islands

The Cook Islands

Hilyard is a customer of Bluesky, primarily a satellite Internet Service Provider that dominates the Cook Islands, which have no other options for Internet access. A basic account costs $31.50 a month, but that provides just 3.5GB of data for the entire month. Automatic overlimit charges of $0.03 per megabyte accrue after the allowance is used up.

The most likely victims of Windows-induced bill shock subscribe to usage-limited wireless or satellite Internet services. While many providers throttle the speeds of customers who reach the usage limit, others charge penalty rates. Microsoft has no way to know which is true. Instead, the company claims it looks for evidence of a wireless connection before performing updates and when it finds one, it assumes it to be metered. But wired connections stay firmly in the unmetered category, whether they are usage-capped or not. Customers are invited to choose by digging through confusing settings menus.

Even more problematic is the built-in peer-to-peer technology that gives Microsoft’s servers a break and uses your Internet connection to share the latest Windows software updates with other Windows users across town and beyond. Microsoft has offered no provision to track this usage, but users can opt out with this advice from the Sydney Morning Herald:

Users can tweak their Windows 10 system settings by enabling a “metered connection” by searching for “Change Wi-Fi settings” in the start menu, clicking on “Advanced Options” and enabling “Metered connection.” This lets Windows 10 know the Wi-Fi connection you’re on is capped, so instead of forcing a software update onto your PC or tablet, it will notify you first. You can then choose to delay the upgrade until you are on an uncapped connection, or until you’ve rolled over into a fresh month of data.

This workaround only applies to Wi-Fi connections, however, not Ethernet connections.

A second workaround actually comes in an update which Microsoft itself released. It’s a bit more fiddly though, as it involves manually uninstalling driver updates and then downloading a special troubleshooter app to prevent them from installing again automatically. The full instructions are available online.

Vidéotron Will Offer 1Gbps Broadband Speed in Montréal

videotron_coul_anglais_webMontréal cable subscribers will soon be able to buy gigabit broadband speeds from Vidéotron after a successful pilot project demonstrated the cable company’s existing DOCSIS 3.0 network was up to the task.

“It is with great pride that we announce today that we have passed another milestone in the history of Videotron Internet service,” said Manon Brouillette, president and CEO of Vidéotron. “We have always been a trailblazer in this area. Over the past 10 years, we have introduced a series of high-speed Internet access services, each faster than the last, in order to meet consumers’ steadily expanding needs.”

Testing gigabit speeds began in a few Montréal homes and businesses earlier this year and the results have helped the cable operator optimize its network architecture and choose the correct cable modems to reliably support the service across its service area. Availability is expected sometime this year.

In 2016, Vidéotron will upgrade its network to DOCSIS 3.1 technology, which should support even faster speeds and require less network configuration to support the fastest Internet speeds.

Vidéotron has been aggressively pushing speed upgrades to its customers, largely in Québec. Fibre Hybrid 120 and Fibre Hybrid 200 Internet services are available to nearly 2.9 million households and businesses.

CRTC Orders Phone and Cable Companies to Open Their Fiber Networks to Competitors

CRTC chairman Jean-Pierre Blais

CRTC chairman Jean-Pierre Blais

Independent Internet Service Providers are hailing a decision by telecommunications regulators that will force big phone and cable companies to open their fiber optic networks to competitors, suggesting Canadian consumers will benefit from lower prices, fewer usage caps, and higher-speed Internet.

The Canadian Radio-television and Telecommunications Commission on Wednesday ordered companies like Bell/BCE, Telus, Rogers, Shaw, and others to sell wholesale access to their growing fiber optic networks, despite industry protests giving that access would harm future investment in fiber technology just as it is on the cusp of spreading across the country.

“We’re an evidence-based body, so we heard all of the positions of the various parties and we balanced those off through what we heard in our deliberations afterwards,” said CRTC chairman Jean-Pierre Blais. “In this particular case, we are concerned about the future of broadband in the country so we have to make sure we have a sustainable and competitive marketplace. It’s a wholesale decision that says Canadians can expect a better competitive marketplace because we are going to require incumbent cable and telephone companies to make their high-speed facilities available to competitors.”

BNN broke into regular programming with this Special Report on the CRTC decision that will grant independent ISPs access to large telecom companies’ fiber optic networks. (3:13)

Large phone companies, including Bell, warned regulators in a hearing last fall that forcing them to open their networks to third parties would deter investment in fiber expansion. Canadian telecom companies now provide about three million homes with either fiber to the home or fiber to the neighborhood service. Blais, along with representatives of independent ISPs have rejected Bell’s arguments, arguing competition from cable operators was forcing telephone companies to upgrade their networks regardless of the wholesale access debate.

crtc“Our view is the incumbent telcos have a market reason to invest in improving their plant through the investment in fiber,” Blais said. “That’s what Canadians expect and because of market conditions they have to do that investment. So we’re quite confident that’s going to happen.”

Canadian telecommunications companies have done well selling Internet and television services in a highly concentrated telecommunications and media marketplace. For example, BCE, the parent company of Bell Canada, Bell Media, and Bell TV owns a wireless carrier, a satellite TV provider, the CTV television network and many of its local affiliates, dozens of radio stations, more than two dozen cable networks, a landline telephone company, an Internet Service Provider, and ownership interests in sports teams like the Montreal Canadiens as well as a part interest in The Globe and Mail, Canada’s unofficial newspaper of record.

Companies like Rogers, Shaw, Vidéotron, Telus, and Bell have dominated the market for Internet access. But regulators began requiring these companies to sell access to their networks on a wholesale basis to smaller competitors to foster additional retail competition. Today, there are over 500 independent ISPs selling service in Canada, including well-known companies like TekSavvy, Primus, and Distributel. In the past few years, Internet enthusiasts have flocked to these alternative providers to escape a regime of usage caps and usage-based billing of Internet service common among most incumbent cable and phone companies. Competition from the independents, which offer more generous usage allowances or sell unlimited access, has forced some phone and cable companies to offer cap-free Internet service as well.

BNN interviewed CRTC chairman Jean-Pierre Blais about the commission’s decision to open up wholesale access to Canada’s fiber optic networks. (5:26)

bellDespite the competition, the majority of Canadians still do business with BCE, Rogers Communications, Quebecor (Vidéotron), Shaw Communications, or Telus, that collectively captured 75 percent of telecom revenue in 2013.

Although competitors have been able to purchase wholesale access to cable broadband and DSL service, nothing in the CRTC rules required big cable and phone companies to sell access to next generation fiber networks. That gap threatened the viability of independent ISPs, left with offering customers access to older cable/copper technology only. This week’s CRTC decision is the first step to grant access to fiber networks as well, although some ISPs are cautious about the impact of the decision until the CRTC provides pricing guidance.

“The commission took a great step today in favor of competition,” Matt Stein, CEO of Distributel Communications Ltd., told The Globe and Mail. “In giving us access to fiber to the premise, they have ensured that as speeds and demands increase, we’re going to continue to be able to provide service that customers want. It’s definitely going to be some time before these products make it to market. There’s going to be the costing and the implementation, and reasonably it could be a year or even longer before the products are actually out the door. But the heavy lifting? Today that was done.”

Bram Abramson, chief legal and regulatory officer for TekSavvy Solutions Inc., added some caution.

Distributel, an independent ISP, made a name for itself offering usage-cap free Internet access to Canadians.

Distributel, an independent ISP, made a name for itself offering usage-cap free Internet access to Canadians.

“The devil really is in the details on this,” Abramson told the newspaper. “That’s why I say we like the direction, because there are a million ways in which this could become unworkable if implemented wrong. For example, what rates are we going to pay? We won’t know until those tariffs are done and settled.”

Other so-called “wireline incumbents” like Manitoba Telecom and SaskTel will also be required to make their fiber optic networks available to competitors.

Last fall, Bell warned the CRTC of the consequences of letting TekSavvy, Distributel, and others resell access to their fiber networks.

“We are not suggesting that mandated access will immediately grind investment to a halt in every location in Canada, but it is a question of balance and it will have an impact,” Mirko Bibic, chief legal and regulatory officer for BCE/Bell told CRTC commissioners at a hearing.

Bibic cautioned if the CRTC granted competitive access it could affect how the company allocated its capital investments and could lead it to shift spending to other areas instead.

“What we’re saying is a mandated access rule will affect the pace of deployment and the breadth of deployment,” Bibic said.

Bibic

Bibic

Specifically, Bibic claimed Bell may call it quits on fiber expansion beyond the fiber-to-the-neighborhood service Bell sells under the Fibe brand in 80% of its service area in Ontario and Quebec. Bell had envisioned upgrading the network to straight fiber-to-the-home service, eliminating the rest of the legacy copper still in its network. But perhaps not anymore.

“If the commission forces the incumbent telephone operators to open access to fiber-to-the-home, BCE might not prioritize building that final leg in some communities,” Bibic warned. “The point is, with 80% of our territory covered […] we can hold and do really well with fiber-to-the-node for longer than we otherwise might.”

Nonsense, independent ISPs told the CRTC, pointing to the cable industry’s preparations to introduce DOCSIS 3.1 cable broadband and vastly increase broadband speeds well in excess of what a fiber-to-the-neighborhood network can offer.

“First of all, [telephone companies] have a natural incentive to build wherever there is a cable carrier, because otherwise the cable carrier will eat their lunch,” said Chris Tacit, counsel to the Canadian Network Operators Consortium, which represents the interests of independent ISPs. “There’s a reason that they’re sinking all that money into [fiber-to-the-home], it’s because they have to keep up. Now, I don’t believe for a minute that they are going to stop investing if they have to grant access.”

Regulators in the United States have traditionally sided with large telecommunications companies and have largely allowed phone and cable companies to keep access to their advanced broadband networks to themselves. Republicans have largely defended the industry position that regulation and forced open access would deter private investment and competitors should construct networks of their own. In some cases, they have. Google Fiber is now the most prominent overbuilder, but several dozen independent providers are also slowly wiring fiber optics in communities already served by cable and telephone company-provided broadband. Whether it is better to inspire new entrants to build their own networks or grant them access to existing ones is an ongoing political debate.

But the CRTC has not given independent ISPs a free ride. The commission announced it will begin moving towards “disaggregated” network availability for smaller ISPs, which will require them to invest in network equipment to connect with incumbent networks on a more local level, starting in Ontario and Quebec.

The CRTC under Blais’ leadership is gaining a reputation of being pro-consumer, a departure from the CRTC’s often-industry-friendly past. Blais has presided over rulings to regulate wholesale wireless roaming fees to lower consumer costs and forced pay television providers to unbundle their huge TV channel packages so consumers can get rid of scores of channels they don’t watch.

Canadian Press spoke with independent ISPs about their reaction to the wholesale access decision. (1:18)

Another Reminder Wireless ISPs are Not a Good Choice if a Fiber Alternative is Possible

Rationing Your Internet Experience: Stick to e-mail and web pages.

Rationing Your Internet Experience: Stick to e-mail and web pages.

This week’s news that the alleged owner of a Wireless ISP serving parts of New England may have fled the country to avoid an investigation by the Securities and Exchange Commission on an unrelated digital currency matter has left about 1,000 Vermont customers of GAW Wireless with no certain future for their Internet Service Provider.

As the “Geniuses At Work” came under pressure from public accusations the company was running a scam on digital currency investors, so went the performance of GAW Wireless. In February, a two-week service outage left many customers without telephone and Internet service. This month, e-mail accounts stopped working for some and nobody appears to be answering the firm’s customer service line. Even Vermont’s Attorney General cannot find the owner.

While Wireless ISPs (WISPs) can be a good option for North America’s unserved rural communities, they are not always the best choice, especially as customers continue to gravitate towards high bandwidth applications like Netflix.

Some rural WISPs have kept up with customer demand and continue to offer good service. Others have educated customers about being a good steward of a limited resource by showing courtesy to other customers by self-limiting heavy traffic applications to off-peak hours.

But other providers have chosen usage-discouraging data caps or usage-based billing to cover up for their inadequate infrastructure investment. In Nova Scotia, Eastlink’s new 15GB monthly usage cap on rural customers is nothing short of Internet rationing, completely ignorant of the fact most customers have moved beyond the Internet applications Eastlink envisioned them using when it built its network in 2006. Nearly a decade later, it is ridiculous to suggest customers should be happy continuing to pay almost $50 a month for a 1.5Mbps connection designed for e-mail, basic web browsing, and occasional dabbling into downloads, music, and video.

Come for the view but don't stay for the broadband.

Come for the view but don’t stay for the wireless broadband.

Some angry customers suspect Eastlink is simply being greedy. We believe it is more likely Eastlink’s existing wireless network is no longer adequate for the needs of Nova Scotians (or practically anybody else in 2015). The evidence that congestion is the real problem was supplied by customers who have noticed the network’s performance has slowed over the last few years. That is a sign the network is either oversold — too many customers trying to share the same bandwidth limited resource — or has become congested because of the growth of Internet traffic generally. It might even be both.

Implementing draconian usage caps only alienates customers and suggests Eastlink wants to collect as much revenue as it can from a resource that should either be vastly upgraded or retired in favor of superior technology. We have not seen anything from Eastlink that suggests major upgrades are on the way. In fact, the only conclusion we can make from Eastlink’s public comments is they think equal access to an inadequate resource is fairer than actually upgrading it.

Eastlink claims nobody could have envisioned Internet traffic growth from the likes of Netflix. In fact, equipment manufacturers like 3Com and Cisco were issuing scare stories about Internet brownouts and future traffic exafloods since December, 1995 — the year before Eastlink planned its Nova Scotia wireless network. Smart network planners have kept up with demand, which has been made easier by technology improvements accompanying the increased traffic. A good ISP recognizes upgrades are continual and essential to keep up with customer needs. A bad ISP introduces a rationing usage cap and claims it is only trying to be fair to every customer.

Phillip "Fiber is Good for You" Dampier

Phillip “Fiber is Good for You” Dampier

Usage caps and usage-based billing have never been about “fairness.” We’ve seen all sorts of usage enforcement schemes imposed on customers since 2008 when Stop the Cap! was founded. In each instance, usage caps were only about the money. Eastlink customers will not see any rate decrease as a result of its rationing plan, giving users less value for their broadband dollar. If an Eastlink customer confines use of their high traffic applications to the overnight hours, when they would cause little or no congestion, they will still eat into their monthly usage allowance.

All the benefits of usage caps accrue to Eastlink, either by reducing traffic on its network and allowing the company to delay necessary upgrades, or by pocketing the inevitable overlimit fees, which may or may not go towards upgrades. In our experience, the case for spending capital on network upgrades has never depended on overlimit fees collected from subscribers squirreled away in a separate bank account.

This is why communities in Vermont, Nova Scotia and beyond should strongly consider investing in fiber optics for broadband delivery and consider wireless only for the least populated areas. A broadband project in rural western Massachusetts can offer a guide to resolving the ongoing problem of unserved or underserved communities ignored by commercial providers. Deprived of upgrades from Verizon and shunned by Comcast and Time Warner Cable, the residents of these towns continue to vote overwhelmingly in favor of fiber optics.

The WiredWest approach is a solid solution. The initiative secures bond authorizations from each participating town in a public vote backed by deposits of $49 per household, held in escrow to be later used to cover the first month of broadband service when the service launches. Each town must have at least a 40% buy-in from residents, providing strong evidence the project has a solid customer base, is financially viable, and can recover construction costs and pay off the bonds estimated at $100-120 million within a reasonable amount of time. The state legislature contributed an additional $40 million dedicated to last mile infrastructure — the cost to wire each home or business. (In contrast, Nova Scotia and the federal government spent $34 million subsidizing the Eastlink wireless network in 2007 that has not aged well. Fiber optics is infinitely upgradable.) By choosing fiber optics, instead of getting rationed, slow speed, or no Internet service, WiredWest towns will be able to subscribe to 25Mbps for $49 a month, 100Mbps service for $79, or 1,000Mbps for $109 a month
.

In comparison, Eastlink charges $46.95 a month for “up to” 1.5Mbps with a 15GB cap and GAW Wireless (when working) charges $39.95/mo for “up to 7Mbps.”

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