Despite claims from Canadian Internet Service Providers that Internet Overcharging schemes like “usage-based billing” are about pricing fairness, paying for what one uses, and keeping prices down, comparing broadband prices across the west and east sides of the Niagara River tell a very different story.

We went shopping for the lowest possible prices for standalone broadband service from two cable companies serving the Niagara Falls area, on both sides of the border.

Here is what we found (prices roughly equivalent in CAD/USD at today’s exchange rate of $1US = $0.99CAD):

Niagara Falls, N.Y. — Time Warner Cable

$34.95/month

Road Runner Standard Service: 10/1Mbps
No Usage Limit
No Overlimit Fee
No Modem Rental Fee
No Contract Commitment

Niagara Falls, Ontario — Rogers Communications

$39.00/month

Rogers Express Service: 10Mbps/512kbps
60GB Monthly Limit with $2/GB Overlimit Fee
$14.95 Installation Fee
One Year Contract Required
(Price above reflects a one-year promotion that includes the monthly Home Gateway Rental ($4.50 value) for one year, $5.50 per month thereafter, effective 3/2011)

The $46.99 price noted above reflects regular Rogers pricing, before the modem rental fee.

Prime Minister Harper's government is facing an open revolt by Canadian consumers over Internet Overcharging.

A full-scale revolt among consumers across Canada has brought the issue of Internet Overcharging to the highest levels of government.

A spokesman for Prime Minister Stephen Harper said the government is very concerned about a decision from the Canadian Radio-television and Telecommunications Commission that has effectively forced the end of unlimited use broadband plans across the country.

Both the Liberal and NDP parties have made a point of protesting the CRTC decision, which happened under the Conservative Party’s watch.  Harper’s Industry Minister Tony Clement stepped up his remarks this morning which hint the government is prepared to quash last week’s decision by the CRTC, which has already forced price increases for broadband service across the country.

“The decision on its face has some pretty severe impacts,” Clement told reporters in Ottawa after NDP and Liberal critics in the House of Commons repeatedly pounded the government on the issue of so-called “usage-based billing.”

“I indicated the impacts on consumers, on small business operators, on creators, on innovators. So that’s why I have to work through a process, cross my T’s, doc my I’s. When you’re dealing with a legal process, that’s what you have to do. But I will be doing that very, very quickly, and getting back to the prime minister and my colleagues very, very quickly,” said Clement.

As of this morning, more than 286,000 Canadians have signed a petition protesting the Internet Overcharging schemes.

The protest movement has now been joined by small and medium-sized business groups who fear the impact new Internet pricing will have on their businesses.

Richard Truscott, with the Canadian Federation of Independent Business, normally a group that prefers less government action, said his members are demanding a stop to the pricing schemes before they get started.

“The vast majority of small businesses rely on reasonably-priced Internet service to conduct their operations,” he said. “Generally this is the sort of thing that hits the most innovative sector with higher costs.”

Most cable and phone companies are lobbying Ottawa politicians to keep the new usage-based billing schemes, and several are pretending the protest movement doesn’t exist.

AgenceQMI, a cable-company owned wire service, is also coming under fire for misrepresenting Clement’s positions on the pricing schemes in a news report issued yesterday.  The wire service claimed Clement supported the CRTC’s position, something Clement adamantly denied this morning.

The National Post, a self-described conservative newspaper, this morning published an editorial supporting usage-based pricing, claiming a handful of users were creating a problem that light users should not pay to solve.  But many readers leaving comments on the article strongly disagreed, claiming the newspaper is out of touch.

Although the regime of usage caps, speed throttles, and overlimit fees have been in place with most major providers for at least two years, the culmination of several events in the last six months have brought the issue to the boiling point:

1. The arrival of Netflix video streaming, which provides unlimited access for a flat monthly fee;
2. The ongoing limbo dance among several providers who are reducing usage allowances when competitive threats arrive;
3. The increase in providers now enforcing usage limits by billing consumers overlimit fees that spike broadband bills;
4. Recent examples of bill shock, which have left some consumers with thousands of dollars in Internet charges.

Bill Shock

Kevin Brennan, a graphic designer who works from home and downloads large files from clients, was first hit with extra charges in November, which cost him $34 above his usual Shaw bill.

“I’d never been contacted about going over before,” he told the Calgary Herald, adding he was also over in December. “Thirty-four dollars doesn’t seem like much, but over the course of a year it adds up.

“What concerns me, outside my own business, is the lack of innovation people will be able to do. And it makes Shaw a monopoly. . . . if you watch TV or the Internet, you pay more to them.”

Shaw reduced its usage allowance for customers like Brennan late last year from 75 to 60GB on its most popular broadband plan.  It also now enforces a $2/GB overlimit fee.

John Lawford, counsel for the Public Interest Advocacy Centre, told the Herald the concern isn’t just that smaller companies can no longer offer unlimited plans, which reduces competition.

“The phone and Internet and cable companies of the world are playing it both ways. They’re saying, ‘Well, there’s these big data hogs that are using too much, we’ve got to punish them to keep the price down.’ On the other hand they’re buying media companies so they have stuff to shove down the wires, which doesn’t count toward your cap,” Lawford said. “That’s anti-competitive.”

Most Canadian media companies are now tightly integrated with large telecommunications companies.  CTV, Canada’s largest commercial network, is now owned by Bell, the country’s biggest phone company.  Rogers, Shaw, and Videotron — the largest cable companies in Canada own cable and broadcast stations, newspapers, and magazines.  They also control cellphone companies, Wi-Fi networks, and have interests in satellite providers as well.

When a competitor like Netflix arrives to challenge the companies’ pay television interests, turning down consumers’ broadband usage allowances discourages cord-cutting.

The CRTC’s decision to allow Bell to charge usage-based pricing for wholesale accounts was the final death blow to unlimited Internet according to several independent service providers, because virtually all of them rely on Bell — a company that received taxpayer subsidies to build its broadband network — for access to the Internet.

Canadian Parliament

TekSavvy, a company that used to offer unlimited use plans, can do so no more.  In a statement to customers, TekSavvy laid blame on regulators for being forced to increase prices.

“From March 1 on, users of the up to 5Mbps packages in Ontario can expect a usage cap of 25Gb (60Gb in Quebec), substantially down from the 200Gb or unlimited deals TekSavvy was able to offer before the CRTC’s decision to impose usage based billing,” read a statement sent to customers.

TekSavvy spokeswoman Katie do Forno said the CRTC decision is a disaster for Canadian broadband in the new digital economy.

“This will result in unjustifiably high prices and a reduction in innovation,” said do Forno. “I think it’s going to change behavior about how people use the Internet.”

The company underlines the point by including “before and after” pricing schedules on its website, an unprecedented move.  Shaw, western Canada’s largest cable company, was heavily criticized for trying to hide their reduction in usage allowances.

Ottawa residents are planning direct action to protest the decision this Saturday.  Shawn Pepin is organizing the protest rally.

“What they’re doing right now looks like a cash-grab scheme, and people aren’t going to take it,” he said.

[flv width=”640″ height=”388″]http://www.phillipdampier.com/video/CBC News Pay As You Go Tony Clement 2-1-11.flv[/flv]

Minister of Industry Tony Clement was pressed by CBC Television about the Harper Government’s stand on Internet Overcharging.  The CBC asks why Canadians are paying some of the world’s highest prices for broadband and why Clement is finally getting involved.  Watch as he mysteriously avoids stating the obvious: Canadians are in open revolt and politicians from competing parties are taking their side.  (9 minutes)

Clement

On Monday, the Federal Minister of Industry Tony Clement issued a statement about Internet Overcharging that was so non-committal, media companies are interpreting his comments as “for” and “against” usage-based billing.

Tony Clement’s full statement:

“On Tuesday, January 25, 2011, the CRTC announced its decision to allow wholesale and retail internet service providers to charge customers for exceeding the monthly usage of data transfer permitted with their broadband Internet package. This will mean, for the first time, that many smaller and regional internet service providers will be required to move to a system of usage-based billing for their customers.

I am aware that an appeal has been initiated by a market participant. As Canada’s Industry Minister, it is my job to help encourage an innovative and competitive marketplace, and to ensure Canadian consumers have real choices in the services they purchase. I can assure that, as with any ruling, this decision will be studied carefully to ensure that competition, innovation and consumers were all fairly considered.

The Harper Government is committed to encouraging choice and competition in wireless and internet markets. Increased choice results in more competition, which means lower prices and better quality services for Canadians. We have always been clear on our policies in this regard and will continue on this path.

Our Conservative Government is focused on the economy and creating a positive environment for job creators and business to flourish. Canadians can count on us to do what is in the best interest of consumers.”

AgenceQMI and Videotron are both owned by Quebecor Media

CBC Radio made mention of Clement’s comments and indicated the minister had expressed concerns about the billing scheme, but readers of wire service reports from AgenceQMI are getting an entirely different view — Clement’s approval of the new pricing scheme.

In a French language story headlined, “Minister Clement justifies the end of unlimited Internet packages,” the news agency got just a little creative in interpreting Clement’s statement (roughly translated from the French original):

He also argues that billing based on actual usage would more efficiently manage Internet traffic and bandwidth and provide a better experience for light users, currently impacted by massive data exchanges among the Internet’s heaviest users.

Minister Clement, who supports this decision, said in a statement that it is his duty to encourage a more competitive market.

It’s hardly a coincidence that AgenceQMI‘s creative spin of Clement’s statement just happens to match the position of Videotron, Quebec’s largest cable company.  They are both owned by Quebecor Media.  Videotron engages in Internet Overcharging that left one Montreal student with an $1,800 broadband bill.

Time Warner's Wheel of Retention Deals

[Update: See our updated piece with important new details about how to great the best possible deal from Time Warner Cable.]

Your cable bill now exceeds your electric and landline phone bill combined.  You’ve dropped the multiple premium channels, dumped the extra add-ons like Road Runner Turbo and even considered turning in your DVR box.  But your bill after the 2011 rate increase is still sky high.

Stop the Cap! has spent the last week working with several Time Warner Cable customers looking for a better deal from the nation’s second largest cable company.  It was a learning experience for all of us, with different “best offers” extended to different customers, deals some employees insisted simply weren’t available… until they were, and confusion galore as employees had to navigate their way around corporate roadblocks.

The good news: The quality of customer service from most Time Warner employees we worked with was generally excellent — professional, generally helpful, and even irritated when they couldn’t get some of the best deals in place for customers.  The bad news: As Time Warner moves more towards a regional corporate bureaucracy, new rules and pre-conditions frustrate all concerned.

When it comes to this cable company, the less business you give them, the better the offers.

As Scott, our reader in Brighton, N.Y., tweeted to Time Warner: “It would be nice to toss your longtime customers a bone now and again.”

Step One: Review Your Bill

The first way to save is to scrutinize your current bill.  Know what you are paying and consider dropping services you no longer use.  Most Time Warner customers purchase a bundle of two or three services, usually cable-TV and broadband.  The Watch N Surf bundle in the Rochester area now runs $118.99 per month.  Below the bundle (shown in bold on the bill) are breakdowns of equipment charges — set top boxes and remote controls, and add-ons such as movie channels or Road Runner Turbo.

Before Time Warner Cable will authorize a lower price, expect them to question any add-ons, such as premium movie channels or Turbo.  They’ll attempt to get you to drop services before they’ll extend a deal.  We found it more difficult to convince the company to give price breaks to customers who subscribe to a number of extra services and want to keep them.

Be prepared to temporarily drop services if you want the best possible deal.  You can always add them back later.

Step Two: Prune Your Package

Still paying for channels no longer on Time Warner's lineup?

Think carefully about the services you are getting.  Are you still watching premium movie channels these days or downloading your movies from Netflix or other services?  A few years ago, Time Warner only charged $7 a month for each additional premium channel.  Now that price has nearly doubled in many areas.  Are you really watching them enough to make the price worthwhile?  At upwards of $13.95 per month — $167 a year, it may be time to ditch them.

Time Warner told us subscribers routinely confuse the “Digital HD Tier” with the cable company’s standard HD channels.  The package, priced at $4.99 in most areas, is on many customers’ bills because it used to include HDNet and HDNet Movies, two of the earliest HD channels a number of early HDTV set owners craved.  The company dropped both networks more than a year ago, replacing them with Smithsonian and the improbable RFD-TV.  The latter channel has no business in a premium-priced package — it’s like charging you extra to receive C-SPAN 3.  If you can do without those channels as well as MGM HD and Universal HD — you just saved $60 a year.  Time Warner does not charge extra for other HD channels.

Some Time Warner customers also have several set top boxes they originally got for free or at a discount.  Today those boxes run $7 per month.  If you have cable in a bedroom or kitchen and can manage with channels 2-99, you can turn in the set top box and save $84 a year per box.

Broadband customers with Road Runner Turbo, now $9.99 per month, may find little value from that add-on in areas where speeds increased in the past year.  In Rochester, for example, Road Runner Turbo turns 10/1Mbps service into 15/1Mbps service — hardly much of an improvement and certainly not worth the price.  Save the $120 a year for something else.

Step Three: Negotiating a Better Deal

Now that you’ve reviewed your services and pruned your package where necessary, it’s time for Time Warner to do their part and meet you halfway.

Getting the cable company to approve the best possible deal depends on a number of factors:

1. How long you have been a customer and how well you pay your bill;
2. How serious you are about canceling service;
3. How many services you have;
4. Who you talk to.

The fewer services you have, the better the deal you can get from Time Warner’s retention department.  For example, a recently-ended promotion offered a year of free DVR service — but only for customers who don’t have a DVR box already.  If you already have phone, broadband, and cable service from Time Warner, scoring the most aggressive Triple Play promotion was a lot harder than it was for a customer with a single service.  But not always.  More often than not, deals that were not available from one customer service representative were available from another.

Let’s get started.

Call your local Time Warner Cable office and request to cancel your service.  You want to be transferred to a Retentions Specialist, authorized to extend special deals to departing customers.  Ordinary customer service representatives won’t have access to the best deals.

There is no reason to beat around the bush with the representative.  Just tell them “it costs too much” when they ask why you want to cancel.  You don’t need a sob story.  When you focus the representative on the money issue, you won’t have to navigate around their arguments about how bad satellite TV is or why the phone company offer isn’t as good.

The best savings and least red tape are won by new customers.  Judging from a few “shopping deal” websites we explored, it isn’t unprecedented for customers to cancel service and sign up under a family member’s name as a new customer.  But that method can be a major hassle.  Orders cannot be taken until an existing customer schedules a date to disconnect service.  Customers will also have to pay installation costs in some areas, and will lose their current Road Runner e-mail accounts.  We often found taking this drastic measure was not necessary — some existing customers managed to win deals just one or two dollars greater than a new customer would pay.

Time Warner’s most aggressive current offer is their triple play/$99 month offer, including cable-TV, phone, and Internet service.  Equipment costs extra, and that price comes before taxes and fees.  Virtually any customer currently taking broadband and cable-TV service can manage to score the $99 price when threatening to cancel service.  It also costs nearly $20 less per month than Time Warner’s price for just cable and broadband.  If you disconnect your landline, you will save another $20-50 a month and get unlimited long distance calling across North America.

Tweet Your Way to Savings.

Our reader Scott grabbed the $99 offer, and all it really took was a tweet to @TWCableHelp:

@twcablehelp Getting ready to cancel my #timewarnercable and take my $ elsewhere if they want new customers more than old.

After exchanging phone numbers, Scott was talking to a retention agent near Buffalo, N.Y., who secured a deal for him in about 10 minutes.

Time Warner says the national retention team has the keys to some of the best retention deals around — deals the local agents can’t always offer.

We did things the hard way — by phone, talking to multiple representatives, each who pitched us different deals, and rejected or accepted our counteroffers.  The diversity in responsiveness surprised us.

When Time Warner won't deal, one Buffalo resident called Verizon instead.

We spent time with Gennifer near Buffalo who ended up with a stubborn representative who refused to deal, and the call ended with a scheduled disconnect.

“I am not paying their higher rates,” Gennifer tells us.  “I’m switching to Verizon FiOS after this.”

Time Warner insisted she downgrade her add-on services before they would extend a deal her way.

“I am not going to have a cable company tell me what channels and services I should get, especially when the ‘other guy’ is cheaper,” she told us. “They obviously don’t want to keep me as a customer after years with them, so goodbye.”

Just an hour later, we were back on the phone with Time Warner easily scoring the $99 triple play promotion Gennifer couldn’t get, this time for a relative in Rochester, no questions asked.

“It is a great deal and we’re happy to extend it to you,” the representative told us.  (Gennifer eventually got that same offer talking to a different representative, but she’s still headed to Verizon FiOS regardless.)

Time Warner’s recently finished “12 months of free DVR service” promotion was much harder to get.  Representatives repeatedly told us the offer was not available to customers with existing DVR service, right up until they told us it “sort of was,” with some creative effort and the approval of the right supervisor.  Instead of that particular deal, another was offered worth nearly as much, with a one time credit making up the difference.  That works for us.

A particularly excellent representative, Tim, has gone all-out working on our account over the past three days trying to keep us happy.  Apologizing not less than two dozen times for various frustrations he encountered along the way, he’s still manning the wheel as he navigates around headaches thanks to a somehow-corrupted account and an obstinate Frontier Communications who is stubbornly trying to block the request to switch providers.  He continues to impress us as that journey continues, even offering a year of Showtime gratis to make up for all of the inconvenience.  Our “out the door” price will be around $132, including Turbo, a DVR box, a HD set-top box, Showtime, and a one time credit of around $25.  We were paying around $40 a month more, and will also save another $35 a month dropping our landline from Frontier Communications.

Seeing the back of Frontier Communications.

Time Warner’s willingness to deal gives us the chance to see the back of Frontier Communications, dumping their landline service.  In the process, we actually expanded the number of services we are buying from the cable company, and earning the chance to say goodbye to a phone company that has done little for this community in recent years.

When Frontier asked us why we possibly would want to cancel, we unloaded:

• The company’s insistence on Internet Overcharging schemes;
• The fact Frontier’s DSL service is at least a decade behind Time Warner’s broadband speeds;
• Frontier has done nothing for the Rochester area except provide slow and lousy DSL service — satellite TV as a triple-play afterthought doesn’t cut it;
• They charge too much and stick customers on term contracts that are expensive to cancel;
• We don’t have much confidence in Frontier’s long-term future with the ongoing exodus of customers.

Other Deals and Promotions

Time Warner broadband-only customers might be able to secure this deal, or pay Earthlink even less.

Not every customer will want a triple-play deal from Time Warner.  For those who want cheaper standalone broadband service, we recommend Earthlink’s six month promotion (available on Earthlink’s website), which is billed directly by Time Warner with no equipment changes:

• Standard: (equivalent speed to Road Runner Standard, without PowerBoost): $29.95/month for six months, $41.95/month thereafter;
• Turbo: (equivalent speed to Road Runner Turbo, without PowerBoost): $39.90/month for six months, $51.90/month thereafter.

After six months, switch back to Road Runner.  It should run $34.95 a month for the first year on a commonly-seen promotion.

We found a lot less savings for customers trying to lower the price of cable and broadband, without phone.  In fact, we found it was actually cheaper to take the bundled offer with phone service than finding a retention deal without it.  You are not obligated to use the phone service, of course.  They can assign you a new number you may or may not care to use.

Some other promotions to ask about:

• DVR Service: Rent one box at the regular price, get one free.  For homes who want two DVR boxes, ask if you can get the second one for free for the first year;
• Road Runner Turbo: This $9.99 add-on can be had for free for one year in some areas.  Ask the representative what they can do for you;
• Starz! $25 mail in rebate: Starz! is running a $25 mail-in rebate for new customers who keep the movie channel active for three months;
• Free Showtime: Although not promoted any longer, a year of free Showtime might still be available to those who ask and sign up for the $99 offer;
• Installation/Start Up Costs: Ask for free installation, if you are a new phone customer.  You will probably still pay the one-time $20 fee phone customers are charged, but let the cable company install the service for you for free.

If you are uncomfortable with the agent or the offers you are getting, tell them you still want to go ahead and schedule a disconnect.  Suggest a date a week in advance.  Then, a day later, call back Time Warner and again request to “cancel” service, telling the representative you want to confirm your disconnect date.  Often, they are amenable to reopening negotiations at that point.  Yesterday’s “no” may turn into today’s “yes.”

Don’t be intimidated if a representative tells you he’s unlikely to get a supervisor to approve a counteroffer you make in response to theirs.  Go ahead and tell them to check anyway.  More often than not, the supervisor will “surprisingly” approve your request or provide a better offer.  If you live in an area with “price protection agreements” and think something better might come along in the next year or two, fight to stay off of one -and- get the retention deal price anyway.

Step Four: Gratitude Expressed

If you got what you called for, be sure to thank the representative and get their name.  You might want to drop a message to the president of your local Time Warner Cable office to thank the company and mention the representative that helped you remain a customer.  Good employees deserve recognition and in the future, these are the people you will want to talk to when you call about something else.

In the end, it was a hassle to spin the “Wheel of Retention Deals” to see where it landed.  It sometimes took multiple calls to get the best deal, and we agree with Scott’s assessment that treating your best customers to the worst deals is not a great way to win customer loyalty.  Calling and asking for discounts is a necessary annoyance these days but we’d rather never have to do it.  The next step is outright cancellation of services like cable-TV, so Time Warner gets something out of the process as well.  We just wished the representatives were given the tools to be more consistent.

As we’ve always said here — we have no complaints about the quality of the local employees who manage and maintain the service we’ve subscribed to for well over a decade.  Our beef has been and probably always will be with the corporate decision-makers who conjure up the rate increases, experiments of Internet Overcharging schemes, and other annoyances.

More than 160,000 ordinary Canadians have signed a petition telling telecom companies to back off their Internet Overcharging schemes.  The NDP has adopted an anti-Overcharging position, and now Openmedia.ca, an ally of ours, is spearheading an effort to get the larger Liberal Party involved in the fight against Internet ripoffs.

Deep pocketed cable and phone companies have invaded Ottawa with their lobbyists and friends to try and keep your broadband bill as high as possible. We can trump their hand, but only if you get involved.

With Canadian government pressure, the CRTC will fold like a wet newspaper.  Openmedia is trying to collect a historic 200,000 signatures, and starting today every signature will send e-mail to the inbox of Michael Ignatieff and Liberal Party Digital Critic Pablo Rodriguez, encouraging them to join the fight.

If you don’t want to pay through the roof for your broadband, hurry and add your name to the petition.  Ottawa has been surprised by the backlash from everyday consumers from BC to PEI.  Now let’s deliver the death blow to Internet Overcharging and tell Bell, Rogers, and Shaw to enjoy the fat profits they already earn, and stop the gouging.

Tell your friends:

• Email the petition link: https://openmedia.org/en/ca/look-back-our-stop-meter-campaign
• Share it on Facebook: http://www.facebook.com/sharer.php?u=http%3A%2F%2Fopenmedia.ca%2Fmeter&t=Stop%20The%20Meter%20On%20Your%20Internet%20Use%20%7C%20OpenMedia.ca&src=sp
• Tweet it: https://mobile.twitter.com/session/new