Their bull got you right in your wallet.

The next time you hear a provider telling you usage-capped broadband is the way the rest of the world does business, understand one thing:

They are lying to you.

Stop the Cap! conducted extensive research on just what kind of broadband plans are sold around the world. We researched every member country of the Organization for Economic Cooperation and Development, and included several developing and non-aligned countries for good measure.

Our findings are conclusive: Unlimited broadband packages are the global norm. Some providers sell a mix of “light use” plans with usage allowances, but almost always side-by-side affordable, unlimited use options for those who want them. The only exceptions we found:

• Australia: The most common reason for usage caps comes from lack of capacity.  Countries in the South Pacific continue to experience international capacity shortages that are gradually easing with the introduction of new underseas fiber cables.  Several providers have promised to ease or eliminate caps as new capacity comes online.
• Canada: For reasons of marketplace concentration, lack of competition, and regulatory malpractice, Canadian broadband has lost its former status as a world-leader in broadband and has now become an also-ran, with almost universally usage-capped and throttled broadband from large cable and phone companies delivering expensive, comparatively slow service.
• Iceland: International capacity problems limit international broadband traffic with usage caps, but some providers offer unlimited service for domestic traffic.
• New Zealand: Just like Australia, New Zealand suffers from international capacity problems not seen in Europe, North America, or continental Asia.  Both Australia and New Zealand are using public finances to overcome broadband shortages and reduce or eliminate usage caps.

Some providers in the United States are following Canada’s lead attempting to monetize broadband traffic to maximize profits.  Some Canadian providers claim usage-based billing is necessary to finance the construction of broadband networks across the broad expanse of rural Canada.  Yet Russia, a far larger country with fewer financial resources, succeeds in delivering unlimited service where Canada fails.  Their arguments just don’t add up, and combined with the reality we present here proves providers are telling tall tales about the need for their Internet Overcharging schemes.

If Albania can deliver unlimited Internet access, why can’t your provider?

Bell's Broadband Shell Game (image: Dave Blume)

The digital equivalent of a Trojan Horse was laid at the feet of Canadian telecom regulators Monday when officials from Bell, Canada’s largest phone company, announced they were withdrawing their controversial proposal to mandate usage-based billing on all wholesale broadband accounts.

The original proposal would have mandated that independent Internet Service Providers bill each of their individual customers a monthly fee based on their Internet usage in addition to the wholesale access rates paid to Bell all along.  The pricing proposal would have forced every ISP in Canada to abandon flat rate Internet service, raise prices, reduce usage allowances, and increase overlimit penalties.

Now Bell has told the Globe & Mail newspaper it wants to introduce something called “Aggregated Volume Pricing” instead — a plan Bell claims will shift financial penalties for “high usage” away from individual customers and onto the ISPs themselves. Bell also slashed the proposed overlimit fee from a heavily-defended-as-fair $2.50 per gigabyte to a more modest $0.30/GB, perhaps echoing AT&T’s forthcoming overlimit fee.

In fact, Bell’s revised plan is the same Internet Overcharging scheme under a new name.

The radical reduction in overlimit fees only further illustrates the “phoney-baloney” of providers attempting to monetize broadband usage under the guise of “fairness” and “congestion relief.”  Last week’s ’eminently fair’ $2.50 is this week’s ‘more than reasonable’ $0.30.

Bell exposed their hand — showing they have been bluffing about congestion all along.  An analysis of the proposed rates shows the company is still trying to target “heavy users.”  But instead of penalizing them into reducing their consumption, Bell is now seeking to monetize that usage, not control it.  By shifting aggregate usage costs to the wholesale market, Bell hopes individual customers will blame independent ISP’s for higher bills, not them.  Independent providers have to pass along their wholesale costs as part of the retail price of their service.  It’s a high tech shell game, one that consumers will always lose.

Despite this, Bell assumes the revised plan will take the bipartisan heat off its backside since it first proposed doing away with flat rate Internet service in Canada.

“With our filing today, we are officially withdrawing our UBB proposal,” said Mirko Bibic, Bell’s head of regulatory affairs. “Let’s move on, in my view, and use the CRTC hearing as an opportunity to approve those principles and get the implementation details right.”

"We don't like (Bell's proposal)."

Several Canadian officials were not impressed and one — Industry Minister Tony Clement — said exactly that.

Canada’s consumer groups and politicians have the giant telecom company on the run after using Bell CEO George Cope’s own words against him.  Cope openly admitted in conference calls with investors UBB had everything to do with monetizing broadband usage for profit.

Bell’s attempt to serve warmed-over Internet Overcharging from a new recipe isn’t flying among consumer groups either, who recognize it as more of the same leftovers, just under a new name.

Bill Sandiford, who heads a coalition of wholesale ISPs called the Canadian Network Operators Consortium, told the Globe & Mail Bell was simply presenting its usage-based pricing model in a more acceptable guise.

“We don’t think this is an about-face. It’s the same thing, just dressed up differently,” Mr. Sandiford said. “We don’t like it. It’s still wholesale UBB.”

Openmedia.ca, an online activist group, said Bell’s new proposal shows consumers are having an impact, but the fight is by no means over.

“We’re pleased that Canadians will now have the option to use indie ISPs like Teksavvy and Acanac to access the unlimited Internet,” said OpenMedia.ca’s Executive Director Steve Anderson. “This is a giant step forward for the Stop The Meter campaign, and a victory for those who support competition and choice in Canada’s Internet service market.”

“While this is a positive move, it is only a Band-Aid solution to a much larger problem. We at OpenMedia.ca hope the CRTC takes Bell’s submission as a sign that widespread usage-based billing is not an acceptable model for Internet pricing, and that it creates policy to support the affordable Internet.”

AT&T’s support forums are being censored to stop a free and open discussion about the company’s elimination of an unlimited Internet experience.

We received word this morning from Stop the Cap! reader Roger, who tried to post a message including a link back to one of our stories exposing the myth of AT&T’s “congestion problems” to share with the large community of readers angry with AT&T about its Internet Overcharging scheme on its support forum.

“AT&T will not allow people to post links to your website,” Roger writes.  “Both myself and a friend of mine tried on two separate occasions to write messages that quoted from your facts and figures and linked back to them for readers looking for additional information, and AT&T removed them within minutes.”

Stop the Cap! can confirm AT&T is actively engaged in censorship on its support forum when I tried posting a message myself to test the theory, under my real name, including three links to three individual stories, and signed with a link back to our website’s home page.  Sure enough, within the hour, AT&T stripped out the links and implied we “revealed personal information” (about myself in the form of my name, which still appears as my ‘handle’) and were “spamming” the forum — a stretch when the only links were back to the content referenced in the piece.  A few other linked sites, including Broadband Reports, are not suffering the same fate when users link back to their content, at least for now.

(click to enlarge)

AT&T followed up claiming it does not allow messages that support the work of third-party groups, even if that “support” comes only from links back to content referenced in the forum.

“At least your message remained partially intact,” Roger adds.  “Ours were deleted completely.”

“With AT&T’s heavy handed ‘editors’ at work, no wonder there are concerns about Net Neutrality.  AT&T censors first, asks questions later.”

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.