One further follow-up today to yesterday’s post about the dystopian future of Canada’s increasingly compartmentalized internet. University of Ottawa internet law professor Michael Geist wrote last week about how the real story behind Teksavvy’s new plans was not the company’s price hikes, which is what many media stories focused on, but its differentiated services.
The CRTC’s new capacity-based billing (CBB) system is a good thing, he said, because it allows smaller internet providers to get creative with the plans they offer. Teksavvy, for example, is now offering service with generous caps during the day and unlimited downloading during the night, which are plans that none of the big ISPs are currently matching. This is a good thing for competition.
Geist is, of course, absolutely right. It’s obvious by comparing Teksavvy’s plans to the big guys’ that they are considerably cheaper and have more generous caps. If the smaller ISP can poach enough customers, the big guys may be spurred to action and offer similar plans, which would be a textbook case of how this whole messy regulatory system is supposed to work.
There is, however, a perverse competitive side effect from the CRTC’s new CBB scheme: there is now an effective dollar value assigned to a throttled internet connection.
Teksavvy offers both cable and DSL services. In its main operating area of Ontario, these connect largely to Rogers’ and Bell’s respective networks. Bell recently announced that it was cutting out its throttling practices – which slow certain uses of the internet, particularly file-sharing – on both retail and wholesale customers. Rogers, meanwhile, continues to reign as the global king of throttling.
Teksavvy is offering virtually the same speeds and usage caps over both cable and DSL, but at the higher end the prices are different depending on the type of connection. A 24-megabit-per-second connection over cable with 300 gigabytes of usage, for example, is $46.95 while 25 mbps on DSL with the same usage is $52.99, a difference of $6. The discrepancy on the highest-end plans – 24 or 25 megabits with unlimited usage – is even greater: $61.95 for cable versus $77.99 on DSL, or $16.
So there you have it: a price tag on throttling. If you want a fast connection with generous usage that isn’t slowed down, you’ll have to get a DSL connection and pay between $6 and $16 to get it. The hope is that Rogers will eventually feel some sort of competitive pressure and knock off its own throttling, but in the meantime, there it is.
Innovative, isn’t it?