The broadband news of the day on Thursday was Comcast’s announcement that it was axing its data cap of 250 gigabytes a month, while testing a new 300 GB limit in certain markets.
In a blog post, the largest U.S. internet service provider said it was doing so because it realized that in recent weeks the conversations about its new products were “focused on our data usage threshold, rather than the exciting opportunities we are offering our customers.”
Critics were quick to jump in. Rabble rousers Free Press issued a statement criticizing Comcast’s plan to charge people who went over their caps an extra $10 per 50 GB.
“Comcast has never had any legitimate reason to cap its internet customers and today’s announcement of new overage charges is just another example of the cable giant’s efforts to discriminate against and thwart online video competition,” said Free Press policy advisor Joel Kelsey. “Data caps are not a reasonable or effective way to manage capacity problems, which are virtually non-existent for Comcast.”
Like Free Press, Netflix also lambasted the cable company for continuing to give a free ride to Xbox video content. Comcast previously announced a deal with Microsoft wherein the content wouldn’t count against customers’ data caps.
On that front, there’s a very clear net neutrality violation going on and Americans have every right to be up in arms. But complaints over caps being scrapped or raised to 300 GB? As we like to say up here in Canada: Give us a frickin’ break.
In central Canada, internet subscribers are lucky to get 70 GB a month. A 250-300 GB plan from the likes of Bell or Rogers will run upwards of $100 (Bell’s 300 GB service is a whopping $134), whereas on Comcast such plans start at $30. With many studies finding that Canadians use the internet just as much as Americans, if not a bit more, well… that means it’s time for analogies. It’s like Canadians are being asked to drive just as far as Americans, but on a quarter tank of gas. To use one telecom company’s favourite comparison, it’s like Canadians eating at the same buffet, but having to pay four times more. Which is completely unfair because we all know how much Americans love buffets.
So, how has this giant disparity in usage caps between Canada and the U.S. happened? Actually, the better question is how can a country with a regulatory regime that is supposed to promote competition from smaller wholesale ISPs, which will keep the big players honest, have miniscule caps in comparison to a country that doesn’t have such a set-up? If you answered anything but “total regulatory failure,” you’re wrong.
The CRTC has been dealing with this whole usage-based billing issue for years now. In the end, the regulator allowed itself to be snookered by the likes of Bell and Rogers into believing that some sort of pay-as-you-go scheme was needed to make sure the wholesale ISPs coughed up their fair share, to cover the costs of all this supposed congestion occurring on their networks. Bell was particularly successful, since it convinced the CRTC that its network costs were much higher than other big ISPs’, so it should be able to charge wholesale customers accordingly more.
The most galling part of it is that just as soon as the CRTC alleviated these cries of poverty, the giants turned around and spent hundreds of millions of dollars on the unnecessary purchase of sports teams. Together, to boot.
The regulator is now refereeing arguments between the big network owners and wholesale companies over just how much extra those small players must pay. If CRTC commissioners had any concept of reality, they would look to what’s happening down south and tell Canadian network owners to stuff it.
Wholesale ISPs shouldn’t have to pay anything more, which would mean they could offer even cheaper plans with big monthly usage allotments. That might actually lead to gaining some market share, which would inevitably force the big ISPs to lower their prices and raise their caps.
But nope, that’s not going to happen. Instead, Canadian internet users are just going to have to sit there and fume over the fact that Americans are crying over their relative excess of riches.