So much for net neutrality . . .

I don't know whether my readers in the USA, Europe and the rest of the world have been following developments in Canada concerning internet usage, but they're very interesting . . . and likely to affect the rest of us before too long. Ars Technica reports:

Metered Internet usage (also called "Usage-Based Billing") [UBB] is coming to Canada, and it's going to cost Internet users. While an advance guard of Canadians are expressing creative outrage at the prospect of having to pay inflated prices for Internet use charged by the gigabyte, the consequences probably haven't set in for most consumers. Now, however, independent Canadian ISPs are publishing their revised data plans, and they aren't pretty.

. . .

Starting on March 1, Ontario TekSavvy members who subscribed to the 5Mbps plan have a new usage cap of 25GB, "substantially down from the 200GB or unlimited deals TekSavvy was able to offer before the CRTC's decision to impose usage based billing," the message added.

By way of comparison, Comcast here in the United States has a 250GB data cap. Looks like lots of Canadians can kiss that kind of high ceiling goodbye. And going over will cost you: according to TekSavvy, the CRTC put data overage rates at CAN $1.90 per gigabyte for most of Canada, and $2.35 for the country's French-speaking region.

Bottom line: no more unlimited buffet. TekSavvy users who bought the "High Speed Internet Premium" plan at $31.95 now get 175GB less per month.

"Extensive web surfing, sharing music, video streaming, downloading and playing games, online shopping and email," could put users over the 25GB cap, TekSavvy warns. Also, watch out "power users that use multiple computers, smartphones, and game consoles at the same time."
You need "protection"

Here's the "good" news: TekSavvy users can now buy "insurance," defined as "a recurring subscription fee that provides you with additional monthly usage." For Ontario it's $4.75 for 40GB of additional data (sorry, but the unused data can't be forwarded to the next month).

There are also "usage vault" plans - payments made in advance for extra data. Consumers can buy vault data for $1.90/GB up to 300GB in any month.

Where once TekSavvy consumers could purchase High Speed Internet Premium at a monthly base usage of 200GB for $31.95 a month, now they can get about half of that data (if they buy two units of insurance) at $41.45 a month.

Starting to hate this? TekSavvy hates it, too.

"The ostensible, theoretical reason behind UBB is to conserve capacity, but that issue is very questionable," noted the ISP's CEO Rocky Gaudrault on TekSavvy's news page. "One certain result though, is that Bell will make much more profit on its Internet service, and discourage Canadians from watching TV and movies on the internet instead of CTV, which Bell now owns."

. . .

The big question now is how these kind of billing changes will impact 'Net consumption patterns. Many subscribers use minimal data, but that's changing as Internet video becomes the norm. If these new plans simply discourage data hogs from backing up their 120GB pirated movie collection over the 'Net every night, there's no sleep to be lost. But if they scare consumers away from legitimate non-ISP affiliated movie and content sharing sites, that should be a firebell concern to consumers, entrepreneurs, and regulators.

And not only in Canada.

There's more at the link.

Commenting on Teksavvy's new limits, Karl Denninger points out:

Well now. That would be about 20 hours of SD viewing, and a bit less than 10 of HD on Netflix, assuming no other usage. Across all devices. Or, to put this in a bit better perspective, about 20 minutes a day.

Overage? $2/gb, or about two bucks an hour of use on SD and $5/hr on HD.

There goes Netflix's "$8 all you can eat" buffet!

. . .

So now to watch an hour of Netflix a night you'd need to spend not $8, but about $13, and for two hours a night (especially if in HD) it's closer to $20.

Again, more at the link.

Trouble is, the owners of backbone data networks want it both ways. They want to charge us, the consumers, for using their bandwidth; and they also want to charge those who provide the bandwidth-intensive content we consume! Ars Technica again, in a different report:

Poor Internet providers. They have to carry all that horrible, horrible traffic from Netflix and YouTube, and they just can't afford it anymore. Unless they start charging end users 21 percent more for Internet access, or unless they're allowed to bill Internet companies at 3.7¢ per GB, the Internet could "become unusable at peak times" due to congestion.

The huge incumbent ISPs have a fairly obvious agenda for the future of the 'Net, one that involves traffic prioritization, more "managed services," and high prices, but rarely is the wish list on such prominent display as in a recent report from consultancy A.T. Kearney. Four of Europe's biggest ISPs - Deutsche Telekom, France Telecom, Telecom Italia, and Telefónica - commissioned a study from the company on "A Viable Future Model for the Internet" (PDF), which involves giving lots more money to ISPs.

The basic argument is simple and well-known. The ISPs claim that they just can't afford all the investment they've been making, and that's it totally unfair that companies like Netflix get to make nice business on their pipes without paying their fair share.

. . .

The report is worth a read, if only to see how the next ISP push to charge more money will look. Commissioned by big European operators, it's not surprising that the targets are generally content companies - especially American content companies.

. . .

ISPs really do seem to believe that content companies are "dumping" traffic onto their networks, but the "source" of all that traffic isn't the content companies; it's the users who have chosen to access those services. Having popular online services is of course the very reason that people pay for Internet access in the first place.

While usage-based billing has already come to places like Canada, it's clear that ISPs would like to extend it to Internet companies as well as to end users.

Read more at Ars Technica.

So, the owners of backbone network infrastructure want to restrict my use of the bandwidth they've contracted to supply to me, and/or charge me a lot more for unrestricted or high-volume usage; and they also want to charge the companies whose services I'm consuming, to allow them to provide their services to me over the same bandwidth I'm already paying for!

Can you say 'extortion'? Can you say 'double-dipping'? I thought you could . . .

I understand that the provision of network infrastructure for the Internet has cost a great deal of money: but the owners of that infrastructure have already recovered those costs, either through charging end-users directly, or through charging other Internet Service Providers (ISP's) for the use of their infrastructure, or through Government subsidies to make it economically feasible to build the network in the first place. For them to protest that they need to pay for it all again is disingenuous at best. Furthermore, I know that new technology will require a great deal of money to upgrade network infrastructure; but once again, those costs are and will be covered by the monthly charges levied against users.

For them to try to charge at every level of the Internet - content providers, service providers, and end users - is greed, plain and simple. We need to start making our voices heard in protest, and let them know that we won't stand for it. I think we can exert enough pressure to short-circuit this money grab before it gains too much momentum . . . but only if we start now, and only if enough of us get involved. If we ignore the problem until UBB is implemented by our own service providers, it'll probably be too late.

Peter