Bell Says Jump, CRTC Jumps

The CRTC is such an obedient little corporate lap dog. When Bell says jump, the CRTC jumps. Usage based billing was a approved several months ago but the CRTC stipulated that UBB could only begin once Bell had eliminated all its unlimited accounts. Bell asked the CRTC to reconsider this requirement. The CRTC jumped.

Now, accounts created before 1 January, 2007, will be grandfathered. On Bell's retail side this means they won't have to eliminate many unlimited accounts since they stopped offering that option in 2007. On the wholesale ISP side, accounts created before 2007 will not be subject to UBB. Unfortunately, I signed up with TekSavvy in October 2007, so I'm going to be UBBed, starting in 90 days.

Considering I use about 60 to 100GB per month and the UBB cap is only 60GB, my paltry 3 Mb/s Internet access is about to become very, very expensive. To cover the cost, I'm going to cancel all the features on my land line and reduce it to the basic phone service, which is needed for the DSL. Effectively, Bell is not making any more money from me than it did before UBB. I'll be sure to tell the Bell CSR exactly why I'm cancelling the services.

Nobody at Bell will care why I'm reducing my services. Bell's goal is to eradicate the wholesale ISP competition and UBB is a big step towards that result. One of the mandates of the CRTC is that it must foster competition in the telecom market, which is directly at odds with Bell's goal. Sooner or later, the CRTC is going to have to answer for being Bell's obedient corporate lap dog.

Speed Matching

Yesterday the CRTC issued a ruling that requires Bell and other ILECs to offer wholesale ADSL speed matching to the independent ISPs. On the face of it, it looks like a big win for consumers, but I not convinced.

Although the higher speeds are great, the main problem is the independent ISPs would still be using the ILEC's Gateway Access Service (GAS), the aggregation infrastructure that connects wholesale ISPs to their customers. That means the connections are subject to throttling, deep pack inspection, usage based billing, and anything else that the ILEC can dream up. That actually makes it harder for the independent ISPs to differentiate themselves from the ILEC's Internet services. That's not good for consumers.

Some ISPs were asking for a new service (dubbed ADSL-CO) that would allow them to install their own DSLAMs into Central Offices, but the CRTC has ruled against this option, at least for now. This service couldn't offer the full range of speeds which would be limited by the customer's distance to the CO. There's no doubt that there are significant technical challenges for installing ISP equipment in COs. In addition, each CO needs a non-ILEC network back haul, which would have delayed wide spread deployment. The CRTC likely took these factors into consideration in its decision. But in the long term, it would have been good for consumers.

The ILECs would definitely have lost revenue with ADSL-CO since GAS would no longer be required. The CRTC has mandated that wholesale ISPs will pay a 10% surcharge on the tariffs for the higher speed to compensate the ILECs for the investments that they've made. So the ILECs are actually making more money with this decision! What a sweet deal! Not only that, the ILECs remain firmly in control of the ADSL market.

To me, it looks like the real winners are the ILECs, not the consumers.

Paying For Actual Speed

Every ISP wants users to pay for actual usage. Fair enough, but how many mention paying for actual speed you are getting? It's ridiculous that I should pay the same for a DSL connection whether I'm 1 km or 3 km from the Central Office. The difference in maximum possible speed is significant between those distances. The ISPs never mention this difference at all, except as a vague "up to" references in the advertising.

CRTC Is Concerned

The Canadian Radio and Television Commission (CRTC) released a report which confirms that telephone and TV costs are rising out of control. Well, duh! is all I can say. This situation was inevitable in a deregulated market with a grand total only four suppliers, who do not even compete with each other in every region of the country. Of course, it doesn't help that the CRTC agrees to almost everything that Bell, Rogers, Telus, and Shaw wants.

It is possible to get out of this mess but it requires the Federal government to change the regulations. Fortunately, Minister Of Industry Tony Clement understands the need for changes. Unfortunately, we have a minority government that is acting like yahoos, so those changes are not going to happen before the next election.

Touch Tone Fee

Bell Canada introduced touch tone in the 1970s and added a charge on everyone's phone bill to cover the cost of the upgrades. Here we are, forty years later, and the fee is still on everyone's phone bill. Apparently the charge pays for "other" upgrades now. Yeah, it's more like an upgrade to their profits. Just a small example of why monopolies are bad.

The Competitor Returns

The Industry Minister has overruled the CRTC and given Globalive the green light to enter the Canada telecommunications market. That's great news for cell phone competition in Canada. Micheal Geist thinks it may even be a precursor to changes in the laws regarding foreign ownership.

I'll bet the incumbent telcos are fuming over all that lobbying money they wasted on the CRTC to get Globalive disqualified. Even now they must plotting their revenge, digging up dirt on Minister Tony Clement... What? You think they wouldn't? It's suicide for politicians to go against their corporate masters.