Usage Based Billing is an Unfair Bad Bargain

And now, News from the North* with regard to Usage Based Billing and the coverage thereof.  First, a long and boring intro for those who are unfamiliar with the situation.

All of the radio, TV, Internet, etc in Canada is run by the Canadian Radio-Television and Telecommunications Commission, or CRTC.  That is, if it involves using electricity to send information a long distance, it’s the CRTC who manages the connections.  Why is it set up like that?  The same reason that everything in Canada is set up as a Crown Corporation and not a bunch of small competitive businesses.  Because, in the early days when Canada was just getting itself together, there was this massively powerful emerging country to the south whose competitive businesses could easily stamp out our own.  Therefore, Canada stuck whatever resources it had all together, so we would have something that would survive and remain Canadian.  The fact that we use our Canadian media to tune into American content anyway is one for the Irony Files. 

Fear not that I have painted a picture of Soviet Canuckistan as a socialist wasteland.  It is required, by law, that our big ISPs (Bell, Rogers, and Shaw) must lease some of the infrastructure to smaller companies.  Even though it’s the big guys who built our infrastructure, they have to allow for some competition.  Now, these little guys often offered better deals and lower prices, until one day…

Dun dun dunnnnn.



Today, because people are using the Internet more and more, and for bigger things (such as downloading movies), the big companies complained.  The big companies feel that they are being undercut by competitive pricing, and I could debate either side of this fairly well, but the point is, the CRTC stepped in.  The complaint of the big companies** is that the little companies to which they’re forced to lease are offering customers unlimited usage.  This costs money.  The little companies don’t have that kind of money.  The CRTC said they’d solve that by making the consumer pay per byte for Internet usage to cover the cost.

Well, they said they’d make the little companies charge extra if their customers buying “unlimited” Internet use went over a certain limit.  The little companies will either go bankrupt, or pass the costs on to the customers.

Yeah, I know.  I’m not happy either.

So that is what Usage Based Billing, or UBB, is.  Now, if you’re still awake, I’d like to discuss what it means for progeeks.

It means something very bad.  How many of us rely on YouTube to get our videos out there, or use MySpace to promote our music?  How many of us are involved in collaborations that require online meetings?  How many of us live and breathe online, simply because that’s where we need to be to do what we need to do?  In the already highly competitive situation of indie media, can we really handle the added trouble of paying extra money so we can do our own work?

Let’s say a progeek can afford the extra cost of going over the byte cap (and therefore paying the extra fees).  What about their fans?  Even if I can afford to put a nifty website up to promote my homemade game, what is that worth if none of my fans can go there and download it?  If UBB is allowed, then that is punch in the face to Internet-era entrepreneurs everywhere.  Even if you live in a country that manages its communications system a bit better, UBB in Canada could still cost you some of your Canadian fans.  Not to mention, this opens the door for such a thing to happen in other countries (because governments are big fans of precedent and see “someone else did it” as a good reason to do something).

In the US, there is currently no byte cap simply because it would be so unpopular.  No company would want to be the first do it, because it would make their client base hate them and therefore move elsewhere.  However, this is early in the game.  Watch what happens when Internet usage gets even heavier and the infrastructure doesn’t keep up.

Although no specific sites have been explicitly targeted, many believe the “network traffic” the CRTC means to manage refers to sites like Netflix and BitTorrent.  And really, you can’t deny that, for whatever reason, bandwith usage is skyrocketing.  Internet traffic grows 30% every year, and ISPs are struggling to keep up.  But is the answer to charge more, especially when that means piling on the extra fees to even the average consumer?  One of the main arguments pro-UBB (or, more likely, “Why should I care about UBB?”) is that it’s only the people who sit around downloading things all day who are going to be paying extra.  Well, that is true, for now.  At the moment, the extra charges associated with exceeding this proposed byte cap would only affect approximately 10% of users.  That’s now.  But remember, if we’re growing at a rate of 30% each year, how long will it be until you and I are paying big bucks for what has become an unavoidable part of life?

Sadly, the pro-UBB arguments I’ve heard base themselves on consumer greed.  Of course, this is not the case of some greedy jerk using up all the Internetz.  Usage is increasing anyway.  It’s based on the speed and quality at which information is transferred, which is going to increase whether you sit around downloading movies all day or not.  Telling the average consumer that their answer is to avoid exceeding the cap is like telling the average household today to keep their budget under the cost of living from sometime back in the 1970s.  Even if you cut back, your numbers will never be that small because the world has changed.  The Internet has changed.  I believe that, instead of charging customers based on how they use the Internet, the CRTC should be beefing up the current infrastructure.  Sure, we’ll have to pay for that too*** but at least that serves us better.  It is better to update the system so that it works more efficiently than it is to get people to cover the gaps**** in the budget.  Being a big ISP here is like being a landlord with a leaky roof and charging tenants for buckets and duct tape.  Maybe it’s time for Bell to fix the [profanity] roof.

Thankfully, there is a meeting today between Industry Minister Tony Clement and CRTC Chairman Konrad von Finkenstein, and it looks like this UBB thing is going to be more of a temporarily proposed political brainfart rather than the new normal.  We’ll see what happens by the end of today.

Finally, if you’re still with me, I want to report about the way this story was covered.  I listen to news radio, read newspapers, and occasionally watch television news, and UBB didn’t get much attention.  So where did I read up on all this?  Twitter and blogs.  Now, we’ve seen how Twitter is used in politics in more extreme cases (from Iran in 2009 to Egypt right now), but what about in stable democracies?  For one thing, everyone has a Twitter account.  A friend of mine first alerted me to the issue.  Due to his job, he has to travel a lot, so the only time we ever really communicate is on Twitter.  It would not be possible another way.  He tweeted a link to an article about UBB that was written by our former professor.  From there, I followed more Twitter users and more blogs.  The Internet was how I found and signed this petition, as did over 300,000 of this country’s citizens.  Tell me, how many petitions get that kind of attention, and how else could this one have gotten such a response without the Internet? 

The big players know of the Internet’s power as well.  I have seen confirmed Twitter accounts belonging to Tony Clement, Prime Minster Stephen Harper, Opposition Leader Michael Ignatief, (who are ALL against UBB) and… yes, even the CRTC’s PR department.  The Internet has not only enlightened concerned citizens as to the situation of UBB, but it has also given people a voice with which to respond.  It has allowed for two-way communication between the people and their government, and between the people and the CRTC.  Indeed, the Internet is helping us shape our democracy, beginning with ensuring that we may use Internet as needed.  Call it a little happy news, and another story for the Irony Files.

*I assume, with no basis to do so, that most of our readers are American.
**Who can totally afford to pay for it, trust me.
***In our taxes, because it’s government money.
****read: gaping holes

-Tamara Hecht

  • http://tinyurl.com/UBBExplained Alex

    Bear in mind that measuring data transmitted over billing period is a disingenuous way to gauge network strain.
    Usage based billing is a non-technical solution to a technical problem that doesn’t exist.
    http://tinyurl.com/UBBExplained.
    The basic gist of it is that nobody can use “more internet” than they are sold. If big, greedy ISPs are complaining that people are using too much bandwidth, why have they sold them so much?
    To make matters worse, news and pro UBB shills have resorted to misusing terminology and totally dodging explaining just exactly whether there is a strain on their networks or not.
    Can it get any more asinine? Yes! They act like UBB is the only way to make money when they fail to realize they’re already charging some of the highest base subscription fees for some of the worst internet access in the world!
    We have far more indicators than we’d never need to show that UBB is the big greedy telecom giants reaching shoulder-deep into the cookie jar.

  • http://profile.typepad.com/tamara126 Tamara Hecht

    @Alex
    You raise a good point, but I am thinking (and hoping!) it’s over with. It seems like everyone, including those in the government, is against it. I believe Tony Clement told the CRTC today to drop UBB or they’d drop it for them.