Les Routledge

Von Finckenstein said the CRTC review will evaluate the original decision to verify it protects consumers, ensures those who use the Internet “heavily” pay for their “excess use,” and enables small ISPs to retain “maximum flexibility and continue to be a key source of innovation in the industry.” Winnipeg Free Press

The industry claims that usage based billing is necessary to manage heavy traffic, reduce network congestion, and maintain quality of service for all subscribers.  If the goal of bandwidth caps and usage based billing is indeed focused on achieving those outcomes, the incumbent operators should propose a voluntary policy for the use of caps and UBB.  

Having decided to review this decision, however, Mr. Clement is embarking on somewhat more than that. He’s beginning a review of independent telecom regulation as a functioning institution in the federal government. (Globe & Mail)

I agree with the above comment.  As I indicated in a previous post, there is a deeper problem here than one unpopular decision by the CRTC.  There is a perception that the current structure of the market is not functioning effectively.

The recent turmoil about usage-based billing and bandwidth caps indicates that all is not well in the competitive model of the telecom industry.  The government is discovering that competition in the Internet market is a hot button issue.  Consumers appear to perceive that the industry is rife with price gouging, anti-competitive tactics, and self-dealing among the incumbent telco and cable system operators.  There is an expectation that government will take action to fix the problem.

The question is, what sort of action will fix the underlying problems with the competitive structure of the broadband market place?

Back in 2008, Google posted a thought provoking article outlining the concept of “customer owned fibre” as a mechanism to deal with some of the competition issues in the broadband market.  The concept is to rethink how the market works for the provision of broadband access and restructure it so that competition is built into its structure from the start.

The Harper government will overrule a recent decision by the Canadian Radio-television and Telecommunications Commission that effectively kills unlimited Internet-pricing packages — unless the telecommunications regulator backs down first, Postmedia News has learned. (see article)

While this decision should be welcomed by opponents of the CRTC  decision, the bigger question is why was the CRTC placed in this position to begin with?

On Tuesday, Michael released an article on UBB and bandwidth caps.