Canadians About To Reach For Their Ankles

200GB to 25GB: Canada gets first, bitter dose of metered Internet

"Metered Internet usage (also called "Usage-Based Billing") 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.

"Like our customers, and Canadian internet users everywhere, we are not happy with this new development," wrote the Ontario-based indie ISP TekSavvy in a recent e-mail message to its subscribers.

But like it or not, the Canadian Radio-Telecommunications Commission (CRTC) approved UBB for the incumbent carrier Bell Canada in September. Competitive ISPs, which connect to Canada's top telco for last-mile copper connections to customers, will also be metered by Bell. Even though the CRTC gave these ISPs a 15 percent discount this month (TekSavvy asked for 50 percent), it's still going to mean a real adjustment for consumers.
This is going to hurt

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.

Wired ISPs have large fixed costs of building and maintaining their last mile network of residential cable and fiber. The ISPs' costs, however, to deliver a marginal gigabyte, which is about an hour of viewing, from one of our regional interchange points over their last mile wired network to the consumer is less than a penny, and falling, so there is no reason that pay-per-gigabyte is economically necessary."

update 2/2/11 - Ottawa to reverse CRTC decision on Internet billing