Thursday, November 17, 2011

Canada: Final(?) Decision - No UBB for Bell Canada Wholesale Service

A year ago the Canadian regulator, CRTC, allowed Bell Canada to use metered (usage based) billing (UBB) for its wholesale broadband service (here). Since then ISPs announced their intention to apply the overage charges to their subscribers (here and here), the CRTC delayed the decision (here), the Canadian government said it will overrule the CRTC UBB plans (here) and Bell said it is rethinking it (here).

Now, the CRTC made a new decision, and rejected the wholesale usage based billing idea. See "Telecom Regulatory Policy CRTC 2011-703" - here.

  • The Commission has decided that there are two acceptable billing models. The first is a capacity-based billing model in which independent service providers determine in advance the amount of capacity they will need. Should demand exceed this capacity, they will have to manage their network capacity until they purchase more. The second model is the existing flat rate model, where independent service providers pay a flat fee per month regardless of usage.
  • The Commission has also decided that rates for either model should be based on each of the individual large cable and telephone companies’ costs to provide the service plus a reasonable markup, and further, that these markups be comparable for all cable and telephone companies. As an exception to this and consistent with the Commission’s decisions in Telecom Regulatory Policy 2010-632, the telephone companies may charge an additional 10 percent markup for usage and access to the faster fibre-to-the-node services. This will encourage companies to continue to invest in this new technology.
See also Michael Geist post "The CRTC's UBB Decision: Bell Loses But Do Consumers Win?" - here.

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