Internet 'Usage Based Billing' on the way - TekSavvy as alternative?

Started by Kithop, January 14, 2011, 01:23:38 AM

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Selkit

I'm actually attempting to get a meeting arranged with my local MP, to discuss the issue and put forth concerns. Hopefully enlighten a politician. Unfortunately, the local here is Conservative, but one would hope that they will open their eyes and realize that this is threatening to become an HST scale unwanted affair with the public.

Silvermink

Quote from: Selkit on February 02, 2011, 11:59:41 AM
I'm actually attempting to get a meeting arranged with my local MP, to discuss the issue and put forth concerns. Hopefully enlighten a politician. Unfortunately, the local here is Conservative, but one would hope that they will open their eyes and realize that this is threatening to become an HST scale unwanted affair with the public.

I was listening to CBC Radio One yesterday and it looks like federal politicians are falling all over themselves now to proclaim themselves the defender of the people's interest here - apparently Stephen Harper has asked the CRTC to review the UBB decisions.

Of course, as ever, people have to get pissed off before they'll care.

Acco

I'd wager that any self respecting politician is paying attention to the state of public reaction to UBB, given how hot button a subject it's becoming.

But, teksavvy's cable offerings are unaffected right now, at least.

Selkit

TekSavvy has already posted to their customers that they will be subject to capping as a result of UBB; They have no choice in the matter but to follow suit with the big ISPs that are deliberately aiming this kind of punishment at them. However, if UBB is killed at the federal level, it'll be a moot point; Shaw will look very foolish. And it's looking increasingly likely that UBB may either be watered down or binned entirely.

Selkit

It looks like I spoke too soon:

http://www.torontosun.com/news/canada/2011/02/02/17131626.html#/news/canada/2011/02/02/pf-17131641.html

Common sense won out. The government has told the CRTC plainly that they are not going to permit UBB. In its current form. That doesn't mean the dragon is dead, unfortunately, but it does mean we've been given a stay of execution on this nonsense, and a chance at something more reasonable.

Acco

Now, I've not done research on this, but... I have a good feeling on why there's no true competition: Foreign ownership limits.

If a big multinational could come into the Canadian marketplace, and provide halfway competitive rates, we could see some amazing things happen... like "fair" pricing on broadband.

FurryJackman

The government is not permitting UBB of wholesale internet, not retail. Shaw and etc will still charge you UBB as it stands right now, but this does mean TekSavvy no longer has to shrink caps to compensate for UBB on their incoming service that was purchased wholesale.

However, this will drive more people to switch to TekSavvy as common sense of "$60 for 100GB or $60 for unlimited" sinks into consumers. No doubt about it, the telcos will lose customers to unlimited choices.

Acco

The thing is, I personally don't believe that unlimited data is a solution - I'm in favour of billing the internet like a utility

Take your pick of link and speed + data per gb from 5-15 cents (basing this off the Amazon EC2 rates that I pay when I go over my transfer limit). Heavy users pay for the above average data they use, and light users pay less in the end. A "true" pay for what you need solution instead of the bullshit pay for what you need but not really cause you might want faster speeds or more data per month.

IE, household 1 is a casual user. Maybe 15GB a month used. They choose to pay $20 for a basic link rated for 5mbps/1mbps. And then they pays $2.25 for the 15GB (@ 15c/GB) a month he uses. $22.25.

househald 2 is a heavy user, does a lot of stuff. 400GB a month used. They choose to pay $40 for a high speed link rated 50mbps/15mbps. And then they pay $40 for the 400GB (@ 10c/GB - maybe they get a better rate because they use more /shrug). $80.00

I personally don't see any reason why one's internet connection shouldn't be billed like a utility. It practically is one now. With reasonable rates for the link and the data, the consumer really does get exactly what he wants, and there's "some" incentive to be responsible with your data.

Kithop

Except there are existing utilities that are NOT billed by usage and are managing just fine - water (I believe for Metro Van anyway) and local landline telephone service comes to mind.  Would you have a landline if you had to pay for and watch your minutes usage on every local call like a cellphone?

Internet access is something that SHOULD be built out to the point where it doesn't matter any more - that's the key to a functioning high-tech society.  And even 5-15c/GB is actually WAY overpriced; from my understanding it's actually less than a penny per GB in actual costs - that's Amazon's markup (albiet a much saner markup than Shaw/Telus/etc. are doing).

At 1c/GB, your 400GB/mo of usage works out to $4.00.  It's so cheap it's not even worth monitoring, just the overhead of hiring someone at the ISP to write and maintain a tracking and billing system to try and recoup those minor costs just isn't worth it, and even at the $10/mo extra I pay to TekSavvy for the boost from 200GB/mo to 'unlimited' usage, I'd still have to completely saturate my line 24/7 for at least half the month to get close to burning through 1TB of data.

I'm of the mindset that we should all be able to get affordable unmetered links, just like we'd get an affordable local POTS landline, and forget worrying about tracking usage.  The actual line rate should determine 'how much bandwidth' you can use in a month, provided you saturated it 24/7, and be priced accordingly.

Companies like TekSavvy only need incumbent telcos for their last-mile connections, because those telephone wires were put in with gov't assistance/funding/right-of-ways in the first place and thus should be equally accessible by all - they run their own backbone connections and pay for their own bandwidth to the 'net, and if they can get it for 1c/GB or less, why can't they offer what they want to consumers, especially if they still make a profit for themselves in the end?  UBB on wholesale lines is being seen for what it is - a blatantly obvious anticompetitive attempt by big telcos to squash companies like TekSavvy so they can dictate rates across the board, and force people onto their own backbones where they can rate limit, packet shape, snoop, and filter to their hearts' content.

tl;dr: give me (and everyone) an unmetered line because usage is really too cheap to meter - this is BS in this day and age.

Silvermink

I'd actually be okay with à la carte data like Acco is suggesting, just not at a 10,000% markup like I can envision the telcos charging. I think the base rates would have to be somewhat in line with the genuine cost of providing service before you consider the data that's flowing through (including paying for the infrastructure, of course, not just the day-to-day cost).

The lack of competition in the telecommunications sector in this country, along with the government's willingness to let the telcos gouge the hell out of us for what is, at this point, an essential service, is fairly terrifying.

I think one of the main stumbling blocks here is that it's hard to see something intangible as a limited resource, and in a lot of ways it's not readily comparable to something like electricity or even water where there's a tangible environmental cost to using more than your fair share.

Always more trees bandwidth over the next hill link!

I'd be really curious as to the actual costs of building out infrastructure. Probably buried somewhere in the financials of TELUS, Bell, etc.

Kithop

It wouldn't be the end of the world if it was that kind of reasonably metered data - but 'reasonable' to me sounds like:

Base infrastructure cost: $20-40/mo
Usage per GB: 2c/GB

So say you had a $40 'base', your bill would be between $40.50 (25GB) and $50 (500GB). Or at 1c/GB, $40.25-45.  As an ISP, I'd ask myself - is it even worth it to track and adjust this every month, or do I figure out the average bill is $42.50 and just call it that for everyone, and save the electricity + manpower costs in accounting? :)  That's what I mean by 'too cheap to meter', not the actual bandwidth costs, but the office overhead of having people worrying about it at all.  There'll be some people that don't use the full cost, and some people that use a bit more than that cost, but the differences should be so small - on the order of no more than even $20/mo at the high-end - that it's just not worth caring about, because you can save the $40k/yr+ on the accountant. :P

Silvermink

Quote from: Kithop on February 03, 2011, 12:29:35 PMSo say you had a $40 'base', your bill would be between $40.50 (25GB) and $50 (500GB). Or at 1c/GB, $40.25-45.  As an ISP, I'd ask myself - is it even worth it to track and adjust this every month, or do I figure out the average bill is $42.50 and just call it that for everyone, and save the electricity + manpower costs in accounting? :)  That's what I mean by 'too cheap to meter', not the actual bandwidth costs, but the office overhead of having people worrying about it at all.  There'll be some people that don't use the full cost, and some people that use a bit more than that cost, but the differences should be so small - on the order of no more than even $20/mo at the high-end - that it's just not worth caring about, because you can save the $40k/yr+ on the accountant. :P

Welllll... at the same time, there are limits to how much traffic a link can carry. With that in mind, you really do have to have some kind of reporting on how much is in use, and if the link is getting saturated (and I freely admit this is a big if, but high-bandwidth usage scenarios are getting more and more common), you'd want to know who's using a ton of bandwidth. Otherwise you can get to a point where you're getting service degradation and your customers are yelling at you for not paying attention to how much load is on the link.

At that point, some kind of UBB isn't a big step. They'll just hire the accountant and roll his/her salary into what they're charging their customers (which, spread over a large number of customers, will be a pretty small cost). And then they'll work in some kind of additional profit, of course, just because they can. :)

Acco

There's nothing wrong in letting the carriers make some money.   

Kithop

As far as your backbone is concerned, oh, of course you should have monitoring and filtering available at your disposal in case of emergencies and stuff - any halfway decent router will let you do that. ;)  I meant more for the customer facing side.  I really don't like how ISPs oversell their bandwidth - if you're getting to the point where people are using what they're paying for (last-mile) and having contention issues on the backbone, you should probably be upgrading your backbone's capacity, not looking to just squash people's connections down. ;)

There should be reasonable markup for ISPs to make a profit, but as Rogers, Bell, Shaw, Telus, etc. have demonstrated - they want to be anything but reasonable.  I actually like TekSavvy's rate structure - here's a base package with a reasonably high usage limit that will serve 90% of our customers' needs, but if you give us an extra $10/mo. to cover the bandwidth costs, you can go nuts.  And I don't mind paying a bit more to them in terms of those base rates and stuff because I know they're looking out for me (well, themselves - and by extension, me :p), they have good customer service, and are actively doing things like trialling IPv6, letting you run home servers, running a newsgroup mirror, etc. etc.  Versus someone like Shaw who turns around and says 'oh, hi customer of 6+ years, we're reducing what we're giving you for the same money and going to charge you extra for what you were using before, all because we're scared of Netflix eating into our cable profits.  OH AND YOU SHOULD TOTALLY GET OUR DIGITAL PHONE PLZ PLZ PLZ *spam*'. x.x;

Acco

I just don't think that "unlimited" by the sense of the word is a workable solution for the future. UBB is a solution, if reasonable rates are put into place. And 5-15c is a fairly reasonable mark up in today's world. When we start consuming data by the 10's or 100's of GBs, we can look into a new system then. Until then, it's a reasonable system that I could live with.

You have to remember that these corporations employ people too - there has to be some markup along the way for support/maintenance costs... and profits for the shareholders (as they are public entities), but decreasing the markup from ridiculous to pennies more is a good step.