OTTAWA – In the face of enormous political and public pressure, Bell Canada has killed wholesale usage-based billing.
Knowing politicians (whomever wins the election) are determined to stop wholesale UBB in its tracks, in its submission to the CRTC late Monday evening on the newest proceeding into the issue, Bell Canada abandoned any plan to continue pushing for UBB in its previously Commission-approved-form.
Instead, Bell has proposed a new idea (well, borrowed, really from CRTC Commissioner Candace Molnar and industry consultant Mark Goldberg) it is calling aggregated volume pricing.
“We are basically riffing off of the sentiments expressed by several of the small ISPs as well as Mark Goldberg (who advocated for that on Cartt.ca here) and Candace Molnar (who dissented with the last UBB decision by proposing an aggregate approach) that a model which aggregates all end user usage across a small ISP should be a way to go,” said Bell’s senior vice-president of regulatory and government affairs, Mirko Bibic.
Under Bell’s new model, existing wholesale independent internet service providers like Teksavvy and Telnet will continue to pay the same monthly access fee it does now “and for each ISP, we’re going to give the equivalent of 41 Gb per user of the independent ISPs free.”
Assuming a fictional independent ISP has five customers, that would mean those five could collectively use 205 Gb in a month for the base fee paid now, explained Bibic. Additional costs would be incurred when that threshold is breached.
Bell’s proposal calls for independent ISPs to then analyze and pre-pay $200 for each terabyte (which is 1000 Gb, so Bell says that would be 19.5 cents/Gb) they believe their customers will use each month, over and above the 41 Gb they already get.
“At the end of the month we tally their overall aggregate usage. If it’s more than what they pre-purchased from us, then they have to make up the shortfall,” added Bibic – at a post-pay rate of 29.5 cents per Gb.
That 50% higher rate is to “try to encourage better prediction and better capacity management,” said Bibic.
He believes this idea should satisfy what most are looking for and will deflate criticisms led from the Parry Sound Muskoka Conservative candidate who was Industry Minister, Tony Clement. “We were faced with opposition from the government and minister Clement on what was filed and initially approved,” noted Bibic.
“So we said we want to achieve three really important things. There was concern about ISP flexibility so they can adopt their own pricing models. This does that.
“Two, we really do believe the lower users shouldn’t be subsidizing the heavy users and that there should be some form of pricing so those that use more pay more. This does that.
“And the third one, is we have to come up with a pricing model to generate the returns we need to continue to invest and this ought to do that.”
However, retail UBB is not going away, despite our thoughts that the issue and the practice is becoming untenable.
“We’re going to keep it the same way,” said Bibic, noting Bell can respond in the marketplace to any drastic pricing or packaging from one or a number of independents, once AVP is instituted..
“At least with AVP they’re paying for access and the strain they are putting on our networks.”
More to come on the UBB submissions this week.
