CALGARY – This will shake things up among broadband providers and their customers.
On Wednesday evening, Shaw Communications met with customers in four cities – Vancouver, Edmonton, Calgary and Winnipeg – to show that the company has heard their complaints about usage-based billing and data caps by unveiling an expansive overhaul of its broadband plans.
Bit caps are up huge across the board for Shaw customers, including two unlimited broadband plans, others with 250 to 750 GB limits and another coming soon with a Terabyte limit.
The new broadband plans were created after the company listened to hundreds of its customers during 34 in-person consultations and online submissions earlier this year. After the usage-based-billing issue became national news this past winter, company executives hosted forums where customers could air their grievances and offer new ideas. The company, it appears, took the advice to heart.
At first blush, it appears fair to say this could set a new standard for broadband packaging for cable and telecom companies across North America. All of a sudden, the bit caps offered by all the other major broadband providers – especially in Canada – look awfully puny.
“It addresses what we heard in those consultations, which is that customers want to know what they’re paying for, they want it to be fairly priced and they want it to adapt to their future use of their Internet connections,” Shaw Communications president Peter Bissonnette told Cartt.ca in an interview late Wednesday.
Right off the bat, existing Shaw customers who do not want to change their broadband plans – like Shaw Lite, Shaw High Speed and Shaw Extreme – can keep their plans and prices, and they’ll see their GB limits double from 30 GB for Lite to 250 GB for Shaw Extreme, at no extra charge (See below for the full Shaw explanation and package charts).
Most interesting, however, are the two new phases of broadband packages. Phase One, which will launch in June in nearly all Shaw regions, will see broadband packages ranging from a low-speed Lite package of just 1 Mbps downstream speed, but one with unlimited data, for $59 plus a TV package.
That plan is for the heavy BitTorrent user who wants to cheaply download tons of video through the night but doesn’t care how quickly it happens, said Bissonnette.
The high end plan is a 100 Mbps plan – again with no GB limit, for $119 per month. However, Bissonnette figures the most popular plan will be the $59, 50 Mbps plan that comes with 400 GB of data.
“The likelihood of anyone going over that cap is extremely low,” he said. And if anyone does go over the cap, they simply get bumped up to the next plan for that month.
Phase 2, which will start rolling out in some regions in August, will see some additional packages added with download speeds of up to 250 Mbps, uploads of 15 Mbps and bit caps of up to a Terabyte for $99. The high and low end unlimited packages will also remain available.
(Ed note: It’s not that long ago where a telco’s trunk line couldn’t handle a TB of data.)
That second phase will be enabled by the complete reclamation of all analog cable TV spectrum, which will be done over the next 16 months. That means all Shaw Cable customers will be digital come the end of August 2012.
Reclaiming that network spectrum will increase the network’s capacity “six-fold,” said Bissonnette who pegged the project’s cost at $100 million.
The company executive said they wanted to move away from bit caps and overage charges as much as possible, because it just isn’t a very customer friendly way to do business every month. (Ed note: That and it will be a very effective competitive tool as the telcos won’t be able to achieve those speeds or GB levels unless they get fibre optic cable far closer to their customers’ homes than they currently do – an expensive proposition.)
“We wondered how we can get away from where every month there’s some kind of push and pull between ourselves and our customers,” said Bissonnette. “We want to take away that monthly irritant of going over (the bit cap).”
“The economics of this are also very, very good,” he added. “We have properly priced packages and customers like to buy what makes sense to them – and this gives them that opportunity.”
Broadband providers – especially vertically integrated ones which own a lot of content like Shaw does with Shaw Media – have been viewed with much cynicism by many people. They believe the big ISPs want to use bit caps and overage charges to put the technical brakes on over-the-top video services like Netflix in favour of their own content.
“The question has been are we friend or foe?” acknowledged Bissonnette. “Everyone knows Netflix is using more and more bandwidth but Netflix is not some sort of inanimate object. It is an experience being had by our customers. And so if they want that experience, wouldn’t it be great if we could actually provide it?
“Why limit (our customers)? We want them to use our Internet. Our role as customer-centric distributors is, frankly, to provide our customers with what they want. Plus, we’re looking at offering a streaming movie service as well to compete with Netflix and if customers want that, they are going to be able to get it from us,” he continued.
And what about those who might complain about the price of the new packages? Bissonnette notes that when the company first offered Internet in the late 1990s, it retailed for $55 for 1.5 Mbps service. Phase One offers 50 Mbps for $59 (plus TV, however).
And as for re-setting the bar pretty high for its telco competition and fellow North American cable companies?
“I don’t see how anything we’ve done couldn’t be achievable by anyone else,” added Bissonnette.
We’ll see how the market reacts to this but Bissonnette is hopeful the leaders of the “Stop the Meter” campaign will like the move. “The folks at OpenMedia, even they, I hope, will look at this and see it as somewhat enlightened.”
