usage based billing

Canada – The Dial-Up Dungeon ?

It appears that even with the progresses we’ve had in Canada when it comes to the internet that some are still behind.

A quarter million of Canadian internet users still use dial-up according to the Convergence Consulting Group, a large percentage of which are in rural areas according to the CRTC. And of those who subscribe to high speed, only 52% have the necessary speed to download standard definition films.

Though 77% of Canadians are able to access services that are fast enough to stream high definition video content according to the Broadband Report, only 2% use these services. And it is obvious that it is because these services are prohibitively expensive that more Canadians are not subscribed.

Usage based billing has kept most Canadians from using these services to rent and purchase films online. And though the taxpayer is responsible for most of the infrastructure, we are still being told to pay more.

Perhaps the rates might go down once the spectrum management issues are resolved at the CRTC, which could result in the introduction “Super Wifi” into Canada’s major urban centers.

Unfortunately this wireless service could have issues in communities where analog television broadcasts still exist and digital television broadcasts are only mandatory in the major city centers.

The technology is also in its infancy, having only just been introduced in the United States in Wilmington, North Carolina.

Shaw Discusses Video Service

It appears that Shaw customer will not be able to rent films online from this company’s Movie Club service without it counting against their monthly allotment of data unless they rent this content via their set top box.

The video on demand service, which is currently available in Standard Definition, costs $12 per month and a high definition service will be made available shortly, for $5 more per month according to this press release.

Netflix users have been complaining that the cable companies are imposing limitations on this popular service, giving their own movie rental services a competitive advantage by removing or reducing their own service’s impact to their customer’s allocated monthly transfers.

So, what does it mean ?

As you may have heard the Conservative Party was elected as a majority in Canadian Parliament yesterday, the New Democratic Party having been elected into the opposition. And you must be wondering what next ?

Well, it obvious that copyright reform will likely be on the agenda shortly.

When the election was called Bill C-32 died whilst it was being reviewed by a legislative committee, the legislation’s digital lock provisions having been a major issue.

Had Bill C-32 passed, consumers in Canada would have been able to make private copies but would not have been able to circumvent copy protection to do it.

This meant that the counsumer would again be subjected to the whims and experimentations of the film and music distributors, who in the past had attempted to impose digital locks that kept people from copying material, even for personal use, to the extent that it caused security issues (i.e Sony BMG’s rootkit).

Basically Bill C-32 appeared to give the music and film industries an ability to disable private copying whenever it suited them, independently from the democratic process, whilst possibly giving them the ability to impose additional levies to conform to several World Intellectual Property Organization treaties. And of course this didn’t bode well with the Canadian consumer, who refused to pay the exhorbitant rates proposed on iPods/mp3 players and were wary of RIAA style copyright litigation.

Format shifting, the ability to copy copyrighted material from one medium or device to another, will probably remain a major issue in the forthcoming new copyright reform bill. And i’m hoping we have progressed on the issue.

The majority of consumers simply want more control in regards to the accessibility and portability of the content they purchase. They should not be subjected to obtuse allegations of piracy nor should be subjected to levies or taxes on devices on which they store legally purchased material.

Royalties are obtained from this legally purchased material, some of which is dependant on the existance of devices that enable the consumer to access this material.

For example, if it weren’t for iPods and mp3 players the consumer would not be purchasing music downloads from legal distributors, who pay royalties to rights agencies.

Levies on such devices may sound good to some artists but in reality it would result in fewer purchases because the consumer would eventually be presented these extra costs by the manufacturers. After all, the WIPO treaty ratifications would have resulted in additional levies for foreign content, resulting in prohibitive costs for the consumer.

This may be being sold as a compensation scheme for artists and composers but in reality quite a large amount of levies collected from the sale of blank audio media failed to be distributed from the current levy.

According to the Canadian Private Copyright Collective ‘s financial highlights, only $183,301,000 of the $284,878,000 collected from 1999 to 2009 was distributed. And nearly 11% of the monies collected were used as expendatures by the collective itself.

One can only guess how much of these levies would remain available for distribution if international copyright owners were to get levies. But is clear that all of these schemes would be quite costly to the consumer.

In March 2002, the CPCC had requested a rate of $21 per gig, as publisized in the Canada Gazette, and the Copyright Board had decided on a rate of $15 or $25 per device in December 2003 until having their decision overturned by the Federal Court Of Appeal, twice.

I certianly hope both the Conservatives and New Democrats appreciate the fact that this is not the time to hinder the sale of consumer products by introducing costly levies that fail to be distributed to the artists and composers.

Must Reads On Usage Based Billing

The following documents dispell many of the claims used to justify Usage Based Billing : “Canada‚Äôs Usage Based Billing Controversy: How to Address the Wholesale and Retail Issues” by Michael Geist and “Myths and Fallacies about Usage Based Billing (UBB)” by Bill St. Arnault.

The later was commissioned by Netflix, who have recently decided to offer additional video quality settings to their customers because of this issue.

For additional information on Usage Based Billing, consult Michael Geist’s blog.

Bell Canada Drops UBB

Bell Canada has decided to drop usage based billing in response to the consumer backlash. They have decided to propose an alternative wholesale internet service pricing scheme, “Aggregated Volume Pricing“.

Details on Bell Canada‘s proposal can be found by clicking here.

An Interesting Video On UBB

Click here to view an interesting Youtube video explaining usage based billing and the related issues.