BCE CEO Cope Says UBB Accounts for Almost All Internet Revenue Gains

When Bell’s Mirko Bibic appeared before the Standing Committee on Industry to answer questions on usage based billing last month, he focused on the “fairness” associated with the billing approach. Using the word “fairness” seven times, Bibic mixed congestion, heavy users, and fairness with responses such as:

As for small businesses, which are generally on the same network as residential users, what you have is really a case where the congestion during peak periods is largely a residential phenomenon. It’s in that area that we’ve addressed the usage-based billing issue, and all we’re asking the CRTC for is to follow a fundamental principle of fairness. If we asked 97% or 98% of Canadians if they would be prepared to pay more so that the 2% of heaviest users pay less, I’m pretty sure of what the answer would be.

While Bell emphasized fairness once UBB became a political hot potato, the company had a far different emphasis when discussing UBB last year with financial analysts.  In an August 2010 quarterly call, BCE CEO George Cope stated:

our data revenue growth was 3.8% for our Residential Services business, particularly driven through an increase in Internet ARPU of 3.3%.  And interesting, almost all that increase now coming from usage based billing as the demand for Internet use explodes through the use of video services, and we’re continuing to see an increase in the revenue per customer.

Three months later in November 2010, Cope noted:

our residential services had an excellent revenue quarter from a data perspective, as well, with data revenue growth of 5%, driven principally by the bandwidth usage revenue being up 83% year-over-year.

Why is Bell doing this? Apparently it isn’t about fairness, congestion or heavy users. In response to a question on the issue, Cope states:

as we see a growth in video usage on the internet, making sure we’re monetizing that for our shareholders through the bandwidth usage charges

While there is nothing wrong with Bell maximizing revenues for its shareholders – that is what it is supposed to do – no one should be under the illusion that UBB is anything other than a revenue maximization strategy in a market with limited competition, not one premised on fairness or network congestion.


  1. The bigger sin
    Obviously, what Bell wanted to do to its resellers and the permission granted by CRTC were sinful and wrong. But the bigger sin is the requirement that entry level consumers, who average 25GB/month, are forced to to buy 100GB/month (i.e. 60GB contract and $5 overuse “insurance”) to get half decent bandwidth. The arbitrary linkage of bandwidth and speed to volume is the bigger sin. If buy 10 litres of gas at the pump, I don’t have to drive on it at 20km/hour.

  2. Jordan Louis says:

    Fairness? Naah, I just want Honesty.
    It’s telling that Bell seems conscious that if they say out loud and without conflation that they’re simply making decisions based on profit and shareholder motivations, as most corporations do, there may be a backlash or a PR disaster.

    It’s also telling that Bell hasn’t noticed yet that despite their efforts to cover up the facts behind their decisions, the public is often able to see through the facade and understand the reality behind the situation: Bell’s business model relies on constant price increases, of one sort or another, to maintain continuous ‘growth’ (read: artificial profit-motivated inflation) and appease shareholders.

    “No one should be under the illusion that UBB is anything other than a revenue maximization strategy in a market with limited competition, not one premised on fairness or network congestion.”


    Mind you, most or all of the large telecommunications companies which happen to be traded in stock exchanges (Bell, Rogers, Telus) have been caught up in exactly the same strategy for at least two decades, and cannot escape due to the inflationary pressures of shareholders wanting regular dividends on growth and banks wanting interest on their corporate loans – the only way they can get money for nothing. There’s no way to try out new ways of making money or take risks to develop new markets if you’re dissuaded from doing so by the very people who would stand to benefit from some fresh ideas.

    I’m almost starting to think the Catholics and the Muslims had something incredibly right with their (now-ignored) anti-usury provisions – loan interest and shareholder dividends combined with insufficient imagination and incentive to try something different (other than sustained and constant price increases or new and additional charges on existing accounts) seems to be the logical root of the problem here. 😉

  3. Jordan Louis says:

    @ Albin
    “If buy 10 litres of gas at the pump, I don’t have to drive on it at 20km/hour.”

    Yes! Let’s turn the utility analogies against them! Good point!

  4. Jason Chambers says:

    It’s always about money
    I was a former Bell employee and I blogged about this last month:

    There has never been any evidence that there is congestion on their network. ISPs just likes to complain about bandwidth growth. I hate to tell you Bell and Rogers, but GET OVER IT! Video isn’t going be the end of growth of internet usage. Today it’s video, tomorrow it’s going to be something else that’s going “to choke” your internet connection. Upgrade and conform.

  5. It’s also about being anti-competitive
    Let’s not forget that the telecartels also have their own Pay-Per-View and On Demand video services they’re trying to protect at their ridiculous high prices. UBB is clearly designed to cripple those services.

    If can afford to send me 15 DVDs a month using prepaid postal mail for $25, then why do I pay $5-$8 to Rogers per movie? I don’t. I’d like to use more streaming media but can’t afford with such low data caps.

    Unfortunately, UBB also cripples the online backup services as the initial backup can take months if you stay under your data cap. That’s even if you schedule the backup at off-peak times. UBB doesn’t do a thing to stop congestion at 4 AM (it doesn’t exist), yet I’m billed $1.50/GB anyway.

  6. re:It’s also about being anti-competitive
    I said, “UBB is clearly designed to cripple those services.” I meant, “…COMPETITORS to those services.” Apologies.

  7. Wayne Borean says:

    What did you expect?
    This is exactly what many of us predicted was behind UBB back when it first was floated years ago. We were told then that we were paranoid, that the ISPs really were not trying to rip us off.

    And now that it has been proven that we were right, will be see refunds?

    Fat chance.


  8. Fair Broadband says:

    This is a surprise?
    It was clear from the get go that this had nothing to do with “fairness.” We were suppose to believe that all of a sudden Bell had become a socially conscious consumer advocacy group fighting for the little guy? Really? It is painfully obvious to all but the willfully ignorant, that if Bell does not get it’s way, then companies like TechSavvy are going to eat their lunch in pretty short order. NOTHING Bell offers can compete in any way, shape, or form with what is available elsewhere. If I were them, I’d be working feverishly at a new business plan because if the CRTC ends up in a showdown with the Government over this issue, it’s not going to work out in Bell’s favor and may in fact, be even worse if the Government decides to shove a microscope up Bell’s collective rear end after the dust settles.

  9. “[…] what you have is really a case where the congestion during peak periods is largely a residential phenomenon.”

    Impossible. We already know it can’t happen on Bell’s DSL:

    Nap. 🙂

  10. Congestion
    Ummm if the ISP’s didn’t over sell their lines, they wouldn’t be in this predicament and if this is causing congestion its not the consumers fault. Its the ISP’s fault that oversold their system and now they are trying to lobby to punish the consumer for business plan that is biting them in the ass. Strange how its always the “MEDIA” companies crying out the most and paying off politicians to change laws to punish customer so they can sustain the business plan.

  11. @Jordan Louis, Albin
    I don’t see how you can identify “If buy 10 litres of gas at the pump, I don’t have to drive on it at 20km/hour.” as a utility model. The utility model, whether you agree with it or not, relates to the volume purchased and the consumption of the means of delivery. If you get natural gas, water or electricity from the utility, you can take delivery of it and store it (if you have the capability), then consume it when you want. Let’s look at electricity (since Ontario is going to time of day based pricing). If you set up a storage unit (like you do for home solar) you can charge that during the off-hours at the cheap rate. You can then use that to power your high consumption devices during the expensive periods.

    This is no different than doing a download of data from an ISP; where the model breaks is in accounting for streaming data. However, streaming data occupies data capacity, often during the high usage periods. As a customer you want the last mile carrier to be able to deliver the streaming data without stutter; they need to build up the capacity to handle the peak loads. In this sense it is just like a utility; in the case of electricity a lack of capacity results is black and brown outs. Now, the idea of a cap does not completely fit with the utility model. That is simply a means to make money. There is some parallel with respect to Ontario Hydro; where you are billed using “normal meter pricing” (non time of use), your price per kW hour is increased once you go beyond a particular consumption. One cent per kW hour for summer consumption more than 600 kW hours, or 1000 kW hours in the winter.

    @Napalm: I understand that Bell does not claim the congestion occurs on the last mile (at least any more), but rather on the intermediate links where the data from all of the DSL links as well as the third party ISPs is aggregated (between the backbone and the DSL lines).

  12. Revolted internet user says:

    how congestion is possible????
    This is something that really needs to be cleared out. How the congestion is possible at all?? There is no congestion in cables, that is impossible. if we cut fiber optic cable numbers will fall out? people get serious, this ubb thing is noting but a sneaky and greedy way people who don’t even understand internet wants to make more invisible money. this is pure manifestation of greed and how greed will make you to de-evolve economy of the future, digital business. I hope sanity will prevail…

  13. @Anon-K:

    In the utility model, Hydro will deliver as much power as they can before they run out of capacity and brown outs happen. Under no circumstances do they reduce the voltage to 50 Volts or the frequency to 30 Hz depending on time of day, or to certain users that use more power than others or that use electricity for a particular purpose.

    So the ISP embracing UBB should completely stop discriminating traffic (as in “we throttle P2P at all times whether we have capacity or not”) and any traffic management should be done only on the aggregate traffic of the user regardless of the protocols.

    What’s really annoying is that Bell wants to have it both ways.

    Like in you pay per kWh but as soon as you connect a washing machine we’ll reduce your voltage to 50 Volts.


  14. Pull my finger …
    Nothing else makes more disgusted and angry then the double face of Corporate [North] America. This is yet another example of saying two opposing things at once, usually out of more than one orifice. A tricky act for sure, but one that is becoming more difficult with the freer flow of information and the increasing ability of groups to have a greater collective voice.

    Keep up the pressure 😉

  15. Another reason for those tidy UBB profits …
    For the two boys and father JR Shaw, the company faces a future retirement bill of some $147 million, according to its own actuaries. The amount these three men have paid into this plan: zero.In the end, the Shaw family gets away with it only because the other shareholders don’t complain about it. Why don’t they complain? Because despite all the fat, the company remains ridiculously profitable, just like the rest of the major players in the Canadian cable and phone racket.

  16. Why does everybody worry about Bell? DSL is slow and obsolete. Let them do whatever they want. Isn’t everybody on ROGERS docsis 3 cable internet?

  17. Isn’t everybody on ROGERS docsis 3 cable internet?
    I only wish … I’m on 2mbs radio wireless.

  18. So-called “Heavy Users”
    My house would easily fall under the “heavy users” that the Telcos are trying to vilify. We aren’t pirates. We don’t d/l dozens or hundreds or thousands of movies. In fact, we are just regular users, except that there are seven people in my family! Every one of us has a computer, plus we have three iPod Touch and an iPad and a smartphone. We easily use double our alloted bandwidth every month; maybe even triple sometimes. We’re on Telus and our cap is 65GB.

    I always get seriously pissed off when high bandwidth usage is automatically associated with Peer2Peer file swapping or simple pirating.

  19. be aware of alternatives
    If there is no alternative in your area, then UBB is clearly wrong. You can get unlimited service tethering on a cell phone for $45/month complete service including free long distance, and all the bells and whistles in major cities already.

  20. Re: Craig
    In your last comment, you say you get pissed off when high bandwidth usage is associated with P2P or pirating. P2P != pirating by default. There’s nothing wrong with P2P, and any argument that says there is, you could easily replace P2P with HTTP or the entirety of your Internet connection and say the same thing. Newsgroups, IRC, the WWW, etc. have all had their rampant-piracy days. Also, UBB has nothing to do with piracy to begin with and much to do with restricting access to content to the point where you’re still dependent on cable/satellite for TV/movies.

    Some countries see Internet access as a right ( and we’re still getting nickel-and-dimed to Hell. It’s disgusting. I want NBTel back. They gave us 10mbps up/down HFC in the mid 90s. It took more than a decade for Bell Aliant to catch up.

  21. The middle tier of ISP packages typically supplies a modem and fast enough access to theoretically be able to download approximately 1300 gigabytes a month. Why should consumers NOT be able to get full value for their investment? There is no such thing as a bandwidth hog. There are only those who wish to use the service they’ve paid for to its full capability, and those who do not.

  22. TY in NFLD says:

    heavey users are good for the economy.
    heavy users are good for the economy we spend our hard earned money in dozens of places all across hundreds of countries… I would fall under a heavy user classification, i spend over 100$ a month for my rogers internet, i think it has 150gig a month usage, and we kill it every month easily, Between 2 or 3 of us we use 2 desktops computers, a laptop, 2 game consoles,2 smartphones, and the biggest bandwidth hog of all “Netflix” on nearly every device we have, we love our internet and we don’t mind spending money on valued items, things like Netflix, for 8$ you get any movie you want whenever you want it, and that is definitely hurting rogers/bell’s bottom line in the way of their TV movie on demand services they offer at 4-8$ per movie… so we decided to spread our money around to other online services through their internet gateway and this is just another way for them to make some of that money back 10 fold…its all about the money, plain and simple. they use scary wording to the public to vilify regular people into online pirates and thieves…. when its really just about the money and how much more they can make, check out rogers or bells last quarter revenue, they make crazy money and it grows every quarter larger and larger. don’t get sucked into their BS, this is all leading up to an internet model that makes you scared to embrace new technology with the fear of monetary reprimand.. what about later this year when several companies start using “Cloud” based storage and purchase solutions, meaning you are always download and uploading something.. get ready to pay again i guess… that or fall behind and miss out i guess….come on canada fix this…

  23. @Scott: “There’s nothing wrong with P2P,”

    I’ve already frothed at my mouth in another thread talking about P2P as being a rather inefficient method of distributing files, especially on asymmetric residential lines.

    As long as we were talking “unlimited” usage, I was seeing that there was a point into trying to “throttle” it as to push users toward more efficient protocols.

    But now we changed to UBB and pay per gigabyte. Why do we throttle it (and other protocols) anymore. Educate the user that his “bandwidth” meter will go on average twice as much when using P2P vs. http download. And let him decide how he spends his money.

    Traffic Management? Sure, if there are utilization peaks, just slow down everyone proportionally to make everyone fit within aggregate bandwidth constrains.

    No real peaks/congestion and you’re “traffic shaping” people just because you can? That should be restricted.


  24. Sorry about mistake in previous post, that was me not “Scott” writing it.


  25. @Nap
    Sorry, when I said there was “nothing” wrong with it, I was speaking exclusively about the misconception that all P2P traffic is illegal. If someone downloads a copy of something and shares 1 copy, you’re right that they would be using twice the bandwidth. And I agree that it’s an inefficient use of end-user bandwidth.

    However, the connection is paid for by the customer, and I think that if someone wants to legally share and distribute files with the connection they pay for, they should be permitted to do so by any method allowed by the media’s license. I pay for a 7mbit connection (down. Significantly less upstream) and I think I should be allowed to use it at full speed all day long, every day that I’ve paid for. Without traffic shaping or absurdly overpriced (to the point where it should be illegal) penalties. Unfortunately I have access to only one provider, so I’m stuck with what ever they decide to sell to me. Fortunately I haven’t yet been bound by any caps or noticeable traffic shaping (though I do think I pay too much).

    Hopefully that didn’t come across as argumentative (not my intent). I usually tend to agree with most of what you have to say (I read here often but rarely speak). Thanks!

  26. Utility not a clean comparison
    @anon-k – The problem I have with utility comparisons is that the service delivery model for say electricity is to keep the grid saturated with the “right” amount of energy. Not too much and not too little. Electricity is generated and the people who deliver it to you have a cost to either purchase that electricity and resell it OR recoup their own costs in having generated it. When I consume it, it is gone… removed from the grid. If I produce my own electricity (ie solar) I can sell it back to the grid. If my consumption is less than I generate I can get a cheque (less the “basic charge” which is their access fee). Using this logic the internet would have to also have a cost of purchase for those to deliver… or it would have to be their own content that they would have a right to recoup. We would have to destroy what we bring down when downloading in order for it to have a cost and lastly… if I upload content to the web I should get my usage dropped.
    We can’t say utility models apply with a broad brush because the commodity being transported is physically and tangibly different. While there are electrons at movement here, I am not buying and consuming those electrons… at the congestion points the cost of producing and consuming those microvolts are no different if the fiber is dark or fully lit. Lets stretch for a moment though and look at the your utility bill. Mine has a “basic charge” which represents my connection to the grid whether I consume or not. Then there is a usage charge which reflects what I consume. I would be glad to pay bell the $6 I pay the hydro company to be on the grid and I will pay them $5 a Gig for every byte of THEIR content I download… but not the content they did not create or pay for to begin with.

  27. @Scott: “I was speaking exclusively about the misconception that all P2P traffic is illegal.”

    Scott, fortunately I don’t share that misconception, in my view P2P is just a protocol among others and there’s nothing intrinsic to it that would make it more or less legal than others.

    However most P2P software is designed so that while you download a file, that file is offered to others through your upload ‘bandwidth’. This is to ensure file propagation (otherwise everybody would just “leech”). So by the time you consumed 1 GB of download, you also uploaded 1 GB to others, making a total of 2GB from your bandwidth cap.

    When we had “unlimited” plans, people would go for it because it wouldn’t matter for them financially and you couldn’t “police” them other than by “throttling”.

    But with UBB you can explain it in dollars and cents, which people tend to quickly understand (“if you download Windows 7 SP1 from Microsoft it will cost you $2 while if you do the same via P2P it will cost you $4 in bandwidth usage”).

    However at this point it should be left completely at the users discretion. If for some reason he has to use P2P (like in playing Call Of Duty Black Ops), then let him do, it’s at his expense and the more he spends the more the ISP gets (and can set aside for further network upgrade).

    Personally, if the price per GB is “just and reasonable”, I would prefer unthrottled UBB to heavily “traffic shaped” “unlimited” plans.

    But price gauging on the GB combined with full bore throttling – now that’s hard to swallow.


  28. @Tom S: “If can afford to send me 15 DVDs a month using prepaid postal mail for $25, then why do I pay $5-$8 to Rogers per movie? I don’t. I’d like to use more streaming media but can’t afford with such low data caps.”

    Well if you go to your nearest Rogers Video store you can also rent DVDs from the “5 for $10” bin. You should have picked Bell instead as they don’t offer DVD rentals 🙂


  29. @RoBaer: “Using this logic the internet would have to also have a cost of purchase for those to deliver… or it would have to be their own content that they would have a right to recoup.”

    But you’re not paying the ISP for the content, you’re paying him for transportation of that content. Pretty much like with phone calls, you don’t pay for the content of your conversation, you pay for it being transported.

    It is for TV channels that you pay both for the content and the transportation.


  30. David Paterson says:

    Fairness is in the eye of the beholder, but he may be blinded by his own narrow mindedness…
    Bell has a telephone network mentality, where they sell services on lines knowing that we won’t all pick up the handset at the same time. They have invested great efforts in trimming their network to just the right capacity so that we seldom notice any delay in service, and we are left to think we could use that line whenever, and a much as we wish. But heaven forbid we should actually use it too much.

    Then they bring that inappropriate “skinny up the service” mentality to Internet access. They sell us “up to 5 Meg” service, but with fingers crossed behind their backs in traditional telephone company fashion. If we try to use it as much as we wish – as if it were really allocated bandwidth, then apparently we are to be demonized. Apparently we are being unfair. But Bell doesn’t fess up to their view that we’re being unfair to Bell; they claim that we’re being unfair to each other. I think unfairness is selling a service that you don’t really intend to deliver, and then demonizing the customer for trying to get full value for their money.

    Wake up Bell. This isn’t POTS. If you’re not up to it, move aside and let better people service the customers.

  31. Could computing
    “Today it’s video, tomorrow it’s going to be something else that’s going “to choke” your internet connection. Upgrade and conform.”

    Cloud computing is going to suck up alot of bandwith. Needing to stream everything to every device is going to be bandwith intensive.

  32. Fair? Not to the average Family
    The point I’ve made against UBB since it was first mentioned is just how unfair this is to the average Family.

    Think: A Family of five gets to split that 60GB cap five ways. That’s twelve gigabytes per person in that Family. Twelve gigabytes.

    If this were about fairness and reducing drag on the networks, the ISPs would throttle or cut off heavy users – they’re not, choosing instead to use it as a new revenue stream.

    UBB is going to cost you.

  33. Another theme often absent from the debate is how much of the infrastructure was built with tax incentives, grants and other forms of government (taxpayer) money in the first place.

    After business build infrastructure with taxpayer money, they move as much of their operations overseas as possible–to maximize shareholder returns and CEO benefits–and register assets in tax friendly jurisdictions, to minimize ROI to taxpayers.

    It’s then the customer who is taking advantage of the multinational’s equipment?

  34. @Napalm
    I agree, if the ISP wants UBB, then they must be content neutral.

    @RoBaer: I agree that it isn’t a clean comparison. My intent both here and in other postings on UBB is that there are parallels that can be drawn. When one breaks down the costs (in fact I believe the Hydro One pricing model, used in Ontario, is very reflective of what I am getting at). The breakdown is:

    1) Basic connection charge to the distribution mechanism.
    2) Cost of the consumable.
    3) Cost of distribution.

    From what I’ve seen a lot of jurisdictions combine 2 and 3 into a single cost; Hydro One breaks them up as the government of Ontario has legislated the electricity price. For an ISP, 1) represents the administrative costs plus the costs associated with mail servers, etc provided by the ISP. As you’ve indicated, the price of 2) is nothing as nothing is consumed. 3) represents the costs of maintaining the network. Based on this I can see the parallels between an ISP and a utility. I don’t believe I’ve ever said here that an ISP was a utility (at least that was not my intent); rather I can see where the comparison could be applicable.

    @Darrin: To play devils advocate (not the user), there is a parallel that could be drawn with the monetary policy used by the Bank of Canada. By making it more expensive of get loans, they can slow the economy. By putting in place various levels of caps, the family can pay for what they want and then pay extra for overages… or so the theory goes. One of the areas where this is broken is for the heavy users with actual unlimited caps (such as is offered by some of the third party ISPs). For folks such as these there is no incentive to reduce their consumption; its like an all you can eat buffet. Heck, I’ve heard of home businesses using the cheaper home service rates instead of buying the more expensive business rates. As I understand it the problems here arise not in the last mile but in the aggregated links, where Bell aggregates the traffic from the third party ISPs and their own customers prior to putting it on the main backbone.

  35. @Anon-K:

    There’s this other utility that delivers tap water. In Canada you don’t pay for the water itself but for its conditioning & transportation to your home. This is pretty much similar to the ISP business.


  36. @napalm — municipal water delivery is ‘pretty much similar to the ISP business’ … ???

    wrong on too many levels … is it also like we don’t pay for gasoline but for the processing and transportation of it?

    can we please move away from the erroneous natural resource utility comparisons?

  37. @darrin — you say “If this were about fairness and reducing drag on the networks, the ISPs would throttle or cut off heavy users”

    bell has you hook line and sinker still blaming the evil ‘heavy users’ … not that i really want to engage in this ‘heavy user’ fallacy, but guess what man? your family of 5 would fall into that heavy user category LOL

    not too worry, your family is not really dragging down the internet, that’s just a red herring that bell likes to use to pit you against me while they rob us both

    your family is really caught in this though, i can imagine the family bandwidth squabbles … the only fair thing is to give everyone unlimited access, like 95% of the world has, the way the internet is meant to be … UBB is a anti-competitive scam, nothing more, there is no evidence of congestion, none has been proven, so there is no need to continue blaming heavy users … i mean the heavy user is just the long haul trucker on the road, and nobody is talking about kicking them off the roads

  38. @Napalm
    I like the way you refute the electric company analogy. To add to what you’ve said, the electric company doesn’t allocate you a set number of ‘use ’em or lose ’em’ kW every month and they don’t charge inflated rates for ‘excess kW’. Additionally, no one would tolerate an ‘up to’ rating for continuous power draw from the grid.

    IMO, our communications companies are more easily compared to an all you can eat buffet where:

    – you have to promise 2 future visits or pay a penalty (term contracts)
    – you pay to get in (monthly service fee)
    – you have to pay extra for every plate of food beyond the first (overages)
    – you have to pay extra for condiments & pop (value adds)
    – you have to rent the cutlery (system admin fees)
    – anyone eating a lot will be given a smaller plate (throttling)
    – they admit more customers than the restaurant can seat (oversold infrastructure)
    – they don’t have enough cooks (saturated up-links)
    – there are long lines at supper time (congestion during peak demand)
    – you can pay extra to be guaranteed you’ll get some of the chicken fingers (QoS)
    – they have coke and the competition has pepsi (consumer choice)
    – they blame the fat guy for all the problems (bandwidth hogs)

  39. Robert .O. says:

    Tech gains and bell’s short falls.
    I’ve been on the net for ten years now. Technology has improve 10 folds but the Bell net work has not improved. They say they offer the highest downloads, but the phone system at best can only handle 1.5 G/s. Note that I have never seen this speed the best that I have ever recieved was 1765 Mb/s a far cry.(sympatico offered me a 7G/s ,when confronted with the technology of best situation of 1.5 G/s I was told that Bell has the right to limit traffic as they see fit.)That means they can sell you any speed but you lucky to get better then a fraction of what you pay for.

    The next time you buy groceries fill the cart pay for it all and let the store manager decide what he’ll let you take in a bag or two and see how that flies.(Just upset with the Canadian way of Justise)

  40. David Paterson says:

    Its about price! Nothing else!
    In my job in recent years, I have been responsible for setting and asserting prices. Two simple guidelines:
    1) There are no rules in pricing. It has nothing to do with cost, or fairness, or anything other than what price you can succeed in getting.
    2) If you want your price to stick, you have to have better arguments than your opponents (competitors and customers, that is).
    In this case, the main argument being made is a fairness appeal, complete with an attack on the most prolific consumers. And Bell’s strategy is to exclude the customer from the negotiation. Thus, by artificially limiting supply, while pretending excess demand, Bell’s intent is to convince the CRTC to let them abuse the customers. If the consumer is in fact excluded from the negotiation, Bell expects to assert their price strategy. Simple, really.

  41. Water
    Here learning activities: Canadian

    Unlike oil fields, the rivers / lakes where municipalities are pumping water from are not the “private” property of some corporations. The municipality doesn’t have to pay anyone for the water it pumps to your tap, like you don’t have to pay for the air you breathe. There were some discussions about big users like bottled water companies (should they pay or not for the water) but I didn’t follow on how those ended.

    Now follow the second link and pay attention to the “how much does it cost” section. You’ll find explained “flat rate” “constant rate” etc.

    After you go through all the material it is impossible not to notice that the closest utility to the ISP business is the one of water distribution.


  42. @Anon-L:

    The ISP analogy works much better with the water utility than the power one. It is very close, to the point where undersized pumps/pipes create the same effects as insufficient bandwidth on certain network links. And as with data, water itself doesn’t cost anything and is renewable.


  43. @Napalm
    Yes, a water utility is by far the best analogy. I was being a bit facetious with the buffet analogy since our ISPs think that every trivial little thing is valuable enough that we should pay extra. I bet they’d rent out network cables if they thought they could get away with it.

    The analogy to a water utility is great because it’s very easy to explain the difference between throughput (water pressure) and data (water).

    I imagine the ISPs would be singing a different tune if _any_ utilities were billed like their UBB proposal. As huge businesses, they’d be classified resource hogs and have to pay exorbitant per unit (kW, liter, etc) rates on everything.

  44. Whoops, typo!
    That last post @Napalm was supposed to say Anon-L for the name.

  45. @Anon-L @Napalm
    Except that it costs a lot more to treat to water then to route data 😛

  46. My Internet speed is 50Mbps and my limit is 100gb, this means at the speed they offer I have 2048 seconds of Internet per month for 99$. Fortunately, even the 50mbps is a big lie and my real speed is much lower than that.

    Is it so hard for the brain to be creative towards efficiency instead of profit? Everything about this model is wrong.

  47. @ :P: “Except that it costs a lot more to treat to water then to route data 😛 ”

    Sometimes I wonder if our friends at Bell aren’t spending more with “treating” the data through the “traffic management” machines than with actually routing it 😛


  48. I’ve followed the link provided by Michael to Mr. Bibic appearance in front of the committee:

    and I have an issue with Mr. Bibic’s comments about IPTV being exactly like cable TV and having nothing to do with “Internet”. I beg to differ, please check the diagram here:

    Yes, it is not “Internet” as it is not routed through the Internet backbone. It comes from a Bell internal server, but otherwise it traverses Bell’s internal IP network infrastructure sharing resources with the “Internet” traffic (and possibly contributing to the “congestion” that Bell admits to be happening in their internal network).

    This is completely different than how cable TV operates, where video is *not* transmitted with the same IP protocol as Internet traffic.


  49. Reading through many of the comments on this thread I am absolutely stunned by the number of people who have convinced themselves that the various networks that make up the internet have infinite capacity.

    Here is a simple demonstration you can do at home to help understand that all networks are capacity contrained. First, on your home Internet connection go to YouTube and stream a video to your PC. Next, invite 10 of your friends over with their PC’s and have them stream the same video off YouTube at the same time through your internet connection. Your in-home LAN can handle the traffic just fine but your access connection to your phone or cable company was likely choked.

    Fortunately the problem is fixable, someone just needs to cough up some more money to upgrade your connection to a higher speed so you have more capacity – if you are lucky you might be able to get away with upgrading the electronics at each end but there is also a chance you might need to replace the existing copper/cable wire with fiber. Then the next question is who is going to cough up the money? Should you cough up the money to feed your capacity demands or should your neighbours also cough up to help you out.

  50. Timothy Barrett says:

    The CRTC gave in to telco/cable on UBB so fast they simply have to be on their side. They are supposed to be protecting the little guy. I read that one of the CRTC members who said she had no conflict was actually sitting on the board at Vidoetron, and they let her get away with it.
    This kind of garbage was identified many years ago by Frank Zappa (RIP) He called it “Brown Lips on Corporate Executive Lips Syndrome” They apparently haven’t found the cure.

  51. Listen, Bell can do whatever the hell they please with their poor, misinformed customers. This is all about choice, I want the option of unlimited through a provider like TekSavvy, who pays bell the majority of my Bill. Funny enough, the Bandwidth doesn’t COME from Bell, it’s not theirs, it travels their network, that is the fee. So what’s UBB then? If it’s a tax it’s near 100% Seems legit though, seems fair…Yeah, and all the while I can stay on my outdated 5Meg DSL and never expect a speed upgrade, or at least if I do, naturally I should pay more…..Idiocy.

  52. @Becky: “Next, invite 10 of your friends over with their PC’s and have them stream the same video off YouTube at the same time through your internet connection. Your in-home LAN can handle the traffic just fine but your access connection to your phone or cable company was likely choked. ”

    I definitely realize that Internet doesn’t have infinite throughput.

    But you should also realize that what some people are asking is not instantaneous throughput. They don’t want to stream 10 movies at same time. They want to stream 10 movies per month without running into some cap.

    The whole racket is not about speed, it’s about monthly download cap.

    As for speed alone, the current offer is plentiful. Even the bog standard DSL connection is enough for simultaneously streaming 2 good quality SD movies at 2 Mbps each (that’s video on demand / rental quality).


  53. Ramblin' Rose says:

    Give Credit Where Credit Is Due !
    Michael Geist wrote: “While there is nothing wrong with Bell maximizing revenues for its shareholders – that is what it is supposed to do – no one should be under the illusion that UBB is anything other than a revenue maximization strategy in a market with limited competition, not one premised on fairness or network congestion.”

    Has anyone else other than myself who posts here written to their local Member of Parliament, the responsible Minister Tony Clement and the various Opposition Party Critics drawing attention to Professor Michael Geist’s simple and clear summary above as to what the UBB bottom line is all about?

    Tuesday evening the Netflix website went down for several hours. At first because I was trying to access it via a streaming media device to my TV, I though perhaps it was a problem at my end such as an associated AP, the device itself or a router or modem needing resetting. To make a long story short I was able to quickly reach Netflix by phone in spite of a high call volume and this morning I received an email indicating that I would be given a 3 percent credit on my next bill, something I did not ask for. A token gesture maybe, bu when have Bell, Rogers or even my Indy ISP, offered me or anyone else an unsolicited credit for any outage of telephone, internet or television service that was clearly due to a problem at their end?

    I’m not here praising Netflix for they still have a long way to go in offering our at times backwater Country the service and choice received below the border, but they are an example of what the well protected and often arrogant folks at Bell and Rogers and elsewhere are so sorely afraid of. I for one do not want the CRTC ruling in favour of their kind of Canadian Content.

  54. hmm
    Becky has fallen into the trap that ISPs such as bell has been laying

    Misinformation. They are claiming that UBB is being implemented to alleviate network congestion. This is false, therefore Becky’s argument does not stand…

  55. George Cope: “as we see a growth in video usage on the internet, making sure we’re monetizing that for our shareholders through the bandwidth usage charges”

    This is ridiculous, everyone is “monetizing” on video usage on internet, except Hydro One who powers the whole shebang.

    I submit that Hydro should classify Bell as “power hog”, put a cap of 30kWh on their monthly usage, and charge $2 per overage kWh.

    Nap. 🙂

  56. Bell expects usage to increase
    If you read the Q3 Q&A, Cope states the 3 things driving up residential broadband ARPU (average revenue per user) in response to Jeff Fan:

    1. “One is just the consumer is moving to the Fibe network that we have because of the access to the quality of the service and the speed of the service, and when they do that, of course, they upgrade to a different rate plan because they’re using a product that’s superior to where they were before.”

    2. “The second piece of driving ARPU is, obviously, as we see a growth in video usage on the internet, making sure we’re monetizing that for our shareholders through the bandwidth usage charges”

    3. “Then, I think, earlier in the year there was a small price increase on the base, but that’s been flowing through over the entire year”

    Finally he caps it off with this:

    “we would anticipate over time all of our clients will move to our Fibe network” … “and we, obviously, do not expect less usage on the internet going forward, we would anticipate people using the internet more and more over the years.”

    So yeah, it’s pretty simple. Bell wants to give you higher speeds, so you can reach your cap faster, so they can make more money. I can understand charging more for Fibe, but points 2 and 3 cannot be seen as legitimate streams of revenue growth. The CRTC must be made to see that UBB is a money-grab!! Marko Bibic is the DEVIL! I feel like finding out where Marko lives and egging his house.

  57. @hmm

    Don’t take my word for it, try it for yourself. Get 10 of your buddies to come over to your house and all try to download the same YouTube video at the same time over your home internet connection. It will work, but it will take a while. Your little home LAN is a very tiny piece of the internet and if it slows down when just 10 of your buddies are using it imagine what happens when 20 million Canadians and 250 million Americans are all trying to stream YouTube at the same time.

    Try it for yourself and let us know what happened. My guess is you don’t want to know the answer so you won’t. You will just sit in the weeds and pretend you have all the answers.

  58. Un-Trusted Computing says:

    Becky = Bell Shill
    For what it’s worth Becky, your experiment is flawed, buy you can believe whatever you want to believe.

    If you try this experiment at home your success rate (eg: getting a fast download from multiple computers accessing the same video) entirely depends on how many sessions your router allows, and how much bandwidth the originating site has. In this case Youtube has plenty.

    Any slowdowns would involve bad NAT configurations, and not bandwidth scarcity.

    The reality of caps is this, they do nothing to alleviate congestion because if there are caps, folks simply ration the gigs they have. It doesn’t mean they actually going to stop using those gigs from 7 to 10 pm when most congestion occurs.

  59. @Becky
    Don’t be a fool. I have tried it. (I’ve lived in my family’s house where everyone downloaded) I know exactly what it does.

    It is called concurrent usage, it has NOTHING to do with monthly capping or UBB. How much I used over the month != what portion of my bandwidth I was using at any given moment.

    Becky, you want to be arguing for throttling. That’s where your argument holds. For UBB – it doesn’t hold any water, as it is completely irrelevant.

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  61. @Un-Trusted Computing

    Most consumer grade routers have sufficient NAT capacity to support up to 64,000 concurrent connections but the practical limitation usually ends up being the speed of your connection. The higher your speed, the greater quantity of bits that can be downloaded in a given amount of time. So you can see that access speed and download capacity are related.

    The point I ma trying to make is that the networks that make up the internet are subject to the same laws of physics as your home network. The internet does not have infinite capacity. I am happy to admit that I am not a left wing socialist, I am pure right wing capitalist. If you want to stay at home downloading movies all day I say fill your boots, just don’t ask me to subsidize your usage through some flat rate, one size fits all approach.

  62. Un-trusted Computing says:

    @Becky You’re still a bell shill
    “Most consumer grade routers have sufficient NAT capacity to support up to 64,000 concurrent connections but the practical limitation usually ends up being the speed of your connection. The higher your speed, the greater quantity of bits that can be downloaded in a given amount of time. So you can see that access speed and download capacity are related.”

    So you admit that example you’ve tried to get everybody to try is going to lead them to a false conclusion? Why on earth would you want to do that… oh yeah you’re trying to use pseudo science to get people to believe Bell’s conclusions are correct.

    Now for the rest of your cow-excrement of a statement.

    Becky I do not care what your politics are, because there are agents of corporations who’s interests are counter to the public on both sides of the political spectrum.

    You used that famous Bell canard that “light users are subsidizing heavy users” and it’s patently false… the reality is that in Bell’s twisted imagination, grandma is still going to have to pay $40/mo even if her usage is a pittance, and heavy users (which will be tomorrow’s normal users) will pay a small fortune for speeds and usages that third world countries take for granted.

    Mirko Bibic called he wants his talking points back.

  63. @Un-trusted Computing or should we say un-trustworthy Computing

    So what you are really saying is that anyone who doesn’t agree with your gross misunderstanding of how networks work must be a “Bell-shill”. Well, you got that wrong too, I don’t work for Bell but if you must know I’m a tech at small ISP in BC that is likely to go out of business in the next two years.

    The owners of my company know the whole UBB issue is a political goldmine for them and they are hoping to milk it as long as they can. The problem is that an independent ISP that is based entirely on a resale business model isn’t really a viable business. But it can provide a nice living for them as long as they can continue to convince folks like you that the internet is going to get ugly without little ISP’s like us to “discipline the big guys”. Even a misguided and clueless fool like yourself has to see the humour in that.

  64. Un-Trusted Computing says:

    Still Shilling
    “The owners of my company know the whole UBB issue is a political goldmine for them and they are hoping to milk it as long as they can. The problem is that an independent ISP that is based entirely on a resale business model isn’t really a viable business.”

    ZOMFG!!! The exafloods is coming!!! quick, follow big telecom logic (like that one better?) before we all lose our Internets!

    I’m not in the mood to open up the right-of-way discussion but as I’m sure you know “the big guys” were granted a conditional monopoly on in the beginning in order to get a return on their investment for building out their copper.

    Is that socialism I smell? I guess for “pure right wing capitalists” such as yourself it’s OK for the government to help out large corporations and but not small companies and folks who vote them into power, but that’s another discussion.

    As far as your company going out of business, it’s very sad to hear that Canadians in your neck of the woods will be losing choice in the near future, if I were your boss I’d fire you now though.

    As they say; with friends like these…

    Hopefully s/he reads this blog and realizes his or her enemies are closer than they realize.

    Your statement about little guys are there to discipline the big guys wasn’t actually made by small ISPs it was made by the CRTC at recent hearings it the exact statement was “wholesale competition provides pricing discipline for internet prices” and it was made by Konrad von Finkenstein.

    But I suppose facts to a Bell *ahem* telco apologist such as yourself.

  65. Anti-UBB shill says:

    Becky I did the experiment
    And I did it bell’s way – I had 10 neighbours PAY ME 10% of my bill and let them use it. Yes it worked out fine. I took a 100/5 Mbps backbone (from shaw), thats $150/month. Each of us paid $15 and were able to watch youtube simultaneously with $15/month and no congestion! Miracle?

    What you dont understand Becky is that your house connection is paid for only 1 person. Get 10 persons to SHARE THE COST and you will see that it costs $15 to watch as much youtube as you want … for EACH of you. THIS is what we are pointing to. Bell takes money from ALL of us – and so we SHARE the cost of the backbone. Its only fair that we share the costs + lets say 20% profit. What bell is trying is to milk everyone of 10000% profit.

    Also, lets say I am a “list user” .. or 2GB download/month. Will bell RETURN ME THE MONEY for the rest of the 25 GB I pay for?

  66. @Anri-UBB shill
    It looks like you are in the same business as Becky – buying internet access from a larger ISP and selling it to your “customers”. So now that you are officially an ISP, I assume you will be making some investments in building out a network for your customers? How soon before I can get a fiber connection to my house from your company – or are you just in it to skim some cream off the top and not planning to invest any of your profits?

  67. @ Un-trusted computing

    I worked for the city planning department in Calgary as an intern last summer. Just to be clear, municipal rights of way are public property and any party can apply for access. The phone and cable companies pay the same rates as anyone else who wants to use them. No one has preferencial access except certain government agencies. Any company that wants to dig up the streets to place cable is welcome to apply for a permit, but they will bear all of their own construction/restoration costs plus pay an additional pavement degradation fee as well.

  68. Un-trusted Computing says:

    This would be great except that incumbent telecoms can use existing legacy rights of way to lay their fiber without have to re-negotiate putting them in a favorable position. The can also use their ROWs as facilitators for the non-mandated services as well.

    I’m aware that only big players are laying fiber to the node at the moment; but assuming the cost of laying fiber went down dramatically in the next couple of years, would the good folks of Calgary enjoy have their sidewalks ripped up every couple of years while each player laid their own backbone?

    Probably not… so we may still have to deal with mutually agreeable line sharing for the sake of good logistics.

  69. Un-trusted Computing says:

    There are different levels of infrastructure that ISPs can invest in:

    Some ISPs have white label services while others have facilities ranging from a small setup at Torix to FTTH with middle mile stuff like CO DSLAMS, and MDU setups. No ISP can provide “the Internet” on its own, but a good wholesale sector is a necessary stepping stone to real value added competition. (eg independent ISPs that cover more and more ground)

  70. @Un-trusted Computing

    You really are naive when it comes to business. You seem to be assuming that the owner of my company wants to stay in business forever which is false. She is not planning to close out due to UBB but rather because we aren’t big enough to provide cost-effective 24/7 customer support that consumers expect – the value of her business has been in steady decline for years. The UBB issue gives her a chance to attract a few more high-use customers that increase the value of her company for when she goes to sell out. It’s a gold mine for her that she wasn’t expecting and she is very happy. But the UBB decision won’t change the inevitable outcome.

    As for me I don’t really care if I work for her or Shaw or Telus. My skills are in demand and I’ll be fine. I do worry about you though as you don’t seem to have any technical skills and your understanding of business and the internet industry also appear to be questionable.

  71. Un-trusted Computing says:

    Hey Becky did you get the memo? Bell withdrew it’s UBB application… guess the ISPs are on the right side of history after all.

  72. @Crickets
    Not sure which newspaper you read but the Globe is saying Bell is proposing an aggregated usage billing arrangement for wholesalers. I don’t know if that still technically qualifies as UBB or not but I don’t really care.

    The only point I was trying to make before “Un-Trusted Computing” tried to change the subject and proclaimed me a Bell shill was that all networks run into congestion issues and the way you fix congestion is to invest money in building more capacity. I personally believe that those who are using up the most capacity should pay more than those of us who don’t in order to fund those network upgrades.

  73. Right Side of History says:

    Look in the mirror
    “I personally believe that those who are using up the most capacity should pay more than those of us who don’t in order to fund those network upgrades.”

    The reason why UTC referred to you as a Bell shill is because you parrot their talking points at every available opportunity, that much is evidenced by your posts.

    Mirko Bibic has stated publicly that UBB as previously requested was about money nothing more. This much is already a given to those of us that have been following the debate for some time.

    Should any upgrades occur they won’t be in areas used by wholesale that’s for sure.

  74. @Right Side of History

    Oh puleese! The tag you used to post your comment suggests you on some sort of righteous crusade. Let’s not get so carried away here that we forget that it takes money to build networks. If all the ISP’s in Canada gave their products away at cost, they would have no money available to upgrade or expand the networks and we’d all still be sharing 28K dial-up ports.

  75. Right Side of History says:

    The cost of maintaining the networks are already built into the tariff… the reason for an increasing revision upwards of this tariff is to appease shareholders… which is neither here nor there.

    Assuming Bell worked like a normal business, they’d be building extra capacity in order to sell more internets, but seeing as the Internet actually cuts into their higher margin businesses they’re seeking to curb usage.

    In a nutshell services like Skype, Netflix eat away at voice and video revenues, so they respond by capping and throttling their own services. When customers started to bleed over to competitive services they first tried to throttle the competition and when that failed due to the advent of MLPPP, they tried to price the competition out of the market.

    End result? Canadians don’t get access to access to services the rest of the world gets access to.

    If you think Bell (or any other member of the robellus clan) is going to build a next generation network where we can access converged services without sufficient competition then I have a some swamp land in Florida you can get in on… real cheap I promise.

    FWIW: the Tag I used to post does signify a crusade… and UBB was repealed, therefore placing me on “the right side of history” I figured a clever guy such as yourself wouldn’t confuse righteousness with self-satisfaction.

  76. @Right Side of History

    Ah yes, the great conspiracy theory. I live in Calgary and get my internet through Shaw so I don’t know much about Bell. But I do know that retail internet services in Canada are not regulated so there is no such thing as a “tariff” for internet services in Canada.

    Certainly Bell or any other ISP can set their internet prices and sweeten their offers anyway they think will give them an edge over their competitors. They also have the freedom to include the cost of maintaining their network in their pricing or charging for usage above a given threshold if they so choose. If their customers don’t like it they can shop around for another ISP with plans they like better. Telus just introduced some new stuff on their TV and internet service so I am in the process of switching to Telus – I am taking advantage of the competition.

    As strange as this sounds, Bell would likely not be able to price their service at or below cost since their competitors would head straight to the Competition Bureau to complain about predatory pricing.

    Not sure where you are getting the notion that Canadians don’t get stuff that other countries get. I’ve been using Skype for years with no problems and no evidence of throttling. I just got back from a trip to Phoenix where AT&T’s wireless network only supports 7 Mbps compared to 21 Mbps here in Canada. And one of the reasons I’m switching my internet and TV over to Telus is they now offer a Facebook app right on the TV and I can use my Xbox 360 as a STB – you can’t do that in the US. Also, Telus just increased their caps on their mid-tier service from 75GB per month to 125 GB per month while Shaw recently pulled theirs back – it would appear that not all ISPs are worried about Netflix.

    I also just noticed that Shaw is laying off 500 people so the competition from Telus must be hurting them. If they are being forced to lay off people then they may also be looking at scaling back investments in network upgrades – so being on the right side of history in the short term might actually prove detrimental to Canadians over the longer term, only time will tell.

  77. Right Side of History says:

    For discussion’s sake:

    The DSL tariff is what I was referring to… competitive ISPs have to buy AHSSPI links from Bell and Telus as a fixed price (it’s different rate for Bell and Telus) and then a per port rate ~18.95 per sub on the GAS network.

    Retail pricing is not regulated but wholesale access is.

    Although I’m aware that both Telus and Shaw are somewhat more neutral in their network management practices Rogers and Bell where I live certainly are not. Look no further than this blog for recent proof of this.

    The way in which Bell and Rogers act in an anti-competitive manner is to charge overages in a manner where you can’t afford the data charges associated with Netflix and Skype (Skype maybe not so much, but I’ve heard rumors of Bell agents quoting Skype as a reason for going over your cap)

    “As strange as this sounds, Bell would likely not be able to price their service at or below cost since their competitors would head straight to the Competition Bureau to complain about predatory pricing.”

    They can’t charge for *regulated* services below cost… but they are really good weasels though, and get all sorts of micro changes applied to these services to get out of the regulated category, after which predatory or conversely exploitative pricing ensues.

    As far as caps are concerned… if the monkeys in management at Bell had left well enough alone (not capped and throttled indies ISPs) this wouldn’t be happening.

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  79. @Becky L.
    I don’t think you understand what people here are saying. There is a difference between usage and bandwidth. I can use 1 TB/month and do it all in the middle of the night and not cause any congestion at all. The network does not need to be upgraded because of me. And it costs my ISP about $8.

    I’d be glad to pay more than other people given my bandwidth usage. I’ll even pay double what it costs my ISP to help make them some money. Let’s be generous. I’ll pay them triple..and a bit. I’m in favor of $25 dollars a month per TB.

    But that’s total usage. Bandwidth is another issue all together. I’m paying my ISP (Shaw) $150 per month to reserve me 100 MBits down and 5 MBits up for my usage day and night. I think the money they make from $150 per month should be enough to upgrade their routers and fibre to accommodate that. Upgrading is a one time fee and I give them money each month. And don’t tell me that it costs all $150 dollars just to maintain what they already have. Instead, it costs maybe 20 per month per user in order to maintain what they have. The rest is profit. Or a small portion of it should be. The rest should be to upgrade their network continuously.

    What’s happening, is that upgrades are not being done and they are taking it ALL as profit. Then complaining that their network is congested.