Over the past couple of weeks, there’s been a lot of talk about Usage Based Billing and a recent CRTC decision involving Bell Canada.
You – our Rogers High Speed Internet customer – want to know how you will be affected by this decision. The short answer: you won’t. Your rates and the amount of Internet bandwidth you’re provided each month remain unchanged. And we offer a number of plans that provide the vast majority of our customers with more than enough bandwidth to suit their needs.
The CRTC decision relates to a very specific question about the economics of how larger Internet Service Providers (ISPs) sell bandwidth to smaller providers. More on that later.
I’m writing here because there is considerable confusion around the issue. Our customers are asking us questions about Usage Based Billing in forums, blogs and Twitter. In these online discussions, a very specific CRTC ruling about wholesale billing rates has led to a broader philosophical debate about how customers should be charged for Internet services.
Some people say you should pay the same no matter what you use – that casual Internet users should pay as much as those who download movies and music around the clock. (According to one study the top one per cent of Internet connections is responsible for more than 20 per cent of Internet traffic.)
Others say it’s more fair for customers to pay for the amount of bandwidth they actually use. We agree with this approach. It’s in line with the way other services are billed including heat, electricity and water. We use a similar model in selling long distance minutes because we think a customer who doesn’t make long distance calls shouldn’t have to pay extra to subsidize the heavy business user who spends hours on long distance calls each day.
Rogers invests approximately $2-billion each year on capital investments. This includes a significant investment in our broadband networks to accommodate Internet traffic that is growing at 40 per cent each year. In order to maintain fast reliable service and prepare for ever increasing demands for bandwidth, we are continually laying new fibre and rolling out new innovations such as DOCSIS 3.0.
That’s why we think it’s more fair to charge customers for the amount of Internet bandwidth they actually use.
For years, we’ve offered a variety of Internet tiers to meet the needs of all our customers. For a casual customer, our Ultra-Lite plan offers 2 GB of Internet bandwidth each month. That’s enough to send and receive approximately 50,000 e-mails, download 100 songs from iTunes (5MB each) and upload/download 500 photographs (2 MB each).
On the opposite end of the spectrum, our premium tier provides you so much bandwidth (175 GB) that you could watch streaming video on YouTube every day from 7 a.m. in the morning until midnight without reaching your cap. Customers who go over on this highest tier pay just 50 cents more for each additional GB.
And while business customers pay a little more, their bandwidth entitlements are higher – allowing them to drive innovation without having to worry about overage charges.
Not only are customers using far more bandwidth than they did a few short years ago, they’re expecting faster speeds. And we’re delivering. Here’s one example. In 2006, customers on our premium Extreme Plus tier paid $99.95 per month for top download speeds of 18 Mbps. Today, they get top download speeds of 25 Mbps for just $69.99. We offer tools on Rogers.com to help pick the plan that’s right for you. And you can check your usage by logging into the MyRogers section of the site.
Now back to the CRTC decision, which related to the question of how larger ISPs sell their services to smaller ones. The CRTC said ISPs can bill according to the same usage based billing principles they use to charge their own customers but with a 15 per cent discount.
The CRTC decision continues to generate debate with Industry Minister Tony Clement saying he’s going to look into the decision. What’s important for us is that regardless of what happens, we want our Rogers High Speed Internet customers to know they will not be impacted by this decision.
Keith McArthur is Senior Director of Social Media at Rogers