The CRTC’s ruling means it is unequivocal in its ‘position is to support an open internet.’
Ben Klass Takes on Goliath:
Canadian regulators took a big step toward supporting net neutrality on Thursday with a ruling that bans wireless carriers from favouring their own content over others.
Bell and Videotron have till April 1 to end the practice of exempting their own video services from customers’ monthly data caps while still counting other online options such as YouTube and Netflix.
“When the impetus to innovate steps on the toes of the principle of fair and open access to content, we will intervene,” CRTC chairman Jean-Pierre Blais said in a speech.
“We will defend and support an open Internet. Canadians want an open communication system. And we heard you.”
Bell has responded to the decision by saying it will “stifle mobile innovation.”
The ruling is in response to a complaint filed in November 2013 by University of Manitoba student Ben Klass.
It’s a veritable David versus Goliath story in which a lone individual took on one of the biggest companies in the country – and won.
I chatted with Klass, who is now pursuing a PhD in communications at Carleton University in Ottawa, about the decision. Here’s an edited version of that conversation:
It seems like this is a total victory for you without any conditions, right?
I’d agree with that. In the announcement this morning, the CRTC chairman was unequivocal that their position is to support an open internet and to prevent the handful of vertically integrated providers from taking advantage of a gatekeeper-like position.
Is the most important part of this the fact that the CRTC is affirming that video over wireless is a telecom service and not a broadcast service?
Yeah. They provided some certainty. Bell raised this issue, the question of whether it’s telecom or broadcasting, and in the actual decision what the CRTC is basically saying is that when the company transmits the service to you, it’s subject to the Telecom Act.
Regardless of what you do on the internet, the actual treatment of the traffic has to be subject to the same set of rules.
The CRTC didn’t rule that this is a violation of its net neutrality rules, but rather that it transgresses the Telecommunications Act. Can you explain why that difference is important?
I’m still processing that particular distinction but in my view, the underlying principle of net neutrality is in this case being upheld by appeal to the Telecom Act.
The Telecom Act is intended to promote competition, to discipline market power and to ensure that no particular carrier can exercise preferential or discriminatory practices.
Companies have to be competing on a level playing field. That’s built into the law.
The net neutrality framework is built up on top of that, so I think what the CRTC has said here is, ‘we don’t consider this particular practice to be an ITMP [Internet Traffic Management Practice] because they’re not doing any priortization at the technical level.’
Where I may have some disagreement is the practice of usage-based billing [also known as data caps], which this case really shows, can be used as a way of discriminating between different kinds of services.
It seems the commission is upholding the principle, but hasn’t really acknowledged that usage-based billing (UBB) as a traffic management tool is being used in this way.
That could lead to problems down the road. For instance, take a look at cable TV versus Netflix. They’re coming down the same pipes, but one of them is subject to UBB and the other is not.
It’s a slightly different distinction at a technical level because they use something called a VLAN to deliver the IPTV, but from the consumer’s point of view you’re still limited in watching content from other service providers whereas with the cable TV you’re able to watch unlimited.
The commission is walking a fine line. They don’t want to start dragging these bigger issues into this decision. But a failure to acknowledge usage-based billing as the central issue here can cause problems down the road.
The U.S. Federal Communications Commission is in the midst of its own net neutrality battle. Do you think this decision will have any impact there?
In terms of the similarities between the U.S. and Canada, the carriers there are using the claim that the internet is an “information service” where it can’t be regulated in a similar way that the companies here are saying it’s a broadcast service that can’t be regulated.
I think the U.S. is pretty much its own force, so I wouldn’t go so far as to say this will have a direct influence. But, on the broader issue of zero rating or positive price discrimination, this is something that’s developed since [my] complaint began in November, 2013.
Around the world in various countries, particularly in developing countries, you have companies such as Facebook or in the U.S. it’s AT&T with its sponsored data plan, arguing that content companies should be able to pay the data charges for customers.
They say this is a way to bring internet access to people who otherwise wouldn’t be able to afford it.
There’s something to be said for that but at the same time you have to think that if this is allowed, is this really the internet that people are getting or is it more like AOL 2.0?
The closest parallel of this issue to the U.S. seems to be T-Mobile’s Music Freedom program, which exempts certain music services from data caps. How similar is it?
I met with and discussed this briefly with one of the FCC commissioners in Ottawa a couple months ago. They are monitoring this situation.
It’s slightly different because in Canada it’s the same company. It’s Bell who does the broadcasting and the internet, whereas with T-Mobile it’s third-party services like Spotify that are getting exempted.
My suspicion would be that in the United States they’d probably lean towards a slightly more permissive approach because it’s not one carrier getting benefits, but rather there’s competitive negotiation going on.
I think in the case of T-Mobile, they actually provide some sort of online voting system on a monthly basis where customers choose which ones are exempt.
But the same underlying principle of carriers picking winners and losers is something that is important and really needs to be watched closely. It’s a developing situation so I don’t think they’re going to move to ban it.
What initially motivated you to launch this complaint?
I saw the Bell advertising and I’ve been hit with the data charges myself before. I hear lots of people expressing frustration about the data limits and the usage-based billing debacle in 2010-2011.
I’m familiar with it and saw that Bell was exempting its own service from the data limits, so it really highlighted for me how unfair the usage-based billing situation is in the first place.
If Bell can encourage its own customers to watch its own video, then how can it possibly justify limiting the use of the broader internet and competitors’ services? It seems patently unfair.
What sort of reaction are you expecting from Bell and others?
I couldn’t say if they’ll file a review or any of that stuff, we’ll have to wait and see. In terms of Bell’s PR reaction, I could see them saying that this decision is going to cost Canadians and they’re going to have to raise rates and so on.
I’d respond by saying that if the market is as competitive as these companies say and if they’re as innovative as they say they are, then they wouldn’t be able to raise prices.
If Bell was really committed to providing Canadian content and getting customers to use its service, they would find other ways of offering the TV app.
Imagine if Bell started offering larger data caps than its competitors as a way of attracting people to its mobile TV service. In a competitive market, that’s what we would be seeing.
What are you going to do once you’re finished your PhD?
I’ll leave that as an open question. All this telecom and communications and internet stuff, I’m passionate about it so I think I’m going to continue learning about this field and participating any way I can.
UPDATE: Bell spokesman Jason Laszlo responded to the CRTC decision with the following:
“The Bell Mobile TV decision is a shock. Bell has led the world in mobile TV and we’ve worked to keep the price low. More than 1.5 million Bell mobile TV subscribers across Canada responded to that kind of innovation and affordability.”
“There’s a hint here that the government believes Bell Mobile TV delivers only Bell Media content. They should know we offer mobile TV content from all of Canada’s leading broadcasters in English and French. Bell Media content accounts for only about 20% of Bell Mobile TV programming.”