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Canadian Regulator Orders Telecoms To Tell Us What It Costs To Run Their Service

Soulskill posted about 2 years ago | from the jig-is-up dept.

Canada 120

bshell writes "Canada's CRTC (like the FCC) has finally asked telecoms to provide information about how much their services actually cost. Quoting a Montreal Gazette story: 'In a report I wrote last year, I estimated the markup for Internet services was 6,452 per cent for Bell's Essential Plus plan, which provides a two-megabits-per-second speed for $28.95 (prices may have changed since last year).' The markup is likely similar in the U.S. It's about time that we consumers found out what it really costs to provide Internet service, and for that matter telephone and wireless services, so we can get a fair shake."

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almost nothing. (0)

Anonymous Coward | about 2 years ago | (#41783739)

It's well know that telco make millions in profit only with text message.

Re:almost nothing. (2)

kenh (9056) | about 2 years ago | (#41786637)

So what? It isn't about the cost to provide the service, it's the cost your customers are willing to pay.

Not in a free market. (0)

Anonymous Coward | about 2 years ago | (#41787923)

And profit rates like this show that there is a monopoly (or collusion going on).

not really that simple. (5, Insightful)

queazocotal (915608) | about 2 years ago | (#41783751)

The cost of providing services can't ignore fixed costs.
Sooner or later providers would need to install more hardware, or maintain the existing infrastructure.
Costing is complex. Marginal cost is not the sole cost.

Re:not really that simple. (2)

geekoid (135745) | about 2 years ago | (#41783761)

Correct, OTOH what's the markup after that? a measly 3000%?

Re:not really that simple. (4, Informative)

ILongForDarkness (1134931) | about 2 years ago | (#41783931)

The markup is large but I suspect it is no where near that by the time you add in advertising (print, TV, cold/warm calls), collections activities, billing legal etc. The ISP business might very well be like Coke: 1% cost what is in the bottle and all the rest is branding and service around that. If investors really got to make 6000+% on there money the market would flood with people wanting those returns and the prices would drop.

Re:not really that simple. (2)

fredprado (2569351) | about 2 years ago | (#41784107)

But that is the big catch. They have concessions. No matter how profitable their business get they will have no further competition than they already do.

Re:not really that simple. (3, Informative)

ILongForDarkness (1134931) | about 2 years ago | (#41784347)

Rogers didn't have competition in the cable space in east Canada and then Bell got into the business. For phones you have Fido, Virgin etc entering the market. ISPs: the little guys have always been around. They get screwed over since they have to lease bandwidth from one of the big players (usually Bell since it is DSL) but still it is there. They have nothing like the advertising (I think they are so local the revenue can't get them TV time) but you can get a fastish (5Mbps) connection for ~$30 with no limits in most places, some of them even explicitly state they don't traffic shape, the connection is symmetric etc.

Re:not really that simple. (5, Insightful)

Anonymous Coward | about 2 years ago | (#41784931)

Fido and Virgin are terrible examples, considering they're owned by Rogers and Bell respectively...

Re:not really that simple. (1)

fredprado (2569351) | about 2 years ago | (#41785025)

Some times another company enters the market when the government wants to open a new concessions. That has nothing to do with the amount of profit though, and it will always be limited to the number of concessions the government wants to open.

In the end as there are very few companies anyway, sometimes from the same owner, it is very easy for them to arrange for a mutual beneficial agreement regarding basically anything, including prices.

Re:not really that simple. (1)

ue85 (1961968) | about 2 years ago | (#41785431)

The same big three in phones are the same as they always have been. It is a pretend competition because the three others are simply faux-competitors: Fido is owned by Rogers Virgin is owned by Bell Koodo is owned by Telus You're still paying into the same pockets. Sometimes a lack of choices can drive prices down. In Nova Scotia for example you have to primary choices for services, either Eastlink or Bell-Aliant. Both are competitively priced and offer fairly decent bundled services. With their most common packages neither have implemented data caps and the speeds offered have actually increased over the years (15/1 MBit for Bell and 20/2 for Eastlink). Both know if they change their pricing, or limit their packages, customers will flock to their competitor. While in Ontario there are boat loads of choices, all with different "perks", but in the end you're still getting screwed because they all have you paying extra for similar speeds or hitting you with data caps. Paradox of Choice and lack of DIRECT competition hurts the consumer.

Re:not really that simple. (1)

CastrTroy (595695) | about 2 years ago | (#41785533)

Cell phones are getting cheaper if you live in they city. I'm using Wind Mobile and I save quite a bit over the other guys. $30 a month for unlimited text, data (slow down at 5GB) and local calling. The big three can't even come close to that price. Most people I know are paying double that. Sure those rates only apply when I'm in the city limits, but that's where I am most of the time anyway. I'd have to be doing quite a bit of traveling to make up for the price difference. Assuming (conservatively) I save $20 a month, Over a year that $240. Which is enough to pay for 2400 minutes of talk time outside the city. Or I could not talk so much when I leave the city and use the money to buy a new phone.

Re:not really that simple. (2)

compro01 (777531) | about 2 years ago | (#41786801)

For phones you have Fido, Virgin etc entering the market.

Hah. Fido, Virgin, and Koodo are wholly owned by Rogers, Bell, and Telus respectively.

It's nothing but a shell game to create the illusion of competition.

Re:not really that simple. (1)

sycodon (149926) | about 2 years ago | (#41785231)

Because it's complex, what the should have done was send an army of auditors armed with a law stating cooperate or go do jail.

Accounting techniques can make a money loser seem like a money winner and visa-verse.

Re:not really that simple. (1)

Lynal (976271) | about 2 years ago | (#41785659)

Research has shown that in some markets if we outlawed advertising, prices would drop while demand wouldn't decrease as significantly, and everyone would be better off.

If you also consider that this may be a 'price as a signal' market, knowing marginal cost could let consumers make better choices, and we could get better outcomes.

I'm an economist so I might be biased, but this seems like a good thing.

Re:not really that simple. (1)

jenningsthecat (1525947) | about 2 years ago | (#41786383)

Research has shown that in some markets if we outlawed advertising, prices would drop while demand wouldn't decrease as significantly, and everyone would be better off.

But, but... think of the advertisers! Everyone would be better off, except them...

I'm an economist so I might be biased, but this seems like a good thing.

I agree. What was that bit in Hitchhiker's Guide about the 'useless third' of the Golgafrincham population?

Apologies for twisting your words - I just couldn't resist.

Re:not really that simple. (1)

TubeSteak (669689) | about 2 years ago | (#41785855)

The markup is large but I suspect it is no where near that by the time you add in advertising (print, TV, cold/warm calls), collections activities, billing legal etc.

Companies wouldn't pay for any of those things (other than legal) if they didn't provide a positive return on investment.
Most bad bills get sold off to a debt collection agency for pennies on the dollar, because trying to collect directly would cost far too much.
Billing, even though it's the way they make money, has been heavily computerized in order to cut costs.
Advertising... why are we even talking about this?

Re:not really that simple. (4, Interesting)

ShanghaiBill (739463) | about 2 years ago | (#41786443)

The markup is large but I suspect it is no where near that by the time you add in advertising (print, TV, cold/warm calls), collections activities, billing legal etc.

Companies wouldn't pay for any of those things (other than legal) if they didn't provide a positive return on investment.

Just because something has a positive ROI doesn't mean it doesn't drive up costs. My wife made an iPad app. Initially she sold it for 99 cents. But we were able to double sales by running some Google ads. But the Google ads cost 20 cents per click and only a quarter of those clicks resulted in a sale. So that means the advertising cost was 80 cents for a 99 cent sale, which is a 10 cent loss after Apple takes their 30% cut. So we raised the price to $2.99. Now one click in seven leads to a sale, but the price is high enough to pay for the advertising and still leave a profit. So the advertising has positive ROI, but only if we raise the price.

Re:not really that simple. (0)

Anonymous Coward | about 2 years ago | (#41788119)

In other words: Your wife had to triple the price (*300%) to get %60 increment in income (0.99 -30% v.s. 2.99 -30% -0.80).

And you still think that is a good trade-off ?

Really ?

I wonder what would have happened if your wife would have simply doubled the price. I get the feeling (without actual numbers there is no way for me to verify) that you would have come out on top, even without advertising.

Re:not really that simple. (0)

Anonymous Coward | about 2 years ago | (#41786289)

None of those should be considered costs of providing service. Maybe billing (I disagree), but at bulk mail rates, how much could it really cost to send a paper statement every month, a few cents? Go paperless.

Re:not really that simple. (3, Interesting)

kenh (9056) | about 2 years ago | (#41786621)

'In a report I wrote last year, I estimated the markup for Internet services was 6,452 per cent for Bell's Essential Plus plan, which provides a two-megabits-per-second speed for $28.95 (prices may have changed since last year).'

That makes no sense.

$28.95/64.52 = $0.45

So the author of the original piece "estimated" that it only costs 45 cents to provide 30 days of wired internet access? That is nonsensical. The ISP can provide 30 days of ISP service for 45 cents? How much of that estimate accounts for the cost of electricity to rn the headend equipment to support the service? How much of that 45 cents goes towards mailing the bill to the client each month, etc?

Re:not really that simple. (0)

Anonymous Coward | about 2 years ago | (#41786763)

In Canada there are only three major wireless carriers and realistically only a single monopolistic telecommunications carrier. The cable and satellite has maybe four participants in an oligarchy. There is no reason to advertise although they do simply to pretend their is a competitive market for the consumer. If they charged less for the services there would be a reduction in the necessity for collections and billing departmental overhead. The legal departments only exist to perpetuate the monopoly or oligarchy as the case may be at any given time.

Re:not really that simple. (0)

Anonymous Coward | about 2 years ago | (#41787911)

There is no market.

Re:not really that simple. (5, Informative)

Anonymous Coward | about 2 years ago | (#41783829)

I don't get this issue here. Most of these companies are publicly traded, so you have access to their financials. Go look for yourself if you want to know what their operational profit margin is.

Re:not really that simple. (0)

Anonymous Coward | about 2 years ago | (#41783981)

Parent hit the nail on the head.

Re:not really that simple. (4, Interesting)

similar_name (1164087) | about 2 years ago | (#41784153)

Large companies are complicated. AT&T for example recently posted $3.64 billion profit on $31.46 billion in revenue [chicagotribune.com] . Compared with the quarter before where profit was $3.62 billion (slightly lower) on $31.48 billion (slightly higher) in revenue. Two things to note. First is that cost in each quarter was different by about $40 million. Second is profit went up when revenue went down. New customers cost more so slow customer growth meant decreasing revenue but increasing profits. To make matters more complicated this is all while carrying $64.5 billion in debt [att.com] .

Re:not really that simple. (0)

Anonymous Coward | about 2 years ago | (#41787903)

"$50M bonus and $25M worth of comps for each of a dozen executives" still appears as a "business expense" on those financial releases, even though it has fuck all to do with the actual cost of doing business.

Re:not really that simple. (4, Informative)

Anonymous Coward | about 2 years ago | (#41783917)

actuallly, most of the fixed costs that you would imagine telcos pay to secure rights of way, lay wire, etc. etc. is heavily subsidized by taxpayers, so effectively we're paying for that part, too, even if we don't subscribe to their ridiculously overpriced internet service

so charge like a utility (2)

Chirs (87576) | about 2 years ago | (#41784791)

Fixed monthly cost for maintaining the lines, then much smaller per-GB cost for bandwidth.

Re:not really that simple. (1)

Anonymous Coward | about 2 years ago | (#41785439)

It is simple. I would not believe that they don't track this information themselves. If they did not, they are a failure and they are surviving based on luck or abuse. Every business should know the cost of doing business.

Re:not really that simple. (0)

Anonymous Coward | about 2 years ago | (#41788007)

Sooner or later providers would need to install more hardware, or maintain the existing infrastructure.

Haahaha tell that to the Telecom here in NZ.

SMS (1)

wiedzmin (1269816) | about 2 years ago | (#41783773)

Yeah, make them reveal how much it costs them to send each SMS that they charge [gthing.net] is 15 cents to send and receive (unless we have a "plan").

Re:SMS (2)

Mitreya (579078) | about 2 years ago | (#41783891)

Yeah, make them reveal how much it costs them to send each SMS that they charge is 15 cents to send and receive

I especially like the part about charge-to-receive (I pay 20 cents each way). Imagine if post office charged you 45c for every letter you receive with no option to decline.
How is this not illegal? It's out of my control.

Re:SMS (1)

geekoid (135745) | about 2 years ago | (#41783921)

It takes people to get there government to create a regulation. That's how it stopped with phone calls in the US. SO when you are called on a land line, YOU don't get long distance charges.

Re:SMS (1)

Alex Pennace (27488) | about 2 years ago | (#41784117)

I was under the impression that "caller pays" was always the rule for land line phone service, and this happened even without government edict.

You have piqued my curiosity, do you have any more information on this?

Re:SMS (1)

alannon (54117) | about 2 years ago | (#41785371)

You mean, exactly how many postal services ORIGINALLY operated? In the UK, it was receiver-pays until about 1840. Of course, that doesn't mean that the system wasn't terrible and unfair.

It wasn't reciever AND sender pays (0)

Anonymous Coward | about 2 years ago | (#41787929)

And you got a chance to refuse in the UK postal delivery.

That's not how prices works (0)

Anonymous Coward | about 2 years ago | (#41783775)

Prices works in value given, not only costs. And if the cost is higher than the value given then the idea isn't cost-effective. Is really silly to make a pricing strategy only based on the costs. Even sillier think that saying them how's their profit share is fair in any way. Use another service if you're not ok with their pricing scheme or anything.

Re:That's not how prices works (0)

Anonymous Coward | about 2 years ago | (#41783873)

May be that is why in some more socially oriented countries in Europe there are laws allowing only as much as 20% mark up on your costs :)

Re:That's not how prices works (0)

Anonymous Coward | about 2 years ago | (#41784051)

Thank God, I don't live in a 'socially oriented' country in Europe then. Look nobody is forcing anybody to buy anything*. If the consumer is willing to pay 100% mark up, then so be it. If a same or similar product only has 10% mark up, gee... I wonder which one the consumer will buy.

Whoever decided that consumers are nothing but mouth breathing checkbooks with 60 IQ's should be ridiculed out of office.

*I forgot that Obama, Roberts, Sotomayer, Breyer, Ginsberg, Kagan shat all over the Constitution and declared the Federal Govt can force you to buy anything, from insurance to automatic weapons.

HILLBILLY ALERT!!! (0, Insightful)

Anonymous Coward | about 2 years ago | (#41785547)

You must be from Kansas or Alabama or somewhere like Arkansas, and undoubtedly are a home schooled "intellectual" idiot. Take your confederate flag and wave it all about! If not already, you'll soon have a job a a Walmart "greeter" or stock person. You're probably sucking on the government teat as well. The telling part: saying that Obama, Roberts, Sotomayer, Breyer, Ginsberg, Kagan ... declared the Federal Govt can force you to buy anything ... automatic weapons. I bet you have plenty of guns and ammo and are waiting for the revolution. Asshat.

Re:That's not how prices works (-1)

Anonymous Coward | about 2 years ago | (#41783943)

May be that is why in some more socially oriented countries in Europe the value mark up is limited to 20% of the costs of product or service by law.

Re:That's not how prices works (4, Insightful)

Belteshazzar (202070) | about 2 years ago | (#41783957)

Use another service if you're not ok with their pricing scheme

I would have no problem with what you are saying if it weren't for the fact that the 'service' they are providing is access to a limited public resources they do not own but instead license it's use from the public. When you are granted a monopoly to resell a public resource, it generally comes with the stipulation that you operate in the public's best interest.

Re:That's not how prices works (0)

Anonymous Coward | about 2 years ago | (#41784015)

You presume there is some form of other competitor that they aren't colluding with to keep prices artificially high.

Re:That's not how prices works (4, Insightful)

sjames (1099) | about 2 years ago | (#41784087)

In a healthy market, market forces will drive you to price based on costs. Only an unhealthy market can support value based pricing.

The fact that there's so much value based pricing out there is sending us a message.

Yawn... (4, Insightful)

NeutronCowboy (896098) | about 2 years ago | (#41783777)

What - did the regulator just find out that his industry is a natural monopoly, has a few very entrenched players facing almost no competition, and who are protected by near infinite barriers to entry? And did I mention that the service provided has morphed into a requirement on the order of electricity and roads?

Welcome to market pricing when the market is not competitive and has highly inelastic demand. And if he tries to "get a fair shake", watch the telecoms pull out their infrastructure build-up costs from 30 years ago to justify pricing now. I expect that after the telecoms are done with their studies on their profit margins, they will lose $2000 on every byte they transmit.

This is so doomed to fail.... I need to grab my popcorn.

Re:Yawn... (1)

fuzzyfuzzyfungus (1223518) | about 2 years ago | (#41783841)

Just for giggles, I wonder if the costs of lobbying against the requirement to provide cost estimates can be factored into the cost estimate?

Re:Yawn... (0)

Anonymous Coward | about 2 years ago | (#41784215)

What - did the regulator just find out that his industry is a natural monopoly, has a few very entrenched players facing almost no competition, and who are protected by near infinite barriers to entry? And did I mention that the service provided has morphed into a requirement on the order of electricity and roads?

More like the regulatory agency doesn't seem quite as beholden to the interests of Big Telecom as it used to be. One can hope anyways.

Welcome to market pricing when the market is not competitive and has highly inelastic demand. And if he tries to "get a fair shake", watch the telecoms pull out their infrastructure build-up costs from 30 years ago to justify pricing now. I expect that after the telecoms are done with their studies on their profit margins, they will lose $2000 on every byte they transmit.

If they do that, the regulator can pull out the millions and millions in government funding that most of the telecoms received in the past. Especially heinous is a bit of funding from the 90s (intended for infrastructure upgrades), where Parliament neglected to specify consequences for not spending the funding on infrastructure. So Bell et al spent it on bonuses and shareholders instead.

Re:Yawn... (0)

Anonymous Coward | about 2 years ago | (#41788547)

Yes but in Canada, a lot of that infrastructure was taxpayer funded. Now they're acting like 'they built that' and milking it dry.

I sense a great disturbance in the force... (5, Funny)

fuzzyfuzzyfungus (1223518) | about 2 years ago | (#41783815)

As if hundreds of Hollywood accountants suddenly received job offers from Canadian Telcom companies...

Basic accounting (0)

Anonymous Coward | about 2 years ago | (#41783833)

How much does it cost?

(Gross revenues - liabilities) / number of subscribers.

How much less could/should it cost?

Profit / number of subscribers

Jobs (1)

pitchpipe (708843) | about 2 years ago | (#41783837)

Canadian Regulator Orders Telecoms To Tell Us What It Costs To Run Their Service

I wonder how many millions of jobs will be lost in Canada because of this new regulation.

Re:Jobs (1)

ILongForDarkness (1134931) | about 2 years ago | (#41783961)

Since Rogers, Telus and Bell have ~120k employees and also provide phone and cable services with those employees I'm willing to guess that the answer will round to zero millions. That is a lot of millions for a country as small as Canada :)

Re:Jobs (0)

Anonymous Coward | about 2 years ago | (#41784255)

Telus already shipped their customer support to somewhere in Asia. I don't any of the telcos have many Canadians left on regular staff.

Re:Jobs (0)

Anonymous Coward | about 2 years ago | (#41785343)

Disclosure: I work for Shaw. We're not a cell phone provider, but we do provide land-line phone service and our customer support is 100% Canadian.

Re:Jobs (0)

Anonymous Coward | about 2 years ago | (#41784813)

Information like that shouldn't cause job loss. What, do the Canadian telecom companies have to worry about, oh, Mexico Telecom or something moving in and competing with them if they reveal their secrets? Don't make me laugh. They're practically a monopoly. They have little to lose by stating their actual costs. Of course, we know they're probably going to do a bunch of Hollywood accounting to make sure the numbers are bogus, like the way *nobody* could explain to me why after my 3-year contract, when the amortization of the cost of my cell phone hardware was paid off, my service costs didn't go down. "That's just the way it is." Uh huh. Right.

Re:Jobs (0)

Anonymous Coward | about 2 years ago | (#41786359)

We can only hope a lot of jobs will be lost... We have a pretty decent culture of small businesses here but American-style corporationism is taking over and we can always do with less "jobs" and more independent trades people. Yes, some industires like telecom are best handled by large corporations, but it's important to remind people constantly that running a small business is much better than being a working stiff.

You Would Be Very Surprised (0)

Anonymous Coward | about 2 years ago | (#41783867)

You would be very surprised how much is costs to run a telco.

Here's a newspaper article that indicates a rental cost for electric poles. [tbo.com] $32 per pole per year ads up when you have to run your wires for a few miles, let alone a few thousand miles.

Then there are additional costs for termination, ports, peering or upstream bandwidth, equipment, facilities, real estate, vehicles, labor, insurance, benefits...

Not cheap.

Re:You Would Be Very Surprised (0)

Anonymous Coward | about 2 years ago | (#41783955)

umm, interesting you'd reference a completely non-applicable dispute between two privatized american companies. shill much, AC?

Re:You Would Be Very Surprised (0)

Anonymous Coward | about 2 years ago | (#41785751)

Those poles were put up with tax money. Therefore they should bill the private entities that use them, but same private entities should not be allowed to pass down the said cost to the society that already paid those taxes.

Re:You Would Be Very Surprised (1)

dead_user (1989356) | about 2 years ago | (#41786237)

Not sure about where you live, but around here the poles are owned by by any one of the major players, be they cable, phone, or power. They are each numbered and have a small tag on them stating their ownership status. They then all rent space on each other's poles. The public part of the deal is that the land is on a permanent lease that intersects every other property as needed. They are leasing access to the right of way in exchange for the franchise tax or agreement. A local municipality here passed up the tax income from a local cable provider for a guaranteed operational dark fiber ring with maintenance thrown in to boot. Not a bad deal for either side really.

The prices could be better (3, Insightful)

SuperMooCow (2739821) | about 2 years ago | (#41783875)

The prices and the speeds could be better, but IMHO the real problem is the incredibly small monthly caps that we have up north.

A monthly cap of 50GB is just proof that the companies are trying to use their ISP side to protect their media broadcasting side. Bell Internet is protecting Bell ExpressVu, the CRTC should not be blind to the conflict of interest in all this.

The monthly cap should start around 100GB even for the slowest speeds and go up from there. My 2Mbps connection has a 35GB monthly cap with fees of around $5 per extra GB, which is insane when you consider the cost to Bell.

Re:The prices could be better (1)

ILongForDarkness (1134931) | about 2 years ago | (#41784023)

Do what I do ignore the cap. When you reach it they only charge you the $5 for the first 50GB or something. If you get a better package you usually get a smaller fee for the overages too. I have 150/10 with Rogers and only get dinged 50c per GB over 250GB. I'd like that it was free but I'll pay $25 a month for unlimited porn.

who has caps that small? (1)

Chirs (87576) | about 2 years ago | (#41784833)

In Saskatchewan the competitors are Shaw and Sasktel. Shaw's caps start at 125GB/month but there is effectively no penalty for exceeding it, while Sasktel doesn't have any caps.

Re:who has caps that small? (0)

Anonymous Coward | about 2 years ago | (#41786567)

Live in a bigger city ;-)

Re:The prices could be better (1)

AlphaWolf_HK (692722) | about 2 years ago | (#41785467)

Ouch. They say broadband is bad in the US, but in Arizona my ISP gives a 30mbit connection for $60 with a 250gb cap that they've never actually enforced (and I regularly exceed it every month, sometimes doubling or tripling it.)

Whats strange is there's no real competition here either.

Re:The prices could be better (0)

Anonymous Coward | about 2 years ago | (#41785617)

From Shaw in my part of Canada $60 gets you 25mbit down, 2.5mbit up, and a 250gb cap, which they rarely enforce (that will change next year).

Re:The prices could be better (0)

Anonymous Coward | about 2 years ago | (#41785777)

You get 50GB? In my dreams. I live in a semi-rural area about 80km outside Toronto (Canada's largest city) and my only available internet option is a Bell Canada wireless service which costs $60/month for a 10Gb cap. Highway robbery.

Re:The prices could be better (0)

Anonymous Coward | about 2 years ago | (#41786281)

Try being even further north. In the NWT, most people have only one choice: Northwestel.
http://www.nwtel.ca/media/images/cable-internet-table_personal.jpg

Check out their pricing, and note that this changes for some areas and many places do not get the higher packages. Hell, we have only had the 70 and 110 caps available since January, and they only recently dropped their overage charge to 75c per GB from $1.

Re:The prices could be better (2)

Maow (620678) | about 2 years ago | (#41787829)

The prices and the speeds could be better, but IMHO the real problem is the incredibly small monthly caps that we have up north.

A monthly cap of 50GB is just proof that the companies are trying to use their ISP side to protect their media broadcasting side. Bell Internet is protecting Bell ExpressVu, the CRTC should not be blind to the conflict of interest in all this.

The monthly cap should start around 100GB even for the slowest speeds and go up from there. My 2Mbps connection has a 35GB monthly cap with fees of around $5 per extra GB, which is insane when you consider the cost to Bell.

I had a 300 GB soft cap when I first signed up with TekSavvy cable-modem based internet, for $35 / m. They reworked their plans and now, for $35 / m it's unlimited.

Shop around, there are better deals out there.

Even with Wind Mobile I have 5 GB / m before throttling kicks in (tethered), included in a $40 / m plan giving unlimited North America wide talk & text, unlimited global SMS, call management (vmail, call display, etc.), no contracts, *and* truly subsidized phone (HTC Amaze 4G for $99 if I keep my $40 / m plan for 3 years after which the phone is mine), *and* network unlock codes after 3 months as a customer.

Um, sorry, didn't mean to go on so long, but I am pretty damned happy with those 2 service providers. And no, I'm not affiliated in any way.

Seriously, check around for better ISP...

I want to see (0)

Anonymous Coward | about 2 years ago | (#41783877)

What it really costs (infrastructure, redundancy, switches, hubs) and what it costs to employ people that are going to keep that service once it is up and running. it looks liek they are just looking at the infrastructure cost to build, and expecting it to work forever.

Which we all know, is simply not the damned truth. And then they have to pay the employee's that take those phone calls about things like... My internet isn't working. So, whats the REAL markup after all of that? (yes, I know it will vary).

Like the FCC... (1)

Belteshazzar (202070) | about 2 years ago | (#41783907)

I misread the beginning bit and thought the article was suggesting that the FCC was also asking US telecoms to provide actual cost info. Then reality set in and I remembered that in the US the telecoms "Rule the Air" not the FCC.

A "fair shake" (2)

MSTCrow5429 (642744) | about 2 years ago | (#41783951)

For the telco: Infinite

For you: Zero

Solution: Supply and demand

Re:A "fair shake" (1)

firewrought (36952) | about 2 years ago | (#41784089)

Solution: Supply and demand

Not a very good solution if the supply is monopolized.

Re:A "fair shake" (0)

Anonymous Coward | about 2 years ago | (#41784283)

supply is monopolized

Bingo. Liberalize right-of-way and transit and the cost of bandwidth will drop an order of magnitude.

Alas, all the relevant organs of government from the FCC on down that must act to achieve this are willingly captured by telecom/cable companies while soaking up various and sundry taxes and fees.

Re:A "fair shake" (0)

Anonymous Coward | about 2 years ago | (#41784189)

now, now - we get six attempts at a 'fair shake'

So.... (3, Insightful)

RandomUsername99 (574692) | about 2 years ago | (#41783979)

This is good... we can know exactly how much they're screwing us. This will be yet another legal disclosure to be buried in fine print, surrounded by legalese, and whisked away from the collective consciousness. Do they expect enough people to cancel their internet access, on principle, to pressure the ISPs to offer more reasonably priced plans? Give me a break.

This is yet another example of shifting the responsibility to individuals to work against gigantic corporations, which are designed specifically to insulate themselves from the actions of individuals. These companies are purposefully not giving the customers properly priced choices, because they know that there's nowhere customers can go to get properly priced choices. Until someone compels one or more of them to give properly priced choices, or gives consumers another option, the status quo will remain in effect.

It's not price fixing because we haven't actually seen them talk about it... right? There's the "free" market for you.

Re:So.... (1)

Anonymous Coward | about 2 years ago | (#41788527)

No, we will get nothing out of this. I think this is basically an excuse for the big three to show how "little" they are making and thus should be able to buy up competitors (Remember Bell just got shot down in it's bid to buy Astral). Basically, what's going to happen is the charges will be displayed, with hundreds of "out-sourcing" companies that charge $$ and thus Bell only makes a small profit (say 5-10%). The Regulators and investigators will ask for information about the "out-sourcing" companies and be told they are privately owned and thus do not have to say or provide anything.

Then the regulators will state they are allowed to make 20% profit and that, for competition and pric sustainability, the big three should be allowed to purchase stakes in smaller competitors to provide the growth they require. Wham Bam, our costs (as individuals) we go up 5-10% and the Big Three will be able to buy up competitors to "help them". The other issue that may come from this is that The Big Three will be allowed to "drop prices" aggressively below costs in areas to compete with the "small" competitors in order to maximize the use of their infrastructure while maintaining higher prices elsewhere (currently not allowed based on regions), but will allow the Big Three to put most of their smaller competitors out of business or in a better position to be bought out.

Basically, this sounds like it is good for the "customers" when in fact this is just another entrenchment of the Big Three to get around current regulations and Protections. To see history repeat itself just look at the whole CRTC Data Caps fiasco (What should have been good for consumers turned into the nightmare we currently have -- and the Big Three can still, mostly, smell rosy, while shoving this shite down our throats).

In the US competition gets sued out of existence (2)

GoodNewsJimDotCom (2244874) | about 2 years ago | (#41784065)

We had states compete with Comcast and Verizon. Guess what, they got sued because it was found illegal for government to compete with corporations.(The stories were on Slashdot) Yet somehow UPS and Fedex haven't found a way to sue away the Post Office...

Re:In the US competition gets sued out of existenc (0)

Anonymous Coward | about 2 years ago | (#41784387)

There is a law that says that corporations can compete with the post office.

Re:In the US competition gets sued out of existenc (1)

gatfirls (1315141) | about 2 years ago | (#41784399)

Simple, the USPS does not a have a profitable business model.

Re:In the US competition gets sued out of existenc (2, Informative)

Anonymous Coward | about 2 years ago | (#41785233)

Simple, the USPS does not a have a profitable business model.

That's actually false. The USPS is profitable and self sufficient. All the dire warning crap you here about the USPS is because the owner of FedEx was good friends with the Bush family. In 2006, they managed to get Congress to require the USPS to fully pre-fund its retirement benefits for the next 75 years by 2016. 10 years to save enough to cover 75 years of benefits... that puts the USPS in the red every year. It is entirely an effort to break the postal union.

read more here [firedoglake.com]

Kill the bidding for frequencies (4, Insightful)

EmperorOfCanada (1332175) | about 2 years ago | (#41784159)

This whole bidding billions for frequencies is a crock. Only a company that raises the billions can hope to bid. So the incumbents issue a bond or whatnot and buy up huge chunks of spectrum.

Also they need to block the mergers. The pattern in Canada is that some snot nosed upstart gives them a run for their money and they buy them out. I suspect that the big guys get upset that the customers even got a taste of freedom.

These guys have had enough of a free run so first don't let them buy one ounce more spectrum. Next any spectrum that hasn't been used should be returned with 12 months of winning it. Eastlink in eastern Canada has been sitting on some spectrum with no explanation as to why they aren't using it. They are saying soon soon. How 'bout no; use it or loose it. Next the CRTC needs to be able to go after individual executives much like the SEC can hammer individual executives. So if some executive breaks the rules he is banned from the telco industry for X years just like finance types are banned from fiance for X years.

And lastly CRTC people need to be apart from the telco industry. If you worked for the telco industry then you can't be in the CRTC. If you are in the CRTC then you can't work for a telco company for 10 years.

Although the CRTC just nailed Bell good with their denial of Astral. Keep up the good work there.

Re:Kill the bidding for frequencies (0)

Anonymous Coward | about 2 years ago | (#41784901)

You're not getting it.

Regulation is why the frequency auctions go like they do. Regulation is why the CRTC exists. Regulation is why the internet is basically owned by two companies in Canada. Regulation is why there can't be competition. Regulation is why your cellphone costs so much. Regulation is why there's no foreign TV. Regulation is why your milk costs 3x what it does in the US and regulation is why Canada has an airport that charges higher taxes than the one they built a false island for in Japan. Regulation is why big companies make big money and small companies can't get a look in. Regulation is why you pay $20 for a 5 minute cab ride. Regulation is why you go to jail for trying to offer a ride for pay. And regulation is why it's cheaper to export beer from Canada to the US and then smuggle it back in.

There's a common theme here... I bet now you're getting it!

Re:Kill the bidding for frequencies (0)

Anonymous Coward | about 2 years ago | (#41785193)

rar rar regulation rar rar

Yes. Totally free-for-all unregulated wireless. What a great idea. What could possibly go wrong.

Re:Kill the bidding for frequencies (0)

Anonymous Coward | about 2 years ago | (#41786545)

>What a great idea. What could possibly go wrong.

We've had radios for ages that can figure out a clear frequency to use. It's time to sort this out in a more intelligent manner than through feudalism.

Go ahead, though, keep feeding the regulatory flowers and see what fruits they bear. Regulation has done so damn well in the past it's a complete no-brainer to just keep on making more.

Re:Kill the bidding for frequencies (0)

Anonymous Coward | about 2 years ago | (#41786813)

Jackass take your american wife and go home

Re:Kill the bidding for frequencies (0)

Anonymous Coward | about 2 years ago | (#41788641)

I think you are making the, easily understood, mistake of confusing National Security, Protectionism, and Nationalism Laws with Regulatory laws. Most of the above you describe fall under Protectionism laws and nothing to do with Regulatory laws (which is a common mistake as I think media and the government like to confuse the two on purpose).

Without Regulatory law (which applies to EVERYTHING, and does not create barriers other than minimum requirements) you would have to have multiple cell phones and land lines (so that you could talk to others of the same business), have to pay service fees every time you received a phone call, pay for each TV in your house, have jammed phone calls and non-working wi-fi equipment as everyones equipment interfered with everyone else and a game of "get the next higher setting device" ensued... Basically, we would, as a whole, be complete screwed without Regulations imposing basic minimums, safety, and compatibility on Businesses. I mean really, would you want a person to say they are a Doctor and perform open surgery on you but you have no idea if they even when to college? Regulations are important and necessary; confusing them with Protectionism and Nationalism laws (like the ones that protect Air Canada (airports), Telcos (CRTC), etc) is completely misunderstanding the problem.

Re:Kill the bidding for frequencies (0)

Anonymous Coward | about 2 years ago | (#41786713)

The CRTC should just federally seize spectrum and manage it as a crown corporation - same price for everyone, devices are certified once and run everywhere, profits instantly re-directed into infrastructure upgrades.

Cost to run infrastructure (1)

phorm (591458) | about 2 years ago | (#41784281)

they don’t want to say how they have arrived at those numbers, only to say that Canada is a big country, and it costs a lot to provide infrastructure.

It does cost to provide infrastructure, however the biggest tend to provide the poorest service. Bell is notorious for "accidentally" over-billing and messing up on contracted service plans for cellular. For internet service, when I lived in Toronto (biggest city in Canada), their internet/phone infrastructure seemed the worst. In one's connection wasn't oversubscribed, then it was on a DSL line that was run several KM farther from the CO than it should be, resulting in miserable speeds or terrible packet-loss (or both).

In the west, Shaw is smaller but tends to fairly consistently deliver decent speeds and reliable service. I emailed them when their phone service started to get really bad (>1h wait time or no call-back until a day or two later). Their level-2+ guy were great but getting a a call to level-1 to start things off was nie impossible. A few later I got a call back from a manager letter me know that they had gotten a lot of feedback were hiring a new call-centre of support people. After that, support's good again. I wouldn't call them *small* (they span several provinces), but they're smaller than Telus, Bell, or Rogers.

I've dealt with smaller companies than Shaw, but they tend to go through one of the bigger guys (Bell or Telus generally), and while customer-service is good, the technical service is often hampered by dealing with a third-party.

IMHO, the big-boys offer terrible service and value for the price. Infrastructure is terrible even in large centres, so it's not just an issue of bad service somewhere out in the middle of nowhere. The bigger the get, the more invincible they feel, and the more the customer loses out.

This is good, CRTC (1)

Nexzus (673421) | about 2 years ago | (#41784559)

Next up, Cable Cards.

Meanwhile in the U.S. (0)

Anonymous Coward | about 2 years ago | (#41784737)

If this ever happened in the U.S. the ISPs/Telecoms would provide such slanted figures which would show they are actually losing money at a tremendous rate. They would present such a sob story that the FCC would grant them a 300-500% fee increase with customer crippling data caps without even requesting it. So go our crooked self-serving, non customer serving monopolistic telecoms, with of course our crooked politicians wink of the eye and pat on the ass.

Not "if", but "how much"? (0)

Anonymous Coward | about 2 years ago | (#41784847)

Awesome. We're finally going to find out how much we're being ripped off instead of settling for merely knowing that we are being ripped off.

What? (1)

cloudmaster (10662) | about 2 years ago | (#41785451)

Next they'll tell me that it doesn't actually cost $84 to activate a replacement cell phone on my existing cell phone plan.

Stop paying them? (0)

Anonymous Coward | about 2 years ago | (#41785499)

Here's an idea: Internet costs too much? Then stop using it!
Seriously, how much actual work do you really do that requires the internet? Maybe 1-2 hours? You can go to your local lan place and pay them 3$/hour to check your e-mails, download papers, answer e-mails. You can do this 2-3 times a month, that means you pay 10$ instead of 30-50. There I've saved you 20-40 dollars. A smarter way would be to use the internet at your local library.

Only one way to reduce prices (0)

Anonymous Coward | about 2 years ago | (#41785635)

Infrastructure companies (the ones laying out the cable or phone lines) may not offer services on top of this infrastructure. They must offer the same pricing to all companies who wish to offer services on top of these lines.

Suddenly there are no more excuses for state-sponsored monopolies. Israel did this and the price of internet and TV and it sent prices plunging. I've got a Serbian employee who pays the equivalent of $30/month for a 64Mbit synchronous service. My Bulgarian employee tells me a similar story.

Why is Canada such a third-world country when it comes to internet and TV? There is no excuse for these monopolies!

Only one way: carriers can't sell phones (1)

denis-The-menace (471988) | about 2 years ago | (#41786323)

Separate the phones from the service providers and most of this BS goes away.

Would you by GM gas that ONLY works in GM cars?

6,452 Percent Markup (1)

butlerm (3112) | about 2 years ago | (#41786761)

In a report I wrote last year, I estimated the markup for Internet services was 6,452 per cent

It is actually better than that, much better. Somewhere along the line, a customer sent that data to an Internet Service Provider for free. By a simple exercise of elementary arithmetic, we can see that the markup charged on data transmitted and received is actually infinite. (Shhh! don't let anyone know).

Does it makes sense? (1)

ruir (2709173) | about 2 years ago | (#41788067)

Why not ordering CostCo what their costs are? Hell, why not ordering the CEOs disclosing how much they pay for their meals, trips, drinks and hookers? Now people dont like a capitalist regimen, odd. This measure is just probably to appease people, I very much doubt they wont cook up the numbers.

No problem. (0)

Anonymous Coward | about 2 years ago | (#41788381)

They willjust be sure to figure in the cost of all the lines, buildings, etc, when they were build, adjusted to today's prices, and divided between the customers.

Let them know it really doesn't "cost" $2.50CAD for the "service" they get today. There's a cost well ahead of that.

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