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Tijuana wrote: Teksavvy's traffic does not impede Bell's ability to make profit.
It does. Increasing numbers of high-traffic users force expensive backbone upgrades.
Tijuana wrote: In Europe this is the norm, as I already mentioned. It is the "norm" to allow this to happen. Why isn't this the "norm" here?

Europe's a big place. In Sweden, for example, the municipal government builds the networks and then the ISPs pass on the operational costs. You pay to build and grow the network with your tax dollars, which makes the monthly access cost considerably more palatable. The norm in Europe is for government and telco to work together to build networks. The norm in Canada is for the government to burden the telcos with well meaning (but poorly thought out) plans to reduce prices to customers. When Alberta built the supernet, they did as much as they could to prevent big telecom companies from being able to benefit from it. That sort of thing doesn't happen in Europe.
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i6s1 wrote: Not really. Capitalism with regulation is still capitalism. There's no unregulated country in the world.



It should be pretty obvious that heavy users cost the ISP more. I think it's pretty obvious that reducing network demand allows carriers to delay upgrades, and if they can, then the price of the equipment drops.




I'm not suggesting that the total costs are, or should be, the same. I'm saying that GAS providers should be paying for capital costs, since it's disproportionally their users who are forcing the capital spending that's keeping the network uncongested.



The CRTC has done, and will continue, to do things that are unfair if it believes that an action fulfills their mandate.

And look at the US, without the regulatory burden, and tell me that our inefficient artificial competition has allowed to keep pace with their network build, and therefore there prices and caps. (Or lack thereof)

If this is a country with many regulations, then why so surprised that Bell is a heavily regulated company with regulated profits? If you want to complain about regulation, there would be a million other things to talk about. Network congestion can be addressed via technical measures such as traffic shaping, which Bell and Rogers already do, upon ALL it's users, not just heavy users, during peak hours. The phenomenon that is happening now has been happening for decades. The burden on the network now is no more than it was when downloading MP3s were the big thing back in the Napster days with our less than 3 Mbps broadband. As Professor Geist pointed out, all this proves is that there is congestion at certain parts of the network at certain times of the day rather than a catch all scenario like "the network is congested". This has always been the case.

If GAS IPSs had to pay proportionate capital costs, then why wouldn't they just go out and build their own? If that's the logic, then we don't need the CRTC to enforce competition. Why have "open access"? Just let whoever wants do enter the market build up everything and do as they please. Not to mention the copper line from the end users house to the CO has been built for decades, the costs to the incumbents have likely been recovered.
The people who seat the CRTC has done, and will continue, to do things that are unfair if it believes that an action fulfills their mandate.
Except, their mandate hasn't been fulfilled and has gone the opposite way. Any third party without ties to the telecom industry can tell you that the prices and packages have gotten worse and worse over the years. Hence, the public (who the CRTC are supposed to serve) outrage against the CRTC recently. It's clear that these people do not have the best interests of the public in mind and needs to be unseated and replaced with consumer friendly people.
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Tijuana wrote: Teksavvy's traffic does not impede Bell's ability to make profit. In Europe this is the norm, as I already mentioned. It is the "norm" to allow this to happen. Why isn't this the "norm" here?

Actually, it does. Teksavvy's heavy customers are some of the most profitable. Yet they also place the highest burden on Bell's network. So not only does Bell lose significant streams of highly profitable users, but they're left with most of the network upgrade expense involved in serving them.

The worst of both world's for Bell. And completely unsustainable.

Also keep in mind that profit and cash-strapped content providers (which pretty much describes most social media companies) may very well be knocking on the doors of Bell in the future looking for cash, a piece of the pie, in exchange for continued access to their valuable content and services. The whole industry needs to start bringing in a lot more money from end-users. "Free" or "cheap" isn't sustainable. Nor is advertising revenue in an economy with declining consumer consumption and rising rates of savings. This is why Bell's shareholders won't be laughing all the way to the bank with UBB. Already, you see some signs of organizations, such as Netflix, fighting back against Bell -- by, for instance, reducing the bit-rate of the services offered to Canadians. Facebook wants to IPO for $50B, which means they're going to have to do a major job of sucking a lot of cash out of users and the ISPs in order to justify that valuation. Etc.
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Aznsilvrboy wrote: If GAS IPSs had to pay proportionate capital costs, then why wouldn't they just go out and build their own?
They're certainly welcome to, but the costs of doing so, especially at low market penetrations, still make using Bell GAS cheaper in many circumstances. If GAS costs keep rising, then certainly, the economics will shift in favour of new infrastructure at some point, which is the desired outcome.
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Aznsilvrboy wrote: If this is a country with many regulations, then why so surprised that Bell is a heavily regulated company with regulated profits?
I'm not surprised. Do I sound surprised?
Aznsilvrboy wrote: If you want to complain about regulation, there would be a million other things to talk about. Network congestion can be addressed via technical measures such as traffic shaping, which Bell and Rogers already do, upon ALL it's users, not just heavy users, during peak hours.
And many people get around the traffic shaping. Even if they didn't, you're incorrect, it's no longer an option. ISP applied traffic shaping to p2p traffic because it generally wasn't time sensitive. They can't traffic-shape Netflix without destroying the service. So obviously, traffic shaping is no longer the solution.
Aznsilvrboy wrote: The phenomenon that is happening now has been happening for decades. The burden on the network now is no more than it was when downloading MP3s were the big thing back in the Napster days with our less than 3 Mbps broadband. As Professor Geist pointed out, all this proves is that there is congestion at certain parts of the network at certain times of the day rather than a catch all scenario like "the network is congested". This has always been the case.
What we're seeing now is different. This is a drastic change from the past. Napster never had data that was time sensitive. It doesn't have traffic that's so "peaky", you could download songs overnight, but you can't watch a movie while you're asleep. Napster (or any p2p) was never mainstream, Netflix is, since it's legal and pretty much anybody can operate it. And it's happening at a time when a huge portion of capital will be tied up with FTTH, something that never happened with incremental DSL upgrades.
Aznsilvrboy wrote: If GAS IPSs had to pay proportionate capital costs, then why wouldn't they just go out and build their own?
That was the original idea. They could build a network, but the last mile was too expensive. At some point, the CRTC had to abandon the "fair" concept and force providers to go with GAS, and have the ILECs transport data all the way to the independent ISPs, instead of just renting them the last mile.
Aznsilvrboy wrote: If that's the logic, then we don't need the CRTC to enforce competition. Why have "open access"? Just let whoever wants do enter the market build up everything and do as they please.


That is the case. There's nothing stopping anyone from building a third network, other than the fact that there's no money to be made by doing so.
Aznsilvrboy wrote:
Not to mention the copper line from the end users house to the CO has been built for decades, the costs to the incumbents have likely been recovered.
Again, this was the justification for last mile rental, but the network backbone hasn't been built for decades, and it requires constant upgrades.

Aznsilvrboy wrote: Except, their mandate hasn't been fulfilled and has gone the opposite way. Any third party without ties to the telecom industry can tell you that the prices and packages have gotten worse and worse over the years. Hence, the public (who the CRTC are supposed to serve) outrage against the CRTC recently. It's clear that these people do not have the best interests of the public in mind and needs to be unseated and replaced with consumer friendly people.

Really? Feel free to go back to paying $40 for 1.5 megs, if you really think that things have gotten worse. I'll keep my uncapped $37 15 meg connection. Good thing I live in a Province that TS hasn't really been interested in.

I don't disagree that we've fallen behind the rest of the world, but I think it's because of inefficient regulation, not greedy telecom companies. (There are greedy telecom companies all over the world - none is different from another. It's capitalism.)
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Let's summarize a bit and see if we can narrow this discussion a little. There is common ground but I think many just enjoy the argument.


Things we can agree on:

1. The original UBB proposal was flawed. It did not put the costs on the heavy user as the CRTC/Bell tried to sell to us, but did put it on the average user. (I can't comment on AVP yet but it seems like much the same thing).

2. Congestion is not an issue on the copper line, but on the aggregated data to the CO.

3. The future is FTTH and somehow that network has to be built.

4. Bell/Rogers, etc. are about making the most money they can for shareholders and themselves.

5. Government/CRTC has no clear direction or policy.


Things there are disagreements on:

1. The cost of a gb. Pegged at less than a penny for operational, total cost with capital requirements pegged at $0.08/gb. To the other extreme of $2/gb.

2. Who should pay for the FTTH build? Should the big telcos, or should it be public? And expectation that customers pay for network build even though they are not receiving the product, or should the company (shareholders) pay for product and then sell product to customers (the way most companies work).

3. Should heavy user bear some of the extra costs? I think there is roughly a 50-50 split on this, depending on how we define the heavy user and their expectations.

4. Netflix has no bearing on the UBB. I think most will say Netflix has everything to do with the UBB but there are still a few who disagree.

5. Wirelines are not profitable.

6. Bell has been subsidized by the public for decades. Whether direct (I think most agree not direct) or by indirect subsidies (government granted monopoly, tax breaks, crown land, etc.).

7. Competition will lower/raise prices. Lot of inconsistency in these discussions.

8. CRTC has public's best interest. Or CRTC is just Bell/Rogers supporter considering the members are ex-big telco.

9. Wholesale vs retail pricing.


I am sure there are a lot more on the disagreement side, and even a few more on the agreement side. Heck as I was writing the list, I began to realize it isn't going to narrow the discussion much but at least it is a little summary,
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don242 wrote: 1. The original UBB proposal was flawed. It did not put the costs on the heavy user as the CRTC/Bell tried to sell to us, but did put it on the average user. (I can't comment on AVP yet but it seems like much the same thing).
UBB is hardly flawed; its still one of the best ways of distributing the costs.
2. Congestion is not an issue on the copper line, but on the aggregated data to the CO.
If you're happy with only 5mbit, up to 25mbit, then sure. I know, I won't be forever. But this leads you to the next point.
3. The future is FTTH and somehow that network has to be built.
Agreed.
4. Bell/Rogers, etc. are about making the most money they can for shareholders and themselves.
These firms can only make money if they make a service that people are willing to buy. But yes, generally, their motive is to maximize shareholder value.
5. Government/CRTC has no clear direction or policy.
Agreed; there were not changes in legislation governing tariffs, so why UBB wasn't in place 10 years ago, or alternatively, why we suddenly have UBB today and we didn't a year ago, is a failure of regulation. This failure of policy, and of regulation, has artificially increased the cost of debt and equity capital to the industry, hurting the consumer. This failure of policy encourages mal-investment and may bankrupt Teksavvy and/or Bell in the process, quite needlessly I might add.
1. The cost of a gb. Pegged at less than a penny for operational, total cost with capital requirements pegged at $0.08/gb. To the other extreme of $2/gb.
I think all of us can agree that operational cost of a gigabyte is pennies, excluding capital. If even. Network gear doesn't increase its electricity consumption with additional load, so essentially, the cost is $0/gb at the margin, operationally. Nearly all of the cost is in capital. Operating expenditures do not generally grow unless capital grows.

A tariff needs to be set to recover, as an ongoing stream of revenue, the long-term capital cost.

The inputs to the long-term capital cost equation are complex, and are full of risk. This requires a relatively high discount rate to compensate.
2. Who should pay for the FTTH build? Should the big telcos, or should it be public? And expectation that customers pay for network build even though they are not receiving the product, or should the company (shareholders) pay for product and then sell product to customers (the way most companies work).
Bell can only get money from the public, so where's the disagreement there? Your question is whether Bell essentially should default on its obligations today, and start with a clean balance sheet, wiping out the shareholders and trimming the bondholders, or if they should raise prices, pay stranded debt, and fund the upgrades out of their (much greater) retained earnings.

The question you ask is ultimately one of broader economics; should society allow companies that have been responsibly managed (relatively speaking), and that provide a useful service, to go bankrupt, simply to drive lower consumer costs? What does this do to the long-term competitiveness of Canada, if investors can't be confident that they'll get a return by investing in what arguably is a very useful company with very useful services? Hate Bell/Rogers/Shaw/Telus all you want, but without them, most Canadians would not have access to the Internet.
3. Should heavy user bear some of the extra costs? I think there is roughly a 50-50 split on this, depending on how we define the heavy user and their expectations.
And the corollary, should the light user get off scot-free, even though they're going to, over time, benefit from the network upgrades? Network upgrades that ultimately improve their lives, even if they aren't heavy users?
4. Netflix has no bearing on the UBB. I think most will say Netflix has everything to do with the UBB but there are still a few who disagree.
Indeed; unless you believe the conspiracy theorists who say that Bell is tacking on UBB to preserve TV revenue. This may or may not be the case. Of course, Netflix is just the tip of the iceberg in the sorts of unicast IPTV services coming down the pipeline. The phaseout of analog TV over the next couple of years in Canada will push a lot of cost-conscious users towards the Internet, if they just want to pick up a local news program, or the like.
5. Wirelines are not profitable.
Wirelined is profitable, but not particularly, compared to other places to invest money in the realm of telecom infrastructure, or simply returning the money to shareholders where they can go out and buy other cheap investments.
6. Bell has been subsidized by the public for decades. Whether direct (I think most agree not direct) or by indirect subsidies (government granted monopoly, tax breaks, crown land, etc.).
Sure, that's debateable, and a point of contention.
7. Competition will lower/raise prices. Lot of inconsistency in these discussions.
For FTTH, which is capital intensive, one needs to discuss capital utilization. Replication of networks isn't desirable. A third company or partnership may be quite desirable, or failing that, direct government buildout-ownership of the last mile.
8. CRTC has public's best interest. Or CRTC is just Bell/Rogers supporter considering the members are ex-big telco.
Don't think anyone is particularly happy with the CRTC. Especially when their response can be quite unpredictable and poorly explained (ie: the 15% rule on UBB).
I am sure there are a lot more on the disagreement side, and even a few more on the agreement side. Heck as I was writing the list, I began to realize it isn't going to narrow the discussion much but at least it is a little summary,

Not a bad place to start... Although I don't know if I have a lot of passion left to post much more to the thread.
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Canadians need to stop with GBs and heavy users etc etc etc -- It's all BS :cheesygri

If I buy a 5mbps connection to the internet, can you give it to me? If not, don't sell it to me.

I may use it 1 hour a day, or 10 hours a day, or never, or always. ;) Can you provide it??? If not, DON'T SELL IT.

Everyone is getting hung up on usage. Bell has drastically oversold their services. Guess what? It's catching up with them. So, buy some equipment and supply what you sold everyone.

Bell / Rogers has been counting on selling a service that nobody would actually use. Perhaps they should have been investing back into the infrastructure all along.
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patpond wrote: Canadians need to stop with GBs and heavy users etc etc etc -- It's all BS :cheesygri
If I buy a 5mbps connection to the internet, can you give it to me? If not, don't sell it to me.
So you only want a $500/month connection that you can pound on 24/7??? Bell will sell you that; just call them up. The whole point of the Internet and packet switching networks in general is that they can be shared amongst many users who don't use them 100% of the time, economizing on the costs of providing the network.
I may use it 1 hour a day, or 10 hours a day, or never, or always. ;) Can you provide it??? If not, DON'T SELL IT.
I don't think very much of the population would be willing to pay leased line prices, for a service they only use, on average, around 1% of the time (ie: 20gb / 2tb theoretical monthly transfer on a 5mbit DSL line!).
Everyone is getting hung up on usage. Bell has drastically oversold their services. Guess what? It's catching up with them. So, buy some equipment and supply what you sold everyone.
That overselling, which is part of *all* IP networks is what makes them so darn cheap.
Bell / Rogers has been counting on selling a service that nobody would actually use. Perhaps they should have been investing back into the infrastructure all along.

They have been; to the tune of billions of dollars per year. Its still not enough to keep up with the acceleration in demand.
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patpond wrote: Edited for relevance

Best Mark77 quote yet. Simple and to the point. :razz:

By the way, unlimited internet with Netflix kicks ass. No more worrying about if I am going over our allowable gb's each month. Time to ditch the cable.
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Why are our upload speeds still so low? Why aren't they the same as the download speeds? What is the rationale for this...
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Tijuana wrote: Why are our upload speeds still so low? Why aren't they the same as the download speeds? What is the rationale for this...

There is no rationale in Canada.

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