Posted by & filed under business models, Cloud Computing, Digital Policy, Ecommerce, industry analysis, M-commerce, telecomunications, WI-Fi.

Description: To protect their businesses from the cloud, ISPs north of the border won data caps on broadband usage.

Source: Businessweek.com

Date: Feb 3, 2011

Last week Canadians got the unwelcome news that their Internet Service Providers could cap their broadband access to downloading as little as 25 GB per month, or the equivalent of about 12 HD movies or 25 hours of Netflix (NFLX) streaming. Outrage ensued, and on Wednesday, Industry Minister Tony Clement said the cap wouldn’t stand, noting that if Canada’s Radio-television and Telecommunications Commission (CRTC) didn’t overturn their decision on usage-based billing of broadband sold to resellers, the government would. This would be akin to the FCC saying ISPs could use data caps and suddenly having a member of President Obama’s Cabinet tweet that Congress would write a law preventing it. Read rest of story

Questions for discussion:

  • As a Canadian what do you think of the CRTC decison from a consumer point of view?
  • As a shareholder of a Telcom what do you think of the CRTC decison from a shareholder point of view?
  • As a Canadian , what do you think of the CRTC decison from a politiacl policy point of view?

13 Responses to “Of Canada, Caps, and Clouds”

  1. Russ Sommerfeldt

    I personally am not in favor of the caps that companies are putting on data. These caps are making it so that consumers cannot get the most out of the latest technology. The reason they are doing it is because they are trying to suck as much money out of the cable tv market before it runs dry. Not only are they doing that,but they are probably going to try and double dip from the consumers pocket as long as possible because they realize once the television world turns to the internet there is no turning back.It is only a matter of time that the cable hooked to the coaxil going into the tv will be done away with. If they don’t put caps on the data then the ISP’s will not be making their maximum profits. As consumers see the possibilties with internet TV they will just want more and more. Just like anything else they will have to pay dearly to get the more but will do it because thats what everyone else is doing. The business of telecommunications is a good business to be, i am sure there are lots of people getting rich. It is also a rip off in my opinion, they are making way more than they should be.

  2. Landon

    From a consumer point of view, it is a way for companies to make more money. The internet has become so popular, it is almost a necessity nowadays, and the service providers are seeing this, the direction online computing is going with the online movies, live video, etc, why provide this much desired service for free when we can make people pay. I don’t like the CRTC’s decision to cap the broadband access, I enjoy the freedom of not having to worry about not going over my downloads. I think the service providers are gaining a little too much power in the industry, an oligopoly, trying to put a cap on the amount one can download. If if were to occur, then they would make quite a profit on it.

    As a shareholder of one of the service providers, I would love to see this happen, more money!! Share prices would rise due to the expectation of increased profits coming in.

    From a business perspective though, a cap on the amount one can download would be a nice thing to have happen. With so much downloading, the number of people connecting to the internet ever increasing, the companies need a way to store all this information, tons of information. Storing this information is not cheap either, paying in the hundreds of millions of dollars for mainframe computers, putting a cap on downloading would be a way to cut costs in storage. Like it mentioned in the article, putting a cap on would make people use the internet in a more efficient manner, decreasing traffic. Let’s face it though, the internet is a luxury and what we do with our luxury is up to us, we want to use it for movies, music, and games.

  3. Katie

    I am definitely not in favor of putting a cap on internet usage. It is ridiculous for how consumers are being charged at every level and chain. The way of the world is moving towards that of an online system. We have already seen the online media industry surge to high levels. iTunes and Netflix are both major players in the music and movie business. Now, not only are customers charged for buying or renting a movie online, but they will be charged for the downloading as well, and oftentimes that can cost more than the actual movie. Almost everything can be done online now, but if these charges continue to increase, many markets will see consumers going elsewhere and using other means to do what they need. These charges are going to discourage a lot of consumers and they will go looking elsewhere. It may increase business in the short run, but consumers will eventually move on and find something new.

  4. Bretton MacDonald

    I, like most people have read this article definitely disagree with the capping put on data by these companies. Capping the amount of data we can download would not only effect many people who swear by the internet but it also has repercussions on companies such as netflix which was mentioned in the article. If you can only watch a certain amount of netflix movies per month then people might not even subscribe to the website. This could definitely hurt revenues for netflix who just expanded to Canada a few months back. Internet service providers know they can get away with this and still have business because the internet has become so essential to everyday lives of people. Government intervention is a must in this situation or else it could get out of hand. One might argue that it violates our rights as canadian citizens, they allowed us to use as much data as possible now but they want to take it away? Doesnt make a lot of sense to this guy.

  5. Jenn Oloya

    From a consumer’s point of view I’m not in agreement with CRTC decision to have caps on Internet downloads. I think this is another way for the company’s to make money off people. The problem of putting a cap on peoples broadband access is that in today’s society people are using the internet more and more for personal, educational and work proposes. These company knows that the usually of the Internet has skyrocketed and will continue to soar which is why they want to implement this. The price of shares would go up because consumers would be paying more to access the Internet so for a shareholders point of view this would be good. From a political policy point of view I don’t that this would be beneficial for Canadians and the economy so this shouldn’t be implementing which I think would be overturned.

  6. Rio P

    Speaking from a consumer point of view, I think that putting a cap on broadband usage is outrageous. As a frequent downloader, I feel as if I were to be all of a sudden restricted by the amount I download, I would be very upset. For companies, such as Netflix, which lives off the downloading capacity of their users, would be greatly affected by this change and would not be the only voice of opinion. It is understandable from a service provider’s point of view as to why they would limit the amounts of downloads and broadband usage per month, however customers have become so accustomed to “unlimited” that the plan won’t be successful. Even if it were to be successful, I think that many people would find their ways to bypass that cap and continue to enjoy their downloads.

  7. Todd McCune

    From a consumer point of view, I think putting a cap on internet usage is outrageous. To me it is the same thing as telling us we can only watch tv for one hour a day and then start to charge us for every hour after that. Just like we pay for cable to watch unlimited television, we pay a large fee each month to use the internet. As a shareholder of Telcom, I would not be pleased by the decision to put a cap on internet usage because it could lead to a lot of businesses leaning away and households as well. This could ultimately cut into the profits of the company affecting my earnings as a shareholder. From a political point of view, I can somewhat understand that they do not want people to abuse the services that the internet provides for us. Some people are downloading music and movies illegally and from that standpoint it kind of makes sense. To me the internet is just like television or radio, we pay a monthly fee and get to use the service at our disposal without a limit. Putting a cap on internet usage will affect the way that people and businesses use the internet to our advantage.

  8. prab22

    I think Internet providers that want to cap usage should never be allowed to do this. I believe it’s just another way for these companies to make some more money off us. For example Wireless cell phone companies make loads of money, when people go over their data or phone minutes, and have us the consumers by our wallets. Internet providers just want to be like wireless cell phone companies and jump on the bandwagon of overcharging its customers. If the internet providers cap usage, the consumers that go over will be charged and be puppets to these companies. Now that the internet is a necessity for most Canadians, these companies want to implement these new rules of usage now. Makes sense for the internet providers they will make a killing like the wireless cell phone companies. I think that the Canadian government won’t implement this in the near future, unless they want to lose some votes. For the internet providers it’s a great idea but from my standpoint as a consumer I never want to see this cap happen.

  9. Momah Moseri

    I am not in support of putting a cap on internet usage. The way the world is today, internet is no longer a luxury rather it is a necessity and with this cap on internet usage it limits what consumers can do on the net. This will not only affect users, companies that do business online will also be negatively affected for example Netflix. I understand that times are hard and they are trying to make money but not to the detriment of others. Internet is a way for some people to communicate, watch and download movies, listen and download songs, store data, check on how family and friends are doing and so much more. Putting a cap on the internet usage is like telling people that ok you are allowed to download this amount of movies every month or if you download this amount of movies you cannot browse the internet for the month or else we will charge you extra. From my research internet belongs to no one. So I do not think that they have the right to put a cap on internet usage.

  10. Taofikat

    The idea of putting cap on internet usage is not a perfect idea to me so am not in support of it because the amount we pay for internet is high and as a student we survive on it. some people earn a living by using the internet as their form of business for example the e- market like ebay. internet creats lots of convinence in today’s world. i feel the company just wants to make us a money bag which is not possible.i don not want to witness this cap happen its so sad how people inconvinence others to make profit they do not even care of people”s opinion. So sad.

  11. Alex Hedges

    I cannot believe that Canada is toying with the idea of implementing these caps before the USA. Because of the significant barriers of entry into this industry, it is run by a select group of companies. In other words, a select handful of individuals are working together to keep prices high. As a Canadian, I would hope and expect that our government would stand up and implement some strict, but fair laws to keep these companies in check. However, I can see this cap system working very nicely in the US, where every congressman and person of authority would get a nice little piece of the pie as, much like health care, the internet today is considered a necessity. The Americans are usually the first to turn an asset of high demand into a profit-driven scheme that forces consumers pay out of nose. No caps would not only be beneficial to the average Canadian, but also stimulate the growth of our economy in this new technological era.

  12. Chelsa

    As a consumer I feel as though the CRTC is trying to take advantage of consumers. Internet usage is important for many people and many people have become reliant on it. I would go as far to say that in the technological society we live in today that internet is a necessity. It would be very unfair for the CRTC to put a cap on internet usage. It would hold people back from playing games online, watching TV and movies online and connecting with people in different communities and countries. The internet providers are able to profit from the service they provide and the companies on the internet are making money especially those you have to subscribe to. By putting a cap on internet usage it would be to the detriment of certain companies. If there was a cap on internet usage I would not pay over inflated prices to use the internet for the things I do now. I would stop watching TV over the net and go back to old fashioned DVD’s for watching movies.

  13. Jatinder Aulakh

    •As a Canadian what do you think of the CRTC decison from a consumer point of view?
    •As a shareholder of a Telcom what do you think of the CRTC decison from a shareholder point of view?
    •As a Canadian , what do you think of the CRTC decison from a politiacl policy point of view?

    As a Canadian I think the CRTC decision from a consumer point of view is ridiculous. I think we as consumers already pay enough to get the internet and don’t need to be paying extra to watch movies or play games online. This is just a way to make money off consumer. As a shareholder I would think the CRTC decision is a great idea, because it would help the company increase profit and have a higher market share. From a political policy point of view the CRTC decision would not be that great of an idea because the government would not have people getting help online for information. I personally think this is a bad idea because this generation is very sharp minded and eventually will find a way to download their stuff illegally.

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