The Canadian Radio-television and Telecommunications Commission has approved a request by Bell Canada to implement usage-based billing for its wholesale internet customers.
The decision, made on an interim basis, could result in lower download limits for customers of smaller companies such as Teksavvy and Acanac that rent portions of Bell's network to provide their own internet services.
Smaller ISPs, which typically allow customers to download hundreds of gigabytes a month, may be forced to lower their limits to Bell levels. Bell's most popular plan allows customers to download 50 gigabytes a month.
The CRTC on Wednesday also approved a request from Bell that will allow the company to charge small ISPs 75 cents for every gigabyte over 300 that their customers use.
Smaller ISPs had fought the requests and said if granted, their services would become indistinguishable from Bell's. The CRTC last year also allowed Bell to extend its traffic management practices, where certain uses of the internet such as peer-to-peer file-sharing are slowed or "throttled," to smaller ISPs.
Independent companies are therefore required to throttle their own customers as well.
Although the CRTC ruled in favour of Bell during the throttling dispute, it also launched an inquiry into the larger issue of net neutrality, or how much control internet providers should have over the connections they provide to customers. The regulator is expected to make a ruling on net neutrality by the end of the year.
Internet experts said that with usage-based billing, the CRTC has once again ruled in favour of Bell at the expense of consumers.
"It raises significant competition concerns since it suggests that independent ISPs will further lose their ability to differentiate their services," University of Ottawa internet law professor Michael Geist said.
"It also calls into question Bell's claims during the traffic management hearing that they can't differentiate between providers since the implementation of [usage-based billing] would mean much more detailed info about end users."
Mirko Bibic, head of regulatory affairs for Bell, said the company's network-management technology is capable of differentiating between wholesale customers for accounting and usage-based billing purposes but not for traffic shaping, a fact that was made clear in its filings during the CRTC hearing.
"Our statements to the CRTC were and have always been accurate," he said.
Bell stopped offering unlimited downloading to its own retail customers a few years ago. Throttling and usage-based billing are key parts of its strategy to fight congestion on its network. Critics, however, have said that Bell has so far failed to prove its network is congested.
Rocky Gaudrault, head of Teksavvy, was angry with the CRTC's decision and said it will limit his company's ability to offer new services such as television over the internet and could see an increase to customers' bills of $10 to $20.
"Today's decision has to send a clear picture to those the CRTC have to answer to," he said.
"Someone needs to step in and audit how these lawmakers come to their conclusions as predatory tactics, which last I checked were not allowed in Canada, are being allowed to march through the regulatory gates without any resistance, all while laughing in the face of both Joe competitor and Joe public."
The CRTC has given small ISPs 90 days to prepare for the implementation of Bell's usage-based billing.