TekSavvy said it will boost prices in response to a recent CRTC decision on usage-based billing. (Jacquelyn Martin/Associated Press)

An independent internet service provider, TekSavvy Solutions Inc., said Wednesday it will hike its rates next month in response to recent CRTC decision on usage-based billing.

The Chatham, Ont.,-based company, which had been a critic of the CRTC move, posted an announcement on its website saying new rates would go into effect Feb. 2.

"The cost of most of our 300GB packages will increase," the company said in its web posting.

"However, for DSL customers, the 300GB meter will not run between the hours of 2 a.m. and 8 a.m. effectively allowing unlimited services for all downloading in that off-peak period."

Many packages will see increases of between $3 and $4 a month, but the company will also be introducing new speeds with unlimited bandwidth "for our more avid Internet users."

However, they will also come at a higher cost. For example, its planned high speed DSL 25 unlimited service will be sold for $77.99 a month.

"These products will lead us into the future, accurately reflecting the greater demands that will occur as Internet usage increases," TekSavvy said.

Compromise solution

TekSavvy's announcement comes less than two months after the Canadian Radio-television and Telecommunications Commission handed down a compromise solution on the contentious issue.

The regulator on Nov. 15 rejected a controversial plan that would have allowed the big telephone and cable companies like Bell and Rogers Communications to impose usage-based billing on small, independent Internet service resellers.

However, it offered them a choice of either charging the resellers a flat rate per user or selling them a specific amount of capacity on their networks.

At the time, TekSavvy CEO Marc Gaudrault said the decision would "make it much harder for independent ISPs to compete."

"This is an unfortunate development for telecommunications competition in Canada," he said.

Bell had argued that independent Internet providers contribute significantly to network congestion and that the price they pay to large telecom companies should reflect their weight in data traffic.

Canada's largest telecom company has said wholesale independent service providers make up 17 per cent of users in Ontario and Quebec. They also drive 29 per cent of total traffic on Bell's network in those provinces.