ANALYSIS: Clement's CRTC shots hit wrong target

Stephen Harper's government has put a gun to the head of the federal telecom regulator, this time supposedly to rescue thousands of home internet users from being gouged. Too bad they got the wrong culprit.
Industry Minister Tony Clement may get loud applause in cyberspace, but reality is different. (CBC)
Once again, Stephen Harper's government has put a gun to the head of the federal telecommunications regulator, this time supposedly to rescue thousands of home internet users from being gouged by the big, bad telephone and cable companies.

Too bad they got the wrong culprit — in reality, the Harper government is promising to save consumers from its own laws and regulations.

CBC's Greg Weston ((CBC))
A ruling last October by the telecom regulator, the CRTC, effectively meant that as of next month, smaller internet service providers would no longer be able to offer residential customers unlimited downloading and access to the net for a fixed monthly fee.

The phone and cable companies already use so-called usage-based billing that limits how much customers can download before incurring extra charges.

Smaller internet providers have been offering monthly plans with unlimited use as their main competitive advantage over the big players, mainly the phone and cable companies.

Needless to say, the CRTC decision caused a furor in cyberspace, with more than 350,000 people so far having signed one online petition to junk the plan.

With talk of a possible spring election in the air, Industry Minister Tony Clement finally weighed in this week, saying the government expected the CRTC to reverse its decision and "to basically go back to the drawing board on this issue."

Otherwise, the minister warned, the federal cabinet would take the matter into its own hands.

Maybe some votes

Within hours, CRTC chairman Konrad von Finckenstein appeared before a Commons committee to announce that the implementation of usage-based billing would be delayed until May 1 while the commission conducts a review of the whole issue.

All of which is sure to win the Conservatives some loud applause in cyberspace, and maybe some votes for at least appearing to rescue beleaguered consumers.

Reality is a different story.

First, von Finckenstein left little doubt the commission had already decided to review the whole usage-based billing issue long before the industry minister did his late-night gunslinger imitation — on Twitter, no less.

Second, in a choice of populist politics over sound policy, the Harper government has taken aim at what is supposed to be an arms-length regulator.

And all for doing its job — namely, upholding federal laws and regulations as they are written.

It isn't the first time government has pushed around the regulator, rather than changing the rules.

In 2009, the CRTC denied a licence to Globalive to launch a new national cellular phone company on the basis that the venture was majority controlled by Egyptian interests and therefore didn't meet the Canadian ownership rules set out in federal law.

Undermines authority

The Harper government intervened to have the ruling reversed, arguing that Canada needed new competition in the wireless market.

As a result, Wind Mobile is now a competitor in the Canadian marketplace.

While no one can argue with the government's aim to create new competition, simply overruling the CRTC to get a desired result undermines the commission's authority — and indeed calls into question its existence.

If government doesn't like the rules, it is always free to enact new ones.

In the case of the latest CRTC head-bashing, the argument for over-turning the commission's ruling on usage-based billing is open to debate.

As commissioner von Finckenstein put it this week: "We are convinced that internet services are no different than public utilities, and the vast majority of internet users should not be asked to subsidize a small minority of heavy users."

83% of internet traffic

He said that among Bell Canada customers, for instance, less than 14 per cent of internet users are responsible for more than 83 per cent of internet traffic.

Von Finckenstein said the concept of charging heavy users more than average families "is a question of fundamental fairness."

On the other hand, opponents of usage-based billing point out that much of today's heavy internet use is from downloading movies, games and live-streaming programs — all internet products in direct competition with those provided for a price by the phone and cable companies.

In short, opponents claim the big providers simply want to use usage-based billing to try to stifle competition.

Whatever the cause, all is definitely not well in Canadian cyberspace. Contrary to much government hype, over the past decade of the internet revolution, Canada has slid from world leader to laggard.

At one time, Canada had the highest percentage of internet users in the world; now it is barely average.  In one recent international study comparing internet services in dozens of countries, Canada ranked below mediocre for high-speed access, with some of the worst consumer prices anywhere.

Something for the industry minister to put in his pipe and Tweet it.