Canada regulator to reconsider Internet ruling

Thu Feb 3, 2011 6:14pm EST
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By Alastair Sharp

TORONTO (Reuters) - Canada's telecoms regulator will reconsider its own ruling that would have effectively stopped small Internet providers from offering unlimited downloads, taking a step back under pressure from the government.

Industry Minister Tony Clement had threatened to block the regulator's decision, citing the need to protect consumer choice. The government's stance, which follows a public outcry over the cost of Canadian Internet services, is a blow to the country's dominant providers.

In its ruling last week, the Canadian Radio-television and Telecommunications Commission, or CRTC, said BCE Inc, the parent of Bell Canada, could charge wholesalers that lease bandwidth on its network on the same usage basis it charges its own customers, minus a 15 percent discount.

That would force small carriers to pass along the extra cost to their customers and push them to abandon their unlimited download service plans.

"CRTC must go back to the drawing board," Clement wrote late on Wednesday on the social networking site Twitter. (!/TonyClement_MP)

The issue has taken on urgency for Canadians as online video services such as Netlix grow more popular at the expense of programing from satellite and cable companies, which have been long dominant as Internet service providers.

"I think frankly there have been long simmering frustrations with the lack of competition around Internet services in Canada," said University of Ottawa law professor Michael Geist. "In a sense, the usage-based billing decision in particular was the boiling-over point for many consumers."

An online petition opposing the usage-based billing regime has collected more than 300,000 signatures, signaling that the controversy could become a political issue if elections are called this spring.   Continued...

<p>Canada Minister of Industry Tony Clement speaks during Question Period in the House of Commons on Parliament Hill in Ottawa February 2, 2011. REUTERS/Blair Gable</p>