Canada regulator to reconsider Internet ruling

Thu Feb 3, 2011 7:48pm 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.

The CRTC said on Thursday it would delay implementing the ruling until at least June while it conducts its review.

"If they do a review and come back with exactly the same answer, that is not acceptable to the government of Canada," Clement said.

The issue has taken on urgency for Canadians as online video services such as Netlix grow more popular at the expense of programming 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."   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>