Independent study needed for UBB: Telus
An independent study of consumer Internet usage is needed to prove whether service providers need tools like usage-based billing to control broadband access, says the head of the country’s third largest telecom carrier.
“If there needs to be (regulatory or government) intervention in this area because people feel there is a public good or social right then I think this area would lend itself well to a very strong analytical, independent study,” Telus Corp. CEO Darren Entwistle told reporters Thursday after the company’s annual general meeting.

Such a study would “come up with empirical evidence and recommendations so that policy makers would make a decision based on empirical facts from a third party rather than make decisions based on the heat coming off social networking.”

Entwistle’s idea comes before a July hearing by the Canadian Radio-television and Telecommunications Commission (CRTC) into the way large carriers charge independent Internet service providers (ISPs) for wholesale access to their broadband networks.

They also come two months after Industry Minister Tony Clement dismissed the carriers’ arguments that they need UBB to prevent a minority of Internet subscribers from overwhelming Internet traffic.

Originally the CRTC hearing was to look at usage-based billing UBB, which became controversial after the commission said BCE Inc.’s Bell Canada could extend its UBB policy to wholesale buyers of access. ISPs, who are trying to keep offering unlimited access plans, complain they would have to charge identical rates to their subscribers, thus taking away a competitive advantage.

Groups like Stop The Meter and the Public Interest Advocacy Centre fought the move, after which opposition parties in Parliament raised a ruckus in several committee hearings. Eventually, after Industry Minister Tony Clement made it clear the cabinet won’t permit carriers to force a pricing system onto ISPs, the CRTC decided to look at the issue again.

Since then the hearing has been broadened to include looking at the reluctance of carriers to offer what ISPs consider fair pricing to their newest high-speed networks despite a CRTC ruling that they had to.

Under usage-based billing providers offer a range of monthly plans with limits on the amount of data subscribers can download. Rates go up in step with the limits. There are also financial penalties for going over the limits.

Carriers who impose UBB insist the minimum limits are well within the average most subscribers download a month. At earlier CRTC hearings, they presented closed door evidence to show that with unlimited data rates a minority were consuming most of the network traffic, which the commission apparently agreed with. The carriers are expected to do the same before the upcoming hearing.

For their part, consumer interest groups complain that there is no public proof the carriers have a real problem.

Telus has a UBB scheme for wholesale buyers, with what Entwistle called “generous” data caps, but still offers unlimited plans for its own subscribers. However, he said the company is looking at extending usage-based billing to its customers.

Carriers around the world are dropping unlimited data plans.
During the press conference Entwistle also said Telus won’t change its schedule for launching next generation Long Term Evolution (LTE) wireless data service. While Rogers said its LTE service will start in select cities before the end of the year, Entwistle is sticking to an LTE launch of early 2012.  One reason is there will be more handsets available that can take advantage of LTE’s potential of 100 Mbps data speeds under ideal conditions. “We do feel that within a 2011 timeframe the device availability will be significantly limited,” he said. “We also feel the devices that will be available will be significantly customized and don’t enjoy economies of scale in terms of price points, so they will be expensive for our organization.”

In the past year wireless carriers have boasted of the potential speeds of their networks. But there are few handsets that can take advantage of it. For example, while Telus’ current HSPA+ wireless network offers speeds of up to 42 Mbps under ideal conditions, today it sells only one handset and two USB laptop modems that are capable of that speed.

Finally, Entwistle also repeated his pleas that Ottawa lift foreign telecom investment restrictions for all carriers, not just for those with small market share, and that the rules for the upcoming spectrum auction be the same for all participants and without set-asides for carriers with small market share.

Ottawa is expected to deal with both issues this year.

 “I do find it somewhat paradoxical that on the one hand you do want to reduce regulation by relaxing foreign ownership regulations, and on the other hand you want to substitute that with increased government intervention because the rules are not the same for all the players in the industry,” said Entwistle.

Any protection for new entrants or small carriers is “unacceptable,” he said.

New entrants like Wind Mobile say they need set-asides in the auction to prevent Bell, Rogers and Telus from buying up all the spectrum.

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