CRTC’s decision on differential pricing bans Videotron’s unlimited music service, data caps still allowed


Canada’s telecommunications regulator revealed new rules that prevent mobile and fixed Internet providers from exempting certain content from data caps, a move that strengthens the country’s support for the net neutrality principle that all data should be treated equally.

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The Canadian Radio-television and Telecommunications Commission released on Thursday its decision on differential pricing, a practice also known as zero-rating that allows customers to access certain content without counting against their data caps.

The much-anticipated ruling stemmed from a complaint about Quebecor Inc.-owned Videotron’s unlimited music mobile plans that let customers stream as much music as they want without dipping into monthly data caps.

The CRTC decision effectively kills plans such as these by creating a framework that requires providers to treat all data equally. The decision did not, however, ban data caps, an issue that dominated consultation on the matter since zero-rating can’t exist without data caps in the first place.

In an interview, CRTC Chairman Jean-Pierre Blais said a free and open Internet is crucial for the future of free exchange in a democracy. The commission’s aim with the decision was to encourage Internet service providers to compete on price, speed and network quality instead of acting as a content gatekeeper, he said. While data caps are frustrating, he acknowledged, banning them outright was out of the CRTC’s scope.

“Canadians see the ads coming from the U.S. where they see competitors going at it and offering more and more unlimited and more and more lines on the same package. It’s that kind of competition on the core aspect of what a provider should be doing,” Blais said.

The CRTC gave Videotron 90 days to comply with the rules. Videotron is disappointed with the ruling and is considering how to proceed. It has 90 days to challenge the ruling with the CRTC, cabinet or the courts.

“We regarded unlimited music as a compelling example of innovation and diversification from a new market entrant seeking to differentiate itself from the dominant mobile carriers, to the benefit of Canadian consumers,” CEO Manon Brouillette said in a statement.

Consumer groups including OpenMedia welcomed the ruling, which ends a practice it believes deflected pressure for larger or more affordable data caps.

“While Canadians still want to see data caps abolished, we are pleased to see the CRTC plant a flag that will prevent Big Telecom from exploiting data caps to pick and choose winners and losers online,” campaign director Josh Tabish said in a statement.

The differential pricing framework will be complaints based and will evaluate the agnostic treatment of data, exclusiveness of the offer, the impact on Internet openness and innovation and whether there is financial compensation involved. Differential pricing based on time of the day would be allowed, for instance, but anything that picks and chooses one type of content would not.

It’s a big win for net neutrality, said Public Interest Advocacy Centre executive director John Lawford.

“You can’t discriminate on content. I don’t know how much clearer they could say that.”

Rogers Communications Inc., which split from its peers to take a stance against differential pricing, supported the new framework.

“This is a good decision for consumers and for open and fair access to the Internet, which is a vital resource in our digital economy,” David Watt, senior vice president or regulatory, said in a statement.

“We’re glad that Internet providers won’t be allowed to act as gatekeepers and give privileged access to a select few.”

BCE Inc. sees the decision as consistent with the way Bell already operates, a spokesperson said in an email.

A Telus spokesperson said it is reviewing the decision.

Financial Post


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