CRTC decisions on ‘Net Neutrality reinforce status quo
October 30, 2009


OTTAWA – October 30, 2009 – Last week the Canadian Radio-television and Telecommunications Commission (CRTC) introduced a long-awaited but disappointing Internet traffic management policy.

Yesterday the CRTC responded negatively to a request from the Canadian Association of Internet Providers (CAIP) and the Public Interest Advocacy Centre (PIAC) to review and vary the original “traffic shaping” decision issued in the spring of 2009 after CAIP had complained to the CRTC about the interference Bell Canada was causing to the broadband traffic of competitive providers.

During the seven month public proceeding which emanated from the CAIP complaint, Canadian Internet users and competitive Internet Service Providers (ISPs) hoped for a change in attitude. Instead, the CRTC has simply codified previous decisions.

“Despite the CRTC calling last week’s policy announcement a world ‘first’ and ‘comprehensive’ the only real change for Canadian Internet users is that they must now be informed prior to the implementation of any traffic management practices by their ISP. What’s worse is that the CRTC has condoned higher prices for Internet access as a method of managing telecommunications networks”, says Tom Copeland, Chair of the Canadian Association of Internet Providers (CAIP).

Copeland elaborates, “The CRTC has done little to placate the concerns of the competitive ISP industry and Canadians. We had hoped for clear guidelines on when traffic shaping was permissible, how long such measures were permissible and under what circumstances the Commission would approve such practices. Instead, the CRTC has simply reinforced the need to use the cumbersome and time consuming regulatory complaints system should an individual or competitive ISP feel the actions of a ‘primary ISP’ be disproportionate or unfair”. In their first traffic management policy recommendation the CRTC has stated that their preferred Internet Traffic Management Practice (ITMP) would be higher prices for Internet access as “economic practices are the most transparent ITMPs”.

In the new policy the CRTC has also coined the phrases “primary ISP” and “secondary ISP” to describe the regulated wholesale arrangement between the dominant incumbent carriers and their downstream competitors who purchase network access from the carriers.

“The CRTC continues to mistake Internet services for regulated wholesale access to Canada’s telecommunication networks,” notes Copeland. “The wholesale services we purchase from the dominant carriers and the interference caused by their traffic management practices affect far more than Internet access. In many cases these wholesale services are not used to deliver Internet access yet they are subject to the same anti-competitive traffic management tactics. The CRTC has yet to understand that these wholesale services are used as inputs to deliver a far broader range of services than just Internet access.”

The debate on traffic management practices was brought to a boil in April 2008 when CAIP and its members discovered that Bell Canada had begun “throttling” or slowing down the traffic destined for the customers of CAIP’s members. After denying relief sought by CAIP, the CRTC launched a proceeding which led to the October 21 policy announcement.

The following day, the Federal Communication Commission launched a similar proceeding to codify four principles which the FCC had been using as a guide in their decisions relative to the Internet since 2005. They added two more draft principles, similar to those in the CRTC policy, regarding non-discrimination and transparency.

“Nowhere in the FCC draft principles will one find the suggestion that higher prices for Internet access is an acceptable method of network management. By contrast, Canada’s regulator, through its policy statement, has further eroded Canada’s standing in international Internet metrics,” notes Copeland.

“Canada’s largest phone company has been throttling the traffic of its own customers 9.5 hours a day, seven days a week, across its whole network for two years and doing the same to the customers of competitors for 18 months”, Copeland states. “The recent announcements do nothing to limit the duration, longevity or location of these actions. The CRTC has once again given the dominant carriers, who have 94% market share of all residential high-speed access in Canada, carte blanche to continue to abuse the trust and privilege bestowed upon them by Canadian consumers,” concludes Copeland.

About CAIP
The Canadian Association of Internet Providers, a division of CATAAlliance, is Canada’s oldest and largest industry association representing the independent Internet industry. CAIP’s members serve hundreds of thousands of Canadian consumers and businesses with data, telephony and Internet services. Founded in 1996, CAIP’s Mission is to foster the growth of a healthy and competitive Internet service industry in Canada through collective and cooperative action on Canadian and international issues of mutual interest.

About PIAC
Founded in 1976 the Public Interest Advocacy Centre has been vigilant in compelling government and private corporations to administer programs or to conduct business in accordance with fairness and due process. The organization provides Canadian policy makers with key research and is engaged in advocacy on issues associated with fairness, financial consumer protection, and access to banking services. PIAC is focused on ensuring that important public services are delivered for the benefit of all Canadians.

Tom Copeland
Chair, Canadian Association of Internet Providers
John Lawford
Counsel, Public Interest Advocacy Centre
613-562-4002 ext. 25