I’ve gotten two phone calls in the last few days to advise me of “changes” to the bandwidth caps on my high-speed internet service. If you live in the United States, or frequent American technology forums, you’ve probably noticed how angry Americans are about Comcast and Time Warner Cable imposing bandwidth caps on their customers. Comcast appears to be rolling out a 250 GB per month limit, while TWC has a variable cap that goes no higher than 40 GB per month. It was easy to shrug off a 250 GB cap when I live in a country that has imposed caps one quarter of that size for years, but a 40 GB maximum cap is… well… it would render the internet useless.
I’m trying to imagine how companies like Apple, Microsoft, and Netflix are going to be able to sell their download services when people have a 40 GB monthly bandwidth limit. And let’s not forget that television networks like NBC believe so strongly that they can sell episodes of their most popular shows as downloads on iTunes or Amazon that they were willing to allow their writers to go on strike for over 100 days rather than back down over the writers’ demand for a cut of download and DVD business. The American television industry collapsed over the issue, so both sides obviously believe that television over the internet is the future, but Time Warner Cable clearly isn’t going to let that happen.
On any given technology forum, Americans complain about their fear of the caps coming to their city, or their anger that it has already happened, and people from around the world tell them how lucky they are to live in a country that has such reasonable caps.
It’s certainly true that some countries have pathetically slow internet speeds at outrageous prices with unacceptable bandwidth limits. And that includes wealthy, Western nations. Australia, I’m looking in your direction. Meanwhile, Europe and Japan have 20, 50 and 100 Mbps internet for the same price or less than what we pay in North America. Pretty scary, isn’t it? The reason always ends up being the same: because cable companies own the cable lines, there is only one cable carrier in any part of the continent. Wherever you live in Canada or the US, you generally have a choice between two internet providers: the phone company and the cable company. They choose not to compete with each other, and offer the same speeds at the same price. There are, of course, internet resellers who use the phone company and the cable company’s lines, but they rarely offer better prices, don’t offer higher speeds, and can’t offer bundles. Then there are millions of North Americans who live in areas that don’t have cable, so the phone company has a monopoly on high-speed internet. There are even millions of people who can’t get high-speed internet from their phone company. Dial-up is alive and well in North America!
In the face of the growing consumer furore over bandwidth caps in the United States, I decided to compare the services of the two main internet providers in Canada. Once again, you have two options: the phone company and the cable company. The phone company is Bell, and there are three major cable companies: Rogers, Cogeco and Shaw. Rogers is, by far, the largest cable provider, so let’s use them to represent cable.
To be fair, and for the sake of simplicity, all prices are the regular price and don’t include bundle discounts. (more…)