I attended a Shaw Customer Consultation Session on March 28th. It was somewhat informative but since Shaw's stated purpose was to gather data they could use to decide what type of billing model to introduce in the future, I didn't find out anything about what their plans are. Officially at this point they don't seem to have any. The key take-away phrase was "we're open to considering anything". Shaw had wanted to get 40 people per session, but they didn't get anywhere near that number. I didn't do a proper head-count, but there were perhaps 15 customers present and six or seven representatives from Shaw. Apparently this type of turnout is typical for these consultation sessions, although the earlier ones did have somewhat higher numbers. I suspect that there was a heavy selection bias in place, anyone who didn't really care one way or another about UBB might not bother to come. All of the other people I spoke with had requested to attend, rather than being asked by Shaw. That might not be representative, though, I only asked two or three of those present, and the Shaw representatives did indicate that they invited a cross section of light, medium, and heavy users to attend.
The session was supposed to be under "Chatham House Rule", according to the email I received. Which apparently means I can discuss what was said, but not who said it. I suspect roughly identifying Shaw vs. customer points is fair game. For the most part, Shaw seemed to be there to listen in any case.
The session itself:
The session began with an admission by the Shaw representatives that they'd screwed up in implementing Usage Based Billing. A large part of that was the timing, they started rolling out UBB right around the same time as the CRTC decision for Bell and the subsequent public outcry. I'm pretty sure that this particular decision, however, is not directly relevant to Shaw charging or not charging based on bandwidth usage. I believe the cable companies won the right to charge residential customers this way nearly a year ago in a separate decision. Unfortunately I can't find a handy reference right now. If they'd had UBB in place for several months when that happened, they could have simply shrugged it off and pointed out that their customers hadn't minded until then. That, or have already dealt with a backlash of their own. A lot would depend on how many people were hit by the charges and for how much.
After the opening remarks things opened up to questions from the floor. A lot of questions were asked, and the Shaw people were fairly open with their answers, but didn't really have any hard numbers. People did want to know where the $1 or $2 per GB UBB charges had come from. The other customers present, like myself, thought those values seemed much higher than necessary. Shaw acknowledged that the wholesale cost per gigabyte had come down in recent years, and that this number seemed to have plateaued, but said that this cost alone couldn't be used to determine the true cost of bandwidth. I suspect that's true, but without access to a lot of data from Shaw it's not possible for anyone else to calculate what a fair cost of bandwidth would be. Hopefully they will release those numbers at some point, but I'm not going to hold my breath.
One of the main goals of Shaw was to receive feedback on possible alternative models they could use for billing. They indicated that since their current projections are for continued exponential growth in bandwidth usage, they forsee issues with all levels of their network. What is currently considered heavy use will eventually be considered normal use, and peak usage hours are widening over time. There was some joking that eventually peak hours will be 24 hours a day. That's probably an overstatement, but it's easy to see that bandwidth usage will only go up as we move forward. As Shaw sees it, there is no silver bullet to fix the issues they're facing short of spending more money on improving the network. Which in turn means collecting more money from their customers, since the number of internet subscribers isn't growing nearly as fast as bandwidth usage. Which makes sense, nearly everyone has broadband these days. Usage is going up because the existing users are using more, not because there are more users using the same amount.
The general consensus among the customers present was that any problems with Shaw's network were almost certainly due to peak usage. Shaw needs to build and maintain their network for peak traffic, and it's increases in peak traffic that will cause the most problems for other customers and incur the most additional costs for Shaw. No one seemed to think that per GB usage billing would directly affect this.
Suggested payment models:
- Shaw's original proposed plans but with rollover GB: Similar to Shaw's initial proposal, but allow rolling over unused GB from a previous month.
- Flat rate with bandwidth cap and speed limit: If you go over your current bandwidth usage your speed will be throttled.
- Quarterly or yearly usage caps, instead of monthly.
- Bulk purchase of usage: Buy GB that can be used at any time. Possibly at a flat cost, possibly cheaper if you buy more at a time.
- Different per GB costs depending on time: Have different rates for GB used in peak hours vs. off-peak hours.
- Limit speeds to a guaranteed floor: (My suggestion.) Instead of two upper limits, one instantaneous in Mb/s and one in GB/month have a floor in Mb/s. Barring attack of backhoe, guarantee the customer that speed or better.
- Cheaper plan for low-usage customers: Since lower instaneous speeds have less negative effect on the network, have a cheaper plan for customers willing to download very slowly. This might have either a higher usage cap or lower overage fees or both.
- Automatically rising usage caps: Shaw tend to increase the costs of packages a couple times per year. It was suggested that the usage cap for each plan be increased at the same time so the plans would keep up with the expected increase in how much bandwidth a normal user consumes.
Things I hadn't thought of:
- It was pointed out that over the last few years, while usage and package prices have been going up the usage caps on the various packages have actually been going down.
- Does bandwidth directed toward your IP without your consent cost against your usage. i.e. A denial of service attack. The answer seems to be yes. I suspect you'd be able to talk your way out of such charges, but it would likely entail a lot of hassle.
- It hadn't occurred to me before, but being at this session made me wonder whether re-sent packets would count against your usage. The answer is yes, since Shaw can't really tell if a packet was re-sent "just because", because of issues outside of Shaw's control, or because of issues with Shaw's network being congested.
- It was pointed out that the very low rates for very high bandwidth found in, for example, Japan are due to heavy government subsidies. Apparently there are very few direct subsidies for telecommunications in Canada.
Overall, I suspect that we haven't seen the last of UBB from Shaw. It doesn't seem that enough people really care for them to drop this plan entirely. People don't like the idea of their bill going up, but as long as only some people are affected, I suspect Shaw will find that a few complaints are worth not leaving that money on the table. As was pointed out in the session, they don't really have a lot of competition. Especially here in Manitoba. The only real alternative is MTS, but they don't have comparable speeds. So heavy users don't really have a choice. Luckily, they're also aware that UBB isn't particularly popular, so hopefully they'll limit it so that most users will not have to deal with cell-phone style overage charges.
(Oh, and Wil, Shaw does do "network management" but don't look too closely at the packets. I think this means they do throttle torrent downloads. This wasn't directly applicable to UBB so I just quickly asked at the end.)