Canada's fight for net neutrality

by Kevin McArthur, Straight Goods

Shortly after I founded the Net Neutrality advocacy site Neutrality.ca in January 2007, TheTyee, published an article saying that Canada was sleeping through the war to 'save the internet'. Writer Bryan Zandberg cited the lack of signatures on my petition (a 'paltry' 217 at the time) as evidence of Canadians' disengagement with the issue.

Today, the same petition, which is now run by the rock-star professor Michael Geist, has collected over 14,000 signatures. Clearly something has changed. We can all thank Bell Canada for turning a hypothetical threat into the personal cause of thousands of Canadian internet users.

Offline, when a company restricts, interferes or prevents customers from purchasing products from a competitor, the law provides significant penalties for anti-competitive behaviour.

What Bell did was to throttle P2P traffic while, almost simultaneously, launching competitive video-on-demand services — and that's what the Net Neutrality Rally in Ottawa last week was all about: competition.

The technology that is being throttled by Bell is primarily used to distribute video content on-line. Some of it is copyright infringing content like pirated movies and TV shows, but increasingly, it is legitimate content from outfits like Bitorrent Inc, Vuze, and even our own CBC which attempted to distribute Canada's Next Great Prime Minister using this technology.

Canada's limited competition in 'last-mile' connectivity is making matters worse. Typically, in any given market there is a duopoly consisting of two giants — a cable company and a phone company. For most users, this is a binary choice that represents no real market choice.

Partly in response to this lack of competition, Bell was required to open up its lines to competitive resellers. For a while, this reseller arrangement resembled some form of competition — at least in customer service, if not pricing. One such reseller is TekSavvy, which, seeing the benefit to a neutral network, promised never to interfere with its customers' traffic — and in the process stole a large number of accounts from Bell.

Then came the shocking realization that Bell, acting as the network 'owner', was starting to degrade specific traffic on these resellers services, and in the process was breaking TekSavvy's non-interference promise to its customers. Bell's actions exerted control over its supposed competitors' services. On April 3rd, the Canadian Association of Internet Providers, filed a complaint against Bell with the CRTC.

The actual complaint is yet to be resolved, though the CRTC did deny CAIP's request for interim relief — meaning that Bell is free to continue throttling for the time being.

For all the interest the latest Bell actions have generated, these actions are but the tip of an iceberg, and we're sailing dangerously close to destruction.

In November 2005, as reported by Business Week, SBC CEO Edward Whitacre spoke in response to the question:

"How concerned are you about Internet upstarts like Google (GOOG), MSN, Vonage, and others?"

He answered:

"How do you think they're going to get to customers? Through a broadband pipe. Cable companies have them. We have them. Now what they would like to do is use my pipes free, but I ain't going to let them do that because we have spent this capital and we have to have a return on it. So there's going to have to be some mechanism for these people who use these pipes to pay for the portion they're using. Why should they be allowed to use my pipes?"

This argument is where the danger truly lies. Closer to home, Videotron's President Robert Depatie is quoted by the Canadian Press (via the Globe and Mail) as saying:

"If the movie studio were to mail a DVD... they would expect to pay postage or courier fees,... Why should they not expect a transmission tariff?"

The actions of Bell upon their video competitors pales in comparison to the stated intention of these other ISPs who appear to want this type of content discrimination to be the norm. The essence boils down to an internet where the only websites that are allowed to operate are ones that do not compete with ISPs and only those that have enough money to buy market access from those very same ISPs. Those who can't pay, or who are competitive with the incumbents, will simply be degraded or denied access to internet subscribers.

We must be careful not to mistakenly assume that the providers of websites do not pay for bandwidth, because they do. They pay their hosting ISPs for every bit they upload, just as you pay for every bit you download.

What these ISPs are musing about is a second charge to website providers so that they will pay your ISP for bits you download, despite that being the service that you're already paying them to provide. Incredibly, these ISPs appear to want to be paid twice — once from you, and again from the sites you visit.

Under these conditions we would likely not have seen the development of services like Google, Vonage, YouTube, or Facebook. In fact, it is more than arguable that the Internet would probably be unrecognizable by today's standards had this been the norm from the internet's conception.

"When I invented the Web, I didn't have to ask anyone's permission. Now, hundreds of millions of people are using it freely. I am worried that that is going end" — Sir Tim Berners Lee.

In the offline world, we already have laws to deal with this type of activity. When a company restricts, interferes or prevents customers from purchasing products from a competitor, they call it anti-competitive behaviour and there are significant penalties. Unfortunately, such laws have not been modernized to understand the digital world and Canada's competition bureau so far has failed to see the problem with this type of digital interference and its effect on consumer choice.

According to a poster on Geist's blog, the Bureau had this to say about Bell's actions.

"At this point, Bell's network management practices appear to be non-discriminatory, in that they are being applied at a network-wide level to both Bell's own retail service and the service of all its wholesale customers, as opposed to the targeting of specific competitors. In this regard, it does not appear to the Bureau that Bell is currently engaging in a practice of anti-competitive acts in order to harm a competitor contrary to the Act... "

But I must take exception to the bureau's understanding of this issue. In analyzing these actions, the bureau appears to believe that if Bell prejudices their own customers in the same way as their resellers, that this somehow makes their behaviour less anti-competitive regarding their competitors in Video on Demand (VOD) services. The bureau doesn't seem to understand this complex, multi-faceted issue and the anti-competitive effect these actions have against Bell's fledgling VOD competitors.

This is unfortunately not the first time the regulatory agencies have gotten it wrong on Net Neutrality. In March 2006, Vonage filed papers with the CRTC asking that it investigate Shaw's QoS service — a service that Vonage calls a 'thinly veiled VoIP tax'. Similarly, to-date, no action has been taken to stop Shaw from selling this questionable QoS service.

Canadian political parties have also been similarly uninterested with the issue, with the notable exception of the Bloc MP Paul Crête who argued in the house of commons for Net Neutrality in February 2007 saying:

"Mr. Speaker, once again, the Minister of Industry is siding with telecommunications giants against consumers and is refusing to apply the principle of net neutrality, which guarantees identical upload or download speeds for anonymous blogs and big business websites alike. Real competition for sure."

"Can the minister make a commitment, here in this House, not to make any decisions that would favour big businesses at the expense of consumers, thus ensuring that the Internet remains a democratic tool?"

The Green Party recently spelled out its policy on the issue in its Vision Green platform stating:

"The Green Party of Canada is committed to the original design principle of the internet — network neutrality: the idea that a maximally useful public information network treats all content, sites, and platforms equally, thus allowing the network to carry every form of information and support every kind of application."

The Conservative and Liberal positions on the issue remain to be seen, though both parties have a less than stellar track record taking a consumer-first stance on issues of digital importance.

On Wednesday, NDP MP Charlie Angus introduced a new private members bill to the House of Commons C-552 titled An Act to amend the Telecommunications Act (Internet Neutrality).

At its heart is the following clause:

36. 1 (1) Network operators shall not engage in network management practices that favour, degrade or prioritize any content, application or service transmitted over a broadband network based on its source, ownership or destination.

This clause should do a lot to prevent the most egregious violations. However, it stops short of declaring all bits to be equal, with a number of exceptions and the lack of language that makes it clear that entire classes of applications — like BitTorrent or VoIP — cannot be discriminated against.

This bill should be considered a really positive first step toward full-blown Net Neutrality in Canada, and perhaps if it is the intent of the NDP to rule on the Bell vs TekSavvy via bill C-552, then maybe we will see the language revised in committee to explicitly close this potential loop-hole.

Those interested in helping to bring Net Neutrality to Canada should join the SaveOurNet.ca Coalition and sign the petition found on Neutrality.ca. With your help, Net Neutrality may become the law of the land.

article originally published at http://www.straightgoods.ca/ViewMediaFile8.cfm?REF=28.

The media's job is to interest the public in the public interest. -John Dewey