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Shaw Cable Plans to Implement Usage Based Billing in Late Spring

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With the explosion of internet video, services such as Netflix Canada are prospering. The only thing stopping this is the controversy over usage-based billing (UBB). Earlier this year, Bell was caught up in a media firestorm over their plans to implement UBB to resellers such as Teksavvy.

The big telecom operators in this country are indeed scared. The UBB saga was a huge controversy, and it appears it’s not over yet. A recent conference call to Shaw Cable investors has revealed the company plans to implement UBB, after bowing out earlier in the year to avoid a media blitz. Here’s what they said when Bell was getting roasted by consumers during the height of UBB, as reported by Gillian Shaw of the Vancouver Sun:

“We’re putting everything on hold,” Bissonnette said in an interview. “We’re not going to enforce the caps, we’re going to spend the next couple of months hearing from our customers.”

The furore has clearly damaged what Bissonnette characterizes as the company’s good customer relationships.

“This is also about relationships,” he said. “We really pride ourselves on having really positive relationships with customers and we want that to continue.”

Canadians have short term memories, and our telcos know this. Fast forward to their recent April 13th conference call, and what CEO Bradley Shaw had to say:

“We are of the mind that we still have a tremendous upside in terms of pricing power on our Internet services and through the course of our consultations with our customers, I think what we’ve seen from that is a recognition that the principle of ‘if you use more, you should pay more’ holds true,”

“But we believe as we work our way through some of the feedback we received from them that there really is a win-win for our shareholders [as all of] their customers in the way we offer our tiers of Internet services.”

Mr. Shaw said the company would have more to say about its new pricing and packaging plans in the “late spring, probably May, early June.”

“People have said to us, let’s not divide the Internet product today,” Mr. Shaw said. “Let’s figure out how to create a world-class Internet experience and then we can figure out how to do pricing and packaging from there. So, we think it would be reasonable to get further clarity before we’re going to go back and talk to some more customers about it. You’ll probably read about it on the social media like you seem to be reading about all the stuff, which is great and probably have more formal announcements end of May or early June.”

Wow. Talk about a huge turnaround of events. I wonder what these plans will be like when they are announced. UBB is a huge threat to companies such as Netflix in Canada, and others that are reliant on internet use. What can we do? Sign this petition at StoptheMeter.ca if you haven’t already.

Are you a Shaw customer? How do you feel about their upcoming UBB plans?

[Financial Post]

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  • Eh, I’m fine with this. Since Shaw put the meter on their website to let you monitor your usage, I’ve discovered I’m using less than half of my alloted cap, so enforcing that cap won’t bother me.

  • Anonymous

    Anyone see the irony in this post and the Netflix Canada one? That right there is one of the main causes for increase support for UBB from the providers. Their ageing business model is dying, UBB is how they can protect it and even increase profits.

  • That’s it right there. They are scared. Nowadays, it’s possible to not
    subscribe to cable and watch everything on the Internet.

  • Boo

    I love my Shaw internet service, but if they don’t implement a reasonable UBB I will denounce my relationship with them. As im sure many other customers are thinking the same thing. RIP Shaw…

  • SIzzle

    If they do this, I’m canceling ALL oF my services that are provided by them.

  • I will be dumping Shaw. People forget that UBB also affects those in smaller markets with secondary ISPs.

    No thanks. I give the big middle finger to Shaw. Greedy bastards!

  • Anonymous

    Indeed Gary
    I have an antenna setup in my home and grab in about 20 digital channels including all the main US stations from Buffalo. Signal is excellent and everything is in HD… I could easily do without cable

    The only thing I miss are TSN, Sportsnet and Discovery for Mythbusters 🙁
    I can get all the news online.
    Whenever I am not home my Samsung TV can record a tv show in HD when I am not at home so I can watch it later. Why do people pay $100/mo for cable?

  • Calgary

    what i don’t get it is these BIG 3 will charge UBB, and then they turn around and resell their lines and these secondary companies won’t charge UBB and still makes millions…just a bit ironic. shaw can kiss my ass

  • Yeah, there are ‘ways’ to get streaming live sports but at the end of the day nothing beats watching TV in HD on our big screens. The only good thing that can come out of this is the telcos getting a bit more competitive with each other.

  • Calgary

    just the opposite, i think more people are using more

  • Calgary

    just the opposite, i think more people are using more

  • Calgary

    you get HD from an antenna? maybe you get digital, which is 480i/p at best.
    There is so much HD content on the internet, kids in 10-15 years may never watch shows on cable tv or even know what that is anymore

  • Calgary

    there are “WAYS” of getting Live HD Streams (including sports such as NFL and NHL, or the Discovery ch), if you know WAYS. His a nice guy

  • Anonymous

    Not a Shaw customer… but there is a difference between charging $2 per gb when you go over and the real charge of only $0.01 per gb

    How many would be upset if Shaw came out with a 500gb cap?
    Working it out… a Netflix HD stream is say 4gb MAX per hour, that’s 125 hours or just over 5 days of constant HD streaming a month. Even if you don’t want that HD stream, you can downgrade to SD and get two ro three times your viewing pleasure with a DVD quality video, which is still pretty good.

  • Zamrod

    You aren’t subsidizing anyone. It costs Shaw approximately 2 cents per GB to transfer data to you. It costs approximately 8 dollars per customer per month to provide tech support. It cost them a one time fee to buy your modem, another one time fee to install the infrastructure to your neighbourhood, and a one time fee to pay the installer to install the modem to your house.

    Shaw is averaging these one time costs amongst all their customers and across all of the months that you are a customer. Shaw has likely paid off their entire initial investment in infrastructure. At this point it only costs them bandwidth cost, tech support and maintenance costs to keep you as a customer. Let’s say it costs 10 dollars per customer per month for maintenance, 8 for tech support and as an average customer you use 100 GB per month or less. That means it costs Shaw about 20 dollars per month to provide you with service. You likely pay about $50 per month.

    As a heavy user myself, I use about 500 GB per month and am paying for Shaw Nitro ($150/month). It costs Shaw about $28 per month to provide service to me. When these new rates take effect, it will cost me $300/month to use as much data as I currently use. Now, in order to provide me with the speeds I’m getting, they had to pay more to upgrade their infrastructure than they would have if they were only going to provide you with your speeds. Which is fine, that’s why I pay more. But their monthly cost to provide service to me is about 8 dollars more than you. And I pay for that, and then some.

    Shaw and all the other ISPs just like to throw out the “why should everyone subsidize heavy users?” argument in order to make people angry and agree with them. This is because the average speed and usage of all of their customers is increasing as time goes on. In the next 5 years or so, they realize that they’ll need to do another upgrade. They don’t want to upgrade, because it means giving up some of the profits they are making now.

    You may be using less than half your cap today. What about 5 or 10 years from now? An average 2 hour movie that is in 1080p is 15 GB in size. One of those movies exceeds the bandwidth of Shaw’s smallest plan. A movie once a week exceeds the bandwidth limits of the next highest plan. 7 movies exceeds their next highest plan. 12 movies for their next highest plan. 23 movies for their most expensive plan. You can substitute 2 hours of TV for one movie. So, if you want 2 hours of tv a night in HD over the internet, it’ll exceed the bandwidth limit of their most expensive plan. Of course, it costs Shaw less than 8 dollars to provide you with that bandwidth. And in 5 years, it’ll likely cost them less than 4 dollars.

  • Anonymous

    It depends on the station and the show.
    The prime time shows are the ones that matter to me.
    Global, CityTV, & CTV have pretty much everything prime time in 1080i
    CBC is probably the best one because every time I watch them they have a program in 1080i… Playoffs in 1080i? Yes pls

    I find the Buffalo stations don’t offer much high def stuff like the Toronto stations…. eg: Jeopardy is HD on CBC but only SD on ABC. There are times where a program like Judge Judy is only offered in 480i so CityTV has no choice but to downgrade it, and you do notice the difference between 1080 and 480 and all the primetime shows are 1080i 🙂

  • Theatral

    in france it’s 30 euros/month for:
    28mb/sec unlimited bandwitch + HD TV + unlimited phone in france and to 70 other countries. everything is unlimited and include in the 30 euros. they add the wireless modem, blueray player, hard disk with server set up, recorder and apps to watch, control, record or anything else from your iphone and ipad. and it exist since 2004/2005 with the hd TV and 2001 without regular tv.

    so yes even if there is twice less ppl in canada the big telco makes huge benefit and could drop their price a lot and they will still make lots of money. so UBB…. it’s just a way to make more money and not as they say to protect the smaller user than pay for the bigger one. in this case they can just reduce the bill of the smaller one.

  • Anonymous

    Yea I know of these sites and have used them from time to time. But my dinky Rogers Internet is holding me back right now….

  • David Ranson10

    I have already checked my options and cancellation terms, ready to pull the plug when they go to UBB

  • Anonymous

    CRAP!!

  • This was bound to happen. Shaw is scared shytless that services like Netflix could crush them in the long term. Other providers are bound to follow suite so don’t be surprised if it happens.

    I personally think Shaw should conform and adopt Netflix as part of their guide… Smart move??

    Either way I think the cap prior to UBB will be quite reasonable so don’t get your panties in too much of a bunch quite yet…

  • Rizulli

    The problem with UBB is that it treats net usage like water, if I use too much there will be less Internet for everyone else. That’s not how it works! I would be more than willing to pay for a more realistic model, like paying for a certain bandwidth speed or allocation, which is how Internet usage actual works.

    Might be switching ISPs after this.

  • Yamadorishitate

    Figures, just when I was seriously considering Netflix. Shaw has been good so far, but … it may have to go

  • SgtAdam

    This doesn’t go well with me at all. I have a 50mbit/s connection and I go way over their limit all the time because I game and download a lot. Looks like they’ll lose my business and I’ll be going back to MTS.

  • PapaMike

    Yep bend me over a barrel and $crew me some more!!! The world knows we are screwed the best when it come to tv, internet, phone service and cell phones! Going through the comment I see postings like in Europe they pay $40 bucks Cad. for all the services bundles including freebies like hd pvr’s blue ray player etc….

    For quite some time now I have been turning to the internet for all my entertainment needs… movies, tv shows, music, etc. Maybe if I wasnt forced to pay for channels I don’t want, gotta be maybe 5 channels i would actually pay for, I would be in front of my tv more often. Maybe if I could watch the grey cup like I used to rather than paying 20 bucks a month to watch it I would! the same goes for the STanley cup! 200 + channels all showing the same stupid reality tv shows…. who gives a frack?

    Check this out… 1 hr of programming = 20 minutes of commercials = 8hrs of commercials per 24 hour day = 240 hrs per month of freakin commercials… that I pay for! Do the folks who take out the commercials not pay for it? Why do I have to? And so becuase I turn to the internet for my information I am now going to be double penalized for it by having to pay more for it as well as having to put up with the stupid assed commercials too!

    I suppose the telcos will justify these increased costs because the big wigs have big bonuses coming to them for coming up with this lame idea in the first place!

    Gets my blood boiling!

  • KnightFire

    I was with Shaw for nearly 20 years, and my parents some 40 years – two months after I switched to Telus (for their $15/$15/$15/month Telephone/Internet/TV for one year offer,) Shaw sent a card offering me the same $15/$15/$15 deal – of course I refused. Telus offered me the better deal, and so far have proven they can keep my business.

    PS I’m have OTA Digital TV now too, and plan to drop Telus for TV soon 🙂

  • Similar situation here. Jumped on a Telus 10/10/10 deal for a year, sure beats paying $120/month for a year. Now that we don’t have a bunch of channels, I’ve realized I don’t watch mindless TV anymore.

  • Jedi YYC

    The CEO’s comments indicate new Internet price plans but what he said doesn’t imply UBB

  • Anonymous

    I’ll be changing from Shaw the minute they implement this. Besides Shaw & Telus what other ISPs are available in the lower mainland anyways?

  • Thefrazethatpays

    Shaws new “personal” building rate plans guarantee rates to be the same for 365 days. Wouldn’t this apply to unleashing UBB?

  • Mdixjk

    I want to know that as well.

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  • M R Pgcz

    Just got off the phone with Shaw. Told them if this went through I will be dumping Shaw for all my services no questions asked. They make enough money off Canadians why do they need to steal more??

  • Raids

    Just had a chat with shaw, informed them i’ll be dumping shaw services if they will implement UBB. I asked the rep to put it on record on my account.

  • Anonymous

    OTA= Over The Air? and if so how are you getting it? Via an antenna?

  • Anonymous

    OTA= Over The Air? and if so how are you getting it? Via an antenna?

  • YOU CAN’T CHECK YOUR USAGE UNTIL AFTER YOU GO OVER!!

    I went to check my usage on the weekend and wasn’t able to when previously I was. The online help has the following:

    “You can monitor your ongoing modem use but only if you have exceeded your transfer limits in the past. You can log in to Customer Centre and select Display Modem Usage under the Internet section. You won’t see any information in this section if you have not exceeded your transfer limits.

    We will also send you an email to let you know when you have exceeded the monthly transfer limits on your Shaw Internet plan.”

    So, I guess with their new plans, the email will basically be a warning to expect a higher bill this month….

  • I’ve had a high speed line from Shaw for about two years and I use it for my home business. I’m a portrait photographer so UBB will hurt me because I work with massive RAW files that take a long time to upload to the Internet sites I use for editing and sharing.

    Staying with Shaw will kill my business if they go for UBB. I won’t let my business die. Bye bye.

  • Dennis

    Great response! Well said, I agree 100%

  • Rogers keeps threatening to do the same, and I will do the same as others have said, dump it all if they do this. I Pay over 200 a month for cable, internet, and phone. Seriously thinking of bailing now. Because of cable i don’t use netflix as much but with other downloads i average 50gig a month. I have a cap of 95, but i agree, who knows what the future holds. I think Canadians pay way to much for internet, as well as mobile. Since most of use are using phones from the same big three that offers internet something has to change. We need more competition in Canada, and not this fake stuff where the companies offer the same plans for the same price. They won’t even try to UBB if they know some other company will promise unlimited for the same price or cheaper.

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  • anticorporategovernment

    This is a communist country if this happens.  Well I won’t seek out any shaw apps on my new IPAD I guess and I’ll make sure to sign up for a provider like AT&T and hopefully convince my other to switch to them for the rest of our services as well!  

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