CRTC orders NorthwesTel to drop some Internet rates

NorthwesTel must drop its DSL Internet rates, reduce the overage charges for users who exceed their bandwidth, and give up its practice of charging an extra fee to customers who purchase Internet service but no phone line.

NorthwesTel must drop its DSL Internet rates, reduce the overage charges for users who exceed their bandwidth, and give up its practice of charging an extra fee to customers who purchase Internet service but no phone line.

That’s according to a decision released this week by the Canadian Radio-Television and Telecommunications Commission, intended to improve northerners’ access to the digital economy.

“Although we recognize the exceptional situation that exists in NorthwesTel’s territory, we must not let these challenges hinder the development and affordability of telecommunications services in the North,” commission chairman Jean-Pierre Blais wrote in a release. “Access to reasonably priced Internet services plays an essential role in the North’s economic and social development. With this decision, we are reducing the gap between what consumers pay for Internet services in the northern and southern parts of Canada.”

Subscribers to NorthwesTel’s DSL, or digital subscriber line, Internet service, which relies on the user’s phone line, will see their rates drop by 10 to 30 per cent. Users with the DSL Internet Lite or DSL Internet 2 plans will receive a 10 per cent cut, while the price of DSL Internet 5 and DSL Internet 15 will be cut by 30 per cent.

Currently, those plans go for $41.95, $64.95, $89.95 and $119.95 per month, respectively. The majority of DSL Internet users are in the Yukon’s communities, as cable service is not available outside of Whitehorse. Cable Internet users will not be affected by the reductions.

The changes will take effect by May 4, and NorthwesTel will not be permitted to raise its rates again for any residential Internet service before the end of 2017.

The decision also forces NorthwesTel to abandon its surcharges for customers who purchase stand-alone DSL Internet services and no phone line. The company currently charges $20 per month to residents and $30 to businesses (reduced from an initial charge of $50 for businesses) for stand-alone Internet. Those fees will be gone by May 4, too.

Lastly, the company is required to reduce its overage fees for customers who exceed their bandwidth limits by at least 50 cents per gigabyte, by February 2016. The current overage rates stand at $2 per gigabyte for premium cable users, $2.50 per gigabyte for cable users, and $3 per gigabyte for DSL users, according to a February news release.

NorthwesTel has already reduced those rates voluntarily at various points over the past several years, for a cumulative drop of 70 per cent.

“This is a surprising and unprecedented decision with a significant financial impact on NorthwesTel, given that our prices on residential Internet services in many smaller and remote communities throughout the North are already being provided below cost, without any subsidy,” the company wrote in a statement. “We’re continuing to study the direct impacts of the decision and evaluating our options moving forward.”

In a dissenting opinion, commissioner Candice Molnar wrote that she could not support the commission’s decision, and raised concerns about how NorthwesTel will compensate for the reductions.

“The revenue impact of the price reductions is not insignificant and is recurring. There is no reason to expect this impact to be borne by NorthwesTel’s shareholders,” she wrote.

“Perhaps NorthwesTel will reduce its capital investment in what have become highly unprofitable DSL Internet services, at least in its most high-cost serving areas. Perhaps NorthwesTel will delay elements of its modernization plan. Perhaps it will request an exogenous adjustment, which would allow the company to recover the lost revenue from other regulated services, including other Internet services. Whatever the outcome, it will be telecom service users in the North who will live with the consequences.”

Andrew Robulack, a Whitehorse-based online communications analyst, is also unsupportive of the decision, but for different reasons. He felt it didn’t go far enough.

“It’s a pretty weak regulatory decision. NorthwesTel dodged a bullet, basically. It’s a fairly hollow statement, a fairly hollow order – the headline-grabbing news, the reduction in the DSL rates. The minority of the northern population uses that technology, it’s old tech,” he said.

“The cost reduction should have been across the board and affected the entire northern population, if the CRTC wanted to make a statement and have a real impact… There definitely should have been a reduction in cable rates, which have a higher cost difference ratio from southern Can`ada to northern Canada.”

Robulack argues that at this point in time, Internet service is essential and should be treated as a public utility, like water or power, rather than as a source of profit.

Just Posted

Whether the dust jacket of this historical novel is the Canadian version (left) or the American (right), the readable content within is the same. (Michael Gates)
History Hunter: New novel a gripping account of the gold rush

Stampede: Gold Fever and Disaster in the Klondike is an ‘enjoyable and readable’ account of history

Yukonomist Keith Halliday
Yukonomist: Your furnace and your truck need to go

Perhaps the biggest commitment in the NDP deal with the Liberals was boosting the Yukon’s climate target

Awaken Festival organizers Meredith Pritchard, Colin Wolf, Martin Nishikawa inside the Old Firehall in Whitehorse on May 11. (Haley Ritchie/Yukon News)
Performing arts fest plans to awaken artistic talent in Whitehorse and the rural North

‘A value of ours is to make theatre as accessible as possible.’

April Mikkelsen tosses a disc during a ladies only disc golf tournament at Solstice DiscGolfPark on May 8. John Tonin/Yukon News
Yukon sees its first-ever women’s disc golf tournament

The Professional Disc Golf Assocation had a global women’s event last weekend. In the Yukon, a women’s only tournament was held for the first time ever.

Dave Blottner, executive director at the Whitehorse Food Bank, said the food bank upped its services because of the pandemic. (John Tonin/Yukon News)
Food Bank sees Yukoners’ generosity firsthand

“Businesses didn’t know if they could stay open but they were calling us to make sure we were able to stay open.”

A prescribed burn is seen from the lookout at Range Road and Whistle Bend Way in Whitehorse May 12. (Stephanie Waddell/Yukon News)
Editorial: Are you ready for a forest fire?

Citizens for a Firesmart Whitehorse have listed some steps for Yukoners to boost safety and awareness

Caribou pass through the Dempster Highway area in their annual migration. A recent decision by the privacy commissioner has recommended the release of some caribou collar re-location data. (Justin Kennedy/Yukon News)
Privacy commissioner recommends release of caribou location data

Department of Environment says consultation with its partners needed before it will consider release

Chief Medical Officer of Health Dr. Brendan Hanley. (Crystal Schick/Yukon News)
Family pleased youth will be able to get Pfizer vaccine

Angela Drainville, mother of two, is anxious for a rollout plan to come forward

Safe at home office in Whitehorse on May 10, 2021. (John Tonin/Yukon News)
Federal government provides $1.6 million for Yukon anti-homelessness work

Projects including five mobile homes for small communities received funding.

Drilling at Northern Tiger’s 3Ace gold project in 2011. Randi Newton argues that mining in the territory can be reshaped. (Yukon government/file)
Editorial: There’s momentum for mining reform

CPAWS’ Randi Newton argues that the territory’s mining legislations need a substantial overhaul

At its May 10 meeting, Whitehorse city council approved the subdivision for the Kwanlin Dün First Nation’s business park planned in Marwell. (Submitted)
KDFN business park subdivision approved

Will mean more commercial industrial land available in Whitehorse

Main Street in Whitehorse on May 4. Whitehorse city council has passed the first two readings of a bylaw to allow pop-up patios in city parking spaces. Third reading will come forward later in May. (Stephanie Waddell/Yukon News)
Whitehorse council pursuing restaurant patio possibilities

Council passes first two readings for new patio bylaw

Most Read