In a decision on the regulator's website, the Canadian Radio-television and Telecommunications Commission has ordered Bell Mobility Inc. and Quebecor Media Inc., VidéotronLtd. and Vidéotron G.P. to halt the practice in the next few months.
It stems back to a complaint by Bell Mobility customer Ben Klass in late 2013 who didn't like that Bell was offering him an app called Mobile TV, for $5, that would allow him to consume an extra 10 hours of video content per month, on top of his normal monthly usage, that allowed him to consume more content, some of which was Bell-owned.
Twelve of the 43 channels available on Mobile TV — including CTV, TSN and The Movie Network — are owned by Bell Media, a subsidiary, like Bell Mobility, of the media behemoth BCE.
The app charges another $3 per hour after the first 10 hours. Vidéotron has a similar app that charges $10 per month for 15 hours of content, and $15 per month for 30 hours of content.
Internet video is typically data-heavy and expensive, but such apps would make Bell- and Vidéotron-owned content cheaper and therefore more desirable to consume by making it appear to be less so. That's because the apps track usage in terms of hours — not the megabytes and gigabytes that other content is measured in.
Going over a usage cap while consuming content that isn't owned by Bell (such as Netflix or YouTube videos) would normally result in a charge that's 800 per cent higher than those prices, Klass said in his complaint — implying the companies that own the pipes are giving preferential treatment to their own data when it's moving along them.
That's unfair, Klass argued, because it contravenes a clause in broadcasting legislation that reads: "No Canadian carrier shall, in relation to the provision of a telecommunications service or the charging of a rate for it, unjustly discriminate or give an undue or unreasonable preference toward any person, including itself, or subject any person to an undue or unreasonable disadvantage."
The CRTC agreed on Thursday, ordering Bell and other companies with similar policies to stop the unfair billing practice.
"At its core, this decision isn’t so much about Bell or Vidéotron," CRTC chair Jean-Pierre Blais said at a breakfast luncheon in London, Ont., on Thursday. "It’s about all of us and our ability to access content equally and fairly, in an open market that favours innovation and choice. The CRTC always wants to ensure — and this decision supports this goal — that Canadians have fair and reasonable access to content."
"It may be tempting for large vertically integrated companies to offer certain perks to their customers," Blais added. "But when the impetus to innovate steps on the toes of the principle of fair and open access to content, we will intervene."
Ruling shocks Bell
For its part, BCE, the parent company of Bell Mobility, said in a statement to CBC News that the decision came as a "shock" to the company. "There’s a hint here that the government believes Bell Mobile TV delivers only Bell Media content," spokesman Jason Laszlo said. "They should know we offer mobile TV content from all of Canada’s leading broadcasters in English and French."
Bell Media content accounts for only about 20 per cent of Bell Mobile TV programming, Laszlo noted, adding that more than 1.5 million customers across Canada liked the service enough to sign up for it.
Rogers used to have a similar offer, but moved toward billing per byte, not time viewed, in its similar offerings as of the middle of last year.
In the decision, the regulator will require that Bell halt the practice by the end of April, and ordered Vidéotron to do the same by the end of March.