Telecom | Topics

The limits of “unlimited” internet

By : Julie Barlow

Don’t fall for promises of “unlimited” Internet. At the moment, Internet providers in Canada can slow down or stop service however they want. Judging from the new Wireless Code, created in July 2019, things aren’t about to change soon.

Many subscribers to “unlimited” Internet plans would be surprised to learn that there’s really no such thing as “unlimited” Internet service in Canada. Canadian law allows providers to limit the speed of data transfer for their customers even if they advertise the opposite.

According to the 2017 report, Unlimited… really? Are consumers adequately protected? produced by the Quebec consumers’ rights advocacy organization, Union des consommateurs, even if consumers read their service contracts, they won’t be able to understand what the limits are or when they apply. “Everyone understands the word ‘unlimited,’ it’s clear,” says Anaïs Beaulieu-Laporte, a telecommunications, broadcasting, Internet and privacy analyst at Union des consommateurs. “But certain Internet providers completely twist the meaning of it.”

The authors of Unlimited… really? set out to examine “unlimited” plans in three separate domains: long-distance calls, mobile phones and Internet. The study showed that the real problems lay with the Internet providers. In 2013, the Canadian Radio-television and Telecommunications Commission (CRTC) created a “Wireless Code” for mobile phones that requires providers to clearly state limits in their policy.

There is no such requirement for Internet access.

Consumers are flocking to unlimited services, whether for phone or Internet, because they are watching so much streaming video these days that they need a lot of data.”

Anaïs Beaulieu-Laporte, telecommunications, broadcasting, Internet and privacy analyst at Union des consommateurs

According to figures from the CRTC, there has been a 50% increase in downloaded data over the last 5 years. Streaming now accounts for 70% of total Internet traffic during peak hours. The demand for unlimited service has simply followed this trend: in 2015, 20% of Canadians subscribed to unlimited Internet services while by 2017, that percentage had almost doubled, to 37%.

When Fair is not Fair

The authors of Unlimited…”Really? discovered that there is really no such thing as “unlimited” Internet service in Canada. Internet service providers are actually permitted, by law, to limit traffic on the network for security reasons. Canada’s telecom regulatory policy allows Internet providers to use “Internet Traffic Management Practices” (ITMPs), which essentially means download limits, whenever they judge necessary. This is called a “fair use” or an “acceptable use” policy.

In fact, Internet service providers use the excuse of “abusive use” to impose what amount to random data caps.

The measures permitted by ITMPs are very broad. The ITMPs are only meant to be used in exceptional situations, to keep the entire network running. We were very disappointed to realize how much latitude Canadian Internet service providers permit themselves in using ITRMPs to limit data use. It shouldn’t be left up to Internet providers to decide how to apply them.”

Anaïs Beaulieu-Laporte

As the Commission for Complaints for Telecom-Television Services (CCTS) points out, consumers need to know that most unlimited plans are subject to what service providers call “fair use” policies. But the CCTS goes on to say that “there are no clearly defined policies on what fair use is nor on what kind of usage would have negative consequences for the consumer.”

It’s not surprising Internet providers get away with imposing these limits under the guise of “fair use” policies in their contracts. In the study’s survey, 80% of respondents said they didn’t even know what a fair use policy is. And over half of those who did know what it is said they had not read it. In other words, barely 9% of respondents are aware of these policies and have read them. “When something is so technical, no one can expect the average consumer to read it, let alone understand it,” Anaïs Beaulieu-Laporte says.

Unlimited…Really? also shows that even when the information on limits is explained in service contracts, few consumers are able to understand it.

We thought it would make a difference if things were presented more clearly, but from what we saw, no one found the user agreements or fair use policies clear. No matter how the companies presented the information, whether by using tables or terms that were easier to understand, it just wasn’t clear to users.”

Anaïs Beaulieu-Laporte

One solution, the report concludes, is to oblige Internet service providers to disclose information about limits on data use in their promotional literature “so that customers in a hurry will be far more likely to pay attention to it.”

Onus on the CRTC

Many provinces have laws that require companies to clearly state the limits of unlimited contracts. According to the report, many provisions of the Quebec Consumer Protection Act lead to the same conclusion: “Unless it is explicitly specified in the contract, a provider cannot apply over-limit charges for usage within a service said to be unlimited.” In its 2011-2012 Annual Report, the CCTS recommended that the industry explicitly stipulate in their “fair use” policies the amount of data use that will trigger the application of the policy. But Canada trails behind a number other countries – notably the United States, Australia and the United Kingdom – in forcing Internet providers to be more transparent about limiting “unlimited” data plans.

Unlimited…Really? determined that the CRTC, Canada’s regulatory authority for telecommunications, isn’t doing much to protect consumers against unjustified limits. “The CRTC is putting the responsibility on consumers’ shoulders. In recent years, its approach has been exclusively focussed on making Internet suppliers provide information to customers,” Anaïs. Beaulieu-Laporte says. “But they are missing the point. Having information doesn’t change the fact that it’s unacceptable to let Internet providers unilaterally decide how to limit unlimited plans. Legislators or regulatory organizations like the CRTC have to enforce conditions on limiting Internet services and then ensure that consumers are able to read and understand those conditions.”

But change is on the horizon. In July the CRTC created the Internet Code, the Internet equivalent of the Wireless Code for mobile phones. The Wireless Code, which will go into effect January 31, 2020, stipulates that limits on use must be clearly stated to customers, that all communications between the provider and the consumer must be in plain language and, more specifically, that overage charges for unlimited services are prohibited. The Wireless Code also stipulates that, in general, “no limit shall be imposed on an unlimited service unless the applicable limits are explained in the service provider’s fair use policy.”

Yet according to Anaïs Beaulieu-Laporte the new Internet Code doesn’t go far enough. “It’s very, very disappointing,” she says. “The new Code still gives providers too much leeway to impose limits. They have to explain consumers what the limits are, but the Code doesn’t put into question the limits themselves, which in our view are extreme.” So Canada still has some catching up to do when it comes to making unlimited Internet plans…truly unlimited.

The Study

Unlimited…Really? Are Consumers Adequately Protected?, produced by Quebec consumers’ rights organization Union des consommateurs in 2017 with the financial support of the Office of Consumer Affairs, looked into whether “unlimited” long-distance, wireless phone and Internet plans in Canada were actually providing the unlimited service they advertised. The authors of the study determined that while there were certain limits in all three areas, long distance policies and wireless phone services clearly stipulated the limits, while Internet providers did not.

The study revealed that Internet service providers have too much leeway in applying “fair use” policies that allow them to limit Internet traffic to protect the security of the network. It also determined that even when the conditions for limiting Internet access are explained in service contracts, they are so complex and convoluted that average users are unable to understand them. The report calls for government action to oblige Internet service providers to clearly communicate the limits on use to customers and prohibit overage charges on services sold as “unlimited.”