updated 12:00 am EDT, Tue March 29, 2011
Netflix trims to help those hurt by Bell, Rogers
Netflix in its first signs of addressing a rapidly constricting audience told Canadian users it was slimming down the bandwidth demands of its video service. By default, streaming in the country will now use a lower 300MB per hour bitrate that consumes two thirds less data but with "minimal impact" on the perceived image quality. The choice would let a viewer watch about 30 hours of Netflix on 9GB of data and still leave room, even under a restrictive cap from Bell, Rogers, or another similar provider.
Watching the same amount of standard definition video could normally take up as much as 30GB of video at 1GB per hour, and 70GB at 2.3GB per hour if it was in 1080p, Netflix said. Those on a provider like TekSavvy that don't currently face limits, or anyone who has a large enough cap, can ramp the settings back up if they want the best quality.
It's not known if or when Americans will get the same treatment, although the upcoming AT&T DSL and U-verse caps has prompted some to ask for Netflix to allow lower bitrates in the US.
The gesture has come after a dispute over usage-based billing at the CRTC. The agency had proposed a system that would have required down-the-line Canadian Internet providers, like TekSavvy, to meter their own service like the host carrier, even if they could afford to offer higher caps or unlimited data. Independent providers and Netflix had argued that it would have a chilling effect that would discourage any serious use of online video in Canada and conveniently protect traditional TV services from having to face real competition.
The CRTC copied Bell's position and argued that it was an issue of "fairness" in making sure that heavy users paid more for data while less frequent users paid a smaller amount. However, a public outcry along with the Conservative government's alarm at competition led to the ruling's effect being postponed at least 60 days. Industry Minister Tony Clement warned that the CRTC returning with the same verdict on usage-based billing would lead to the government automatically overturning the decision.
Unlike in the US, bandwidth caps have typically been much lower in Canada than in the US and rarely go up proportionately with speed. A typical 60GB cap would prevent significant 1080p viewing, and possibilities of 25GB caps under the CRTC ruling would have virtually cut out Netflix, iTunes and equivalents for those who still used their data significantly in other ways.