Rogers’ SpeedBoost system temporarily increases the rate that data is transmitted to their customers in the earliest moments of downloading an item. This system is meant to get ‘bursty’ traffic to end-users faster that would otherwise occur, as well as initially buffer streaming video so that customers don’t suffer delays. It was initially couched as a free ‘extra’ but it seems like Rogers customers now get to pay for these ‘enhancements’:
… a Rogers representative insists that users are lucky that the hikes weren’t worse, given Rogers had to “absorb much of these costs.” The company insists the improvements include some additional TV channels and SpeedBoost, a technology that delivers a little extra bandwidth at the beginning of a download (Comcast users in the States know it as PowerBoost):
$2/customer is a hefty increase when all customers are aggregated. While DSL Reports suggests that this move is driven by a lack of competition in Rogers’ primary markets I think that this is only one element of the story. A key problem facing Canadian ISPs is the high market saturation in wireline Internet services; quite simply, it can be challenging to attract new customers away from their current providers to raise quarterly revenues. One solution is to increase prices in minuscule ways, such that you deliver increased “value” to shareholders while targeting monthly cost increases just below consumers’ pain (and flight) points.
This doesn’t make Rogers’ practices any less horrible for their customers, but I really think that focusing exclusively on competition – and avoiding a reflection on market saturation – is missing a key part of the broader story.