Canada Censures Quebecor in Net Neutrality Split With U.S.

(Bloomberg) -- Canada is strengthening regulations to protect the principle of net neutrality just as the U.S. is preparing to gut Obama-era internet rules.

The Canadian Radio-television and Telecommunications Commission said Thursday that Montreal-based wireless carrier Quebecor Inc.’s practice of not charging users for data they used for music-streaming services like Spotify violated fairness rules. In doing so, the regulator adopted a new framework that would forbid giving unfair access to certain content over others. Quebecor has 90 days to comply with the new rules.

The decision also affects bigger Canadian carriers like Telus Corp. and Rogers Communications Inc., which supported Quebecor in the hearings but haven’t pitched similar offerings to their customers.

Videotron, Quebecor’s telecommunications unit, is determining its next steps, and customers will be able to keep using the unlimited music service for now, the company said in a statement. “We regarded Unlimited Music as a compelling example of innovation and diversification from a new market entrant seeking to differentiate itself from the dominant mobile carriers, to the benefit of Canadian consumers,” said Videotron Chief Executive Officer Manon Brouillette.

The decision adds international support to net neutrality -- the broad concept that internet providers shouldn’t treat traffic differently based on its source. Canada has generally upheld these principles over the last few years. However, the new framework allows for some exceptions such as letting a customer check their cell phone bill on the go without paying for the data to do so.

In the U.S., net neutrality protections aren’t dead yet, but they’re effectively dormant. Ajit Pai, the Republican chairman of the U.S. Federal Communications Commission appointed by President Trump, has made it clear it won’t enforce them. Earlier this year, the regulator dropped investigations into whether internet providers violated net neutrality rules through the practice known as zero-rating, where certain services are exempt from data caps on wireless plans.

Pai may also present a proposal this month to gut Obama-era net neutrality rules as soon as this month, Bloomberg reported April 7. Pai has discussed stripping his agency of strong authority over broadband providers and leaving responsibility for fair treatment of web traffic with the Federal Trade Commission.

Pai, a Republican, dissented when the FCC, then controlled by Democrats, pushed through the most stringent net neutrality rules to date.

To contact the reporter on this story: Gerrit De Vynck in Toronto at gdevynck@bloomberg.net.

To contact the editors responsible for this story: Jillian Ward at jward56@bloomberg.net, Paul Barbagallo, Rob Golum