Backed by a public outcry, Canadian opposition parties lined up on Tuesday to voice concerns about a regulatory decision that chokes off the ability of small independent Internet providers to offer unlimited downloading to their customers.

The regulator, the Canadian Radio-television and Telecommunications Commission (CRTC), gave major telecom carrier BCE Inc approval last week to charge wholesalers that use its network on the same usage-based billing (UBB) basis it uses to charge its customers, minus a 15 percent discount.

Major providers such as Bell, Shaw Communications and Rogers Communications charge customers extra if they download more than the monthly limits the big providers set, typically between 20 and 60 gigabytes.

Small providers often offer plans with 200 gigabyte ceilings, or even unlimited use.

At least one market participant and an individual citizen have appealed the regulator's decision.

One of the small providers, TekSavvy, will cut its usage ceiling to 25 gigabytes effective March 1, the date the CRTC ruling comes into force. On Tuesday, its website was festooned with links to groups opposing the pricing framework.

Citizen group Openmedia.ca said on Tuesday its Stop The Meter petition opposing usage-based billing had garnered more than 200,000 signatures, up from around 40,000 before the CRTC handed down its decision.

The opposition Liberal and New Democratic parties said the regulator's decision limits competition and punishes consumers.

We do not agree with the CRTC's decision on usage-based billing, and we will bring the fight for an open and innovative Internet environment to Parliament, Liberal critic Marc Garneau said in a statement.

Usage-based billing is squashing competition and hitting Canadian consumers in the pocketbook, said Charlie Angus of the New Democrats.

Another opponent of the pricing scheme is Netflix, whose launch of an online-only movie service in Canada in September spooked the incumbent providers.

Conservative Industry Minister Tony Clement said he was aware an appeal had been lodged and that the government would study the CRTC's decision to ensure that competition, innovation and consumers were all fairly considered.

Openmedia.ca's national coordinator, Steve Anderson said Clement would have to do more than ask the CRTC to tinker with pricing.

He must either overturn all the CRTC rulings that force pricing schemes on big telecom's independent competitors, or at minimum have the CRTC revisit the entire premise of forced UBB pricing, he said.

BCE, the parent of telecom Bell Canada, and other telecom operators have spent heavily on infrastructure and are mandated to lease their networks to small providers to encourage competition.

(Reporting by Alastair Sharp; editing by Peter Galloway)

Legislation & Lobbying Regulatory Agency | SEC Canada