Shaw presents new Internet packages

On January 7th, 2011 I wrote this article which detailed Shaw’s plans to begin enforcing data caps on their internet plans in what was said was an effort to combat congestion on the network. over 11 subsequent posts (this will be number 13), I’ve detailed a lot more in those posts here if you would like to read further about them.  In a nutshell, Shaw was going to put very low caps into place, coupled that with lowering those caps right before the announcement, and did fall into a bit of bad luck in regards to other internet issues in the CRTC that did not even affect them.  But, this is not about the last 5 months, this post is about today, and I’m pleased to say that the news is good.  Very good.

So, what’s the deal?

I’m going to just get this out of the way and say that, in my opinion, Shaw has just become the industry leader in Canada when it comes to internet pricing. This is a statement that I can make without hesitation, but am shocked to say.  Going into the second round of customer consultations tonight, didn’t know what to expect, but did have some ideas.  My personal belief was that Shaw was going to offer internet packages that separated speed from data limits, letting users pick both their speed, and the amount of data per month.  This would not have been a terrible solution, but would have still resulted in capped internet, and possibly high costs for high amounts of data.  What came out of the meeting surprised me, and in almost the best way possible.

Quite The Statement. Now Get To The Details.

Shaw High Speed Lite, High Speed, and High Speed Extreme will remain, with the exception of the data limits, which are being increased by a factor of 2 or 2.5.  This will mean that for Shaw High Speed Extreme, users will get 25Mbps download speeds and 250GB limits for the same price they are paying now.  I think that this plan should be the minimum now for most users, as it provides a good balance of speed, data, and price, and will be good for most users today.  When compared to the new plans I will detail, I personally do not believe that High Speed does not offer a good price/performance value anymore.

The new plans.  Ah, the new plans.  I will say up front that most of them do have data caps, and the pricing is a bit higher, but the value in them is something that has never been seen in Canada to this point.  For the vast majority of customers who run what Shaw now calls “legacy TV” for $59 + the cost of your TV package, you get a data plan of 50Mbps download speed (6.25 Megabytes/second), 3Mbps upload speed (375 KiloBytes/second), and a data cap of 400GB.  400GB is now the starting point for the new plans.  In the short term, the plans will run all the way up to 100Mbps download speed with unlimited data for $120 + the cost of TV.  This compares to the current cost of Warp speed internet which has 50Mbps download speed and a 175GB data cap for $97 when bundled with TV.  Shaw plans to add 250Mbps download speeds with unlimited data for that same $120/month to all markets within the next 16 months, shifting the 100Mbps plan down to a cheaper price point.

To be frank, these new plans are fantastic.  High speed Extreme remains, but with higher data caps, at current prices.  that alone will be enough for most users today.  However, the value of the Broadband 50 plan (50Mbps, 400GB) at $59 is simply out of this world. The closest plan today is Warp Speed, which is the same speed, lower cap, and $30 more expensive.  Compared to today’s High speed extreme, Broadband 50 has 3.2x the data and 2x the speed for $10 more. The value there is hard to ignore.  The new plans go into place June 7, 2011, you will be able to order them then.  You can find a link to the full list of plans at the bottom of this article.

But There Are Still Caps…

Yes, on most plans there are still caps, which means the ability of users to go over the caps.  In the short term, nothing is going to change from the way it is today.  Shaw continues to have an “acceptable use policy” which, translated into English, means that users can go over the cap, but only users who abuse it the most will be contacted and warned.  That is a bit vague, and that was brought up during our meeting, but essentially if you’ve never had a problem to this point you won’t have a problem now.

And even with the caps in place, they are high, very high.  Consider that Shaw claims only 10% of users go over the current caps today, and those caps have been raised at least 2x.  These limits are significantly higher than anything offered by any other ISP in Canada at similar price points.  In Alberta Telus offers 25Mbps with a 250GB limit for $52/month. Shaw will offer double the speed and 1.6x the data for $9 more. In Eastern Canada, Bell offers a similar 25Mbps plan with only 75GB of data for $56/month. Shaw offers double the speed and  5.3x the data for $3 more.  And do not forget that the top tier plan does feature unlimited internet, so if 750GB or 1TB of internet is truly not enough for you, an unlimited option is available.  These limits will be what they should be, a way only to punish users who truly abuse the system the most.

There will be a new system in the future, however this is one piece that has yet to be fully fleshed out. It is tentatively called the bump up plan, which will be some kind of provision that if a person reaches their data limit, they will be bumped up to the next plan instead of having a per GB charge.  I will again stress that Shaw did say there is much work to do with this, and that a plan will be put into place in the coming months of exactly how this will work (warning customers ahead of time, pro-rating costs, etc), and that this plan will not be put into place until 2012. There will be more details on this in the months to come.

Do You Have Anything Bad To Say?

Sure, these plans aren’t perfect. There are a few oddities, and things that could use some tweaking.  For example, the High Speed Lite plan is 1Mbps with a 30GB data cap, at a cost of $27/month when bundled with TV. A new plan called Unlimited Lite will also be offered that has a 1Mbps speed but with unlimited data.  The cost of this plan will be $59/month when bundled with TV.  That cost is the exact same as the Broadband 50 plan, which offers 50x the speed and 400GB data. Now, the 1Mbps may be unlimited, the average user of such a slow speed plan will be hard pressed to use anywhere near 100GB of data simply because the speed is not fast enough to get that kind of data in a month.  The pricing on Lite unlimited is very awkward, and I would argue that the plan itself is unnecessary.

My only other real complaint is the fact that the new broadband plans all require TV bundled in with them.  There is no option to buy those packaged stand alone.  You will still be able to buy High Speed Lite, High Speed, and High Speed Extreme stand alone, but not the new Broadband plans.  Now, that being said, a customer can get the Broadband 50 plan, and the lowest cost TV package offered will bring the cost to $84.90/month.  This package is less expensive than buying Warp Speed stand alone for $107/month. The user gets more data, the same speed, and TV for $22/month less, and if you really do not want TV, you do not have to plug in the cable box.

that being said, it would be nice if those plans would be offered stand alone. Some users truly do not want a TV package, and under this new plan they will be forced to pay for TV to get a new plan. This is clearly a business decision by Shaw to ensure as many people as possible subscribe to their TV services, and I understand the reasoning behind it.  It is just not a decision I personally agree with.

How Is Shaw Actually Going To Make This Work?

I almost feel like I’ve buried the lead here, because how Shaw is going to accomplish this is a pretty significant step for them.  Over the coming months, Shaw is going to transition most of their analog cable offerings to digital only.  The significance of this shift cannot be understated.  Right now, Shaw has 4 levels of analog cable.  Basic, and tiers 1, 2, and 3.  This transition will leave Basic cable on Analog, but the three tiers will be moving to digital only.  This will mean that a user in a major market will only be able to get approximately 40 channels without a cable box.  Anything more will require a digital cable box.  Shaw says doing this will triple the amount of bandwidth available on their current network infrastructure, which will allow them to offer the speeds shown in the new Broadband plans.

Again, the scale of this transition is quite large, and was the biggest surprise for me.  This type of transition was inevitable, and was going to need to be done eventually, but this plan has accelerated any plans.  Shaw currently has over 300,000 subscribers that have at least Tier 1 level of service and are analog only.  Every single one of those customers will need to be contacted and Shaw is going to work with them on this change.  Final plans are not in place yet, options are being explored including giving each user a free digital box, lowering the cost of the box for the users, and making basic cable cheaper and having them drop down to that. Shaw will be doing this transition beginning in August and will be done region by region, city by city, and neighborhood by neighborhood. it is expected that it will take up to a year to complete.  Once the transition is complete in the area you live, the Broadband 250 plans, which offer the 250Mbit download speeds.

Sounds Like a Big Change For Shaw.

It is, and moves them firmly into the 21st century.  Eventually the Basic Analog will have to be eliminated, but this is a significant step for them.  A move like this really begins to transition Shaw away from a Cable company with internet, to a content distribution company.  TV will still remain a very big part of their business, but this type of move really puts the internet where it should be, equal or higher than TV on their priority list.  Cable TV as we know it will eventually go away. It won’t be next year, or 10 years from now, but it will eventually make way for an entirely internet driven system of content delivery, and this is the biggest step Shaw has made in this direction to date.

I said it at the beginning, and I will say it again. The plans that Shaw unveiled today moves them firmly into the lead in internet pricing in this country.  Shaw will now offer plans that the competition quite frankly cannot compare to.  The bar has been raised, and it has been set very high.  This type of innovation is something that frankly is not seen in this industry.  Shaw has taken a leap forward while others are standing still. Even Telus, who has improved the most in the past 2-3 years, is left behind by this offering. For all of the bad press and attention Shaw has received in the last 5-6 months, Shaw deserves to be applauded, for they got this one right. It’s that simple.

[Read] – New Shaw Internet Packages