Subscribers to Shaw Communications Inc. (TSX:SJR.B) will pay more Internet services in 2015, and will get lower speeds, unless they pay for more bandwidth, according to Vancouver-based digital watchdog OpenMedia.
Shaw confirmed January 6 that it is raising its rates for Internet services for both residential and business customers.
According to OpenMedia, which has analyzed the prices and speeds, the changes mean existing Shaw subscribers will pay more to maintain their current Internet speeds, and new customers will be getting slower speeds on the packages they buy.
"For example, where $60 a month purchased a 25 Mbps service in 2014, it will purchase just a 15Mbps in 2015 - a drop in speed of 40%,” OpenMedia said in a press release.
“So those packages haven’t changed for existing customers, but they are paying more for them,” OpenMedia campaign manager Josh Tabish told Business in Vancouver.
“For new customers, who are going to sign up in 2015 after the price hike, they are going to be paying the same amount as old customers, for much less Internet."
He added that, if history proves true, other Internet service providers across Canada will follow suit.
Telus Corp. (TSX:T) spokesperson Liz Sauve said in an email to Business in Vancouver that Telus has no plans to raise rates for Internet services, however.
Chethan Lakshman, vice president of external affairs for Shaw, said residential customers will pay between $4 and $7 per month more for Internet services. Rates for businesses have also gone up. A base business Internet service, for example, will increase by $2 to $10 per month.
The rate increases are needed to allow Shaw continue to make the investments needed to meet the ever growing demand for more bandwidth, the company said.
