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Mad caps drive up Internet bills: Netflix

Canadian Internet providers are using data caps to inflate their profits, not provide better service, Netflix CEO Reed Hastings says.

Canadian Internet providers are using data caps to inflate their profits, not provide better service, Netflix CEO Reed Hastings says.

The video-streaming company has released a plan to combat low downloading allowances, but Hastings said yesterday that customers shouldn’t have to ration their data use. The true cost of that data is less than a penny per gigabyte and shrinking, he said, though Internet providers have disputed that figure.

On Monday, Netflix reeled out options to control consumption of data. Users can still watch a movie or TV show with the best available quality, which can take more than two gigabytes per hour to stream. But a new default setting — at a lesser quality — will consume only 300 megabytes an hour.

With the new setting, watching 30 hours of content a month would transfer about nine gigabytes of data, which Hastings notes would come under the caps of most Internet plans.

U.S.-based Netflix, which launched in Canada in September, is on track to add its one-millionth Canadian customer this summer.

 
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