The Canadian Radio-television and Telecommunications Commission review, being held in Gatineau, Que., stems from a complaint about Quebecor-owned Videotron over the way it bills customers for the data they use.

The hearings are being held as new figures show Canadians' appetite for data is ballooning.

OTTAWA — Canada's telecom giants go head-to-head this week at hearings that could result in a dramatic change to the way Internet is delivered across the country.

Rogers Inc., on the other hand, calls zero rating discriminatory, saying it limits competition by favouring certain content.

Major service providers including BCE Inc. and Telus Corp. are in favour of the practice, arguing it results in more choice.

The Public Interest Advocacy Centre complained the new service allowed Videotron to discriminate against other music-streaming services that were still subject to data usage fees.

The company launched an unlimited music streaming service in August 2015, allowing its customers to stream music from specific third-party services without it counting toward their monthly data cap, a practice dubbed as zero rating, also known as differential pricing.

Videotron is offering customers access to its own streaming music services for less than it would charge for other streaming services. (Photo: The Canadian Press/Mario Beauregard)

The CRTC had earlier ruled that mobile TV services offered by Bell and Videotron violated the Telecommunications Act by giving preferential treatment to their mobile television services and created an unfair advantage. Those mobile TV services are no longer being offered.

But the regulator said Videotron's data exempt music streaming services are different because Videotron doesn't promote its own application.

Still, it launched the hearings to better define what differential pricing should look like and determine whether regulatory boundaries are needed around the practice.

The CRTC was inundated with comments against differential pricing when it turned to the popular online discussion forum Reddit last month as it reached out in advance of the hearings to gather a wider range of opinions on the issue.

Non-profit digital rights organization OpenMedia says the argument against zero rating boils down to net neutrality: the notion that all wired and wireless Internet traffic should be treated equally.

"For Big Telecom customers, mean-spirited data caps, high prices, and extortionate overage fees all come as part of the package.'' — Katy Anderson, OpenMedia

​

While seemingly arcane, the concept has real implications for how Canadians use the Internet, said OpenMedia. It planned to argue that the regulator impose an outright ban on data caps, saying Canadians deserve unlimited data at affordable rates.

"For Big Telecom customers, mean-spirited data caps, high prices, and extortionate overage fees all come as part of the package,'' said Katy Anderson, OpenMedia's digital rights specialist.

The CRTC's annual Communications Monitoring Report for 2016, issued last week, gave weight to the importance of the data cap hearings. It revealed that the average amount of data downloaded by Canadians has skyrocketed, with broadband usage increasing 40 per cent from 2014 to 2015, and Canadians downloading an average of 93 gigabytes monthly. Mobile data usage saw an even bigger spike, up by 44 per cent.

The report also showed average total household spending on telecommunications, including wired Internet, wireless devices and phone services, has reached $215 per month, with the largest increase on mobile services.

"With data usage surging 40 per cent in just a year, it's clear Canadians need relief from the punitively low data caps and extortionate overage fees that have characterized our market for far too long,'' said Anderson.

While it opposes differential pricing for data, Rogers said it would argue at the hearings against opening all data plans to unlimited use.

"(Service providers) wouldn't be able to offer lower prices associated with lower consumption of data,'' said David Watt, Rogers' senior vice president of regulatory affairs.

Removing data caps would mean "everybody would have a $90 price plan,'' said Watt.

Also on HuffPost