The endurance of dial-up

Canadians may be among the world’s biggest users of broadband Internet access, but we’re not all hanging up on the humble modem. 

Nearly a third of Canadians still rely on dial-up access to get online, and Internet access providers say dial-up will be a viable business

for some time to come.

A recent study of Canadian Internet use by market researcher TNS Canadian Facts said  that of the 73 per cent of Canadian households that have Internet access, 30 per cent rely on dial-up, down from roughly half of online households in 2001. However, TNS noted, more than half of online households in communities of fewer than 10,000 people still use dial-up, compared to only 22 per cent in communities of 10,000 or more.

“Dial-up is still I think mainstream for a lot of providers,” says Tom Copeland, chair of the Canadian Association of Internet Providers (CAIP), “especially those that tend to serve rural and near-urban markets.” Copeland, who runs, a Cobourg, Ont. ISP, says 90 per cent of his own business is dial-up today.

“Because of where I’m located, a fair amount of my business – like 80 per cent of it – is dial-up,” says Donna Warenko, owner of Granite Internet Services Inc. in Pinawa, Man., northeast of Winnipeg. “Definitely high-speed is where it’s at, everybody wants it, but where you can’t get it, you get dial-up.” Some towns in the area have digital subscriber line (DSL) service, but it isn’t available much beyond the town limits.

Warenko offers high-speed wireless access in part of her service area and is in the process of rolling it out to the rest of the service area. Customers are lining up to get the wireless service, she says – “we probably won’t be able to service all of the customers.”

Dial-up service is not limited to smaller ISPs. Although the major telcos offer DSL in many areas, they are still in the dial-up business as well. A Telus spokesperson says 71 per cent of that company’s Internet subscribers use high-speed, the other 29 per cent dial-up.

AOL Canada Inc., long a major provider of dial-up service, is not walking away from the market either. “We currently still see the dial business to have viable revenue,” says Stephen Koles, general manager for Netscape and AOL enhanced services at AOL Canada in Toronto. 

AOL offers its own high-speed access service by reselling the telcos’ DSL offerings, and also sells an AOL Max service that works with any broadband access from another provider and offers access to AOL content.

The company also has an accelerated dial-up offering that uses compression technology to enhance dial-up performance to the point where, according to Koles, it is “very similar in performance to what you see in high-speed lite technology today.” 

AOL has also participated in trials of fixed wireless technology.

While Canadians’ use of dial-up technology has declined, Jenkins says the rate of decline has begun to slow. “Most of the people who were really attracted to the alternatives have made the move,” he says. At least, they have if the option is available to them. Koles says AOL estimates about a third of all Canadian households won’t have access to high-speed service in the near future. 

Dial-up is not just for those who have no faster options, though. Copeland says there is a group of customers who won’t switch, often because their Internet use is minimal and they don’t consider the extra cost of broadband worthwhile, or because they have limited budgets. Koles says AOL has even seen subscribers switch from broadband services to its accelerated dial-up offering, probably because of the lower ($18.95 per month) price tag. “Dial-up,” Jenkins says, “is not about to disappear.”


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