jecasc, I think you've misunderstood.
The primary ISP in Canada makes billions each quarter. They're charging plenty to cover costs. Canadian internet connection costs are on the high end.
What's happened isn't that companies are charging differently of their own accord. It's that the government has regulated that ISP's MUST charge in a tiered structure. They're actually not allowed to offer flat rate internet - irregardless of the costs.
Canadian internet is a funny thing. There's one company that is basically state-sanctioned that owns all of the copper lines across the country. Private ISP's then must lease these lines from that one company. All the while, that one company is also offering retail internet services in direct competition. Now that company has convinced the gov't to regulate that the private resellers can't offer unlimited internet - that they must charge more for useage AND pass some of that money on to them.
That's a bizarre use of regulation if you ask me. If the free market was allowed to operate Canadians would have unlimited internet useage at cheaper rates then they have now. Instead they get demonstratably higher prices for lower service.
In unrelated news, that primary company? they are also huge in land line phones, cell phones, and satellite TV. All areas where they're facing tough competition from internet based offerings - and all areas where they are now either stifling competition or taking an undeserved cut of the profits from their competitors. Get Netflix? Pay netflix for their useage and then pay this company for the bandwidth.