another article that we are moving towards Internet bandwidth caps

[MikeyLSU]

http://www.tomshardware.com/ne...-time-warner,7696.html

The American Cable Association said that, like it or not, metered bandwidth Internet pricing is coming, and will be a necessity.

Zoom
As displeased as internet users are (as in those who actually use the internet) about bandwidth caps, it seems that cable companies on the whole want consumption-based billing policies.

Cable executives who met for the American Cable Association's (ACA) annual summit expressed feelings that metered internet billing would be a part of the business future.

According to Broadcasting & Cable, ACA President Matt Polka said that metered pricing will be a necessity going forward for cable companies as they become broadband companies.

Polka gave that example of his heating bill in Pittsburgh, where he would love to pay the same flat rate all year-round for heating, but instead must pay more during the winter months. With all the network expansion and new internet services such as Netflix streaming, Polka said that cable companies won?t be able to provide service for just $40 per month.

Patrick Knorr, general manager of Sunflower Broadband, which has had bandwidth-based billing for four years now, said that a grandmother who just wants to read e-mail should not have to subsidize the college kid who downloads HD movies to watch later.

Knorr added that metered billing is the only way to manage infrastructure and that charging a flat rate "is not a sustainable business model." Sunflower Broadband currently offers an entry-level 3 GB service tier for $27.95 per month (without video bundle discount). Those who crave the top-level service can get 50 GB for $59.95 (without video bundle discount) per month. Those who go over their quota will be billed at $2.00 per GB, though customers can buy more bandwidth in advance in 15 GB blocks for $10 each.

Sunflower Broadband tries to put its bandwidth caps into perspective using data from more than two years ago. As quoted from its service site: In April 2007, 98.9% of users had less than 40 GBs of bandwidth usage, 86.98% of used less than 10 GBs, 49.46% of used less than 1 GBs of bandwidth usage per month.

Knorr went on to say that, unlike satellite, broadcast, and cable, the internet is not a particularly efficient way to deliver high-res video.

We?re personally of the opinion that the internet is a very efficient way of delivering all sorts of data, video or not. What do you think? Do ISPs have to charge for bandwidth to sustain a business model, or are cable companies just trying to throttle back customers to keep them paying for traditional TV services?

I still don't understand the comparison to energy. My energy bill is near 0 if I don't use any energy in a month. And it is a flat rate forever for how much energy you use.

I would actually not mind that type of pricing. But don't pretend that you are metering bandwidth but have a minimum $30 for that "grandmother" who just checks email once a day. Either have unlimited bandwidth or charge a rate per GB flat for everyone starting from $0 if you don't use it, that is how energy/water work.

 

[Red Squirrel]

They should just increase the pipe sizes if it's such a big issue. Equipment has a one time cost. Upgrading an OC512 to OC1024 and adding 5 more bridged ones is peanuts for a big telco. Or/and they should actually start doing something about spam and bot nets. They waste the most bandwidth.

 

[tasmanian]

This shit is getting out of control. 3 GB cap? I just downloaded a 1.5 GB patch for my game. Now my provider, Comcast, has a 250 GB cap. Which is logical and acceptable.

 

[Red Squirrel]

Yeah it is getting retarded. I hope it wont come to this here in Canada. Right now my DSL is unlimited. They sort of have a cap but it's not really set in stone. Basically if they find you're abusing the service they might cut you off, but they wont overcharge.

That's what I think is the worse part about some ISPs is they'll over charge. I would rather have my speeds dropped, at least I don't have to worry about someone DDoSing my home line or something else taking up lot of bandwidth and end up with a 5k bill at the end of the month.

 

[Engineer]

Click me!

and then you have...

The operating cost of providing broadband service is low and getting lower. At Time Warner, the cost of connecting to the Internet and other direct costs of providing its high-speed data service fell to $33 million, down 18 percent. That represents just 3 percent of the revenue it collects for broadband service. But it doesn?t include the capital expenses needed to upgrade the network. Comcast reported $120 million of costs for high-speed data service, down 13 percent from a year ago. That represents 6 percent of its data revenue.

 

[Modelworks]

They really should be comparing it to electricity 75 years ago. That was a time when you were lucky to have a home that had a single 5 amp 120Vac line. If someone tried to use all the stuff we use now back then, the electrical infrastructure would have melted.

The problem is they built out their systems for the late 1990's. They went to congress and got approval to raise rates on the premise they would upgrade the infrastructure. Instead they pocketed the money thinking what they had would work far into the future. Internet usage grew faster than they expected and now they have a problem. They now have to play catch up , but instead of spending the money required they want to try to put it off by capping the service. If they can ever get to the position of having all the hardware in place and upgraded, ahead of the curve for usage, caps will not be necessary. About the way electricity is now. We have enough of it in most places that need it , except in very high usage times.

 

[mugs]

Originally posted by: tasmanian
This shit is getting out of control. 3 GB cap? I just downloaded a 1.5 GB patch for my game. Now my provider, Comcast, has a 250 GB cap. Which is logical and acceptable.

That's not a cap, that's their lowest tier of service. There is nothing wrong with having a tier that only includes 3 GB. Many, many people are still using the Internet in the same way they did when they were on a 28.8 modem - e-mail, web browsing, no media. Those people wouldn't use 3 GB in a month, and it is to their advantage to have a cheap 3 GB plan.

The problem is that their top tier is 50 GB and their per-GB cost is high.

 

[rudeguy]

Originally posted by: Modelworks
They really should be comparing it to electricity 75 years ago. That was a time when you were lucky to have a home that had a single 5 amp 120Vac line. If someone tried to use all the stuff we use now back then, the electrical infrastructure would have melted.

The problem is they built out their systems for the late 1990's. They went to congress and got approval to raise rates on the premise they would upgrade the infrastructure. Instead they pocketed the money thinking what they had would work far into the future. Internet usage grew faster than they expected and now they have a problem. They now have to play catch up , but instead of spending the money required they want to try to put it off by capping the service. If they can ever get to the position of having all the hardware in place and upgraded, ahead of the curve for usage, caps will not be necessary. About the way electricity is now. We have enough of it in most places that need it , except in very high usage times.

play catch up how? I don't think any ISP is having serious B/W issues. If they truly are, they are set to get back some major B/W from the analog channels in a couple years.

 

[Engineer]

Originally posted by: mugs

Originally posted by: tasmanian
This shit is getting out of control. 3 GB cap? I just downloaded a 1.5 GB patch for my game. Now my provider, Comcast, has a 250 GB cap. Which is logical and acceptable.

That's not a cap, that's their lowest tier of service. There is nothing wrong with having a tier that only includes 3 GB. Many, many people are still using the Internet in the same way they did when they were on a 28.8 modem - e-mail, web browsing, no media. Those people wouldn't use 3 GB in a month, and it is to their advantage to have a cheap 3 GB plan.

The problem is that their top tier is 50 GB and their per-GB cost is high.

Wonder how Granny will feel when she gets a virus that spams the hell out of the network and she gets a $1,000 bill for internet usage?!!?!! :shocked:

 

[Modelworks]

Originally posted by: NSFW


play catch up how? I don't think any ISP is having serious B/W issues. If they truly are, they are set to get back some major B/W from the analog channels in a couple years.

I don't think they have reached the point of saturation but I think they realize that it is coming sooner than they were prepared to handle it. It is their own fault for not spending the money they were given to do it with, but like any company they wanted profits for the shareholders.

The analog channels that are to be auctioned back after the DTV transition will not help backbone providers. If I was a cheap CEO and I decided to run only one fiber to your city the only way I can increase capacity is to pay up for new fiber.

 

[rudeguy]

Originally posted by: Modelworks

Originally posted by: NSFW


play catch up how? I don't think any ISP is having serious B/W issues. If they truly are, they are set to get back some major B/W from the analog channels in a couple years.

I don't think they have reached the point of saturation but I think they realize that it is coming sooner than they were prepared to handle it. It is their own fault for not spending the money they were given to do it with, but like any company they wanted profits for the shareholders.

The analog channels that are to be auctioned back after the DTV transition will not help backbone providers. If I was a cheap CEO and I decided to run only one fiber to your city the only way I can increase capacity is to pay up for new fiber.

The reason that I keep hearing is upgrading equipment and not so much bandwidth. Well...it is about bandwidth until all the new equipment is deployed. Comcast has already upgraded most of their cable boxes to dramatically cut down the bandwidth that video uses. The other cable providers are not far behind. The bandwidth is there, its just a matter of using it the most efficient way.

I really hope that metered billing does not happen. It would be a dramatic step back in time. I can just see the Comcast putting out 1000 free meg cd's at gas stations in pretty metal tins.

 

[SludgeFactory]

Originally posted by: MikeyLSU
I still don't understand the comparison to energy. My energy bill is near 0 if I don't use any energy in a month. And it is a flat rate forever for how much energy you use.

I would actually not mind that type of pricing. But don't pretend that you are metering bandwidth but have a minimum $30 for that "grandmother" who just checks email once a day. Either have unlimited bandwidth or charge a rate per GB flat for everyone starting from $0 if you don't use it, that is how energy/water work.

It's BS. Just like a $2/GB overage charge. WTF is that. And I like how they cite stats from April 2007 to show how reasonable their caps are. That was an eternity ago in terms of consumer demand for video streaming.

Cable co's are all blabbering about paying for what you use, when what they really want is to join the ranks of the ripoff kings, cell phone providers, where you essentially pay $30-$40/month for the most minimal of monthly plans, regardless of usage, and then scale it up from there.

 

[frostedflakes]

I'd like to see them try to implement metered billing. I was surprised by the outcry against TWC's proposed metered service. I think even non tech savvy users saw it for exactly what it was: Trying to charge customers more for less.

If TWC wanted to save grandma and grandpa money, they would be advertising their lite service instead of offering them only premium internet that they don't need.

 

[Newbian]

We need more tubes asap!!!

 

[Modelworks]

Originally posted by: NSFW

The reason that I keep hearing is upgrading equipment and not so much bandwidth. Well...it is about bandwidth until all the new equipment is deployed. Comcast has already upgraded most of their cable boxes to dramatically cut down the bandwidth that video uses. The other cable providers are not far behind. The bandwidth is there, its just a matter of using it the most efficient way.

I really hope that metered billing does not happen. It would be a dramatic step back in time. I can just see the Comcast putting out 1000 free meg cd's at gas stations in pretty metal tins.

Right now the current internet systems could not handle the bandwidth if everyone started to max their connections, it would slow to dialup speeds. The only thing the telecoms have working in their favor for now is that not everyone is downloading movies, software, music, etc. Power users are still in the minority, but growing.

The telecoms are going to have to spend money to get the systems up to the point that they can supply the demand. And they do not want to spend money when they can't get it back three fold the next day. So they put in caps in the hope people will only download what they absolutely have to because it cost too much to do otherwise. I see the caps as a deterrent not a way for them to make more money off each subscriber.

 

[Jeff7]

Originally posted by: frostedflakes
I'd like to see them try to implement metered billing. I was surprised by the outcry against TWC's proposed metered service. I think even non tech savvy users saw it for exactly what it was: Trying to charge customers more for less.

If TWC wanted to save grandma and grandpa money, they would be advertising their lite service instead of offering them only premium internet that they don't need.

Amusingly enough, TimeWarnerCable's own website starts you out with an ad that says "Get more. Pay less."

Ok then, we go from paying $X/month for unlimited Internet to $X/month for a bandwidth cap that made the caps I had back in the campus dorms seem generous.

I think that slogan of theirs is slightly mixed up.

 

[Colt45]

They should start changing 25c per local call on your landline. And discount the neighbour that only half fills his trashcan.

 

[Kadarin]

This is nothing more than an organized money grab by the cable companies. They are looking desperately for ways to save their cable tv franchises in the face of a home entertainment paradigm that's about to render them obsolete. Why pay approx $100/month + PPV when you can watch Hulu and Youtube, and stream the occasional HD movie?

 

[Adam8281]

While I have been against bandwidth caps since the beginning, what has REALLY sealed the deal for me has been signing up for MLB.tv last month. MLB.tv is a for-pay service that streams hi-def major league baseball games over the internet. According to my bandwidth meter, watching MLB.tv uses over a gigabyte per hour! Before signing up for MLB.tv I was averaging a couple hundred MB per day. Now I'm averaging 4-6 GIGABYTES per day! This means I could easily hit 150GB per month, just off of MLB.tv, which would cost $140/month according to the Sunflower price scheme in the OP!! If this happens it will KILL internet video. Who is going to pay for a service like MLB.com ($110 per year) if it also requires paying ISP fees out the butthole? The quality of internet video generally would probably stagnate since bandwidth-conscious viewers wouldn't want to risk exorbitant fees just to watch Youtube in hi-def. Bandwidth caps are such a backwards plan, I pray they don't take effect.

 

[tcsenter]

Originally posted by: RedSquirrel
They should just increase the pipe sizes if it's such a big issue. Equipment has a one time cost. Upgrading an OC512 to OC1024 and adding 5 more bridged ones is peanuts for a big telco. Or/and they should actually start doing something about spam and bot nets. They waste the most bandwidth.

Stop talking on things you have no clue about. How many OC512 or OC1024 have you been involved in the planning, acquisition, and installation for? If what you say were true, the bandwidth and hosting costs for websites like Facebook or Myspace should not be substantially greater than those with 1/100th the traffic. And yet, where is my unlimited hosting plan for $25.00 per month? Hell, I'm even willing to accept caps, where is my 10TB hosting plan for $5.00 per month?

The knee-jerk opposition to usage-tiered plans can be broken down into three groups:

- high school or college students who have yet to enter the real world, where the price of ALL SERVICES is based on usage and/or features with very few exceptions

- the 5% whose exorbitant usage is being subsidized by the 95% paying the same rate but only use a fraction of the bandwidth

- the average moderate user who may actually stand to benefit from a tiered plan because they will no longer be subsidizing the extreme 5% but are just too dumb to realize it

They should start changing 25c per local call on your landline. And discount the neighbour that only half fills his trashcan.

Glad you mentioned it, because a recent study by a consumer group found that extremely 'low-usage' cell phone customers could be paying as much as $3.00 per minute, but even the average moderate users may not be getting any bargain:

"UCAN...calculated the per-minute phone charges of each customer in the survey, then averaged those figures to determine the rate paid by the typical user. That approach yields an inflated figure that sounds nothing like the average per-minute charge paid by anyone ($3.02, to be exact). But if you split UCAN?s data a little differently, it looks more realistic. Fifty-one percent of customers in the survey paid 25 cents a minute or less, and 49 percent paid 26 cents a minute or more." -- What Do Your Minutes Cost?

One size/price fits all plans are bound to either fail due to being fundamentally unsustainable or harm the majority of typical users who indisputably subsidize the small percentage of extreme users.

 

[Cattlegod]

the problem with this metered idea is it is a different technology. this sector goes along with moore's law, all other utilities do not.

 

[TridenT]

Why can't we be like the other European countries where they have like 100/100, no cap, and only like $20/month...

 

[LS21]

what they should do is metered television. man im in town 20% of the town and i pay a fulls month worth of programming

 

[tcsenter]

Originally posted by: TridenTBoy3555
Why can't we be like the other European countries where they have like 100/100, no cap, and only like $20/month...

Tax payers don't heavily subsidize internet infrastructure and capacity here. Ironically, most of those I see wishing for heavily tax-subsidized internet like that in South Korea or Japan also seem to be the same ones who freak out over, yep, publicly funded industry subsidies, incentives/breaks, and corporate welfare. Another day, another change of underwear and opinion.

 

[Bill Brasky]

I'm actually ok with tiered internet pricing, I just wish the caps were more reasonable...