60 Comments

Summary:

Is Time Warner Cable crazy? As I review the pricing plans unveiled today for the broadband and cable provider’s tiered levels of service, I can’t help but wonder that. Earlier this year, the company said it would experiment with tiered pricing in Beaumont, Texas, and now […]

Is Time Warner Cable crazy? As I review the pricing plans unveiled today for the broadband and cable provider’s tiered levels of service, I can’t help but wonder that. Earlier this year, the company said it would experiment with tiered pricing in Beaumont, Texas, and now has set up a pricing plan that ranges from $29.95 a month for something I’d call “barely broadband” at 768 kilobits per second with a 5-gigabyte monthly cap to $54.90 per month for 15 megabits per second and a 40-gigabyte cap. Overage fees will be $1 per gigabyte, and customers will be able to monitor their bandwidth consumption via the company’s web site.

The pricing takes effect Thursday in Beaumont but Time Warner Cable says it doesn’t know if and when it will try this elsewhere. I’ve got a personal stake in this story as Time Warner Cable is my current ISP. I pay about $35 a month for my connection, which is between 1 and 1.5 Mbps, and stream a lot of content from sites such as Hulu and iTunes. Plus, I’m constantly downloading software from the web in the form of fat updates or just to try things out.

On the other hand, it would be worth it to pay more to get a 15 Mbps connection if that’s indeed what I would get, but the bandwidth cap would limit me to watching about 40 hours of standard video content from my PC a month, plus my regular surfing habits and email use. (I suppose this is more transparent than P2P throttling, though).

But here’s where I question Time Warner Cable’s sanity: By offering tiered service at 15 Mbps it’s promising me faster speeds that I will have limited opportunity to use, potentially driving me into the arms of another provider. Additionally, the cable guys are in a fight to the death with the telephone companies, who are unlikely to resort to such plans because they don’t have the same limitations when delivering last-mile services.

For people who get or send a lot of media online, neither of Time Warner Cable’s tiers are a good option, which means they’ll have to turn to other providers. For me, that means DSL from AT&T, as U-verse or FiOS isn’t available in my area. And for a technology teleworker, that’s the equivalent of giving an engineer a slide rule. I don’t think Time Warner Cable will win by trying to hold back changes wrought by ubiquitous broadband with a pricing plan, but it seems hell-bent on trying.

  1. If Time Warner introduces this in my city, I’ll switch to DSL.

    Share
  2. I use Time Warner in NC pay $44.95 for 1.5Mbs, if they increase the rate I would rather use something else, but unfortunately we don’t have much of a choice, all of them charge the same. It is collusion at best but nobody cares.

    Share
  3. Framboulatos Monday, June 2, 2008

    The only reason they can even dream (of testing) such a pricing structure is the lack of competition. Which is the same reason they can get away with throttling.

    Share
  4. I also am a TW subscriber, mostly happy. I would gladly pay bigger bucks for a 15MBs connection, but would find that completely useless with a 40GB cap. Just my work takes at least a quarter of that, and then like you I am constantly trying out software, streaming video, audio, etc.

    I would be gone in a flash. They really need to revisit their “power user” tier. It is all out of whack.

    Switching carriers is really a pain. If I bail on them, they would have a hard time getting me back, just as it has been hard for ATT & another local choice in Austin to pull me away from TW. But this kind of plan would be my marching order. And I also get my phone and TV from them. They would lose all of that, over $150/month. Pretty stupid idea.

    Share
  5. [...] for 55 dollars? Are you freaking kidding me? A faster connection — yes, but isn??t that faster sphttp://gigaom.com/2008/06/02/time-warner-cable-broadband-tiers-lead-to-fears/Complaints Board wgranberrywmconnect.comwgranberrywmconnect.com Complaints: No way to get online [...]

    Share
  6. this has to be treated like roads and highways very soon .. the private sector simply is unable to see the bigger picture about life on earth in this century …

    Share
  7. Heh. Isn’t the industry moving the other way? I remember when AOL capped you to 10 hours. Then it was 100, now it’s unlimited always-on access. In today’s world with broadband, I’ve go my Tivo and several computers with always on connections. When I’m home, my cell phone connects via wifi, and I use vonage for VOIP.

    In a day and age where connectivity is king, Time Warner seems to be going the other way.

    Share
  8. [...] metered broadband is coming to the US market place. Time Warner is the first major cable company to announce its metered broadband strategy & prices for a small Texas market, in what can be described as [...]

    Share
  9. [...] metered broadband are coming to the US market place. Time Warner is the first major cable company to announce its metered broadband strategy & prices for a small Texas market, in what can be described as [...]

    Share
  10. [...] metered broadband are coming to the US market place. Time Warner is the first major cable company to announce its metered broadband strategy & prices for a small Texas market, in what can be described as [...]

    Share

Comments have been disabled for this post