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Summary:

While not so uncommon overseas, bandwidth caps and 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 draconian. We […]

While not so uncommon overseas, bandwidth caps and 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 draconian.

We have written about Bend Broadband of Oregon resorting to such tricks. Comcast, recently proposed bandwidth caps as well. What it means: get ready to pay more and get less for broadband. Will this spur into action, and switch ISPs or look for alternatives. Take our poll and share your opinion.

  1. I do not think this would be an issue for someone like my mother at her house, because outside of a little youtube, all she does is email and web surf. But, I play games on XBL, constantly downloading content (which at times, a demo can ring it a +1GB). If I was big into something like PC gaming and steam, I would have a big issue down the line.

    Mark Cuban talked about how we can increase the bandwidth in our country. It makes perfect sense especially since we talked about going all digital: http://www.blogmaverick.com/2008/04/10/how-to-make-us-broadband-competitive-quickly-and-cheaply/

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  2. Matt Platte Tuesday, June 3, 2008

    Unlimited bandwidth, at any price, is an invitation for abuse. But it’s also a good marketing technique when a late-to-the-game player wants to build a subscriber base. Thus it was never a question of ‘if metering would arrive’ but simply ‘when?’

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  3. Matt, nobody sells “unlimited” bandwidth though. We’re paying for a transfer rate, which has a (albeit rather high, depending on speed) maximum monthly transfer.

    That aside, doesn’t the per/GB overage price seem a *little* excessive? $1.50/GB?

    I can understand if this is the route we need to take, but let’s at least make the pricing reasonable to you don’t *completely* alienate your technically inclined customers. Hell, I’d even use a completely pay-as-you-use bandwidth service styled after AWS s3 — as long as the price was in the same general universe.

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  4. Even though I might not exceed the bandwidth cap, I really don’t want to have to think about how much I’m using. Once you start using it enough, it’s 10x the pain to keep track of. Similarly, I recently switched to unlimited SMS for my iPhone because my usage was going up and I don’t want to have to think about it.

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  5. both Australia and South Africa have meters and caps, for all ISPs. I think ‘switching’ won’t be an option, since it will be priced accordingly, as it is in those markets.
    oh well, it was swell while it lasted..

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  6. I’m a customer of a local cable provider in the Midwest that has been metering their customers’ usage for the past two years.

    I live in a college town where offcampus living is typical for anyone past their first or second year, which means that the statistics I was quoted are probably more extreme than in the real world… but I have it on good authority (from a former network engineer of the ISP in question) that 5% of customers use more than 80% of the bandwidth.

    If usage is really on that kind of power curve as a rule, then metering should come as no surprise.

    I offer two pieces of advice:

    Take the highest-tier plan that you can justify, if it includes a sizable threshold increase. This is true in my case; in fact, the extra $15./mo. gives me a near-sixfold threshold increase, from 6GB to 40. Were I to pay for that bandwidth a la carte, it would cost me $70. When you’re checking e-mail and doing 50-100hrs a month of straightforward surfing, 6GB is plenty.

    If practicable, avoid ISP’s that are hand-in-glove with the local cable television franchise. Video is the bandwidth hog; unless you use services like WebEx on a regular basis, chances are it’s where most of your bandwidth is going, while meanwhile the cable company is offering a video signal that carries channels for which they’re paying sizable license fees. If I were one of those outfits, I’d charge out the nose for bandwidth, too.

    I agree that the whole idea is fundamentally broken, if only because it provides a customer incentive to consent to the constraint of one’s entertainment choices… but this is a world in which most people are perfectly happy to passively consume most of the content that’s put in front of them, most of the time.

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  7. Metered pricing is inevitable. ISPs tried to get content providers to pay for infrastructure improvements, but net neutrality killed that idea. Now they are trying to get users to pay for it. God forbid they pay for the improvements as a cost of doing business and/or a way to offer more services.

    But like it or not, why shouldn’t someone who downloads torrents all day pay more than someone who just checks their email? They are using more services and should pay more.

    As far as the pricing, that will get resolved. As other ISPs switch to metering, comptition will force the pricing to settle down at a reasonable cost. I predict in a few years you’ll be paying the same or less than you are now for faster speeds, but that often talked about 5% who are sucking up all the bandwidth will be paying much more.

    The one thing that would be really bad would be if the bandwidth hogs pay more and the ISPs put the money in their pocket instead of investing it in network improvements.

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  8. I personally don’t care much if my bandwidth is metered or not. What matters to me is the overall quality of service and how much I pay for it. If there is a significantly cheaper option from another provider with the same or better quality of services, I’ll switch. Otherwise – no.

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  9. It is not the Bandwidth Cap\Metering you have to worry about. Even if you have a high cap you may never be able to reach it if you ISP uses throttling\traffic shaping
    throttling\traffic shaping

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  10. I live and work in Bend Oregon, and was a Bend Broadband customer for over 6 years. As soon as they announced their scheme, I dropped their web and cable tv services.

    I don’t believe I was way over the cap, but the notion of metered bandwidth, and especially their intial overage fee’s were simply absurd. I figured voting with my pocketbook would make the most sense.

    Personally, I look at cable company’s doing this as they definately are realizing that their cash cow, cable tv, is threatened by the availability of the same content online.

    Jacking up rates, and charging overages seems to be their solution.

    Bend Broadband also has a monopoly in the greater Central Oregon region for cable tv, and cable modem services. I feel their move was most definitely an abuse of their marker position.

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