Granted, many details of Sony’s plans for 4K aren’t set in stone, in part because the company hasn’t exactly been forthcoming with details about the PS4. But Sony Electronics President and COO Phil Molyneux told the Verge’s Nilay Patel that a typical 4K movie will be “100 gigabytes and plus.”

Just a quick reminder for everyone about to bust out their calculators at home: Comcast’s current cap for most of its customers is 300 GB per month, which would get you just three 4K movies, and nothing else. AT&T’s Uverse cap is 250 GB per month. Both companies charge consumers that use more bandwidth $10 per 50 GB, which would bring the bandwidth costs of a single 4K movie after you’ve exhausted your cap to $20.

Of course, Sony may be able to somewhat reduce the size of its 4K movie downloads with advanced compression technologies — but you can only compress a video so much if your goal is to make it look great in 4K on a huge TV set. Throw in something like 3D, and you’re quickly going to hit the cap, no matter what.

Consider this, for example: Streaming a 1080p 3D movie from Netflix currently consumes 4.7 GB per hour. That’s a little more than 7 GB for a 90 minute flick. Now consider that 4K comes with four times as many pixels as 1080p, and some very basic back-of-the-envelope math would suggest that streaming 4K with a Netflix-like compression would lead to at least 28 GB of bandwidth consumption per movie.

So no matter how you look at it: 4K downloads and streams are going to push the envelope on broadband consumption — and could lead to many more consumers running afoul of their caps.

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This is a dereliction of duty from the agency that’s supposed to ensure that broadband is available across the country, an agency whose chairman gives countless speeches emphasizing how important broadband is in the home and as a source for innovation. Yet as the basic pricing for broadband service has changed, the FCC has not kept up. It hasn’t distributed data on the consumers affected, established any sort of independent group to ensure that ISPs were tracking customers’ broadband usage fairly and doesn’t even insist that ISPs who implement caps provide meters to their customers.

And then there are the harder questions about why such caps are justified in the first place. But the FCC has been content to let this experiment in data caps play out with its tacit approval for the last four years, while more and more Americans became affected by them. There are signals that the agency may be waking up to the problem, so here’s what the FCC at a minimum needs to do if caps are going to be a way of life going forward.

1) If ISPs cap broadband, the FCC should track how those caps affect consumers.

How much data do you use each month? Most of us don’t know. How many people get caught by caps? No one knows. That’s right. The FCC doesn’t track data on how many people exceed their caps, nor does it distribute data on how much broadband people use each month, despite having a program that puts routers in people’s homes to measure for other broadband quality metrics such as speed and latency.

When asked about the growth of broadband caps, and if the agency planned to collect more data an agency spokesman declined to comment on the record. However, in a series of notices and speeches made in the last six months, the FCC has started asking questions about how it should think about caps in relation to broadband cost and quality. It has not asked or indicated that it plans on tracking information about how many people are snared by caps.

The FCC does have access to data from corporations that track broadband usage, and it collects data on average data use by speed tier, but it doesn’t know who or how often people are affected by caps. However, according to Sandvine, a company that sells deep-packet inspection equipment to ISPs, during the first half of 2012 on North American wireline networks, the median usage was 10.3GB, and the average usage was 32.1 GB. Note that this number includes Canada, where broadband caps are generally lower. Back in 2010 Cisco noted that worldwide monthly consumption averaged 14.5 gigabytes per month, based on data it collected from its ISP customers.

2) Would you like a meter with that cap?

When Comcast first launched its cap in 2008, there was outrage over the first U.S. implementation of a cap, even though Comcast’s cap at 250 GB was far more generous than those proposed by others at the time (Frontier had proposed a 5 GB cap while Time Warner Cable had proposed a tier that began at 5 GB and went up to 40 GB initially). But outrage moved quickly from the existence of a relatively large cap to the lack of any way for a user to measure their broadband use.

Comcast eventually rolled out a meter to its customers, but other ISPs — notably AT&T — still haven’t managed to give their customers the tools to measure their own consumption. AT&T defends its lack of meters by saying that it sends customers notification emails letting people know when they hit the 65, 90 and 100 percent threshold, but that’s like having your fuel gauge show you a blinking light when your tank is 65 percent empty and then 90 percent empty before the car just stops. Some people drive that way, but most of us would probably like the full picture.

When asked in general about the lack of meters and about AT&T’s strategy in particular, the FCC declined to comment on the record. However, one is free to file a complaint over a lack of meters with the FCC. The best rules to use would be the Open Internet Order, which most of us know as the network neutrality rules. Those rules require an ISP to be transparent about their network management practices. The FCC would then have to determine if AT&T is not being transparent enough about its caps by not including a meter.

Is anyone watching how ISPs cap?

3) If I have a meter, is it accurate?

Comcast’s meter was later than expected in part because it was getting a third-party to certify the accuracy of the tool. Time Warner Cable also had a third-party company ensure the accuracy of its meter, but there’s no rule or oversight to ensure that ISPs that deploy meters have made sure they work as advertised. The FCC doesn’t check meters for accuracy and it doesn’t require ISPs to certify them with a third-party. Obviously, if a customer has a complaint, they can file it with the FCC, but this Wild West approach, with no promise or rules around enforcement, doesn’t help the consumer.

The FCC again declined to comment on the record about whether it would eventually track and ensure the accuracy of meters, and also demurred when asked about the need for any sort of data collection around the topic. Those with the time and energy can use an alternate gigabyte counter on their router or an external software program such as NetWorx and see if it matches up with what their ISP tells them. If it doesn’t, the FCC would probably be happy to take your complaint.

So now what?

The FCC wasn’t the only organization sleeping on the job as data caps crept over the land. When I asked avid broadband users to send me their usage, I quickly discovered that most people don’t use the meters provided to them and have no idea how much data they consume. Outside of a few very public examples of people going over their caps, it doesn’t seem that most Americans are hitting a ceiling: at least for now.

But in implementing these caps, ISPs have changed the internet industry, as I lay out in this accompanying list of which ISPs are capping data and how they are doing it. So get out there and check your broadband usage. Then maybe it’s time to file a complaint with the FCC, or at least with your ISP. Maybe it’s not too late to get some accountability and maybe even action around data caps.

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And now Karl Bode at DSLReports says that cap may instead be as high as 500 gigabytes per month for those who subscribe to faster tiers:

Interestingly, our source claims that when Comcast proceeds with the deployment of this new cap system nationally, faster speed tiers will see higher caps. For example, users on the company’s “Performance” tier (currently 15 Mbps down, 2 Mbps up) will see a cap of 300 GB. Users on the company’s “Blast” tier (currently 25 Mbps down 4 Mbps up) will see a higher 500 GB cap.

Comcast declined to comment on speculation or rumors. Comcast would be following a pricing strategy some smaller ISPs such as CableOne and SuddenLink which have implemented similar caps. Currently at 64 percent of U.S. broadband subscribers have some type of cap according to my poll of providers and the Leichtman Research Group data on U.S. broadband subscribers, and many have lower caps on slower tiers. In general this points to a more sophisticated pricing model for wireline broadband as ISPs attempt to wring more value for their data pipes amid demand for broadband and worries about their pay TV businesses.

Comcast tower courtesy of Flickr user Kevin Burkett.

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Sarandos was referring to the low broadband caps in place at Canadian ISPs like Bell and Shaw, which force their customers to pay more if they exceed monthly caps that can start at just 15 GB. Netflix has sharply criticized broadband pricing in Canada before, with CEO Reed Hastings calling caps and overage fees like these “grossly overpriced.”

However, Hastings had initially said that he didn’t anticipate the caps to be a problem for Netflix’s business in Canada. The company eventually adjusted its streaming rates in the country, making non-HD streams the default option for Canadian users, and now it looks like it’s acknowledging that the caps are having an impact on subscriber growth.

Asked about it on Thursday, Sarandos had to concede that business in Canada could be better if broadband access came without caps and expensive overage fees. Said Sarandos: “The problem in Canada is… they have almost third-world access to the internet.”

To learn more about the future of TV, check out my ebook Cut the Cord: All You Need to Know to Drop Cable.

Image courtesy of Flickr user LWY.

The investigation likely arose not just because of the issues surrounding access to cable over devices and data caps, but also due to a realization by the Justice Department that if the cable companies sell their spectrum to Verizon and eliminate Verizon as a wireline broadband competitor, the cable industry becomes the nation’s most advanced source of last-mile broadband. And since the DoJ is in the course of deciding whether the spectrum deal is anti-competitive, perhaps it realized that it had better understand a bit more about how cable is influencing and directing the future of television by virtue of its control over broadband.

The WSJ article cites sources at video providers such as Netflix who say that the DoJ has been asking questions over issues like data caps and deals that cable providers sign with content companies. It also looking at authentication, the process by which TV services ask viewers for a cable subscription before showing them content. My own sources have confirmed the DoJ’s interest.

Where’s there’s smoke, there’s a fire.

Worries that services like Hulu Plus might require a cable subscription could be a reason for the probe.

The rise in authentication is troubling, because it prevents customers who want to subscribe to alternative forms of content from being able to do so without buying a full-on cable package. For example, when the Olympics are broadcast this Summer, customers who want to see all of the events as they happen in real time will have to have a cable subscription, while those without will have to make do with broadcast.

The issue of broadband caps is harder for most customers to grasp because they aren’t faced with authentication screens, but are instead going to have to think about the potential of hitting a broadband cap after using too much data each month. And since caps are often high enough for most people to avoid, while still forcing them to think about their streaming, it’s for now a pretty mild deterrent. FCC Chairman Julius Genachowski has said that the broadband cap issue isn’t one that’s he’s concerned with, but it’s one we at GigaOM have watched closely.

There are two potential issues with caps. One is that it undercuts the idea of unlimited wireline broadband for consumers and thus acts as a deterrent on innovation, and two is that it serves to protect the video offerings of many providers. An hour of video can consume between 1 gigabyte and 2 gigabytes depending on the length and screen resolution of the content. For families that stream a lot of video, hitting the old Comcast cap of 250 GB per month isn’t impossible. And even though Comcast recently raised the cap to 300 GB per month, it’s still creating a ceiling that consumers could conceivably hit if they watch a lot of video.

Who gets to avoid the caps? That’s the question.

Comcast is at the heart of another data cap issue — namely what should regulators do when a cable provider lets some content avoid its caps. Comcast recently announced that it’s Xfinity on demand service would be available through the Xbox, but that content streamed only from that particular device wouldn’t count against its cap. Following that news, others reported that Comcast was prioritizing its own traffic that was served through the Xbox even when the quality of rival services such as Netflix suffered.

There’s a technical explanation for this that isn’t as nefarious as it might seem, but this doesn’t change the fact that the DoJ should nonetheless ask how Comcast chooses the vendors who can offer service that doesn’t count against the cap. The risk is that alternatives to cable video, which can cost consumers roughly $86 a month, will be stymied because cable providers like Comcast have the market and infrastructure advantage to keep rivals from delivering online video.

And that in a nutshell is what’s occurring. The Department of Justice should be asking about this, not because a consumer may not want to pay for cable and still wants to Watch Game of Thrones on demand, but because an entire market is undergoing disruption because of the Internet, and cable providers are trying to use their dominant position to halt that innovation.

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In Chattanooga Tenn. last week the city launched its own application competition with $350,000 in prize money from Alcatel-Lucent. John Wilson, Co-founder and former president of flexible display maker NanoLumens, Inc., and coordinator of Chattanooga’s Gig Prize, was discussing the contest over at Gigabit Nation, an Internet radio show run by our sometimes columnist Craig Settles.

The proposed Google network is home to another contest, The Gigabit Challenge, with prizes of up to $200,000 for the winners. If the recently unveiled portal is anything to go by, it’s hard to come up with application that use that much bandwidth without resorting to video. So far the KC folks are hoping to use their superfast network to stream local events over the web, deliver better holograms for virtual presence, install two-way cameras in hospitals and emergency vehicles so doctors could help first responders diagnose and treat patients en route to the hospital or at the scene of an accident, and more.

Of course, even as pioneering folks think of and build gigabit applications, the rest of the country is finding access to big broadband more and more difficult — or costly. Today Cox appears to have started implementing hard caps on its broadband service, according to Broadband Reports. A Cox spokesman confirmed the caps by pointing me to the Cox terms of use, which allow customers to use between 30 GB to 400 GB of data month depending on their plan , but having another ISP join Comcast, AT&T and Suddenlink imposing caps is disheartening.

So, on one end of the broadband spectrum we have a couple million people who can or will soon be able to get gigabit access, at least 60 million households that could get 50 Mbps access or above, but might face caps, and a small portion of rural Americans that will have to content themselves with wireless broadband that comes with both a high price tag and tiny caps. I know which camp I’d like to be in.

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Insight serves about 537,000 high-speed data subscribers, 679,000 video subscribers and 297,000 voice subscribers. It’s also providing its customers faster broadband via DOCSIS 3.0, which gives Time Warner Cable a boost in adding so-called wideband services that can deliver speeds of up to 100 Mbps or more on the downlink side. Time Warner has lagged behind Comcast and Cablevision when it comes to the relatively inexpensive D3 upgrades, but it’s beginning to offer it in certain markets. This upgrade will become more important to Time Warner Cable as a bludgeon to beat off rival telecommunications providers that offer DSL services. In most markets, cable is beating DSL providers handily; but in providing broadband services, scale can benefit the ISP as it contemplates deals with regulators as well as when it comes to delivering services.

That same scale can also help when negotiating deals with content providers on the pay-TV side of the house and provide more of an audience for ads, apps and whatever else the cable provider wants to use to help boost revenue and keep subscribers happy. With more people cutting the cord, perhaps because of easier availability of over-the-top television or perhaps because cable fees are too high, having a larger customer base to market to is helpful.

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Updated: The cautionary tales around broadband caps are trickling in, with the latest coming from André Vrignaud, who detailed in a blog post his experience of being cut off from Comcast’s Internet service after going over the company’s 250 GB per month broadband cap two months in a row. He’s justifiably outraged because he now has no Internet and he didn’t really seem to have a lot of options offered before he was cut off. My colleague Mathew experienced a similar issue with his cap, and I suspect the two stories have something in common — the cloud.

Or rather, backups of huge files. After Mathew was forced to become a network cop and figure out why he was going so far over his monthly bandwidth allotment of 95 GB per month, it took him about a month to determine the culprit — an inappropriately configured cloud-backup service with Amazon. Judging from Vrignaud’s story, he may have hit his cap doing backups as well, since he describes backing up RAW image files and FLAC audio files to a recently purchased Carbonite subscription. He also describes streaming Netflix movies and Pandora in a home with multiple roommates, as well as working from home on digital files. We’ve driven this point home before in a multitude of posts about how caps harm innovation and how they will catch more and more users over time.

But in reading this case and talking to Charlie Douglas, a Comcast spokesman, several other issues around caps came up. Issues that are more important as more users have caps. I’ve long appreciated that Comcast’s cap was pretty fair: It discloses the limits, it has a reasonable network management plan, it offers a meter and — most importantly — the cable provider says that as the median usage increases on its network, it will raise that cap. However, since the cap was implemented in 2008, when Comcast had a median usage of between 2 and 4 GB per month across its entire network, the median usage has risen only to between 4 GB and 6 GB per month. The cap hasn’t increased by a commensurate amount and Douglas was adamant in pointing out that using 250 GB a month was way above normal usage.

But what I took away from my conversation with Douglas is that the web ecosystem is failing consumers (and maybe teleworkers) when it comes to broadband and cloud services. Here’s why:

When there’s a problem, it’s hard for a consumer to know what to do: Mathew and Vrignaud both tried to take action to reduce their bandwidth consumption after being called on their excessive usage. Both failed at first to solve it after taking actions such as turning off public access points (and in Mathew’s case checking for an infected computer). Both of these guys are pretty technically savvy so imagine what happens if a normal person gets such a call. ISPs don’t provide the appropriate resources beyond notification and what Vrignaud called a “canned response.”

As people adopt cloud services, those providers don’t think about broadband: Short of Netflix taking up the crusade against caps, we don’t see Amazon, Mozy or Carbonite helping to educate users about how their services and settings for backups might influence their broadband caps. I don’t think they should have to get into this education campaign in an ideal world, but for now, we live in a world with caps. Helping customers avoid getting kicked offline or charged extra for overages is good customer service.

Residential service isn’t clear-cut anymore: When looking at this guy’s usage, it’s possible that he was using his connection for work, which prompted Douglas to point out that he had signed up for a residential connection. This is a common ISP response when people bemoan their limited caps in the context of uploading files or sharing videos as part of their jobs. But when I asked if Vrignaud would even be eligible for a business connection, Douglas didn’t know. He said that the business people would want to make sure the connection was for a legitimate business which means they would ask for a Tax ID number or some other verification. While a freelancer might have that, a remote worker wouldn’t and would then have to get their employer involved in getting a connection. In some cases, although not necessarily in this one, folks in residential areas cannot even get a business connection. Update: Vrignaud said in a conversation and in his latest blog post that he is trying to get a business connection, but it doesn’t look good.

In my many stories about broadband caps these issues haven’t really come up very often, but I think that’s about to change. And it leaves me with more questions than answers. As residential broadband becomes essential for how we do our jobs, as well as for consumer entertainment and other web-based products, it’s time for big companies to start taking a hard look at how ISPs policies will affect their employees and their ability to offer services and perhaps give a call to their favorite lobbyist. If left unchecked, this won’t stay a consumer issue for very long.

As for Comcast, when I asked if customers were getting caught in its cap more often, Douglas replied,”We don’t disclose, but logically people are doing more online and have more devices. Far less than 1 percent of our customers should ever get a call from us.” That’s not a real answer, but with 17.4 million broadband subscribers it sounds like we should expect to hear more stories on this issue in the coming months — but fewer than 174,000 of them.

Thumbnail photo courtesy of Flickr users Ryan Franklin and Arthur Caranta

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The company did an analysis comparing the total cost of ownership between individual publisher apps and aggregation apps like Reeder, Pulse and Yahoo. Surprise: InkWire, which has a vested interest in this study, found that it’s more economical to buy a reader app that pulls from various sources than hitting up single-source apps, even when aggregation apps initially cost more.

By looking at the average price of the apps amortized over 18 months, and then factoring in the average monthly cost of bandwidth for mobile users and the average amount of data usage per month (about 126 MB), InkWire found that the average data costs for an aggregator app were about $2.73 a month. Assuming that users visit multiple single-source publishing apps to get the same info they can find in one aggregator, the cost of reading apps dedicated to a single source was about $7.94 a month, based on InkWire’s modest assumption that one aggregating app can replace three single-source apps.

Again, InkWire obviously has something to gain from a study like this. And its assumption that people consume three times as much data by visiting an average of three single-source apps doesn’t necessarily compute in the real world. Just because I visit single publishers doesn’t mean I’ll use three times as much data as when using one aggregation app. Data usage might be higher for aggregation apps, for instance, because users can be more efficient consuming news from a news reader app, thus saving time but eating up more content and data during a session.

None of this was even worth much consideration when we had more unlimited plans. But as those fade away, there may be more emphasis on efficient apps that help us consume data with less impact on broadband caps. It’s not just reader applications that merit consideration, either. Any app that helps us stay under the new limits being imposed by carriers is worth paying attention to.

As I recently wrote, there are clear differences between how much various smartphone users consume in data on the different platforms. App makers and publishers may not have had to think about how efficient their product are, but increasingly, consumers may take that into account, especially if certain apps push them over their data caps. I’m not sure we’ll get to a point where users pay close attention to how much data each app they use consumes, as InkWire seems to be suggesting. But being thrifty with data could be a selling point for app makers, InkWire for one, as they look to draw attention in an increasingly competitive mobile software market.

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Nielsen said Android users consume an average of 582 megabytes per month over cellular connections. IPhone users were second with 492 megabytes per month followed by WebOS phones (448 MB), Windows Phone 7 (317 MB), and BlackBerry (127 MB) handsets. The data was gathered by looking at more than 65,000 cell phone bills of mobile users. The results fall in line with a previous report in December from Arieso that also found Android devices were the heaviest data users.

Other Nielsen statistics suggest, however, that iPhone users should be the biggest data users. Nielsen said that iPhone users were tops in downloading an app in the last 30 days as well listening to streaming music or watching video in the last month, while Android users were second in all those categories.

Now it could be that Android owners are more power users while iPhone users dabble more broadly but may not be as intense in their data use. This got me thinking there might be other reasons why Android users look like bigger data users. Apple requires apps that are bigger than 200 20 MB to be downloaded over Wi-Fi rather than on a 3G connection. It also does its software updates over a wired connection via iTunes, while Android users get their updates wirelessly. Those updates are more limited in their impact since they’re not frequent, but it does show that Android can natively route more traffic via cellular networks than iOS. Android also has a higher percentage of free apps compared to iOS, and it’s likely the free apps monetize more through ads, which have to communicate frequently with ad servers.

But I also wondered if the whole frenzy over location databases kept by Google and Apple may also be part of the issue. As you may recall, Apple was in the spotlight for the way its iPhones gathered location information in a local database file. Apple said that the database is backed up by Apple when a user connects through iTunes. But Google, however, said that when an Android user opts in for location services, anonymized location information is sent directly to Google’s servers. That means Google is potentially sending a steady stream of information from its phones back to its data centers to improve its location database, something it has to do because it stopped using its Google Street View cars to gather Wi-Fi database information. This could also help explain why Android users appear to be using more data.

Now, I could totally missing the mark on this. And perhaps it just comes down to the fact that Android users are more savvy. That wouldn’t be totally surprising, especially since Android devices gained mobile hotspot functionality in the U.S. before iPhones did. The platform was more popular initially with programmers and tech enthusiasts who were attracted by Android’s openness and its ability to modify it. So it could be that these users just try to get more out of their devices. Nielsen tells me that Android users skew younger in the 25-34 year old age group, which might also have an effect with younger users potentially more active on Android.

But I think it’s a good question to raise considering Android is now the leading smartphone platform and it’s attracting more mainstream users now, not just techie early adopters. And all this is happening in an age when broadband caps and tiered data plans are now becoming more of a reality, which is putting more of a spotlight on data efficiency. Now, I’m not sure users are going to be attracted to data-sipping platforms like BlackBerry just to save a buck, but this could impact some Android users if they’re finding their usage is higher than it ought to be not because of their actions, but because of the platform’s inherent characteristics.

Again, I could be way off on this. So I’d love to hear your thoughts on this and why you think Android is using up more data. What do you think?

Image courtesy of Gottabemobile

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