TWC's $150 Unlimited Broadband: New Way to Fleece Customers

60 Comments

[qi:004] Time Warner Cable (s twc) will offer users unlimited broadband for $150, it said last night when it released pricing plans for its metered broadband efforts.

A quick check this morning shows that the pricing isn’t just a 285 percent increase over my current $39 a month (previously unlimited) broadband package, it’s also the perfect amount to keep Time Warner’s revenue stream intact should I start consuming all my video and voice via my broadband connection, rather than by purchasing a triple-play bundle.

Buying all three services as part of a triple play would cost me $139.95 a month — $10 less than it would cost to consume anything and everything via broadband without fear of caps. Coincidence?

twc

60 Comments

Rahul Sood

Do you think Verizon could also go this route of tiering up its FIOS service?

bunty

Brett’s is the best reply; it makes the most sense and is backed up by facts, figures and links. The rest of you lose the argument, and that includes Om and his team.

Dan

Brett is arguing from an entrenched interest, which colors his perspective and argument. We see this in his schizoid references to utilities. Bandwidth is getting cheaper, and there is a reason it is CABLE operators employing these schemes. This isn’t rocket science. These guys are terrified of becoming dumb pipes but like it or not that’s all they are. Even their traditional model is based on fear of the dumb pipe model – hence the furious resistance to a la cart cable television service.

Like it or not, bandwidth is a utility service. It ought to be regulated like a utility.

Offroad

Check out Earthlink. They use Time Warner’s network and CPE but don’t have the usage caps or overage fees. You can switch with no downtime.

Eric Hair

“…you can switch.”

Of all these comments, all these many paragraphs, so much backbone talk I’d think this was a chiropractic forum; this is THE problem solving advice.

Leave TWC behind.

Sam Johnston

It seems that many people don’t have that luxury, and even when they do, the service and prices are much the same. We have seen elsewhere (e.g. France) that better services can be delivered for a fraction of the price… with information and entertainment fast becoming an essential service perhaps you guys ought to follow this example.

Sam

Victor Blake

I personally pay $245 for a 2.5Mbps service. I’d love to have a $150 unlimited service. I personally think it’s selfish and unreasonable to expect unlimited broadband data for $40 a month when you KNOW that unlimited VOICE (which is 80kbps) is $40 per month. Be realistic folks.

Om — I’ve been wanting to say this for a while now. I’m not sure what’s in the water but your team has lost touch with reality in your aspiration for socialized broaband. Next thing you know you’ll expect it for free with federal subsidies. I started by removing your page as my home page. Now I’m no longer going to bother.

It’s one thing to have an opinion — it’s quite another to be just one sided and unreasonable.

Again, you should count yourselves lucky to even have a choice. About 40% of americans have NO broaband choice and for nearly all of us in that 40% we would LOVE to have cable as a choice and I hope that someday we will.

Antony

You are seriously flawed with what you’re saying!

Are you saying that because there are 40% of Americans who don’t have broadband those of us who have broadband need to let these companies raise the price against us? Huh??!

With your same argument, you should be charged more than just $245. Says, $2,000, or even $20,000? Because after all what do you have to complain about when there are people who don’t even have broadband service.

You really need to re-read what you wrote!

vivek

Beating up on the GigaOm team detracts from the key issue being discussed here.

The fact that a percentage of people don’t have choices cannot justify unreal price increases for those who do! If at all, this needs to drive demand (and even legislation) to deliver choices for all consumers.

Also, there’s nothing unreasonable and selfish about consumers expecting a level of continuity in the quality and price of services, that they’ve been buying and consuming for a while.

Rather than subjecting loyal consumers to unreal price hikes, broadband service providers need to invest in enhancing efficiencies of their networks, and perhaps even collaborate with media tech providers to improve throughputs for HD and other upcoming rich media formats.

Looking ahead, there’s a lot more to come in terms of rich capabilities that the media industry will deliver and consumers will demand. The solution certainly doesn’t lie in imposing such steep price increases every time a new capability s rolled out. This approach will definitely keep average consumers at bay and will make these high priced services a playground for the elite few; which in turn will guarantee the demise of new and rich media capabilities. Instead, the strategy needs to be to maintain a reasonable cost of broadband connectivity, and associate incremental revenues with rich content. For instance, if as suggested above, HD video delivery is indeed the reason for this price hike, the likes of TWC should maintain existing prices for their broadband service, and create a business model to share revenue with content owners, in return for the delivery of their content to consumers.

One way to express the unreasonableness of this price hike is thru an analogy. Imagine if TV viewers were required to pay a $100 premium just to watch a new season of NFL games, because it was produced in HD and included new and rich interactive features. Reality is that TV viewers never pay such a high premium for specific shows, other than perhaps the price of subscription to specific channels. Instead, the higher production costs are offset by premium ad revenues, interactive ads, etc.; i.e. the cost of ‘connectivity’ doesn’t go up dramatically.

Craig

They have no choice because there’s a monopoly, this is a service industry and if people become so dissatisfied with their service for not only the outrageous cost but the lack of speed and quality than I hope the same thing happens to them that should have happened to AIG.

Lee Drake

According to Hobbs internet usage is groing 40% per year (not sure if that’s bandwidth or subscribers, he cites no sources). Meanwhile according to many studies broadband delivery costs are going down 40% per year. Sounds like a stay-even proposition. That’s also what’s in the 10-Q. He tells consumers that costs are going up, and shareholders that costs are going down. Which one is he lying to?

Will

He’s lying to the consumers and everyone knows it. Newer fiber technologies like DWDM and others are actually DECREASING the cost of IP transit backbone operators like Level3 sell to access networks like Time Warner Cable. It’s a profit grab plain and simple. See this post and the analysis/replies:
http://www.dslreports.com/forum/r22213854-

Jake

If you’re in a smallish town, you can sit on your town’s cable franchising board and set terms when the franchise renews. I’m in a small town and we did that in 2000; we required that the cable co before us fiber up the town and offer high speed data to all homes. They fought like h*ll because the town has enough rural miles to it that they only wanted to wire the main paths and higher density areas. In the end, they agreed and they had the job completed in about 8 months. The committee is meeting again to prepare for the 2010 renewal.

At your state level, I would challenge their advertising where it proves false. You could even consider class action cases for breach of contract and false advertising.

The cablecos have been in this for about 15 years now – that’s 180 months. And making fairly strong profits on data. Don’t let them turn strong into obscene.

Brett Glass

Lee, unlike the lawyers, lobbyists, and pundits who know jack about how an ISP is actually run, I AM bringing competition to my area.

Lee Drake

How are you bringing competition to your area? What is your area? What precisely are you doing besides trolling on this website and calling people names? I’m not a lawyer, lobbyist or pundit. I’m just a guy who owns a small business in the community that TWC is targetting that’s pissed at being ripped off by Time Warner. I’m mad for me, and I’m mad for my customers – most of whom won’t have a clue what hit them when they get their first bill for up to $150/month for internet.

I put a lot of time and money into creating the http://www.verizonfiber.com which is targeted at bringing competition to Rochester. I truly believe that if TWC had direct competition with an equal or superior product that this whole argument would go away – which is why they’re not proposing it in cities where they do have competition. The Competition would EAT THEIR LUNCH.

I would like you to CITE YOUR SOURCES (other than your personal opinion) as to how the sky is falling here. I cite all my sources both here and in the website. My source for direct internet cost to deliver internet to the consumer is based on TIME WARNER’S PUBLIC 10-K statement in which their CEO declares that their cost per consumer is going down, he’s declared this for a number of quarters IN A ROW. Either he’s lying to his shareholders or he’s lying to consumers – you chose I’m happy with either.

Numerous other studies (also cited on my website) back up the position that while usage is going up about 40%/year cost to deliver is going down at an almost equal rate. So far Mr. Hobbs has yet to cite his source that this is not the case, and even if he did – I’m betting you it would be a Cable Industry funded source. You show me proof otherwise I’ll consider it, otherwise you are just blowing smoke and the argument is over.

Will

Brett is correct in that ISPs need to pay for backbone bandwidth of the amount their customers consume. This is something that most consumers do not understand. In fact your consumer facing ISP or division of an ISP is just a company/division that engineers, maintains and links your home to and maintains a link to a backbone network like Level3, AT&T, Verizon Business, NTT, etc. But what I don’t agree with Brett is that it’s VERY Cheap especially in an urban area and a mega corporation like Time Warner can definitely afford the 10Gb level interconnects to get costs as low as 2-10cents/GB on backbone providers like Level3 in bulk. It makes it even cheaper for companies like AT&T & Verizon since they own their own backbone networks (they just hand it off to another division of the company and can get great rates due to their Tier 1 power, settlement free peering). Sure there’s a competition aspect per the cable companies but in the end it’s all about cost and profit. Right now the in the US it’s one of the most competitive markets in the world for IP transit due to the fact that we have multiple backbone providers HQ’ed in this country and competition. Now what I agree is that it needs to extend to the consumer and access networks. If companies are going to do caps, they better price is in realm of what their actual costs + profit are. Time Warner charging $1/GB is CLEARLY price gouging, in fact I see margins of that estimated at 50-80% including the access network costs. Yes the usage distribution of end users is uneven clearly and light users are subsidizing the heavy users but Time Warner is still making profits so I don’t see why they need to start this now. Also another problem with access networks/consumer level bandwidth is that it’s shared bandwidth and there’s only a limited amount of capacity on a DOCSIS 1.1 cable network before there’s congestion. If utilization gets high enough there needs to be node splitting (expensive, time consuming), increased bandwidth per node (DOCSIS 3.0) or shaping so everyone gets an equal amount. It’s only fair that way. Personally I really like Comcast’s idea of 250GB/month since it balances costs with the current dynamic of IP transit costs. PEOPLE YOUR CONSUMER INTERNET CONNECTION IS NOT A DATACENTER CONNECTION. If you really want to know what dedicated bandwidth costs go price a T-1, DS-3, OC-X, GigE or some other kind of dedicated connection. Of course it’s for businesses and service level gurantees but what your really paying for is unlimited dedicated bandwidth (some do bill at 95 percentile though).

Will

Another thing I wanted to add is that Verizon is VERY SMART in seeing the future and deploying the HUGE capital investment for FiOS and reliving the access network node congestion problem for at least a decade considering GPON allows (~2.4Gbps downstream and ~1.2Gbps upstream shared between 32-64 users at a time). They can theoretically increase that in the future even further to 10G and beyond as fiber is infinitesimal in its transmission speeds as they only need to swap out the two ends (OLT currently in the CO and the ONT on the end-users side) Older BPON is half of that but still alot and currently can be easily upgraded to GPON by swapping out components. By comparison DOCSIS 1.1 only allows ~38Mbps downstream and ~9Mbps upstream shared. DOCSIS 2.0 only increases upstream to 27Mbps. DOCSIS 3.0 bonds 4 channels to allow for 152Mbps downstream taking out protocol overhead. Similar results can be achieved with upstream bonding enabled. The evolution of the cable HFC network is still very capable from an access network standpoint as theoretically we can just keep bonding channels together to increase the amount of bandwidth shared per node. You can already hit D3.0 8 channels bonded which doubles node capacity to ~300Mbps. So the access network problem is easily solved through an evolution of technology of both shared Fiber topologies and HFC networks and are both very capable. With this HFC networks still have a lot of life left in them. The real problem isn’t technology as the deployed based of fiber and HFC networks are very capable of delivering capacity upgrades to the end user is it a BUSINESS PROBLEM.
The problem cable operators face is the internet is fundamentally changing the way media and entertainment is consumed and this changes the paradigm of traditional business models of the cable operators as they also have a video business to protect. Personally as a geek I want EVERYTHING ON DEMAND ON MY SCHEDULE because I know what’s possible and the web video companies with CDNs are delivering that. This causes the underlying problem with media creators/operators of cannibalizing their TV revenues. It is 100% theoretically possible (and AT&T’s U-verse is doing this to a minor extent) with IP technology and other protocols to go to a ala-carte model of paying for only the channels you want, on-demand, any time, anywhere, on any device all delivered over IP over any access network as IP is the convergence of that. The cable operators in this sense know it and are scared. But you know what? There are many things that changed the world like Google and they just need to get with the program? Technology & evolution go hand in hand they need to get with the program, sooner rather than later as it just determines how many customers their willing to lose. Most consumers are smart and will vote with their wallet.
On another note, if cable companies truly wanted to embrace the future they can deliver everything over IP (theoretically imagine every channel in the CATV spectrum with QAM channel bonded, e.g. 38Mbps * 150 channels = 5Gbps or so basically maxing out cable capacity) delivering everything over IP. We will probably get their in technology within a decade as consumer bandwidth keep increasing. The efficiency of IP is remarkable as only the stuff YOU WATCH is sent over, and you save bandwidth on the access network either way. Of course it need to use QoS and other network innovations so service quality doesn’t degrade. And with this IPTV & VoIP would use a very small chunk of bandwidth and the rest could be used for the internet letting all sorts of competitors compete in this market. Of course this turns the company owning the HFC plant into a pure IP connection and the business model would never work out. But who knows? I’m just watching the revolution unfold in front of my eyes.

Gadget Sleuth

Reilly is correct…in my area too, for good speed broadband, it’s Comcast or nothing (no, DSL/AT&T isn’t at all the same thing).

Sachin

It is unlikely that any country will have unlimited high speed broadband for a long time. Once people start streaming HD video en masse among other things, the current infrastructure will not be able to handle the traffic. I would like to see what the world network capacity is (I’m sure it’s rather complex), it likely has some very clear limitations.

We see this in different industries. If you take mobile, not very long ago the cost was around 50cents/min. Once the switch from analog to digital happened, infrastructure improved, and now many carriers have the capacity to offer unlimited plans. 3G data is another story, providers are hesitant to provide all-you-can-eat data on their PC-cards — same story.

We will likely continue to see this continue back-and-forth, as capacity and demand overtake each other in the coming years.

Indian

Makes me jealous of you people. In India we pay 15 dollars for 256 kbps unlimited. Now they have introduced 16 mbps which costs 100 dollars and what more you can just download 50 gb. Dont cry you are far better off.

Alex Berger

What makes it all that much more ridiculous is that the chances of them actually delivering you the downspeed consistently you’re paying for is effectively nill. Sure, they’ll sell you all sorts of great connection speeds…so long as you don’t actually expect to use them at that speed consistently. Gotta love the pure bait and switch and non-stop consumer abuse. Nothing like false advertising and price gouging to keep it classy.

Reilly

@ryan,

I wish that were the case everywhere. In some munis you have one or two choices. Where I live in Michigan, we have Comcast and ATT. But ATT does not provide internet on its own (only double or triple play). So, it’s Comcast only if you want broadband and nothing else. It’s a monopoly.

Ryan

So cancel their sorry service and pick up something else! That’s the great thing about Time Warner. NO CONTRACTS! (at least today). I heard they were going to institute contractual pricing, although I don’t quite understand what the contract gets you in terms of subsidized pricing. These guys are completely confused by the changing marketplace.

Brett Glass

$150 per month is actually an incredibly good price for unlimited Internet at 50 Mbps downstream. Here’s why.

Internet service providers buy backbone bandwidth according to the continuous capacity of the link (usually measured in megabits per second). That bandwidth can be very expensive (in our case, $100 per Mbps per month; in some ISPs’ cases, $325 per Mbps per month or more). In certain big cities, you can sometimes get bandwidth at $3 per Mbps per month, but only if you purchase huge amounts of bandwidth and pick it up at a major hub. (In other words, the $3 per month doesn’t include the delivery system.)

End users, on the other hand, want a palatable flat rate price for service. Typically, it’s $30 to 45 per month (though what they really want is $15-20). And even at the lowest service level, they expect Web pages to arrive quickly. They want VoIP to work. And they want interactive games to be responsive.

And so, what ISPs must do to provide them with reasonable monthly rates is reminiscent of the old engineer’s joke:

Q: How do you carry two tons of canaries in a one ton truck?
A: You keep beating on the sides as you drive along, so that at least half of the canaries are airborne at any given moment.

In other words, to satisfy consumers, and ISP needs to oversell bandwidth and rely on the fact that not all users are consuming network resources at the same time. The ISP can let users burst to very fast speeds, but you can’t have all of them doing things which continuously take up megabits of bandwidth for extended periods of time.

ISPs can also leverage the fact that most users have a limited capacity to produce new content. They may be prolific writers, but this isn’t even a blip on the radar because text takes so little bandwidth. They may be avid photographers, but even good still photographs take lots of time to compose, crop, and post. They may even create a lot of video, but since video is generally uploaded to servers close to the backbone (e.g. YouTube) for general distribution, this also does not create much continuous upstream traffic. For this reason, ISPs can buy more downstream than upstream bandwidth, and design their systems so that they have more downstream than upstream capacity.

Now, enter two classes of applications that don’t lend themselves to oversale. One is P2P. Leaving aside for a moment the fact that P2P is overwhelmingly used for illegal activity, the two big problems with P2P are that it often has a 100% duty cycle and consumes precious upstream bandwidth. This wreaks havoc with the careful engineering that is done to reduce the cost of users’ service.

The second application that causes problems is video streaming. An HD stream can easily take up several megabits per second… and users, who are used to leaving the TV on, don’t realize just how much it would cost the provider if they left the stream on in the same fashion. So, they often stream content for hours — EVEN WHEN THEY ARE NOT WATCHING IT. (The same is true of music; many users leave Sirius/XM or Pandora running all day even if they are out of the room.)

The problems are further compounded by the fact that the Internet is not a broadcast medium. When another user tunes into an over-the-air television station or even a station on a cable TV network, no new resources are consumed. But on the Internet, each video is an individual stream which consumes more resources and creates additional costs.

For all of these reasons, ISPs MUST either discourage continuous use of bandwidth-hogging applications (analogous to beating on the side of the truck in the joke above) or raise their prices. This creates a serious dilemma. They do not want to insist that customers pay the full price of backbone bandwidth plus a markup, because the higher prices would anger consumers and cause many of them — especially those not financially well situated — to drop their service. It would also discourage potential new customers from signing up.

ISPs likewise do not want to charge by the bit, because so many applications that download (e.g. virus checkers, which download updates frequently) are beyond the average user’s control.

So, they have been forced to adopt a hybrid approach. They start with a low flat rate that applies when the user obeys the assumptions that allow cost reduction. They then add surcharges which — if they’re designed correctly — will approximate the direct sale of backbone bandwidth on a “cost plus” basis to heavy users who push their connections to the limit.

Of course, all such schemes are approximate. The crudest approximation — caps plus overage charges — tends to discriminate against users who do lots of long, low bandwidth downloads, and also tends to cause nasty surprises (as do overage charges on cell phones). But as one makes the formula more sophisticated (and more accurate), it starts to look like the abovementioned “Skittles bag of caps” and becomes less and less comprehensible to the customer.

The result: more and more naive consumers are already claiming that ISPs are discriminating against online video because it competes with their own offerings (at least when the ISP is a cable company) or leveraging market power. One member of the US House of Representatives, Rep. Eric Massa of New York, has gone as far as to say that any sort of metering should be illegal. “I firmly oppose capping Internet usage,” he said in a press release posted at

http://massa.house.gov/?sectionid=24&sectiontree=23,24&itemid=205

“and I will be taking a leadership role in stopping this outrageous, job-killing initiative.” The Congressman also claimed that metering and capping Internet

I called and e-mailed the Congressman’s office and asked, “Would you also be opposed to metering of electricity? Of natural gas?”

As of this morning I haven’t gotten a response.

In any event, the fact is that $150 for 50 Mbps is really a great deal. It’s literally below the lowest obtainable wholesale cost, and doesn’t cover the expenses of maintenance, billing, support, etc. (Time Warner must be hoping that users won’t use all 50 Mbps 24×7.) So, there’s no reason to gripe. That pricing may be higher than a consumer would like, but it is not at all unfair.

–Brett Glass

Sam Johnston

free.fr can do it in France, complete with HD streaming no less, for €30/month with free installation and essentially no contract. If they can do it, you can do it.

Your comparison to wholesale cost is bogus too – as you well know customers will only get a small fraction of the 50Mbps the last mile link is capable of. $1,800 per annum for what is fast becoming an essential service is absolutely outrageous.

Sam

PS Can’t help but to notice you appear to be an ISP yourself Brett. Figures.

Brett Glass

Alas, Sam, your response is typical of those greedy bandwidth users who refuse to accept the realities of the business and/or compares apples to oranges. (The logistics of doing business in France are very different than those in the US, and the service you mention does indeed have usage limits and restrictions. See their terms of service at http://adsl.free.fr/cgv/CGV_FORFAIT_hors_opt_01022009.pdf.)

What will you be demanding next? Unlimited natural gas for $30 per month? Sorry, but ISPs are not charities. We work very hard for razor thin margins.

jd

Comparing US and French internet costs is stoopid. And no one here cares.

Sam Johnston

Thanks JD for your unjustified assertion that “comparing US and French internet costs is stoopid”. Why should they be any different? If anything it should be more expensive here given much of the content comes *from* the US rather than vice versa.

If I were in the US and paying 150 $local_currency every month then I’d be very interested to know that the people on the other side of the water were paying 30 $local_currency a month for a better, faster, cheaper product (with a bunch of extra features like unlimited, free international calls to most of the world).

Sam

Sam Johnston

Actually my response is not “typical of those greedy bandwidth users who refuse to accept the realities of the business”… I’m a business user who appreciates a fast connection and limits that (even as a power user) I didn’t even know existed after two years of service. And we’re not talking lightweight use here either… we watch HD movies from iTunes a few times a week, stream music from Deezer, download software from MSDN and make phone and video calls.

The reality is that we don’t have every man and his dog running traditional utilities and the same will (for better or worse) soon be true of connectivity.

Sam

PS forgot to mention that if you’re in Paris you’ve got a reasonably good chance of having 100Mbit fiber instead of 30Mbit ADSL. For the same €29.99 per month.

Brett Glass

Internet is not a “traditional utility,” and the very worst thing we could do is regulate it as such. Like gas stations, grocery stores, and other local businesses, it is a business which is best run locally and by local small businesspeople. Users need support and hand holding that no huge, nationwide corporation can adequately provide, and only someone who lives in an area can really serve it well. Folks, you may have an option for two pipes from the cable company and the telephone company, and that’s fine. But the third pipe is local, and it’s the best pipe of all.

Greg

At the point that Internet use is a truly competitive market, you’ll be free to develop pricing plans as you like. But today, residential broadband is a virtual monopoly or duopoly in most locals, with just 1 or 2 companies (cable/telco) offering high-speed broadband internet. And there’s limited wireless spectrum, so WiMax or other wireless technologies are not going to create true competition.

So long as we’re talking about regulated utilities, then you should be required to act as one. Let the local utility boards set your Internet rates according to cost plus a reasonable profit. If high-use services truly increase your costs, then you will be free to pass these costs to the users. You should also be subject to uptime guarantees, and to offer truly plug-and-play modems and routers that guarantee uptime.

I don’t know much about the situation with Time-Warner, but I think the 250GB cap from Comcast is not unreasonable, except for the following. First, they should publish a rate for exceeding the cap. Let the customer know what are the consequences for excessive use. Second, provide tools to show the customer their usage. It is NOT reasonable for customers to meter their own use. All other utilities provide meters that clearly state the usage.

Mrktmind

@Brett – Either get your facts right or stop lying. According to TWC their costs to maintain their networks have went down considerably not up over the last couple of years. To find this out you just have to look in other places than the lies they are telling their customers. If you look at what they are telling their shareholders you will see the truth. For more info go to stopthecap.com or look at the revenue facts in the lastest TWC article on Wired.com

Brett Glass

If you’re going to be so hostile (e.g. saying things such as “stop lying”), there is probably no point trying to talk sense to you; you obviously do not care about the facts. The truth of the matter is that the wholesale cost of backbone bandwidth is going up, not down. I know; I buy it for my ISP. And Mr. Drake here seems likewise not to know a thing about the realities of the ISP business.

Jerry

Brett,

Your comments on wholesale bandwidth pricing is completely out there… if you’re paying $100/Mbps I feel sorry for you as you’re either buying transit off of a 2003 contract or you’re including significant network costs that are not variable per usage. Current rates from any tier 1|2 is <$15/Mb for anything over 50 Mbps at any colo/carrier hotel facility in the US (and that’s on a 1 year term).

Do you really think TWC is paying for transit at anything more than <$10/Mbps for their connections? Add to the fact that they’re probably settlement free for ~20-50% of their traffic this is nothing more than a money grab to either hedge themselves against becoming just a dumb pipe providers or disincenting consumer behavior that could potentially lead to that.

The usage model makes sense if we’re talking about ~$.10 per GB as that’s the rate can be correlated back to current Mbps pricing (see CDN offerings for LLN and others) otherwise all this just a business decision that if replicated across other providers will drastically change the way people use the internet.

oh and you can’t use the gas analogy since bandwidth is not a finite resource only your access to it is

Jerry

Bill in NC

A megapoly like TWC is only paying a few cents per gig.

Natural gas providers don’t charge the consumer TEN TIMES what the gas costs them.

The latter are allowed to charge a nominal facility fee to cover fixed costs – here it’s $10/month for a residential customer.

TWC is bucking to be regulated on the state level.

GT

If P2P is a problem then perhaps they should cap upstream bandwidth. I’m sure this wouldn’t be a problem for legitimate users and would not cause the heartburn this is causing in Congress.

For broadscale Internet access, this can be procured by a cable operator at 4 cents per GB. At this rate a 100 GB/Month cap would cost the operator $4/month, still leaving a lot of room for margin in a $40/Month cable bill. Even further, content providers like XM/Sirius and Apple pay content delivery networks like Akamai to cache these files directly into cable operators head-ends, eliminating the 4 cents per GB Internet fee for these feeds and streams.

This is clearly intended only to protect their cable service which forces people to pay for channels they don’t watch. Why do I have to subsidize doper A-Rod’s $28 Million/year salary made possible by the fees I am forced to pay by Time Warner Cable for ESPN when all I want to watch is the Discovery Channel? This is your cable operator at work.

Antony

Interesting…

So, why did twc NOT upgrade their networks to fiber-optic and give everybody 20 Mbps, no-cap, for under $50??!

Also, if the FCC and government start to put these broadband companies under a good amount of regulations and policies, then I guess fews would have anything to fight against these companies for the unfair schemes. But then again, someone could also argue that internet networks is not like electric or gas. You don’t turn on your gas oven and Nettlix jumps and ask you to pay the premium to watch gas… I mean, video.

Brett Glass

No, Lee: The facts do not bear out YOUR case. You are taking figures from Time-Warner which lump cable TV service (a high profit item) together with Internet service and attempting to derive information about Internet service from them; sorry, but you can’t do that. You are also greatly misinformed when it comes to bandwidth costs. Bandwidth is far and away our ISP’s largest expense, and costs per megabit have been going UP lately, not down, due to consolidation in the backbone market and price gouging in the “middle mile.” I know; I’m in the business, while you are merely a busybody.

John McCain

Dear Brett,

We sincerely thank you for being the voice of reason on this important topic. I have personally been assured that there is nothing wrong with our Internet tubes. We are the greatest country in the world, and our telecommunication policy is working for the American people. God bless America, and the FCC.

yours truly,

JM

Alfred Newman

Thats all well and good but Verizon has been spending billions in upgrading their infrastruture to handle all this “wasteful” bandwidth because they realize they are not the cable company and they don’t need to compete with online streaming videos, let alone downloadable video games.

The money has been there to upgrade the network but they have chosen to not do so like Comcast. They could have already had their hardware switched over to DOCSIS3.0 which would have solved most, if not all, the problems you bring up but the fact that the money was merely wasted. Sure I can’t say all the money was wasted but I can point out were some of it went – http://gizmodo.com/5018572/ten-million-pixel-comcast-display-wows-viewers-with-un+throttled-ultra-hd-video

And heres the icing on the cake. Australia, the country that has always been pro teired services when it comes to bandwidith has stated it will spend up to 30 billion dollars in upgrading it’s network to fiber. Hmmm… I wonder why that is. Maybe because they realize that with all the services available online they will have to upgrade the network mediums to be able to provide those streaming videos, video games, etc.

Brett, you may be speaking of smaller ISPs that could benefit from metered bandwidith but we are speaking of Time Warner Cable, not your business. Instead of looking at the bigger picture you’re focused on the TWC feed-bag that has been strapped to your head.

vivek

Shouldn’t this blatant pricing move be challenged by FCC, FTC, and perhaps the department of consumer affairs?
There are organizations and consumers who have been using unlimited broadband services for many years now … a service that has very directly shaped consumer behavior. For these service providers to now radically change their pricing, and in effect exploit their most loyal customers, is clearly unethical, and likely illegal too.
Beyond hitting our pockets, this trend will raise barriers to future adoption of digital media/apps, and will certainly deepen the digital divide. Appears to be a worthy cause for consumer rights activists and regulators to take on.

Sam Johnston

That’s hilarious. For that price in France I could get FIVE connections at €29.99/month. And for each of those FIVE connections I’d have:

28Mbit ADSL
Unlimited *fast* downloads
Free installation
Tivo-style PVR with 200 channels of TV, video on demand, etc.
VoIP phone line and non-geographical number with FREE calls to 70 countries
Two CPL adapters
A bunch of email addresses and the usual guff
IPv6, LAN video streaming to TV, and other goodies for nerds
http://www.free.fr/

This is certainly something France has got right (even if they’re toying with three strikes laws)

Sam

Randy

How long until they give you this answer:”Just expense it for your business. What do you care?”

Antony

They are creating their own battlefield for us to fight them. Either way we lose. You don’t wan’t to argue whether it’s fair to pay such amount at such and such price. That is exactly what they want you to do, because in the end you’ll be under their control. If you accept one, you’ll accept all. Just step back and don’t get trap on their arena. See it with bigger picture.

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