Marketplace

I have to wonder how companies like Blizzard, makers of World of Warcraft, will react to this. If people feel like they can’t play WoW as long because they are afraid of going over their internet usage they may reduce their time or just flat out quit. Not really sure how much of bandwith hog WoW is but I would like to assume it is rather high. If this billing method goes system wide that might seriously hurt online gaming companies. And with 11 million active accounts on World of Warcaft I am sure Blizzard may take a rather dim view to the loss of players. Some parts of the game require many players and lots of time to complete. With a cap on data transmission this may effect the way Blizzard designs further expansions and future online games.

Some people are too lazy to download music for free (steal copies of albums). Instead, they watch a music video on Youtube every time they want to listen to the song. They don’t care about the video part. This is a MAJOR bandwidth hog. The low-res video portion of the data takes far more bandwidth it takes to stream high-res audio. The quality of the music is grossly inferior; it is a video with sound after all. Most of the bandwidth is hogged repeatedly by the jerky, unwatched video while the listeners repeatedly play the thing for the music.

This also kills any ideas of software as a service becoming more widely available if average subscribers feel like they constantly have to watch their usage. This reminds me of cellular phone plans back in the day…

“The company says in a trial run in Beaumont, Texas, only about 14% of customers exceeded their cap and had to pay additional fees that averaged $19 a month.”

It’s not clear whether the 86% of customers that stayed below their cap did so with their typical (pre-cap) usage patterns, or whether their behavior was altered by the fact that they had to watch their consumption.

I am a fairly high consumer of internet content, so I understand that my atypical behavior should come at some cost. If my choices are between network throttling and usage caps, then I would easily choose the latter. The only problem is that if they are charging $50+ for a mere 40 GB cap (as you pointed out, streaming HD content can be 8 GB) it seems that the end cost could be extremely prohibitive for me.

Aside from Video and Gaming users, downloading emails with pictures or video, and resending them will use up that data cap. Also tele-commuters and SOHO will not like that change.

Cables companies need to watch what they do, because phone companies are trying to make up for the loss in land lines to wireless and DSL is where they expect to make up the difference. Also wireless cell phone providers are trying to get into that market with all you can use wireless internet.

I suspect this tiered pricing will be attempted in markets where people have only one broadband option. The best way for consumers to fight this is to put their money with the company that, wisely, sticks to flat rate no cap pricing. Also, if any company kicks users that happen to use egregious amounts of bandwidth then the FTC and Consumer Protection groups should get involved over misleading advertising.

I’ve got no problem paying by the pound if the ISP’s return the favor and invest more speed at the base price.

Basic internet use has been getting sluggish, lately. I was getting 2.5 - 3MB/s a few years ago and lately I’m typically getting 1.2-1.7 MB/s. That’s with a medium-tier DSL and I’m still paying the same price I was when I was getting 3MB/s.

Okay, forget what I said above. This has nothing to do with bandwidth.

I think Time Warner is doing this to take a swipe at competition from Satellite companies and Neflix, who are now letting customers use their broadband connections to supplement their media usage.

Customers of Dish and Netflix and the like can now plug DVRs into broadband like the kind supplied by Time Warner to watch movies and “On-Demand TV.”

It’s a business move. Time Warner could probably care less if your internet gets congested.

Time Warner has recently increased fees across the board twice in the past 6 months in Charlotte. We just got AT&T UVerse here, so it may be time to ditch TWC.

“…there has to be a significant risk of losing customers with so much broadband competition that charges a flat rate.”

I don’t know where you live, but in my city (Madison, WI) we have two broadband operators, and they both charge the same amount for their basic service ($45/mo. plus taxes and fees for <1Mbps). Both have a reputation for lousy customer service and inconsistent connectivity, and since they are both exactly the same, there is no competition. I’ve been waiting for three years for new blood, or a price war, and I think I’ll be waiting until I move.

All this while in my own area, Broadband is not and will likely not be available for some time. In fact, even over dial-up my best speed is 24k.

Verizon is the only real cell company that gets a signal but their ridiculously overpriced wireless service isn’t available.

To boot, verizon doesn’t even offer isdn lines to consumers here.

Now, to hear about these limit caps on data just further points out the failures of unlimited capitalism. People just trying to maximize profits, without providing the services to match.

It would be different if they were offering cutting edge technology, but compared to many other countries, the US is far, far behind in the internet scene.

I guess it is time for TW user’s to migrate to DSL. Paying by bandwidth is a joke. Sounds like that idea for charging airline passengers to use the bathroom.

The caps may keep the base price from increasing as fast. With flat pricing the customers that are low bandwidth users are subsidizing the 14% or heavy users. The caps put a price on usage just like high gas prices made people think about their driving habits. The Netflix and Hulus of the world were getting a free ride. Now the customer that wants to download a movie every night will have to pay the ISP more. It will also cut out some wasted usage. I saw a post where a guy streamed radio 24/7 even when he was not home. If his ISP goes to caps he will have to decide to pay if that puts him over or turn the stream off when he is not using it. I was watching a video where a major ISP executive said broadband costs were increasing 50% per year while revenue was increasing 3%. In the past the content was not there to download and the end user equipment could not download the amount even a cheap computer can today.

Glenn Britt of Time Warner Cable is a liar.

There is one simple equation that sums all that TWC cares about:

customers x arpu = revenue

They will do anything and everything they can to increase revenue. Getting new customers is difficult and not always profitable. Increasing ARPU (average revenue per user/customer), while it will cause some customers to leave, has likely shown in their test program that the loss in customers is more than made up for in increases in revenue.

The telecom companies have a cartel in this country with more power over the telecom market than OPEC has in the oil market. We need antitrust lawsuits against the telecom companies.

The lines and cables aren’t cheap but the switches are what cost ISPs a fortune. If Japan can charge low broadband prices and have high speeds, we can too in the U.S. The biggest cost in broadband is the port on the switch not the cable to your house, just like Japan.