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February 6, 2008

internet

Time Warner testing bandwidth caps

Posted Feb. 6, ’08, 9:28 AM PT by Dan Moren
Category | Internet

Time WarnerSo, you want to rent Live Free or Die Hard from iTunes—I can’t say I disagree: watching John McClane save the world from evil always pulls me out of the doldrums. Anyway, that’ll be $3.99. Oh yeah, plus overage charges.

That’s if cable companies like Time Warner have their way. An article by Newsweek tech columnist, and former Macworld contributor, Steven Levy dishes dirt on a plan by the cable provider to cap Internet bandwidth on a monthly basis—a trial is already scheduled for Beaumont, Texas. Several plans would be offered, offering caps of 5, 10, 20 and 40 gigabytes for a variety of price points. Go over your cap and you’ll start shelling out on a per-gigabyte basis—just as if you’ve gone over your minutes on your cell phone plan. Time Warner claims that approximately 50% of network traffic is from 5% of customers, and clearly it wants to capitalize on that 5%.

The problem here, as Levy notes, is that bandwidth consumption is going up across the board, as things like online movie rentals increasingly become part of the digital landscape. It may be accurate that 5% of the population uses most of the bandwidth right now, but what about in three or four years? One movie—one standard definition movie—on iTunes runs roughly 1.5 gigabytes. Rent three movies a month, and you’re already up to 4.5GB, without even factoring in your mail, web-surfing, downloads, online gaming, etc.—and heaven forbid you try to rent a single HD movie.

And not only does the cable company get paid overages but, as Levy points out, this makes their own video-on-demand offerings far more compelling they’re roughly the same price, and they won’t use up your bandwidth. So which would you pay for?

Our consumption of digital media is increasing rapidly, and will continue to do so in the near future. Capping bandwidth now is great for the cable providers, but it’s the consumers who are going to feel the crunch.


7 Comments

fletcher Author Profile Page said:

I can see two sides to this. On the one hand you want to be able to use as much bandwidth as possible. But, on the other hand, why should I pay as much for my Internet connection as someone who is running a movie download service out of their home?

February 6, 2008 9:44 AM
Dave-O said:

It looks like Time Warner wants to put net neutrality at the forefront. You're dead on about the competition between on demand through cable and online rentals. This might get more traction than AT&T's even more outrageous plan to filter the internet. Meanwhile there are DSL providers desperate to pull customers away from Time Warner and Comcast, and Verizon is slowly rolling out FiOS (a process that might speed up if Time Warner adopts this nation wide).

Okay Comcast, let us have it. What drug-fueled business strategy have you been cooking up?

February 6, 2008 10:31 AM
wesg Author Profile Page said:

I believe my highest bandwidth usage ever was 75GB combined up and down.

February 6, 2008 11:05 AM
Anonymous said:

Im having an ICHAN moment .

February 6, 2008 11:20 AM
PT said:

Thank goodness I have no intention of doing movie downloads. I am perfectly happy with my DVD players.

February 6, 2008 1:23 PM
Dom said:

Let them charge extra...it'll spur on the development of Wimax. About time we get Wimax rolling anyway...and let the market decide whether comcast and the other cable providers should be able to squeeze their customers dry to the bone or just switch to another alternative.

February 6, 2008 2:04 PM
DWizzy said:

Here in Europe, bandwith limiting is used in several countries. In The Netherlands, ISP's are abandoning the concept while in Belgium, most users have a strict limit.

My provider has a Fair Use Policy, as only 2% of the users has a really high bandwith usage.

February 6, 2008 2:35 PM

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