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Increasing Internet Costs: Cable Company Tests New Billing Plan

By Danny Davids(13,494) Danny Davids

Posted Wednesday, January 23, 2008
View All Blog Posts submitted by Danny Davids

Remember what you used to go through to get on-line access?  You plugged a modem into your computer and used your phone line to connect to a free bulletin-board system (BBS), passing packets of messages and the occasional file from one ring in the system to the next.  Then you broke down and started paying for a service like Compuserve or Prodigy, where you were charged by the minute for downloading files.  You cheered the day you were able to work directly with the ISP, paying a flat fee per month for access and additional fees for downloading.  Then came DSL and cable modems, and the competition became so fierce that you were able to get everything you wanted for one monthly fee.  No more limits on download file sizes or bandwidth.  Now you don't think twice as you download music and movies, or play high-definition games on-line.  That check goes out each month for the same amount, and you're a happy camper.  Well, get ready to relive the good old days, because the major cable companies are about to rewrite the way you pay for Internet access.

Last fall Comcast began cutting off service to a small group of users who were utilizing excessively high amounts of bandwidth.  When customers asked what defined "excessively high", Comcast conveniently ignored the question.  Now Time-Warner Cable is about to launch a pilot program in Beaumont, Texas.  Customers who download large amounts of data will have to pay extra fees on top of their regular monthly bill.  If successful, Time-Warner could implement the plan nationwide, which means the other cable companies will follow suit.

Why the sudden concern?  When a customer accesses the Internet through a cable company, his Internet signal is transmitted through the cable line that all his neighbors use.  The more data that is transmitted along that line, the slower the response time for each person on that line.  That also means more traffic at the cable company, which requires them to purchase more equipment to process that traffic.  All this adds up to expense for the cable company--and they're not going to eat that cost just so you can download more videos.

I don't have a problem with people paying for the amount of service they use.  I really don't feel like subsidizing my neighbor's Internet access just because he watches HD videos on-line.  My only concern is that companies like Time-Warner and Comcast are refusing to let customers know just how much data is considered too much.  Their reasoning is that if people know what that upper limit is, they'll modify their Internet access to utilize everything up to that limit.  This means that the cable company still has to deal with "excessive" traffic without getting the customer to pay additional charges.

To be fair, some DSL carriers like AT&T already offer a tiered program for their customers.  You want faster Internet speeds and higher download limits, you pay more per month.  But at least you go in with your eyes open.  You know what your limits are, and you know you can change your plan if you need to increase your access.

It would appear that the cable companies believe that customers knowing what they're paying for, and being able to adjust their access habits accordingly, is a bad thing.  Please.  I do this every month with things like my utility bill, my cell phone, and other expenses.  I monitor my access and if I start getting close to my limits, like with cell phone minutes, I cut back.

It seems to me that the cable companies believe the old adage that too much knowledge is a dangerous thing, especially if the knowledge is on the customer's side.  That's okay.  They're going to have to tread this road very carefully.  After all, it's not like there are other companies out there that are hungry for the consumer's business.  Good luck, Time-Warner.

This Blog Post has been read 363 times.
Posted to ProBlogs.com on Wednesday, January 23, 2008
View other posts by Danny Davids

Comments on this blog post:

Bob sr.: (129 days 22 hours ago.)
So we get to pay for, and get this, the same shows over and over and over, with a one hour show that has 40 minutes of commercials, phones that work and don't work, digital breakup, and all the rest. Then we are told pay the bill
and live with it, there is nothing we can do, it is how tchnology is today, or we will cut you off. Yes, and we accept this as we do everything else. What ever happened to the no commercial interruption they promised when they initally come into being? Oh I'm sorry, it is a Lolli Pop world for suckers. I just forgot. Good job, best wishes.

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